In this light, taxation is seen as a blunt instrument of exclusion, driving precisely the groups most prosecuted in the war on drug further into the arms of the black market where they remain at risk for arrest or robbery. In one Denver dispensary, a $30 purchase of one-eighth of the Trinity strain of cannabis includes $7.38 in state and local taxes — a near 33 percent rate. As Larisa Bolivar, one of the city’s most well-known proponents of decriminalizing marijuana nationally and opening a true free market, puts it: That seven bucks buys someone lunch.
“It’s simple,” she says. “A high tax rate drives black market growth. It’s an incentive for risky behavior.”
There may be an argument there, says Lt. James Henning, who heads Denver Police Department’s vice/drug bureau, but one, don’t expect much sympathy and two, “you have to follow the law. If you want to sell marijuana, find a way to sell it legally.”
Until then, there’s Junior.
He’s visiting the duplex basement, standing amid the Cool-Bloom, the Rapid Grow, the bags of Coco, sharing an e-cig loaded with a hash oil cartridge with the grower. Both men insist on anonymity, for fear of being targeted by law enforcement.
“Dude, it’s way too hot in here,” Junior says, examining a yellowing plant. “It should be, like, 80.” The digital thermometer on the wall reads 97 degrees. The portable AC broke, the grower says.
Junior, round-cheeked, soft-spoken, a once-upon-a-time gang member, recently lost his job in the oil industry, so he’s returned to an old pastime. “Would I prefer he had his legitimate job, still?” his wife says. “Yes, but when he did he was never home and now he is.”
You have pot to sell, Junior will find you a buyer. You want to buy? He’ll find you product. He prefers to deal in bulk, taking a small commission, usually $100 a pound. Every once in a while, when he’s got extra bills to pay, he sells it himself. That’s much riskier, felony risky, kids-visiting-dad-at-the-jailhouse risky. But profit tempts from all directions. Two thousand dollars a pound in Colorado is $3,200 in Oklahoma or Kansas City and $5,500 in New York City.
A July 9 study of Colorado’s marijuana market and demand for the Colorado Department of Revenue estimates the total adult demand, including out-of-state visitors, at about 130 metric tons in 2014. Of that, licensed retailers are expected to supply 77 metric tons, most of it from medical marijuana outlets. That leaves what the report calls a “sales gap” of about 53 million tons of projected unmet demand — not including use by minors. Enter the licensed home growers, the people buying legally and reselling illegally, the illegal grow and distribution networks: the underground.
Marijuana production in the state “is like a shoe factory,” Balles says. “You’ve got the ones that go to Nike and the ones that go out the back door to the flea market. One way or another, it all gets sold.”
Seven months of legality is too early to tell anything, and what is now may not be in another seven months.
What exists now, however, is profit.
The grower says he cleared $30,000 on his last big deal. “That’s the kind of math I want to be doing,” Junior says. He has plans to start his own grow op in his stepdad’s house. He dreams of opening his own dispensary and is now interviewing for a job at one.
“A lot of people they look at me,” the grower says, “and they go: ‘Damn, must be nice baller, driving that new car, driving that motorcycle, taking your boat out on Sunday.’ I say I worked hard for it. ‘Oh, yeah, we know, you’re working hard, watering plants.’ I call them my money trees.”
“They say money don’t grow on trees,” Junior says. “They’re lying.”
The grower laughs. “They say, ‘What’s that smell?’ I say, ‘Money.'”