California cannabis legalization– not a thrill for all growers

By Lukas Henderson
Flapjack Staff

Samantha and Robert Peterson worked tirelessly, contacting their lawyers, clients, and local law enforcement to prepare for the worst case scenario in the wake of Nov. 8, election day. These mid-level cannabis cultivators in Humboldt county had been dreading this day since the inception of Proposition 64. Now that recreational marijuana is legal, what are they supposed to do to make a living? Wait hold on, what?

Many cannabis growers in the area have been germinating, growing, processing and selling cannabis as a way of life for decades. Although it has been legal for some operations to grow and sell this ancient plant for medical purposes under the Compassionate Use Act of 1996, many have had to rely on other, less legal, forms of distributing their product to make a decent living.

After decades of hiding in the hills of Humboldt county and balancing on the line of legality and jail time, the local cannabis cultivators are now able to be loud and proud about what it is they do because of the recreational legalization that came from the recently passed Adult Use of Marijuana Act.
So why is it that when the California Growers Association took a poll of 750 cannabis growers they found that 31 percent were in support, 31 percent were opposed, and 38 percent of the surveyed growers were undecided? Wouldn’t one think that these people who have been more or less hiding in the shadows their entire lives would jump at the opportunity to live the life of respectable contributors to a perfectly legal market?

This act allows for the recreational consumption of cannabis in designated and private areas, and also allows an individual of 21 years of age or older to possess an ounce, or six plants in their home. But what exactly does it mean for the growers themselves?

Here is what a few local cultivators who have spent upwards of 30 years in the cannabis industry have to say about Proposition 64 or the Adult Use of Marijuana Act.

“I have been growing cannabis since the late 70’s and I have had my run ins with the law many times,” said 70-year-old Robert Peterson while turning down the green house fan. “On one hand I am very excited that we can the medicine we are growing for our clients is not something we have to be ashamed of in the eyes of the law anymore, but on the other hand the amount of money that will go into our cultivating license, and the amount of money that will come out of our harvest for taxes will take a long time to get used to.”

The amount of money that Peterson is referring to is $9.25 an ounce of flower. This will be a struggle for many who are trying to make their way in this business.

“We are currently producing anywhere from 500 to 700 pounds of product a year, which if you do the math, adds up to a whole heck of a lot of dough going to the State Bureau of Marijuana,” said Peterson. Doing the math, that dough lands in the $74,000- $103,000 range. “I do like the sound of the state bureau of marijuana though.”

The United States tax code 280e states that any businesses that sells federally illegal substances, such as marijuana, are unable to deduct normal business expenses when it is time to do taxes. This boils down to the fact that cannabis businesses are paying tax on their gross profits, rather than their net profits.

“This just seems to me like another way that the man is able to keep us down,” said Samantha Hofstadter, an up-and-coming CBD tincture producer and former student of Humboldt State University. “We are automatically put behind every other legitimate industry given the financial disadvantage we are forced to accept in order to be legitimatized.”

This inherent financial setback, and the massive tax put on produced cannabis are major deterrents for a large section of cannabis workers. But not all growers were scared off by this monetary inconvenience.

“I have been very fortunate to make a living for myself and my family for the past 20 years by legal and not so legal means,” said Charlie Henderson, Peterson’s partner, with a chuckle. “I realize that many less fortunate people in inner cities are in constant danger of facing a minimum of six years in prison for minor possession charges. With cannabis being legal, I hope to see a decrease in the amount of non-violent drug offenses putting people in prison. I voted yes on this proposition for the good of the majority instead of the smaller community of growers.”

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