Lisa Bernard-Kuhn, Emily Maxwell
May 18, 2015
BY: Lisa Bernard-Kuhn, Emily Maxwell
Entrepreneurs meander through rows of sticky green plants — Colorado's booming cash crop that's creating a new brand of millionaire.
Stacks of cash pile up in hidden safes as banks balk at drug money.
New arms of government hustle to understand candy that gets consumers high, and families test medicines they hope will help their sick kids.
Welcome to the weed revolution that, for better or worse, is likely headed to Ohio.
Efforts are under way now make Ohio the first state to legalize recreational and medical marijuana at the same time. Already, 23 states have medical marijuana laws on the books, and last year Colorado became the first state allow retails sales of the drug.
“This is sweeping the nation; it’s inevitable,” said Ian James, executive director of ResponsibleOhio, one of at least two efforts racing to get hundreds of thousands of signatures to place a measure on the November ballot. “Marijuana legalization is coming to Ohio. It’s coming to the Midwest.”
Legalizing weed is proving to be the easy part.
From there, state and local policymakers must craft a host of new laws to regulate an industry that's still illegal federally. For now, all eyes are on Colorado as lawmakers look to glean insight into what's working, what's not and how best to navigate through the new world of legal weed.
“We recognize we’re writing the rules on this, and we hope we’re discovering a lot of things that will be useful for other states," said Lewis Koski, director of Colorado’s Marijuana Enforcement Division. “This is really the evolution of a new industry.”
Click the map to reveal details about a state's marijuana laws. If you have issues with the map, click here to open it in a new window
In April, WCPO reporter Lisa Bernard-Kuhn and photojournalist Emily Maxwell spent a week in Colorado to better understand what the evolving pot industry there might mean for the Buckeye state.
Become a WCPO Insider to read about the lessons Ohio can learn from Colorado as voters in the Buckeye wait to find out if they'll get to weigh in on the legal weed debate this year.
Up Next: One Ohio family's 1,200-mile journey for medical marijuana to treat their sick toddler
DENVER — Entrepreneurs meander through rows of sticky green plants — Colorado's booming cash crop that's creating a new brand of millionaire.
New arms of government hustle to understand candy that gets consumers high, and families buy medicines they hope will help their sick kids.
Efforts are under way now to make Ohio the first state to legalize recreational and medical marijuana in one full swing. Already, 23 states have medical marijuana laws on the books, and last year Colorado became the first state to allow retail sales of the drug.
Here is what they found:
Spend any time in a Colorado marijuana dispensary and it’s clear: This isn’t your hippy parent’s weed.
A Willy Wonka-style smorgasbord of candies, brownies, chocolates, gummies, cookies — all laced with THC or baked with marijuana — has replaced the sly hand-to-hand exchange of baggies and cash.
Edibles, as the products are otherwise called, aren’t new for pot users.
But what is new is the rate at which consumers are buying and devouring them.
More than 2.85 million edibles were sold in Colorado in 2014, three times the amount sold in 2013.
As more consumers give edibles a try, Colorado policymakers have hustled to figure out ways to regulate them as a host of problems emerged.
Early in 2014, some consumers reported finding mold and feces in their products. Others said they got too high after eating edibles with large amounts of THC, the primary psychoactive ingredient in marijuana. And increasingly, there are reports of the drugs getting into the hands of children.
For most food products, The Food and Drug Administration has a role in making sure the items are OK to consume. But because the FDA considers marijuana illegal, it's not involved. That leaves states where edibles become legal left to build completely new systems for determining if edible products are safe for public consumption.
As problems emerged, enforcement director Koski said he quickly convened working groups that included members of the pot industry, anti-pot groups, educators and food safety experts to tackle the issues.
The state has taken on nearly a half-dozen new reforms in the last year, including a mandate that no more than 10 milligrams of THC be allowed in a single serving of edible marijuana. It's a level edible makers say won't overwhelm new users. While manufacturers are allowed to produce edibles with up to 100 milligrams of THC, the product must be marked to show the recommended serving size, said Koski.
“An example would be a chocolate bar with 10 easily identifiable and removable pieces, indicating that each piece is meant to be one single serving,” he said.
The state now also requires that edibles be tested for contaminants and to make sure the level of THC isn't overly concentrated in one area - but spread throughout the product.
So far, 19 labs have been licensed by the state but not all are up and running. The labs don’t receive any state funding, and are paid directly by the manufacturers.
Under its plan, ResponsibleOhio says edibles won’t be a problem for the Buckeye state like they have been out West.
The political action committee’s amendment includes a provision that would create a subcommittee of a to-be-created Marijuana Control Commission charged solely with crafting regulations around edibles, said James, executive director of ResponsibleOhio.
That subcommittee would be made of those with experience in the food and drug examination field, he said.
“They will create the framework around how we test every edible to make sure we’re meeting the right safety requirements,” James said.
Nearly everyone tied to Colorado’s booming marijuana industry has their eyes focused on an empty bank in downtown Denver.
It’s the hoped-for location of the first credit union created specifically to serve the state’s growing base of so-called ganjapreneuers: The Fourth Corner Credit Union.
Because marijuana is still federally illegal, few banks will do business with the new pot start-ups, fearing they'll be shut down by regulators for supporting drug dealers.
The Fourth Corner landed state approvals to operate last year, but it’s been waiting for months on a sign-off from the Federal Reserve, the country’s central banking system.
When that might happen is anyone’s guess, said Andrew Freedman, director of Marijuana Coordination for Colorado Gov. John Hickenlooper. The state, he said, is in constant contact with federal regulators over the issue.
