MARIJUANA DISPENSARY PLANNED FOR DOWNTOWN GARBERVILLE; MARIJUANA
SUPPORTERS GET APPROVAL FOR BALLOT PETITIONS

1. Marijuana dispensary planned for downtown Garberville

Matt Scott, owner of Fun Sun Farms, is on track to open a medical
marijuana dispensary in the heart of Garberville.

Scott's Humboldt Exchange will occupy the property at 442 Maple Lane
across from the Garberville Presbyterian Church. The dispensary will
include access to natural and herbal medical consultations, yoga and
massage therapy.

"What we're planning on doing is expanding what's already here," Scott
says, "a healing center in the back of the property. We're going to
expand that to dispensing cannabis as well as what's already happening
here."

The existing healing center will continue to be as it is, but Scott
says his Humboldt Exchange Dispensary will offer dispensary patients
access to those services "as a nice segue to people who want to
explore other options besides just using cannabis."

Humboldt Exchange will occupy the building currently occupied by the
Redwood Times. Scott says there will be some remodeling done to create
a reception area in the front of the building. The dispensing area
will be located in the back of the building.

As is the case with the Garberville Grass Dispensary, all patients
will have to be verified as 215 patients. Patients will be required to
have a member agreement on file and their paperwork must be up to date
and current. Only approved patients will be allowed into the back
area, where the dispensing is done. Scott says also that there will be
a limited number of people who can be in the dispensary at one time.

"Up front," Scott says, "we plan on having security. We're not quite
sure how that's going to play out yet. Actually we'll be looking at
what's comfortable for the community and what's comfortable for the
business. It may look like somebody in a uniform but not armed or
anything like that."

The security function, he says, is primarily for "maintaining traffic
flow, making sure that people aren't lighting up on the front street,
and making sure that they're moving along and moving in and out in an
organized way."

Scott says he is aware of the existing problem of vagrants loitering
in the area and thinks that the dispensary will help to resolve that
problem.

"I understand what's happening here," he says. "There are some
vagrant, homeless people lingering around, often on the sides of our
buildings. We're often picking up trash, people are sleeping on the
sides and it seems to be something we're constantly dealing with. It
goes away and then it comes back. I'm continually picking up garbage
around here that the homeless are leaving. I know our next door
neighbor has a lot of traffic that they are encouraging in and out of
their building and that has been slightly inconvenient for some of the
business owners on the street. People have complained that they can't
operate their business as they should be able to because customers are
afraid to walk in the front door because of the homeless people
sitting out front, or lingering and loitering. I feel that having that
security guard present will help the whole street as far as making
sure that people are flowing. They won't be able to hang out here and
they won't be a! ble to hang out next door. They'll have to move
along. Right now there's nobody doing that during business hours. It
will help the whole street."

The dispensary is part of a larger project, Scott says.

"This is a two-phase project. The phase here in Garberville is an
actual dispensing site where there will only be dispensing of
full-term medicine along with tinctures and edibles. There'll be no
cultivating going on here in Garberville.

"Phase Two is in the Meadows Business Park where we plan on opening a
nursery. The nursery will be where the dispensing of plants is done,
whether clones or seedlings. We anticipate having a greenhouse, having
some indoor cultivating going on there, so we can provide the
community member-growers with clones and with seed starts.

"Also as part of that facility, we plan on having a commercial kitchen
so that vendors can come in and use the kitchen to develop their
product. The health code is going to say that edibles have to be
produced in a commercial kitchen. At least that is what we're
anticipating. We want to offer the space of a commercial kitchen for
people to come in and use it to produce their edibles.

"Also we plan on having a testing lab in that facility. An independent
third party can come in and use that facility, or it will just be
there and be rented out so they can run the testing for things like
THC content, CBN content, CBD content, pesticides, herbicides,
fungicides, things like that, to see if they're present or not."

Regulation of cooked marijuana medicine and who should do that has
been a thorny problem for the Planning Commission. Scott thinks edible
medicine is crucial to the dispensary and that the manufacture of
edibles should be regulated by the County Health and Human Services
Department.

