From Taxation To Overzealous Cops, How Will Black Market Growers Survive Legalization?Growing marijuana no longer fun or easy where you live? Perhaps it’s time to move.

From Taxation To Overzealous Cops, How Will Black Market Growers Survive Legalization?

One of my closest grower friends tried to get registered in California’s Proposition 64 marijuana legalization and licensing scheme. He hired high-priced “compliance attorneys” and spent $17,000 trying to align his 10,000-watt grow op with state and local regulations associated with Prop. 64. At the same time, people he’d supplied marijuana to said they might go to dispensaries because it would be more like a regular shopping experience and less clandestine.

But after all the expense and hassle, my buddy still isn’t Proposition 64 compliant.

Then the wildfires decimated his region, forcing him to move to Southern California. When the wildfires swept his new location, he said the hell with this, and left the state altogether.

The willingness to cut your losses and move on to greener pastures is one way deal with the fact that the place in which you’ve been growing is no longer a great place to grow.

Let’s take a look at how to survive marijuana legalization and other conditions that making moving on a smart move…

How Marijuana Legalization Creates Grower Problems

Ever since voters approved Proposition 215, or the Compassionate Use Act of 1996, my friend was allowed to grow as many plants he wanted to during the years of unfettered, barely regulated marijuana legalization. For this reason, my friend was willing to put up with California’s high property taxes, income taxes, gas taxes, overcrowding, immigration, wildfires, mudslides, traffic jams and polluted air.

Prop. 215 was a simple ballot measure requiring a grower to have a doctor’s recommendation for marijuana. The law’s entire text was only a few paragraphs long, written in clear, concise language far preferable to the reams of legalese contained in Prop. 64 and its implementing legislation.

With a Prop. 215 recommendation, you could grow any number of plants you wanted for yourself, and as a caregiver for others.

Unfortunately, law enforcement refused to accept the will of the voters, especially in California counties like Butte, Shasta, San Diego and Trinity. Police officers busted Prop. 215 growers, claiming they had too many plants or were selling cannabis to recreational users. Growers were forced to hire attorneys and go through the court system to use Prop. 215 as an affirmative defense.

Despite the intrusion of law enforcement, Prop. 215 created a burgeoning pot market and introduced cannabis to people who might never have used it. The only people complaining about the flourishing marijuana marketplace were police, that segment of society who had always opposed cannabis, and conservative politicians.

They complained that the parameters of Prop. 215 were too loose and that growers were abusing the law. Interestingly, the only abuses appeared to be committed by police harassing and arresting legal growers.

Beginning 2005, money-minded politicians, government bureaucrats and tax collectors were making a big deal of how the California cannabis industry had expanded rapidly, and how most of the business generated by that industry was underground, untaxed, off the books.

They were concerned about missing out on tax revenues because the Prop. 215 marijuana industry was in the untaxed, untracked black market. They wanted to capture revenue by getting a slice of the cannabis pie via legalization.

Pretty soon, politicians started tinkering with Prop. 215, passing complex, limiting legislation that angered Prop. 215’s author, the famous cannabis activist Dennis Peron.

Is Post-Prohibition A Reason To Rent The Moving Van?

Ultimately, a consortium came together to put Prop. 64 on the 2016 California ballot. Loaded with regulatory hurdles and fees, Prop. 64 and its implementing codifications create costs and burdens for many growers and sellers, while allowing an aboveground marijuana industry to flourish.

The government is looking to cash in on cannabis. According to the California Department of Tax and Fee Administration, in some areas there’s now:

  • A 15 percent excise tax on retail cannabis sales
  • County sales taxes of up to 8.5 percent, which is waived for medical marijuana patients
  • A $1,000 application fee plus taxes if you want to be a licensed marijuana grower
  • A cultivation tax of $9.25 per dry-weight ounce of bud for the commercial market
  • A cultivation tax of $2.75 per dry-weight ounce of leaf for the commercial market

The black-market grower doesn’t pay those taxes and therefore is likely to price their cannabis below what legal recreational and medical marijuana dispensaries sell it for.

On the other hand, Prop. 64 limits non-licensed personal recreational growers to six plants per person; that’s not enough plants for someone who wants to support themselves solely through growing and selling marijuana.

