A GROWTH INDUSTRY?

New medical marijuana clinic in Aloha, nonprofit in Tigard spotlight
a sprouting, uncertain business

It's been 12 years since medical marijuana was legalized in Oregon,
but just recently, new businesses based around the industry have been
sprouting up in Washington County.

In Aloha, the MedMar clinic -- you can get a hold of them at
503-882-WEED -- opened its doors in February in a non-descript office
building at 20595 S.W. Tualatin-Valley Highway.

Dan DeGroodt, 33, decided to open the business after getting his
medical marijuana card for back pain in January. After 13 years as a
painter, Dan was laid off last year and looking for work. While
having a discussion with his doctor, he was told there weren't any
options for medical marijuana patients looking for help in Washington
County. He decided to do something about it.

"She said that if something was put together, she'd come over and
volunteer," DeGroodt said. "About a month later, we opened up."

For a fee of about $200, the MedMar Clinic's staff (right now just
DeGroodt and one other person) will review a patient's medical
records and help shephard them through the process of obtaining a
card under the Oregon Medical Marijuana Program. The clinic also
sells an array of pipes, bongs and other marijuana-consumption tools
on the site. The clinic is not a dispensary -- Oregon law doesn't
allow those -- and DeGroodt doesn't have marijuana on site.

So far, business has been slow, DeGroodt said, though they've seen a
number of patients and expect the number to grow as word about the
new business gets out. DeGroodt recently printed 10,000 copies of a
small newspaper about the medical marijuana community called "The
Rollin' Stoned," which he will distribute throughout the area. He
said that he hopes to create more jobs once the business is more
established.

"During this recession, while everybody's laid off, I have the
opportunity to create something that could be paychecks for people,"
DeGroodt said.

DeGroodt said that so far, about 90 percent of those who have come
into MedMar's office have been legitimate patients who have qualified
for the card. Mostly, he said, they were older patients looking for
help in navigating the often complex rules of the program. He
started the newspaper, in part, because he found that many patients
didn't have access to the Internet to get information.

DeGroodt said that there is still definitely a stigma against medical
marijuana, but he works around it because he feels that the program
is an extremely valuable service to those that need it.

"From what I gather, most doctors aren't interested in the program,"
DeGroodt said. "Police, they've had to bust people for this stuff for
so long, I just don't think they see eye to eye with a lot of patients."

Driven to the black market

In Tigard, a new nonprofit business, The Human Collective, opened its
doors April 1 at 11509 S.W. Pacific Highway. According to owner Sarah
Bennett, 33, the organization will provide a variety of services and
support to medical marijuana patients, including a new, untested
system for connecting patients looking for marijuana with experienced
growers.

Bennett estimates that there are more than 1,800 Oregon Medical
Marijuana Program cardholders in the Washington County area, and one
of the main issues they encounter is gaining quick, legal access to
cannabis. Oregon law stipulates that cardholders can grow their own,
or appoint someone to grow for them. However, marijuana cannot be
purchased, only the actual agricultural costs, like electricity, can
be recovered.

Bennett says that the confusing laws surrounding medical marijuana
often drive legitimate patients to the black market, and to
situations where they can be ripped off. What the Human Collective
offers for a $365-a-year membership fee, besides classes, massages
and other services, Bennett says, is an organized system for the
legal transfer of marijuana between cardholders.

It works something like this: The Human Collective, which only
employs legal cardholders, meets with growers and reimburses them for
an amount of marijuana. Separately, members of the collective put
money into a "MedExpress" account, which can be transferred later to
the collective to reimburse them for the cost of cannabis.

Bennett says that she's never heard of another set-up quite like
this, but is sure it's in compliance with the law.

Right now, the collective only has one member, but Bennett envisions
that in a few months, her operation will have a wide selection of
marijuana for members to choose from, as well as growing classes and
massage therapy available.

"I've just heard story after story of challenges, people in program
saying that's its failing and doesn't work," Bennett says. "The laws
to allow us, as cardholders, a lot of privileges, so I was just
trying to put something together so that cardholders can get their
medicine in a timely manner."

Bennett, who lives in Southwest Portland, says she believes in the
"healing properties of medical marijuana," and as grower herself,
thought it was time to make the business around the program more
legitimate. She said that she decided to pursue it in October, when a
memo from the United States Department of Justice outlined new
guidelines that de-emphasized the pursuit of patients who are in
compliance with state laws, even though medical marijuana is still
illegal at the Federal level.