"We plan on dispensing edibles because it is a wonderful way for
patients to take the medicine," he says, "but it's a gray area right
now because where this piece is sitting is with the Planning
Commission and how to operate dispensaries in the unincorporated
areas. We're trying to encourage them to follow the model that's out
of San Francisco which allows edibles under the Health and Human
Services Department. Health and Human Services is the perfect place to
have that because they're already trained to make sure that surfaces
are sanitary, there's hot water and things like that. And there'll be
a tracking system so if anybody does get sick from eating an edible,
they'll be able to track it back."

Scott says he is satisfied with the way the Planning Commissioners
have responded to the suggestions of the medical marijuana community
and he hopes the resulting ordinances will be favorable to small farmers.

"They are asking for our input and from the very beginning there have
been a few groups that have come forward and offered a lot of input.
They are hoping that it can be a unified front to advise the planning
commission, but it's kind of hard to do that in a community like this.
There are a lot of opinions and those who see it very differently.
There has been some cohesiveness among the groups, especially lately
and the Planning Commission is moving forward, dealing with indoor
personal use at residences and dispensaries. For the dispensary piece,
we are encouraging that dispensaries not be able to cultivate any
full-term medicine more than a member-grower would be able to
cultivate. That is a really key component because that takes care of
the small farmer in Humboldt County. It allows a small farmer to bring
their extra medicine to the dispensary for use at the dispensary.

"If there's a dispensary ordinance that allows dispensaries to
cultivate onsite as much medicine as they need for their patients,
what good does that do for a small farmer in the legal medical
cannabis world? There's no spot for them. So we're encouraging the
Planning Commission to not allow dispensaries to cultivate their own
medicine except for what a member-grower can cultivate. This would
allow the dispensary to do things like research and development and
testing. It would be a very small amount of full-term medicine coming
to the market through the dispensary. They would have to get it
through the permitted growers in the county. Permitting the farmers
will come in Phase Two."

Scott says that the nature of the medical marijuana market is shifting
and that more and more patients are asking for organic outdoor
medicine over the indoor medicine.

"What's happening now is a big change in the dispensary world," he
says. "Patients are starting to ask for outdoor organic. They care
what it is they're ingesting and more patients are asking for outdoor
organic medicine. This has encouraged dispensary owners to come to
places like Humboldt County to get their medicine. They're looking for
farmers to contract with. But they want those farmers to be permitted
by the county so the county has to have an ordinance in place to allow
a permitting system. Of the producing counties, (Humboldt, Trinity,
Mendocino), the only one with an ordinance is Mendocino.

"Mendocino does have permitted farmers. They do the '9.31' program and
dispensary owners throughout the state are showing up in Mendocino
County at '9.31' meetings to find farmers to contract with.

"A 215 grower should be in contact with a dispensary if they're going
to cultivate beyond their personal use. Right now, the state is
following 100 square feet per patient. A 215 grower that is in contact
with a dispensary would have to justify how much they grow based on
the patient base of the dispensary. We're encouraging the county to
start permitting the farmers so that dispensaries can engage in
contracts with the farmers. The dispensary owners around the state
want to engage with the farmers and want them to be permitted and the
county hasn't done that yet."

Scott says there are 150 dispensaries in San Diego right
now.

"If they were allowed to cultivate their own medicine," he says, "why
would they ever want to come up and get organic medicine from a
Humboldt County farmer?"

Humboldt Exchange is seeking a Conditional Use Permit CUP) to open its
Garberville dispensary. The three dispensaries operating in the county
at present are all operating under a CUP granted by the Planning
Commission. But Scott says that ultimately he would like to see the
dispensaries treated the same as any other business.

"We're arguing that the dispensary piece should be taken out of the
Planning Commission permit process and just be a business license and
an application to Health and Human Services. You won't have to be
zoned in this very tight regulated area for a dispensary. It will be
just like any other business. And when you take the cultivating of the
medicine out of the dispensary's hands, there shouldn't be an issue
with where the dispensary is located. They're not cultivating on site
and they have security. Americans for Safe Access has put out a report
that shows that dispensaries in communities have actually made
communities safer."

