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Washington: Legal Pot Shops Crippled By Black Market Medical Marijuana

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Founder
420 Staff
Seattle - A year into the nation's experiment with legal, taxed marijuana sales, Washington and Colorado find themselves wrestling not with the federal interference many feared, but with competition from medical marijuana or even outright black market sales.

In Washington, the black market has exploded since voters legalized marijuana in 2012, with scores of legally dubious medical dispensaries opening and some pot delivery services brazenly advertising that they sell outside the legal system.

Licensed shops say taxes are so onerous that they can't compete.

Colorado, which launched legal pot sales last New Year's Day, is facing a lawsuit from Nebraska and Oklahoma alleging that they're being overrun with pot from the state.

And the number of patients on Colorado's medical marijuana registry went up, not down, since 2012, meaning more marijuana users there can avoid paying the higher taxes that recreational pot carries.

Officials in both states say they must do more to drive customers into the recreational stores. They're looking at reining in their medical systems and fixing the big tax differential between medical and recreational weed without harming patients.

And in some cases, they are considering cracking down on the proliferating black market.

"How can you have two parallel systems, one that's regulated, paying taxes, playing by the rules, and the other that's not doing any of those things?" said Rick Garza of the Washington Liquor Control Board, which oversees recreational pot.

The difficulty of reconciling medical marijuana with taxed recreational pot offers a cautionary tale for states that might join Washington and Colorado in regulating the adult use of the drug.

While legalization campaigns have focused on the myriad ills of prohibition, including racial discrepancies in who gets busted for weed, the promise of additional tax revenues in tight budget times was in no small part of the appeal.

Weed sales have so far brought in some revenue, though less than officials might have hoped.

Colorado brought in more than $60 million in taxes, licenses and fees for recreational and medical marijuana combined through October of this year, and more than half of pot sold was of the lesser-taxed medical variety.

In Washington, where supply problems and slow licensing hampered the industry after sales began in July, the state collected about $15 million in taxes this year.

The latest states to legalize marijuana — Oregon and Alaska — have different concerns, but officials there are nevertheless paying attention to Colorado and Washington as they work on rules for their own industry.

Alaska doesn't have commercial medical dispensaries, so licensed stores there won't face direct competition. And in Oregon, taxes on recreational pot are set at just $35 an ounce, which officials hope will minimize competition from the medical side.

In Seattle, however, six licensed recreational stores face competition from medical pot shops that are believed to number in the hundreds.

"Am I afraid about medical marijuana dispensaries taking my business? They have all the business. They are the industry," said James Lathrop, the owner of Seattle's first licensed pot shop, Cannabis City.

He said the dominance of medical marijuana and the black market is obvious in his clientele: It's mostly tourists and professionals who use pot occasionally and don't mind spending a little extra at a legal store.

Regular pot users have stuck with their old dealers or continue masquerading as patients, he said.

Reining in medical marijuana will be a top priority when the legislative session begins in Olympia next month.

The question, lawmakers say, is how to direct people into the regulated system — maximizing state revenues — without hurting legitimately sick people who use marijuana.

Ideas under discussion include reducing pot taxes to make recreational stores more competitive and eliminating medical dispensaries, which have been largely tolerated by law enforcement even though they aren't allowed under state law.

The state could lift its cap on the number of recreational stores and license dispensaries to sell pot for any purpose.

Seattle officials have signaled that they intend to start busting delivery services that flout the law and recently sent letters to 330 marijuana businesses warning them that they'll eventually need to obtain state licenses or be shut down.

Tacoma has also announced plans to close dozens of unregulated pot shops.

Officials have less leeway to alter the medical marijuana system in Colorado, where it was enshrined in the state constitution in 2000. But lawmakers are nevertheless set to review how it is regulated next year because the state's 2010 scheme is expiring.

Taxes will be a large part of the discussion. Medical pot is now subject only to the statewide 2.9 percent sales tax, one-tenth of the taxes levied on recreational pot.

Colorado's medical marijuana registry has grown from 107,000 people in late 2012 to about 116,000 this year, though marijuana patient advocates dispute that the growth is tax-driven.

State health officials, who oversee the registry, are planning to better scrutinize doctors who recommend large numbers of medical pot patients or who recommend more than the baseline of six plants for a patient.

The challenge for lawmakers will be countering perceptions that they're trying to squeeze sick people for cash.

"I don't want to wind up cracking down on people abusing the system in a way that negatively impacts the patients and the people who help them," said Teri Robnett, founder of the Cannabis Patients Alliance.

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News Moderator: 420 MAGAZINE ®
Full Article: Legal pot shops crippled by black market, medical marijuana
Author: THE ASSOCIATED PRESS
Contact: Mashable
Photo Credit: BRENNAN LINSLEY/ASSOCIATED PRESS
Website: Mashable
 

41North

New Member
Somehow i can see the day when things get fucked up for everyone because of illegal dealers, just a matter of time.