“Banking relationships are very hard to come by for a lot of these businesses, and it’s a real concern,” said Freedman. “The governor always says ‘It’s as old as Al Capone — if you want to find a way to introduce illegitimate behavior into a legitimate industry, force them to operate in cash.’”
Many in Colorado’s $700 million pot industry are stuck with stacks of cash and forced to hand over piles of money to pay employees and bills. Customers can’t use credit cards, and many shop owners have to hire security firms to monitor stores and any movement of money.
“It’s flat-out a public safety issue,” said Andy Williams, CEO of Medicine Man, a dispensary just outside of downtown Denver.
With a monthly payroll and business bills that total nearly $1 million, Williams said his firm is among the lucky few that has a banking relationship.
“But it doesn’t matter if I have a bank, the perception to criminals is that I don’t,” he said. “Anyone around me and my employees is at risk and could be targeted.”
Officials with ResponsibleOhio say they’re well aware of the issues, but think the ground swell of states moving toward recreational legalization could tip the federal position on the issue.
“There is slowly but surely an understanding that this is inevitable,” James said.
Should marijuana become legal in Ohio, it could help force some solutions, Colorado’s Freedman said.
“Ohio would give national prominence to all these issues, both because of its size, and it’s a swing-state status,” Freedman said. “I think it would give Colorado a big foray into asking the federal government to help us solve this very real public safety issue.”
Colorado’s latest projections for marijuana tax collections in its first full year of retail sales in 2014 rang in at $69 million, a 42 percent drop from the state’s original projection of $118 million.
“The message I’ve been trying to get across to people is, if you’re going to legalize marijuana, there are a lot of arguments for why it would be beneficial to the state; I don’t believe tax revenue is one of those things,” Freedman said.
Even if the state lands maximum returns on pot tax revenues — estimated now at about $100 million a year — it’s still less than 1 percent of Colorado’s entire budget of $27 billion. The state places a 10 percent sales tax on the drug, and 15 percent excise tax on wholesale marijuana.
“It’s just never going to be enough money to solve the problems people talk about,” Freedman said. “It will not solve school construction. It will not solve transportation construction. It’s just not a major part of our budget.”
Officials with ResponsibleOhio have projected annual state tax revenue could be as high as $500 million by 2020. Under their plan, Ohio would place a 15 percent tax on the drug’s sale, 55 percent of which would go to cities and townships.
Already, the projected tax revenues have some politicians in Ohio talking pot.
Cincinnati Mayor John Cranley told WCPO earlier this year that while he’s not taking a position on pot, he’d like to use any tax revenue sent to the city from it to fill potholes and "address deferred maintenance for our infrastructure."
Increasingly, James thinks more officials will align with Cranley’s thinking on the matter.
“Local governments have been losing money to the state for years, and anything you can do to supplement or fill that hole back up has to be helpful,” James said. "There’s a realization that you have this illegal market operating right now, and there’s an opportunity to take the money that’s going into the shadows and bring it to the light to use it for the good of Cincinnati and Hamilton County.”
When Jennifer Chudy Shepherd first moved to Wheat Ridge, Colorado, she couldn't think of a better place to raise her family. The Mountain air, scenic views, nearby skiing - they were all perks that her former hometown of Port Clinton, Ohio just couldn't match.
Then, a pot shop opened up next to her kid’s playground.
"Never, ever did I think marijuana legalization would pass," said the mother of three who in the last year launched Parents for a Healthy Colorado - a group aimed at educating the public about marijuana use and the impact it can have on children.
"Since it's been legal, we know it's been getting into more kids' hands and it’s showing up in our schools," she said. "It breaks my heart that (legalization) could be going on the ballot in Ohio. I really hope Ohioans think beyond dollar signs. This comes down to profit versus public health."
Marijuana use by Coloradans 12 and older jumped more than 22 percent in 2013 to 12.7 percent, according to the latest data available from the National Survey on Drug Use and Health. Across the state, news of kids bringing in and using marijuana in school are an increasingly common, said Tom Gorman, director of the Rocky Mountain High Intensity Drug Trafficking Area Program.
His group is keeping tabs on the number of incidents across Colorado’s schools involving students and pot. In a June 2014 survey of 100 school resource officers across the state, 89 percent reported an increase in marijuana-related incidents. Of those officers, 57 percent said marijuana possession in school was the most common problem, while 37 percent reported students under the influence of pot during school as the top issue.
For now, schools are reporting the information to Gorman's group with the caveat that the school name not be reported out publicly.
“They don’t want to be seen as a doper school, but most are working with us and giving us information and that's a start,” he said. “Some won’t even talk to us. But from what we’re seeing, use among teens is going up.”
Gorman’s group tracks other problems, too. In a report released this year, his agency found:
Officials with ResponsibleOhio say a to-be created Marijuana Control Commission would be charged with drafting stiff penalties for pot-law violators should their plan pass this fall.
"Ohioans require that there be tight regulation. They require there be rules in place so that if you are a retailer and sell to someone under 21 you're going to jail," James said.
Back in Colorado, Gorman says he gets a lot of pushback from pro-pot camps who say not enough research has been done to fully know the impact of legalization in his state.
"We know it's just a matter of time before more states begin to deal with these issues," Gorman said. "Eventually, these trends and this kind of data will end the argument over whether legalization was the right move to make."
Up Next: One Ohio family's 1,200-mile journey for medical marijuana to treat their sick toddler
Full Coverage: wcpo.com/pot