CA: Shasta Lake Marijuana Collectives Eye For-Profit Status, Expansion


All three Shasta Lake medical marijuana collectives intend to become for-profit businesses and are eyeing expansions, including adding full-time jobs, to establish a steady supply chain under a new state law – even if voters don’t legalize pot in November – their owners said Monday morning.

“I realize you don’t want to be the quote-end-quote pot capital of the state but on the other side of that, for your citizens, it can do a lot for the city,” said Stacy Lidie, owner of the Leave It To Nature collective, at the Shasta Lake Medical Marijuana Ad Hoc committee meeting.

City staff, two council members and the collectives’ owners met to discuss how to benefit from the 2015 Medical Marijuana Regulation and Safety Act, aka MMRSA, and Proposition 64, which would legalize recreational marijuana.

They also ruminated ideas to prevent an overgrowth of marijuana businesses in the city, which other “unprepared” communities experienced, Kerr said.

MMRSA sets up a state regulated and licensed medical cannabis industry and phases out collectives, said Jamie Kerr, owner of 530 Collective.

It also allows both nonprofit and for-profit organizations starting Jan. 1, 2018, she said. Current collectives would have priority for licensing as either type, but for-profit comes with many advantages.

“My attorney told me all collectives are going to be for-profit,” Lidie said.

Banks and other private interests already avoid medical marijuana organizations because of their quasi-legal nature, Kerr said. The nonprofit status further limits options for collectives, she said.

Limited alternatives exist and they usually come with high interest rates and steep terms, said Tammy Brazil, Queen of Dragons’ owner. One potential loan had a 22 percent interest rate and half of the stake in the operation, she said.

Being for-profit businesses, however, would allow them to find private investors to expand, she said. She said a 1-acre commercial grow would require “upwards of $1 million” for construction including cameras and fences as well as equipment to comply with an extensive tracking system.

But she also anticipates adding up to 25 jobs – possibly more if voters approve Proposition 64, which legalizes and regulates recreational marijuana businesses and adult use.

“Everything must be accounted for – every seed to every leaf,” she said. She added that if the other dispensaries follow suit, “that’s 75 people who have a job – good paying jobs. They’re not minimum wage jobs.”

However, both MMRSA and Proposition 64 give local governments veto power over what, if any, commercial cannabis activities to allow, Kerr said.

That’s why she, along with Lidie and Tammy Brazil, suggested the city apply its medical marijuana ordinances to all cannabis activities so it can regulate the industry.

City Manager John Duckett agreed to look into it with the city attorney. However, he noted the marijuana tax, which brought in about $365,000 in the previous year, already was written to apply to both medical and recreational marijuana sales.

That would prevent the headaches other, unprepared cities, including Redding, encountered when marijuana dispensaries began popping up all over, Kerr said.

Councilman Larry Farr said he didn’t expect that to prevent all potential problems, and Kerr agreed.

Some changes, such as for-profit cannabis businesses, aren’t urgent. But the city needs to move quickly to address recreational cannabis should Proposition 64 pass.

“If (Proposition) 64 passes, and an adult use market emerges, I don’t want to be left flat-footed,” she said.

News Moderator: Katelyn Baker
Full Article: Shasta Lake Marijuana Collectives Eye For-Profit Status, Expansion
Author: Joe Szydlowski
Contact: (530) 243-2424
Photo Credit: Greg Barnette
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