Alternately, one can say things are already fucked up because of big business and government while they encroach upon the black market, and that illegal dealers are the only ones holding onto the last unregulated free market around.
29% tax? No thanks.
 

c526

Member of the Month: Jan 2015 - Plant of the Month: Jan 2015
sadly All I read/comprehend is ---they will regulate it alright,they will get rid of home growers,you watch man


29% tax? No thanks.

no kidding
 

dingusmcgee

Active Member
as an mmj patient in WA, i'd like to give a special "go-fuck-yourself" to James Lathrop and i'd like to know what a "masquerading" mmj patient looks like, and how he knows that most of us are faking?
 

dingusmcgee

Active Member
Somehow i can see the day when things get fucked up for everyone because of illegal dealers, just a matter of time.

we've always had illegal dealers. their presence is and always has been culturally symptomatic of existing legislation. they have very little influence on what a legislature does in the way of taxes and regulation, which is what determines how viable an illegal market can be. if things get fucked up, it will be the fault of the people who are supposed to be acting on our behalf and the fault of the LCB.
 

c526

Member of the Month: Jan 2015 - Plant of the Month: Jan 2015
I read that,dingusmcgee,I took it as anyone that didn't buy the overpriced,under powered crap they pedal,,is faking a medical issue'

I still believe these guys will side with the gov at some point and get home grows removed back to the dark ages,and make it illegal again
just watch.
 

J9BLACK

New Member
I'll repeat what I told my favorte bud tender. "I really liked growing my own but I wasn't very good at it...but good enough. If I can't grow, I'd prefer [this dispensary] over [the black market], for consistent reliable quality."

Some factors...

None of my friends partakes.
No one that I know that currently partakes, currently grows.
Anyone who is currently growing well, might prefer selling to dispensaries (volume) over dozens of individual risky consumers.
I've met mostly cool people in the black market but not all
Not all patients are 25-34 y/o males. Many patients would not be able to benefit from the medicine without the comfort and security of a dispensary.

Yes, I don't enjoy paying $360 for an ounce...but an ounce lasts me maybe five weeks. I can see how a heavy patient or user could just not stomach that.
 

Gfcollective

New Member
Somehow i can see the day when things get fucked up for everyone because of illegal dealers, just a matter of time.

Someday I can see when a gram is worth a penny because anyone and everyone can grow this plant. How long till they sell and tax air? I was told by a sponsor from China that a company there does sell air.. (Dr seus was right again, o' hare air)

I&I
 

Indica420

New Member
These are the problems you run into when you try to regulate and tax a plant that is here for us to grow and use. The problem is that this world is full of too many idiots, greedy powerful people, and heartless people.

Only man could screw this up. Every day it continues to amaze me, but nothing surprises me any more.
 

xtrchessreal

New Member
"Am I afraid about medical marijuana dispensaries taking my business? They have all the business. They are the industry," said James Lathrop, the owner of Seattle's first licensed pot shop, Cannabis City.


This guy is an asshole. Hey you thought you had the money to get into it and now you are complaining
and you want to change the rules of the game that you happily entered. This is why I hate US capitalism they always change the rules. Why can't you setup the rules before everybody plays and then just play the game. You can't do that in Monopoly, or Scrabble, Poker...Nope not in the US you can change rules if you complain enough.



He said the dominance of medical marijuana and the black market is obvious in his clientele: It's mostly tourists and professionals who use pot occasionally and don't mind spending a little extra at a legal store.
Regular pot users have stuck with their old dealers or continue masquerading as patients, he said.

Yeah as I said above an asshole. People go around acting and dying like they have cancer - I hope this guy loses his investment - its clear he has an attitude that doesn't fit with the universe.

As far as losing our right to grow that can't happen in Colorado unless you put it up for another vote on a state ballot, its in our state constitution. Amendment 64 specifies we can grow it legally. I'm pretty sure even the FEDs can't touch that without a legal challenge at the US Supreme Court level. State legislators can't touch it. Even if they made it illegal they would just be going back to black market that is even bigger than before since millions in this state know how to grow it - so its a negative return for them to take it away.