The uncertainties surrounding medical marijuana and the intentions of
the federal government in regard to it have combined with the general
downturn in the economy to bring about greatly lowered prices for
marijuana. Scott says that he thinks the price for pot will stabilize.
The lows are being tested now, he says, but he thinks that eventually
they will hold about where they are now.

"I think farmers will be able to make a living and do what they do,"
he says. "and if the dispensaries continue to see what they're seeing,
that is patients asking for outdoor organic medicine, there's going to
be a huge demand for the producing counties. It's supply and demand.
That's always what rules. We have a lot more farmers here today than
we had five or ten years ago and they're producing more. The supply is
up and the price is down. Demand is starting to change, though. The
demand for outdoor medicine is getting higher every year."

In many respects, the pricing of marijuana is free market capitalism
at work, and it may work for the advantage of both the grower and the
patient. Patients can't use insurance, MediCal or Medicare to purchase
their medicine so they have to pay for it with their cash. Outdoor
sells for less than the more expensively produced indoor medicine and
that means outdoor is more affordable for most patients.

"I believe that is one of the big reasons you're seeing a rise in
demand for the outdoor medicine," Scott says. "One reason is that
consumers are becoming savvy about what they're ingesting and they
want it to be organic, to come from the land in the full sun, but also
they don't have as much money to spend as they did in past years. So
those indoor cannabis products have been going for $55 to $60 an
eighth on the dispensary shelves, while the outdoor medicine is going
for $30 to $35 an eighth. That's also a reason the demand for the
outdoor medicine is turning around. If we keep the prices fair in the
dispensaries, then the outdoor medicine will prevail."

The process of getting a dispensary approved is long and arduous.
Scott estimates that, four months into his application, it will
probably be another year or more before he gets through the process
and is able to open his dispensary.

County Planner Steve Lazar agrees. He is currently sitting on five
different requests for conditional use permits to open dispensaries
and is taking them in the order in which they were received. Once the
Humboldt Exchange application comes to the top of the pile, there will
be a long period of analyzing location, application, a business plan
and so on, and then the Planning Commission will undertake their study
of the application. Scott says he expects the Commissioners to take
quite a while, as evidenced by the length of time it took the three
existing dispensaries to get permitted.

The proposal has garnered 14 letters of support from the Garberville
business community including Chautauqua Natural Foods, Brannan Realty,
Amillia's Gourmet to Go, Redwood Garden Supply and local health care
providers Inner Healing Center and Peter Stern. A letter of opposition
has come from the Garberville Presbyterian Church on the basis of the
pre-school, play groups and youth events that happen there. But Scott
is hopeful that Humboldt Exchange can be seamlessly incorporated into
the small-town atmosphere of downtown Garberville.

"We really want to work with the community," he says. "We want this to
be a community outreach program. There are different programs
happening around such as the church food drive that we'd like to help
with. We'd like to provide free medicine for Hospice patients and if
there's any way we can help the Healy Center and provide medicine, we
want to be the good guys. We want to be looked at with smiles and work
with a community of neighbors and foster healthy relationships."

2. Marijuana supporters get approval for ballot petitions

Supporters for the legalization of recreational marijuana will try
once again to win over California voters, saying pot growers should be
treated the same as vineyard owners or microbrewers.

Medical marijuana activist Steve Kubby said the state should tax and
regulate marijuana as it does wine and beer making. Those who grow
marijuana for their own use would not be taxed, but those who sell it
would be regulated by the state Department of Alcoholic Beverage Control.

On Monday, July 25, the secretary of state's office has cleared
proponents to begin gathering the nearly 505,000 signatures they'll
need to put the measure on the ballot next year. Voters rejected a
similar initiative last year.

Kubby was the 1998 Libertarian candidate for governor and helped write
the state's medical marijuana law, approved by voters in 1996.