Bennett said that all of her planning around the legality of medical
marijuana has renewed her interest in the law, and she plans to go
back to school and earn a law degree.

Keeping money out of the mix

While DeGroodt and Bennett's businesses are in their infancies, other
medical-marijuana businesses have been booming throughout the state.

While no state agency is required to keep an exact count, state
officials estimate there are about 15 medical marijuana clinics
statewide. The THCF clinic, in Portland, is by far the largest,
servicing about half the state's medical marijuana clinic patients,
according to owner Paul Stanford.

Stanford is a hard-core marijuana activist, and the force behind a
looming ballot measure to legalize marijuana in Oregon. He's also at
the nexus of the burgeoning marijuana business in Oregon.

Stanford owns and runs six medical marijuana clinics (and 37 traveling
clinics) in nine states, with his headquarters in Portland. He says
his clinics's medical staff have approved more than 110,000 people for
medical marijuana cards. Most have paid $150 to $200 for their clinic
visits. That computes to nearly $20 million in revenue.

In an attempt to keep money out of the mix, Oregon law says that
medical marijuana cannot be sold. Nevertheless, money is very much a
part of the medical marijuana landscape. Stanford says the dozens of
horticultural shops that have sprung up to sell supplies such as
indoor grow lights to marijuana growers represent a larger business
right now than the clinics.

Supporters of ballot measures that would change Oregon's medical
marijuana laws say money -- tax money -- is one of their major selling
points.

The measure most likely to make it on to the November ballot would
establish nonprofit dispensaries throughout the state to sell
marijuana to cardholders.

Independent marijuana growers would be licensed by the state to
provide the cannabis, with the idea that competition among the growers
would lower the price of the marijuana sold to the stores, and
eventually to the public. Dispensaries and growers would pay 10
percent of their gross sales to the state, and provide discounted
marijuana for low-income cardholders.

John Sajo, director of nonprofit marijuana advocacy organization Voter
Power, helped draft the initiative, and he projects that in the first
year after passage, dispensaries and growers could be sending between
$10 to $40 million dollars back to the state, which would have to use
some of that money to oversee the growers and stores.

Sajo says based on the growth rate in the number of medical marijuana
users -- and in recent years those numbers have been skyrocketing -- as
much as a billion dollars could make its way into state coffers over
ten years.

Another initiative, to which Stanford has pledged $150,000 of his own
money to help pay signature gatherers, is considered more of a long
shot at this point to make it on the November ballot.

It would make marijuana legal and allow its sale through state run
stores modeled after liquor stores. It, too, would give the state the
power to license growers to feed the machine.

Stanford projects that if his measure passes, the state would bring in
about $150 million in additional tax revenues a year, and save an
additional $75 million in prison, court and police costs now spent on
pursing marijuana-related crimes.

He foresees Oregon farmers profiting the most, as they become the
first in the country to legally harvest marijuana. In addition, he
sees hemp becoming a mainstay of a local biofuel industry.

"It's just going to make Oregon's economy boom. We'll be the
Anheuser-Bush of cannabis," Stanford says.

Oddities of the law

Twelve years of legalized medical marijuana have created a landscape
full of unexpected oddities. For instance, the law allows cardholders
to designate growers or caregivers to provide them with their
cannabis. The thinking is that many in need of medical marijuana
cannot grow their own, or wait six months for a crop.

But how then to explain the thousands of Oregonian cardholders who
have designated growers or caregivers, but are listed as growers or
caregivers for other cardholders?

"If you're able to grow for others, why wouldn't you grow for
yourself?" asks Lt. Michael Dingeman, director of the Oregon State
Police drug enforcement section. He thinks he knows the answer.

More designation options for cardholders means growers can find more
people willing to appoint them as growers or caregivers. That allows
them to grow larger crops. Dingeman suspects portions of those larger
crops end up on the black market.

For his part, because of the way the law works, DeGroodt said finding
a grower can sometimes be a hard, long process.

"We found a lot of sketchy people in this program who are growers,"
said DeGroodt. "Growers are weird. It's just like finding a
girlfriend, you're not going to get the right one the first time."