:peace:
 

c526

Member of the Month: Jan 2015 - Plant of the Month: Jan 2015
As far as losing our right to grow that can't happen in Colorado unless you put it up for another vote on a state ballot, its in our state constitution. Amendment 64 specifies we can grow it legally. I'm pretty sure even the FEDs can't touch that without a legal challenge at the US Supreme Court level. State legislators can't touch it. Even if they made it illegal they would just be going back to black market that is even bigger than before since millions in this state know how to grow it - so its a negative return for them to take it away.

the feds own us,if they chose to kick your door in,no state person will save you,FED IS KING.right now they are turning a blind eye,I would fool yourself with state anything.they took it away from a majority vote in dc,it can happen to ANY person in any state...We should really be shitting,when a new President comes in,he can blast us back into the stone age,by cleaning up what has been allowed thus far.(in their mind)
 

xtrchessreal

New Member
Well I'm just gonna go about my life as though nothing has changed until something changes. It is not worth the worry and the probability is rather low that the FEDs will suddenly take action against what is already a legal billion dollar business. Millionaires and billionaires don't sit quietly to such things. Not to mention the tax boost for the government.

As far as owning us we'll see what they own when the gloves come off
:peace:
 

c526

Member of the Month: Jan 2015 - Plant of the Month: Jan 2015
Well I'm just gonna go about my life as though nothing has changed until something changes. It is not worth the worry and the probability is rather low that the FEDs will suddenly take action against what is already a legal billion dollar business

great,that's the way to live,Ive never been in a cool place,but Ive done it all my life.how is the banking for the mmj world yet?? can I get a business loan,or do I still have to worry about the irs(could be the reason a buddy has had over 700k in a floor safe in his shop)?
has something to do with being a federal issue

I understand how money works,very well.the mmj industry is chump change against the pill giants.and the pill giants are still lining the backs of our government



As far as owning us we'll see what they own when the gloves come off

:19::19::19:
 

xtrchessreal

New Member
c526: I'm not sure to what end you argue. Quoting me and projecting onto my words won't make anything less or more true. DC is not a state and it does not have a constitution like Colorado. Congress can over rule any DC ballot but they can't do that to the Colorado Constitution. It would take a US Supreme Court ruling to overturn the Colorado Constitution. And then who would bring the argument? Which Justice would accept the case hearing? What part of the Amendment would they be arguing against? MMJ, Recreational Sale, Hemp Crops, or the 6 marijuana plants each of us can have in our home? By the way how do they know how many plants I really have in my basement? How about guns? Every gun you buy has a form that asks if you use marijuana and if you check yes then they deny your gun purchase. But if you check no and buy a gun and you are legally growing marijuana what then? Technically you are in violation of a gun law so would they take your gun away or your weed away? Keep in mind in this is an Open Carry Gun State which is also in our constitution. I am only asking because you seem to position yourself as a person who knows.

Even if all of that were to come about then there is still a large portion of the population that would continue to grow weed which would create a larger problem for law enforcement. 23 States have a MMJ legal and 4 states and one District of Columbia have voted in favor of recreational marijuana. Colorado is clearly showing other states how to make some cash for education via taxes etc. So why would the Department of Justice suddenly wish to enforce a law they have pretty much given up on and at what cost. What about manpower? Do you really think there is enough DEA agents to kick in the doors of 67% of the population that is smoking weed and how many judges would give these warrants to allow this? Where are they gonna put everyone once arrested?

MMJ shops, Rec Shops yeah they could do that but you might have States fighting the US gov in the Supreme Court to keep their taxes flowing. We are helping and saving state budgets. Then there is the black market just waiting to come back. I think the probability is pretty low all this would come about. To what end is it a positive return for them to do so?
 

DanJewl

New Member
29% tax? No thanks.

Right, we are supposed to jump for joy and lick big bro's boots to a glimmering sheen for this? Why should we be expected to reach so deep into our pockets to fuel the folks who cull the most ignorant and brutal of us and hand them a badge... send them to peaceful marches in full riot gear because the topic of the day is not that which the true leeches of society agree with.

Regulation regulation... why people DEMAND someone else run their lives - be it religion or state - I do not truly understand. On another level I do not understand why, given this power, people show such a terrible disregard for life outside of their own small brains...
 

c526

Member of the Month: Jan 2015 - Plant of the Month: Jan 2015
opinions are not arguments.sorry if I quoted and replied,its how these things work.

I had typed out response to your gun inquiry's,as i have a friend in Denver going through this NOW

lol Ill let ya figure it out,just like he did and it is not pretty,BUT I will say he has spent about 30g in lawyer fees over the guns and the weed,4 plants a safe full of firearms,well, hasnt worked out for him

really,because they considered it lying on the forms.in the commission of a federal crime(a scheduled 1 drug)
 

xtrchessreal

New Member
I used to carry a gun in the car with me until Amendment 64 passed and had done some research and found that people had been put in jail for many years on that technicality previous to the amendment. If you have a gun on you/in the car and any amount of weed it is considered a perjury which is a felony because you lied on your gun purchase form. If you received the gun as a gift what happens then I wonder. I would venture to guess gifting or receiving a hand gun is also against the law. So in an Open Carry State that is also a Legal weed state you can't have a handgun - legally. So much for Liberty.

:peace:
 
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