IN MONTANA, AN ECONOMIC BOON FACES REPEAL EFFORT

BOZEMAN, Mont. -- With his electrician's tool belt and company logo
cap, Rick Schmidt looks every bit the small-business owner he in fact
is. That he often reeks of marijuana these days ... well, it is just
part of the job, he said.

"I went on a service call the other day -- walked in and a guy said
to me, 'What have you been smoking?' " said Mr. Schmidt, 39.

For Gallatin Electric, a six-employee company founded by Mr.
Schmidt's father, Richard, as for other businesses in this corner of
south-central Montana, medical marijuana has been central to
surviving hard times as the construction industry and the second-home
market collapsed. Not the smoking of it, the growing of it or even
the selling of it, but the fully legal, taxable revenues being
collected from the industry's new, emerging class of entrepreneurs.
Three of the four electricians on staff at Gallatin, Mr. Schmidt
said, are there only because of the work building indoor marijuana factories.

Questions about who really benefits from medical marijuana are now
gripping Montana. In the Legislature, a resurgent Republican majority
elected last fall is leading a drive to repeal the six-year-old
voter-approved statute permitting the use of marijuana for medical
purposes, which opponents argue is promoting recreational use and crime.

If repeal forces succeed -- the House last month voted strongly for
repeal, and the Senate is now considering it -- Montana would be the
first to recant among the 15 states and the District of Columbia that
have such laws.

In Bozeman, a college and tourism town north of Yellowstone National
Park, construction jobs and tax collections dried up just as the
marijuana business was blossoming; residents and politicians here say
the interconnection of economics and legal drugs would be much more
complicated to undo.

Economic ripples or entanglements extend in every direction, business
people like the Schmidts say -- gardening supply companies where
marijuana growers are buying equipment, mainstream bakeries that are
contracting for pot-laced pastries, and even the state's biggest
utility, NorthWestern Energy, which is seeing a surge in electricity
use by the new factories. Medical marijuana, measured by numbers of
patients, has roughly quadrupled in Montana in the last year.

"It's new territory we're treading in here," said Brad Van Wert, a
sales associate at Independent Power Systems, a Bozeman company that
completed its first solar installation last month -- a six-kilowatt
rooftop solar array, costing about $40,000 -- for a medical marijuana
provider called Sensible Alternatives.

Mr. Van Wert said that his company was assertively going after this
new market, and that marijuana entrepreneurs, facing big tax bills,
were responding to the appeal of a 30 percent tax credit offered by
the state for expansion of renewable energy.

The Bozeman City Council passed regulations last year sharply
restricting the numbers of storefront suppliers downtown. But growers
and providers say that even though the regulations restricted their
numbers, they also created a climate of legitimacy that has made
other businesses more comfortable in dealing with them for equipment
and supplies.

And unlike the situation in sunny California or Colorado, where
medical marijuana has similarly surged, growing marijuana indoors is
all but mandatory here, a fact that has compounded the capital
expenditures for start-ups and spread the economic benefits around
further still. An industry group formed by marijuana growers
estimates that they spend $12 million annually around the state, and
that 1,400 jobs were created mostly in the last year in a state of
only 975,000 people.

"Twenty-five thousand dollars a month," one new grower and medical
marijuana provider, Rob Dobrowski, said of his outlay for electricity
alone, mainly for his light-intensive grow operation that supplies
four stores around the state.

Mr. Dobrowski was a construction contractor until the recession hit,
as were two of his brothers who have joined him in the business. He
said he now employs 33 people, from a standing start of zero a year ago.

Bozeman's mayor, Jeff Krauss, a Republican, said he thought there was
an element of economic fairness to be considered in the debate about
medical marijuana's future. "I don't think anybody passed it thinking
we were creating an industry," he said, referring to the 2004 voter
referendum. But like it or not, he said, it has become one, and legal
investments in the millions of dollars have been made.

"Somewhere around 25 people have made anywhere from a $60,000 to a
$100,000 bet on this industry," Mr. Krauss said, referring to the
local startups and their capital costs.

"Now the Legislature has got us saying, 'Ha, too bad, you lose,' "
Mr. Krauss added. "Boy is that a bad message to send when we're in
the doldrums."

One owner of a gardening supply company in the Bozeman area estimated
that a person could essentially buy a job for $15,000, beginning a
small growing operation with 100 plants. Especially for construction
trade workers who were used to being self-employed before the
recession, the owner said, the rhythms of the new industry feel familiar.

"Forty to 50 percent of customers come from construction," said the
owner, who spoke on the condition of anonymity because her national
suppliers threatened to stop doing business with her if their
products were openly associated with marijuana. "Plumbers,
electricians, the whole genre of working-class, blue-collar Montana."

There are shadowy corners in the supposedly compassionate world of
medical marijuana. The owner of one downtown pastry shop, where the
sale of marijuana cookies and brownies accounts for about 15 percent
of revenue, said he broke off a relationship with his first marijuana
provider, who wanted the baker to use less marijuana in the products
and falsify the ingredients to save the grower production costs.

And it is easy to find workers in this new economy who were in the
illegal pot world before. But it is also easy to find people like
Josh Werle, 29, who took a job as a grower at a company called A
Kinder Caregiver after work as a commercial painter dried up.

Mr. Werle, a fourth-generation Montanan, said his family had seen
many industries fade and fail over the decades -- from railroads to
agriculture, and now, in his case, construction. He said he had also
worried about his health as a painter, breathing fumes all day. But
the economy is what finally pushed him out.

"I never envisioned myself working in this," said Tara Gregorich, 29,
who graduated last May from Montana State University with a degree in
environmental horticultural science. She sat under the lights in an
industrial grow room, legs splayed around a plant that she was
trimming lower shoots from to encourage growth. "But this is one of
the few industries in Montana that is year-round."

At Gallatin Electric, Rick Schmidt said he still made a sharp
distinction between medical marijuana and street drugs. Illegal drug
dealers, he said, "should have the book thrown at them."

But he thinks medical use probably does have benefits.

Mr. Schmidt said his father-in-law, who suffers from post-polio
syndrome, was considering applying for a medical marijuana card.