The Golden State’s Big Green Bet

6 minute read

Inside the Bigfoot Golf and Country Club on a cool evening in October, Isaiah O’Donnell, a second-generation cannabis farmer, is making a case that he hopes will get out before Election Day. “As a kid I was taught you don’t say what you do, you don’t drive a fancy vehicle. You just hide, you deny,” he says. “Now we’re coming out … But I’m scared if the shelf space is not there for these small farmers who are moving through this process that they will go back underground.”

The other marijuana growers sitting around O’Donnell nod, unified in one of the unlikeliest alliances in an election cycle filled with them. On Nov. 8, Californians will vote on Proposition 64, which would legalize recreational marijuana use in the state (medical use has been legal since 1996). The measure has widespread support, with recent polls showing a majority of voters in favor. Yet a number of the women and men who make their living growing marijuana in the Golden State are fighting it, fearing it would allow agribusiness to roll over small farms. “It will take something that’s good for a whole lot of people in the state,” says pot farmer Ryan McIntosh, “and funnel it straight up.”

The outcome will ripple far beyond California. Nine states have marijuana-related measures on the ballot, with Arizona, Maine, Massachusetts and Nevada also voting on recreational use. But experts view the Golden State, which represents the world’s sixth largest economy, as a tipping point. Should California vote yes, the market-research firm ArcView estimates, it could help propel the value of America’s nascent legal weed market from about $7 billion today to more than $20 billion by 2020. “California is so much the tail that wags this dog,” says Sam Kamin, a marijuana-law expert at the University of Denver.

California’s outsize clout could help pressure the federal government to change its approach to marijuana, which it still classifies as a drug on a par with heroin. Such a shift could fix issues like banking restrictions that have forced the industry to operate largely in cash. And those changes, in turn, could lead to other states–and even other countries–making the same move.

All of which would seem like welcome news in the Emerald Triangle, as the combined area of Humboldt, Mendocino and Trinity counties in far Northern California is known. With the decline of the logging and fishing industries, marijuana emerged as the region’s economic backbone. “It’s our culture,” says O’Donnell. “I’ve never known anything else.” Humboldt alone has an estimated 10,000 pot-growing operations, one for about every 15 people, and a reputation for the highest-quality product. But many here are terrified that Proposition 64 will drive them out of business.

Their fears are rooted in language in the referendum that would eventually allow growing sites of unlimited sizes—-think plantations of several hundred acres that can sell in bulk at low prices. Though corporations remain wary because of federal law, investors are already sending big checks to private-equity firms devoted to the industry. The architects of California’s measure want to make sure the state secures its place in a brave new world of legal marijuana.

“We didn’t want to shoot ourselves in the foot, saddled by our inability to provide what we need in order to be that world market,” says Amanda Reiman, manager of marijuana law and policy at the Drug Policy Alliance, which helped craft Proposition 64. As a result, the measure is poised not just to allow Californians to buy marijuana legally but to position the state as a producer for the rest of the U.S. too.

It’s the last point that has the Emerald Triangle on edge. While the region has its share of drug traffickers who mistreat their workers and clear-cut forest, many growers here see themselves as small farmers upholding a hippie version of Thomas Jefferson’s agrarian ideal. “Big Business has no interest in the communities or the families that are supported by the industry at this point,” says Stephen Dillon, executive director of the Humboldt Sun Growers Guild, which is housed next door to a lifeless timber mill. He says the 185 farms in the guild are split on the initiative.

State Assemblyman Jim Wood represents the area and helped write landmark regulations for the medical-marijuana industry last year, nearly 20 years after California became the first state to legalize medical pot. He opposes Proposition 64 in part because of the potential for mass production. “If this blows up to these large, megascale, plantation-style grows,” says Wood, a Democrat, “that’s going to decimate the economy of my district.”

There are signs that those megagrows are likely. Two years after becoming the first state to open a recreational market, Colorado has seen consolidation and the creation of dispensary chains. As large outdoor farms have come online, the price per pound has been dropping “like a rock,” says Nancy Whiteman, the co-owner of edibles line Wana Brands: “It’s a simple supply-and-demand situation.”

California’s measure does include a compromise intended to get holdouts on board and keep growers from returning to the black market: farms will be capped at one acre for five years after the first licenses are issued in 2018, which is meant to give smaller players time to establish themselves. But even advocates like Reiman acknowledge that increased competition and regulation will drive out some growers. “We do live in a capitalist society,” she says.

Some Emerald Triangle farmers, meanwhile, see an opportunity to become the Napa of weed, providing connoisseurs with a premium, branded product that can sell at higher prices. The farm country north of San Francisco has become one of the world’s most famous wine regions, where vintners have waiting lists for bottles costing more than $100. Many also point to the success of artisanal ventures like the craft-beer industry as evidence that the area around Humboldt can carve out a similar niche.

Still, the future looks dire to some. As Wood, the state legislator, puts it, “There are only so many craft beers that can survive.”

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