I understood the controversial nature of operating my store in a very small town, so one of the things I did right from the beginning in 2009 along with law-enforcement outreach was community outreach. I operated under the presumption that while there might be folks in the community, particularly local government officials and law enforcement, who might be curious about my operation, none of them were going to come knocking on my door. (This was later confirmed when I was eventually able to secure site visits from them: several confessed to me that they were uncomfortable even parking their car in my lot during that educational visit because they were concerned people might think they were shopping.)
So, I went to them. I got out in the community and I went to meetings. I went to events. I joined the Chamber of Commerce. I participated. And while I was out in the community, I invited anyone and everyone to come see the operation for themselves. I invited members of the public, city council members, planning commissioners, and as was the case with Captain Forrest Bartell, the cops.
Without my really knowing it, something greater was taking place during these early outreach efforts: I was developing and fine-tuning the platform from which I would speak and the format I would use as an advocate throughout the rest of my tenure in the cannabis industry.
I always started with a brief summary of how I got involved with medical cannabis. I talked about my vision, and I invited the audience to ask questions—any question—particularly the hard ones.
I found that everyone had questions about cannabis, and those questions could run the gamut. My job was simply to share information. What I rarely did was share my opinion, that being self-evident and consequently not that interesting or productive. I was always much more interested in the questions and how those questions invariably evolved into an interesting and productive conversation.
In the earlier years, I saw these educational visits as opportunities for me to further the legitimacy of the industry. I never took my license to operate for granted. Consequently, in exchange for that privilege, I felt outreach was my responsibility and my obligation.
Undoubtedly, not all of my visitors agreed with what I was doing or, like Captain Bartell, were happy that I was on Main Street in their small town. But over the eleven years that I engaged in community outreach, every single visitor was respectful.
There’s no way for me to know for sure how much my community outreach correlated with the level of success the stores achieved, but I believe it was significant. In today’s cannabis industry, local government and community outreach is expected. But back in 2009, and even up until and through regulation in 2018, it set me and my establishment apart from the others, not only in my region but throughout the state.
In those early years, I was nervous, unpolished, and awkward—the result of taking myself way too seriously—and I don’t know that those visits were incredibly fun for anyone involved. That really wasn’t their purpose, of course, but over time, that changed. As various jurisdictions reached out requesting an educational tour, my naturally gregarious (and oftentimes cheeky) personality started to show itself more often. I began to relax, take myself (if not my operation) less seriously, and even find occasion for a bit of humor.
Many of the smaller jurisdictions that contacted me for educational visits had opened themselves up to the idea of cannabis in their community solely because of the tax-revenue potential. Shocking, I know. But money talks, and for small jurisdictions looking to fill their general-fund coffers, cannabis was enticing, and they had a Cinderella tax-revenue-generation story in the City of Shasta Lake, 530 Collective’s hometown.
The city had placed a tax initiative on the ballot in 2014 to levy 6 percent of its dispensaries’ gross revenue. The voters passed it by just over 60 percent (because the revenue was allocated to the general fund and not earmarked, only a 50 percent passage rate was required per California law). Several media outlets ran stories after the first year of collection. The $353,436 collected in the first twelve months was staggering for a small rural city of only fifteen thousand people, and the idea captured the full attention of other small cities in the region that were looking for alternate sources of revenue to replace lost redevelopment dollars. These other jurisdictions saw the City of Shasta Lake able to finally fill all its law-enforcement vacancies; they saw it able to support its business community in the form of grants and loans for business improvement; they saw the city able to tear down more of the blighted buildings within its jurisdiction as well as make additional infrastructure improvements.
Throughout the nation, with every election year, we see more states bringing commercial cannabis online, either in the form of medical permissibility or full legalization. While part of this trend is simply due to the significant sociopolitical shift around cannabis normalization, some of it is without question due to the economic drivers at play. Cannabis brings jobs; it fills vacant buildings; and it brings significant tax revenue. Even in California, some of the cities that had been initially reluctant to embrace the industry are now changing their tune because of the revenue potential. The City of Shasta Lake had seen the revenue potential and taken pioneering action in 2014, a full two years ahead of state legalization.
The subject of taxes is tricky, though. The industry doesn’t want to be taxed at all, and the government wants to collect as much as possible. Somewhere in between is the sweet spot. Further complicating matters, as local jurisdictions seek to impose additional taxes on an already highly taxed industry, they run the risk of inadvertently promoting the illicit market, which is alive and kicking in every city throughout the nation, regardless of whether or not its state has legalized cannabis. Part of the proliferation of the illicit market is due to ongoing federal prohibition, but it is also due to states not building robust enforcement and eradication processes into their legislation or initiatives. States that legalize or decriminalize cannabis without such protocols make it very easy for illicit operators to grow and manufacture their products without fear of criminal ramifications. Those products can then be trafficked to states where cannabis remains illegal and therefore commands a higher price. Even illicit producers who keep their products within the state where it’s grown can undercut the regulated market significantly and still reap a huge profit.