Nor are six plants enough for a serious cannabis connoisseur who wants to grow multiple strains, breed cannabis seeds, make edibles and produce concentrates.

Home growing is minimally if at all allowed by most marijuana legalization laws, which favor licensed producers. And unlicensed marijuana selling is never allowed.

A substantial percentage of the tens of thousands of black-market growers who risked their safety and freedom to grow and provide cannabis for decades find that the new legalization represents chaos, competition, and a plague on their business model. They acknowledge that licensed producers, processors and sellers can provide services that black-market growers are unable to, but they want home-based growers to also thrive, as they have for decades.

But when politics negatively impacts one’s cannabis-growing career, it’s then that growers are faced with difficult choices — including whether they should move to another location altogether.

On The Road To Higher Prices Per Ounce

Some of my associates are moving out of legal states such as California and Colorado, and are headed for states with the highest marijuana retail prices, the fewest growers per capita, and a lower cost of living.

Is it any surprise that states with the toughest marijuana laws are states with the highest marijuana retail prices? Texas, Nebraska, Oklahoma, Indiana, Ohio, the Dakotas, Louisiana, Georgia, the Carolinas and Florida are some of the states with brutal cannabis cultivation laws — and the highest marijuana retail prices.

For people who’ve lived in progressive states like Oregon, California, Colorado and Washington, it may look as if the ultra-prohibitionist states where marijuana growing and selling are still extremely illegal are backward, boring, flat, unsophisticated and risky.

It doesn’t help that if you get caught growing weed in some of those places, you risk being sentenced to 10 years or more in prison. The happy news is there are pockets of common sense, even in the worst states. And you make more money as a black-market grower in those states than in legalized locations.

Wherever there’s a college, a place of uncommon natural beauty, or some other positive local novelty, you may find a community within an illegal state that you wouldn’t mind moving to and growing cannabis in, where marijuana consumers proliferate and you’re less likely to face the wrath of an overzealous law enforcement. These places include:

  • Austin, Texas
  • Asheville, North Carolina
  • Athens, Ohio
  • Lincoln, Nebraska
  • Nashville, Tennessee
  • Macon, Georgia
  • Moab, Utah
  • Taos, New Mexico
  • Muskogee, Oklahoma

For sure, Nebraska can’t offer the diversity, culture and sophistication you get in legalized states like California. But look on the bright side — a grow house that would cost you $475,000 in California can be had, along with five acres of rural land, for $155,000 in several prohibitionist states. Property taxes, sales taxes and income taxes are much lower in those states, too.

Those less-legalized states also offer wide-open spaces in which guerrilla outdoor marijuana growing is a breeze. Take a look on Google Earth at flyover states like Texas, Utah, Nebraska, Oklahoma, the Dakotas and North Carolina. See all that empty land? You can grow big plants out there in all that space.

Even more exciting is that demand for marijuana is high in prohibitionist states, but suppliers are harder to come by, which means less competition. In states where recreational marijuana legalization is a long way off and people are afraid to grow because they don’t want to go to prison, premium bud can sell for as much as $400–600 an ounce. The disparity between demand and supply is definitely in your favor!

Saying Goodbye Isn’t Easy

Moving to a new place when you’re a marijuana grower is more hassle than it is for regular people. Yes, moving is always hard work, lots of worry and expense. And more so for growers, who have spent considerable time, effort, and money creating indoor grow ops where we already live.

One of my associates had a three-room grow op for his perpetual garden. The indoor hydroponics growing systems and grow rooms he used are almost impossible to relocate; the physical alterations he did to his dwelling required that he spend money to repair those rooms before he hired a real estate agent to sell his house.

Moving means you have to hit the road, and the literal road is a place of peril for marijuana growers. You don’t want to get caught carrying aromatic bud while in transit. When I’ve moved my grow ops, I carry only the most expensive, hard-to-replace equipment, odorless dry sift, and my cannabis seeds. I make sure the grow-op equipment and the contraband are boxed so that nobody looking into my vehicle can see anything indicating I grow weed for a living.

