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Posted: December 01, 2009

Smallbiz: Medical pot outlets growing like a weed—for now

Mike Taylor

A few decades have passed since Bill "Spaceman" Lee was approached by a reporter seeking to confirm a widespread rumor surrounding the flaky Boston Red Sox pitcher.

"Bill," he asked, "is it true you've experimented with marijuana?"

"No, I don't experiment with it!" Lee responded. "I just smoke it."

I was reminded of this linguistic nuance one afternoon in mid-November as I drove down Broadway in Denver and observed the many pot dealerships - err, medical marijuana "dispensaries" - that have sprung up overnight in Denver, especially on Broadway, Federal Boulevard and Colfax Avenue (where else?).

As of July 31, a total of 13,102 new medical-marijuana patient applications had been received by the Colorado Department of Public Health and Environment, the entity charged with administering the Medical Marijuana Registry Program after Coloradans passed Amendment 20 in the November 2000 general election approving marijuana for medical use.

And yet, marijuana remains illegal under federal law. A doctor's prescription for marijuana doesn't protect an employee from being fired if he tests positive for the drug.

These are contradictions that need to be and likely will be clarified. But that hasn't stopped medical-marijuana storefronts from popping up in the meantime, spurred by the Obama administration's pronouncement in October that it would refrain from prosecuting medical marijuana patients.

But questions remain. Like, when the legal dust settles, who'll get to grow the crop? I spent this past August living solely on what I could grow in my Denver backyard in a personal subsistence experiment. What was I thinking, growing edibles like potatoes and corn and broccoli when I might have been cultivating - though perhaps not legally - a real cash crop?

Maybe it's just as well. The aforementioned Colorado Department of Public Health and Environment acknowledges the lack of legal clarity - and hence the uncertainty for pot businesses. "The law does not clearly state where marijuana plants may be grown or if two or more patients and/or care-givers may share one growing space," the department says on its website.

Hoping to glean some insight into this budding industry last month, I stopped at the pot retailer "Walking Raven" on South Broadway and Evans. The dispensary shares a parking lot with a different self-medication retailer - King Cross Drive Thru Liquors, which was advertising cases of Bud for $16.99 on its north exterior wall. Across the street is a former car dealership converted to another pot dispensary, DrReefer.com, a glass building sporting a colorful neon sign in the shape of a pot plant. "Dr. Reefer," whose real name is Pierre Werner, has two convictions in other states for possession of pot for sale.

I entered Walking Raven, a tiny box of a building with bars on the windows. Inside stood a middle-aged man in a jean jacket and Denver Broncos cap, and a woman sitting behind a desk.
I asked how the pot business has been and their sense of the enterprise's future.

"We probably don't want to comment at this time," the man said. "We're just going to ride it out and see what happens."

Same reaction at a dispensary on Lincoln and Fourth Avenue called Lincoln Herbal, which had been open barely a month but had already undergone a name change, previously going by "Jewel of Cannabis." Lincoln Herbal had an ad in Westword touting its "Grand Opening" with the offer of a "Free 15 Minute Massage with Purchase." An Asian man behind the counter told me he just worked there and gave me a business card with the owner's phone number that he suggested I try calling the next day.

I suspect as with other gold rushes, literal or figurative, the biggest and least vulnerable beneficiaries will be not the growers or the retailers, but those providing the proverbial picks and shovels: the related service providers like the Canna-Business Institute, which offers seminars by attorneys Sean McAllister and Brian Vicente on medical-marijuana law topics such as accounting, "knowing your rights" and "bud tending."

An ad for the Canna-Business Institute in Westword, one of many touting legal services, invited prospective seminar attendees to, "Call Heather at 303-260-9739 to reserve your spot." I don't know what the future holds for pot dispensaries, but the cannabis law business must be doing OK.

I dialed the number. The voice mailbox was full.

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Mike Taylor is the managing editor of ColoradoBiz. He writes about small-business money issues and how startups are launched. Email him at mtaylor@cobizmag.com.

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Readers Respond

Let's just legalize it and get control before the mobsters take it over and ruin it for everyone. There is not enough "legal" growing going on to meet demand, so you know the criminal element will come in, if it hasn't already. By Dave Lucia on 2009 12 07

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