When states and cities impose excessive taxes on an industry in combination with exorbitant licensing fees that can skyrocket into the hundreds of thousands of dollars, while simultaneously failing to protect that industry against the illicit market by ignoring the illegal activity against which its regulated operators compete, you have a recipe for disaster.
California is a poster child for this exact scenario; in the five years since California’s Prop 64 passed, we have seen our illicit market explode with the state taking little to no action against it. (This subject alone could fill an entire book.)
As long as the illicit market thrives—and make no mistake, it is thriving—there will remain cheaper retail options for customers. Consequently, states and cities must remain cognizant of this fact when setting their tax rates.
One such city was the City of Corning. Their city manager contacted me in 2017 after Prop 64 passed. Corning is a conservative city even smaller than Shasta Lake; yet the initiative had (surprisingly) passed within its precincts. In light of that apparent nod of approval from Corning’s citizens, the city manager felt she needed to explore the possibility of a cannabis operation in the city.
By 2017, my media presence was prolific, so it was no surprise that she reached out to me. Over the course of several weeks, she and I coordinated no fewer than three separate site tours for their city officials and law enforcement. (Due to California’s Brown Act, we could not have a majority of the city council present on any single visit. To avoid violating this act, we had to split up the council members into multiple tours.)
During one of these visits, the tour had moved to the back of the building, where we were looking over the clones, the baby cannabis plants that were available to the customers to purchase and grow in their own backyards.
I was explaining some of the properties of the cannabis plant, specifically ways in which the plant strains differ from each other. Not only are the plant strains unique amongst themselves but cannabis itself is unique in that it undergoes sexual reproduction, having both separate male and female plants.
One of the gentlemen on the tour then, of course, asked me the logical next question. “How do you tell the males from the females?”
My hand shot out from where it had been resting innocently at my side and made a very significant cupping gesture in the air while I said, “Well, sir, the males have pollen sacs.”
I’ve always been one of those people who talks animatedly with their hands. (Thanks, Italian heritage.)
With my hand still kind of out there awkwardly floating in the air and my guests blinking at me like owls, I suddenly found it very hard to keep a straight face. I quickly turned away from the group and toward a more chaste area of the store, collecting myself so that I could continue the tour. Pollen sacs . . .
In December 2019, I found myself giving a similar outreach tour to officials from the City of Red Bluff. This time we were at my Synergy store, and along for the visit were the city manager, a consultant, and two law-enforcement officials—all men.
One of the law-enforcement officials, Police Chief Kyle Sanders, had been at 530 several years prior. The industry had evolved dramatically since then, particularly with regard to the development of the state’s track and trace system, Marijuana Enforcement Tracking Reporting & Compliance (METRC), and significant changes to product packaging, as well as to the sophistication of the products on the market.
Prior to regulation, products had come into 530 in bulk. Cannabis flower, for instance, arrived packaged by the pound in Reynolds turkey oven bags. The flower would then be displayed in a jar for customer inspection, to be weighed out and packaged on the sales floor deli-style, based on how much each customer wanted to buy. Under new California regulations and the METRC tracking system, bulk product for retail sale was no longer permitted. Instead, it had to be delivered to the retailer preweighed and prepackaged in tamper-resistant, child-resistant, non-see-through containers with an associated blue METRC barcode that could trace that gram of flower or vape cartridge all the way back to the specific plant from which it originated. While there was nearly statewide mutiny by customers over this drastic change, I absolutely loved the bold move by the regulators. Cleaner and more organized, the new system made inventory management so much easier.
My tour group and I were on the sales floor, moving from department to department and discussing the types of products contained in each one. We eventually got around to the table that held many of the specialty products geared toward women, things like face primers, body lotion, and more.
I could have selected any product from the table that day, but the little devil on my shoulder chose the package of Quim. (Yes, there actually is a product called Quim, and it is exactly what you might expect with a name like that; it is lube.)
Holding it out for the group to inspect, I said, “I think it’s just fantastic that today we have innovative cannabis products like this that can enhance sexual intimacy for everyone. And it’s excellent for either solo or group play.”
I stopped talking and paused for one heartbeat. Then another. And another.
Arms folded across bulletproof vests.
No one was making eye contact or taking the box.
Crickets.
There was an eclectic celebration of dance taking place inside me, but I kept it all inside. I simply put the box down and picked up an innocent CBD bath bomb, turning back to the group with a possibly not-so-subtle transitional comment. “And this is another great example of a product that is also very popular with the ladies.”
I bet that none of them forgot that tour. Outreach spiced with humor became my winning combo.