Before you move, do your research, much like the time I considered moving from California to Michigan.

For black-market cannabis growers, Michigan’s law is better than Prop. 64 because it allows home growers up to 12 indoor plants. A skilled grower can harvest 3–5 pounds of dried buds from 12 plants.

However, you break Michigan law if you run a perpetual garden and have clones or germinated marijuana seedlings in rotation along with your 12 mature plants.

You also break Michigan law as soon as you harvest, because the law only allows you to possess only 2.5 ounces of dried buds. This ludicrous limitation inspires growers to sell most of their harvest as soon as possible, except what they keep for personal use. This too is illegal.

I was all set to move to the Great Lakes State, but then a huge ice storm hit there, and my Michigan associates were without electricity for up to two weeks. “A foot of ice on the roads for a month, dude, and freezing temperatures in the grow room unless you have a generator,” is what one friend reported.

I did not move to Michigan.

Marijuana Growers = Stealthy Entrepreneurs

No matter where black-market marijuana cultivators grow weed, the key to selling cannabis is having worthwhile interpersonal skills and relationships. With opinion polls routinely showing that 60–71 percent of Americans support some form of marijuana legalization, and an increasing number Americans curious about using medical or recreational cannabis, you can bet that a significant percentage of the people you meet, even in prohibitionist states, are using cannabis or would like to try it.

Medical marijuana is a primary driver of novice cannabis curiosity and is a good thing to talk to potential customers about.

Yes, the drug war and lies of reefer madness that started in 1937 still have some Americans believing that marijuana is the devil’s lettuce and that recreational marijuana intoxication causes temporary insanity, bad driving, fornication, Cheech and Chong-like stoner symptoms, and the wearing of too much tie dye.

But as boomers age and the bloom of youth fades into aches and pains, eye problems and arthritis, they learn that prescription drugs have negative side effects and aren’t good at mitigating the impact of aging and acute disease conditions. They realize that medical marijuana could be more effective and less harmful than any other alternative. But they don’t know how to procure marijuana where they live, and aren’t likely to fly to Colorado, buy some, and mail it back to themselves.

That’s where networking and marketing come in, so you can find those potential marijuana customers.

Change is necessary. I used to sit at home like a hermit growing weed and selling it to my old high school friends and a few of their pals. I never went anywhere or did anything, other than to go to the grow shop. That kind of isolation has its benefits, but if you move to a new place, you have to find ways to get out into the new community and make fresh contacts, or you’ll have nobody to grow for but yourself. I forced myself to get involved in the community, for the sole purpose of meeting 420 customers.

Taking college courses, volunteering at an environmental organization, homeless shelter or nursing home, going to yoga classes or joining a church (Unitarians are politically liberal and often pantheistic, the opposite of right-wing faux Christians) — these are just a few examples of ways to broaden your social contacts and eventually find out that many of the new people you meet want to buy marijuana.

You also have to grow weed that people want. Something special. I’ve rigorously calculated what it costs me in labor, time, money, equipment, expertise, hydroponics nutrients, and other expenditures related to growing marijuana, and I deserve a reasonable income for my work and business expenditures.

It helps that I’m growing marijuana strains nobody else grows — because I bred them myself. They’re tastier and more useful for consumers than the likes of Blue Dream, Girl Scout Cookies, Cherry Pie, OG Kush, Super Silver Haze, Jack Herer, Sour Diesel and generic strains that dominate the shelves of dispensaries.

When a customer asks me for specialized buds processing, I create bubble hash, kief, dry sift, or even a chemical or CO2 extract or alcohol infusion product, and charge accordingly.

If someone tells me they don’t want to get high but they want the pain relief and anti-inflammatory medical marijuana benefits of cannabidiol, I’ll grow my CBD strain that last tested at 23.7 percent CBD and 1.1 percent THC.

Now that I’ve changed locations, I make enough money from growing to live a middle-class life, and marijuana growing is the joy of my life.

Although some initial discomfort is inevitable, trust that you can come out on top with your grow op in a better location.

Or to put it another way: If your current grow ship is sinking, get in your lifeboat, sail to a new location, and build a new and better grow op. Sometimes, the grass really can be greener on the other side.

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