"Worse, not better": the illegal pot market booming in California despite legalization



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COSTA MESA, California – In the forests of northern California, law enforcement continues to make inroads to uncover illegal marijuana farms. In Southern California, hundreds of illegal delivery services and marijuana dispensaries, some registered as churches, serve a steady stream of clients. And in Mendocino County, north of San Francisco, the sheriff's office recently broke into an illegal cannabis plant that was processing 500 pounds of marijuana a day.

It's been a little over a year since California legalized marijuana – the largest experiment of its kind in the US – but law enforcement officials say the illegal unlicensed market is still in full swing boom and even in some areas.

"There is a lot to be gained on the black market," said Thomas D. Allman, sheriff of Mendocino County, whose deputies seized cannabis oil worth more than $ 5 million. dollars early April.

The legalization, said Sheriff Allman, "certainly did not put the cops out of work."

California Governor Gavin Newsom said the illegal cultivation in northern California "is getting worse" and that two months ago a contingent of stationed National Guard soldiers on the Mexican border have been redeployed to fight illegal cannabis farms.

A reinforcement of the law enforcement goes along with some irony: the legalization aimed to open a new chapter for the state, freed from the legacy of heavy operations of police and incarceration of minor offenses. Instead, new calls are being made in favor of a crackdown on illegal sales.

Aware of the consequences of the war on drugs on Black and Latin American communities, cities like Los Angeles say they are reluctant to resort to repressive measures to control the illegal market and do not know how to navigate this unknown era. .

The struggles of the licensed pot market in California are distinct from the experience of other states that have legalized cannabis in recent years. Sales in Colorado, Oregon and Washington have increased well above 50% for each of the first three years of legalization, although Oregon also has a large amount of cooking pot.

But no other state has an illegal market of California importance, and these illicit sales cannibalize the revenues of the licensed companies and, in some cases, the experts say they are forcing them into bankruptcy.

Entrepreneurs in the sector, who have spent decades evading the law, are now turning to the law to demand the prosecution of unlicensed pottery companies.

"We are the taxpayers – no one else should operate," said Robert Taft Jr., whose licensed cannabis business in Orange County, south of Los Angeles, has seen his sales plummet in recent years. month.

"It's getting ridiculous," he said of illegal pottery stores, including nearby businesses that call themselves churches and advertise marijuana as a kind of sacrament. "It's almost as if the state was preparing to lose."

California gives cities wide latitude to regulate cannabis, creating a confusing patchwork of regulations. Los Angeles, San Francisco, San Jose and San Diego have laws authorizing cannabis-producing businesses, but most smaller cities in the state do not have them – 80% of the nearly 500 municipalities in the country California does not allow marijuana retail businesses. The 2016 marijuana legalization measure for recreational purposes was approved at 57%, but this relatively broad support has not been translated at the local level. Cities like Compton or Laguna Beach have flatly rejected the pot business.

Regulators cite this timid adoption by California municipalities as one of many reasons for the persistent and pervasive illegal market in that state. Up to now, only 620 cannabis stores have been licensed in California. Colorado, with a population one-sixth the size of California, has 562 licensed recreational marijuana stores.

But the most fundamental reason for the strength of the California black market – and what distinguishes the state from the rest – is the huge pot surplus. Since marijuana for medical purposes became legal in California more than two decades ago, the cannabis industry has flourished with minimal oversight. Today, many companies specializing in cannabis are reluctant to go through the tedious and expensive process of obtaining licenses that became mandatory last year.

Of the approximately 14 million pounds of marijuana grown in California each year, only a fraction – less than 20% by state estimates and a private research firm – is consumed in California. The rest is spreading illegally across the country, by mail, by express delivery services, by private vehicles, and by small aircraft that use decades-old traffic routes.

This illicit trade has been reinforced by the growing popularity of vaping, candies infused with cannabis, dyes and other by-products. Vape cartridges are much easier to carry and hide than bags of raw cannabis. And financial incentives linked to trafficking remain equally powerful: the price of cannabis products in places like Illinois, New York or Connecticut is generally much higher than in California.

Illicit cannabis exports from the state appear to be increasing even now, well before California's second year of legalization. New Frontier Data, a cannabis data research company, calculates that much-needed and more advanced growing techniques will contribute about half a million pounds of illicit cannabis this year compared to 2018.

The federal government still considers marijuana as illegal and the Drug Enforcement Administration says it's still investigating marijuana-related crimes. But a spokesman, Rusty Payne, said the agency was facing a more serious crisis.

"Honestly, the opioid epidemic is important to us," said Payne.

In wild areas, illicit marijuana seizures by the California Department of Fish and Wildlife more than doubled in 2018, the first year recreational cannabis was legal.

The department destroyed 1.6 million marijuana plants last year, up from 700,000 in 2017 and 800,000 the previous year – all grown illegally.

"There is a subset of people who simply refuse to engage in the process," said Nathaniel Arnold, deputy chief of departmental enforcement.

The Bureau of Cannabis Control, the body responsible for regulating marijuana in the state, has received about 7,500 complaints, most of them about illegal operations, and has sent over 3,000 letters ordering the closure of illegal businesses.

"It's only a matter of time before we start reducing the illegal market," said Alex Traverso, a spokesman for the agency, who acknowledged that he There were probably more illegal stores in Los Angeles than licensed stores throughout the state.

Cat Packer, executive director of the cannabis regulation department in Los Angeles, said even when illicit companies were closed, they often reappeared quickly.

"It's a game of moles in Los Angeles," she said.

But Ms. Packer also said that the city was aware that the criminal crackdown had disproportionately targeted people of color.

The city is looking for an effective enforcement policy that is not identical to the criminal prohibition policies of the past, said Ms. Packer. One strategy is to turn off water and electricity services to non-compliant companies.

"We can not fight the 2.0 drug war," she said.

Mr. Taft, the cannabis entrepreneur, has sent 450 complaints to the Bureau of Cannabis Control and does not apologize for his calls for an aggressive approach to illegal stores, which in his view is the only way to make it work. Giant Experience of California.

His clinic pays a cumulative tax rate of 32.25% for states and municipalities. Unlicensed stores do not pay taxes.

One of Taft's main complaints concerns Weedmaps, a phone application that allows users to locate nearby marijuana, licensed or illegal businesses.

In February of last year, the Bureau of Cannabis Control sent a letter to Weedmaps in which it was stated that the company was aiding and abetting illegal businesses and ordering it to "immediately stop any activity that would violate federal laws. cannabis.

Weedmaps replied that it was a technology company and not the office. More than a year later, the company still lists hundreds of unlicensed stores.

Earlier this year, Mr. Taft resigned as a board member of the Santa Ana Cannabis Association because half of his members, he said, were selling illegally and using legalization as a "shield".

"They play both sides of the market," he said.

One morning last week, Mr. Taft called the Bureau of Cannabis Control to file a lawsuit against his neighbor, a cannabis company that he said was not on the list of authorized companies.

"We are looted by these people," he said. "My lawyers are ready to launch rockets!"

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