A recent visit to Nevada opened my eyes to the world of legal weed, something that still feels far in the future for Florida. So to celebrate 4/20 – and with the irresistible temptation of this week's April 20 issue date – I sat down with a local expert on the subject. This Central Florida small business owner (who remains anonymous for obvious reasons) is also involved with an Oregon cannabis cultivation operation. He/she/it shared insider opinions on the new industry.
Getting into the weed biz:
"I don't smoke marijuana. I have smoked it, but I never really liked it. But I have a lot of friends who do [and] who have had their lives turned upside down; arrested, jail time. As people I knew got in trouble, my advice would be 'Get the hell out of Florida.'
"A couple of people took me up on that advice and moved to Oregon. Now there is a small expatriate group of Orlando guys around Portland. They got into medical marijuana before it became recreational, growing for patients to buy the medicine. Right when the chatter started about it going recreational, that's when I got involved, because it seemed like a viable business model. Portland is one of the most liberal cities in the country, so it seemed like a natural to get involved from a business aspect."
Working with weed:
"A lot of people's assumptions are wrong. It's not easy work. It's not as profitable as everyone thinks. It has a distinct allure to it that's not real. It's a living like everything else. There are opportunities right now because it's hot and growing. It's entirely supply and demand, and because of that you have to be a good business person.
"I like it because America was built on the farmer-patriot. It seemed like honest work: growing the marijuana, making sure that it's organic and that care is put into it."
Warnings for potential investors:
"No. 1, it's illegal [under federal law]. You have the potential to lose everything in a night. The federal government can shut people down and arrest people based on not following the state laws to the T, because they trump the state. That is the scary thing that has held an incredible amount of money back.
"Most of the people who invest in marijuana right now are gambling. I would recommend it to people who have an appetite for some risk and the foresight to understand it's not your typical investment."
Moving the money around:
"The state of Oregon's banking system is the most progressive in the nation. Not only have the regulations started catching up with what the banks' practices are, but local banks have been very accommodating. Producers can go in and deposit money, leases can be paid, re-investments in equipment, payroll, all those things.
"It's come a long way from an investor standpoint."
The trouble with taxes:
"Under Code 280-E, you can't deduct the expenses [from income taxes], so now a lot of the businesses are a lot less profitable than they could be. The state is taxing you between 17 and 20 percent. The gross is there, so you can pay people good salaries, but after everything is said and done it doesn't make a lot of money. The feds just want their tax money. A lot of people are still thinking of marijuana as being in the days of the shady transactions, driving money across state lines. But there are legitimate operating business being taxed by everyone with their hand out."
Black market strikes back:
"It's taxed so much that there's still a black market, but there aren't 'drug deals' like we think of in Florida. Everybody's growing it for their personal use, and you have these tiny transactions back and forth, because if you go to a dispensary you're paying 20 percent state tax and the markup. And you have 'tax tourists' coming down from Washington because Washington taxes it higher.
"Florida could learn lessons from Oregon as opposed to Washington and Colorado. There's not much of a black market in Oregon because it's very open. The licenses aren't limited, like in Colorado and Washington."
Medical marijuana and Florida's future:
"One has to accept that medical marijuana is a necessary first step. It muddies the waters, and by the time it's made recreational here it will probably be declassified as a drug. I think it will take a long time for Florida to get to that point, because it's ironically conservative on a lot of things.
"I think it will be a state monopoly [in Florida]; the way it will be regulated won't allow competition.
"I don't know if I'd even want to be involved in growing in Florida. I think I would just be happy with opening up a little dispensary."
"In my experiences in Denver and Portland, I don't see [damage caused by pot]. I see drunk douchebags bumping into people. You see people coming out of dispensaries and smoking, they're polite. They're nice, they're quiet, they don't even engage. I've never seen two guys stoned start a fistfight, but we still have drunk people getting out their guns and starting fights every night."