STATE OF THE WEED

Cannabis Issue: Medical Cannabis Industry Thrives Even As the Economy
and Legalization Movement Sputter

CANNABIS When we did our first Cannabis Issue a year ago, the Bay
Area's medical marijuana industry was booming, and there was high
anticipation that California would soon legalize weed for everyone.

Proposition 19 divided even those who fully support decriminalizing
cannabis - partly because the existing system was working so well in
San Francisco and many other cities, so people were wary of an
uncertain future - and voters rejected the measure in November.

But only the most dogmatic anti-drug warrior would take that vote as
a repudiation of the wonder weed, because California's love affair
with its top crop today is stronger than ever. And the burgeoning
industry that grows, processes, and delivers marijuana continues to
expand rapidly amid a stagnating larger economy.

Three new high-end cannabis dispensaries have opened in San Francisco
in the last six months, bringing to 25 the number of licensed clubs,
and the selection and quality of indoor and outdoor buds,
concentrates, and edibles has never been greater. The industry's many
opportunities are starting to attract top talent from unrelated
sectors of the economy, such as Mark Williams and Nic duTemps.

Williams recently quit his job at Apple to start CloudNine, which is
developing a high-quality portable vaporizer called Firefly that will
be assembled here in San Francisco and released this summer. Unlike
current vaporizers made of plastic that use butane heaters to release
the cannabanoids from the weed without burning it, Firefly is made of
metal and glass with customizable wood inlays, uses advanced
batteries in its heating element, and will retail for about $300.

"I decided now is the time," Williams, 42, said of his decision to
leave the corporate cubicle world after 20 years. "The market is
maturing and the users' ability to make a discerning choice about how
they're going to take marijuana is maturing."

DuTemps worked in public relations for many years and she also jumped
ship to do something she loves a few years ago: landscaping backyard
gardens. "But then the bottom fell out of the economy," she said, and
people growing marijuana were the only ones who still wanted her expertise.

Yet the supply of cannabis products had grown faster than the number
of dispensaries and delivery outlets in recent years. "The clubs were
becoming incredibly flooded," duTemps said. "People have found
themselves with copious amounts of product and nowhere to sell it."

So she decided to marry her PR expertise with her cannabis
connections and last month started Sweeter Made, a medical marijuana
cooperative and delivery service that uses an old meter maid vehicle
for deliveries. DuTemps said she loves "the secret thrill of
delivering medical cannabis, hash, and edibles in something that used
to give people parking tickets."

They're just a couple of the countless Bay Area residents involved in
the pot business, an expanding and evolving sector of the economy
that even cash-strapped government agencies are getting involved in.

Oakland city officials recently stepped back from their ambitious
plan to permit large-scale pot farms in industrial warehouses, mostly
because of legal concerns, but that city and Berkeley last year moved
forward with plans to legitimize and tax the industry at a higher
rate. And the big next step - full legalization of weed for even
recreational users - is still lingering on the horizon.

Oaksterdam University founder Richard Lee, who bankrolled placing
Prop. 19 on the ballot, has announced that he'll try again on the
November 2012 ballot. He told the Guardian that he's currently
developing his battle plan, consulting his allies, and determining
what the measure will look like.

"We're still doing research on what went right and what went wrong,"
Lee told us. "There were lots of people who were for legalization
that didn't like the details [of Prop. 19]."

For example, the measure allowed counties to set different legal
standards, potentially creating a logistical nightmare for
distributing the product. Lee said the new measure will probably
include statewide standards and some degree of local control, but
he's still working with groups ranging from the Drug Policy Alliance
to the NAACP to develop it. Meanwhile, CaNORML, the state chapter of
the National Organization for the Reform of Marijuana Laws, will be
gathering movement leaders together in Berkeley on Jan. 29 for a
daylong conference titled "Marijuana Reform: Next Steps for California."

While there are differing visions for where the movement is headed
and over how hard and quickly to push for full legalization, it's
undeniable that the industry is thriving and here to stay.