{"id":8040,"date":"2018-02-02T18:51:08","date_gmt":"2018-02-02T18:51:08","guid":{"rendered":"https:\/\/www.denverpost.com?p=2939079&amp;preview_id=2939079"},"modified":"2018-02-02T18:51:08","modified_gmt":"2018-02-02T18:51:08","slug":"were-going-to-do-something-about-it-oregons-federal-prosecutor-holds-summit-on-black-market-marijuana","status":"publish","type":"post","link":"https:\/\/cannitrol.com\/blog\/were-going-to-do-something-about-it-oregons-federal-prosecutor-holds-summit-on-black-market-marijuana\/","title":{"rendered":"\u201cWe\u2019re going to do something about it\u201d: Oregon\u2019s federal prosecutor holds summit on black market marijuana"},"content":{"rendered":"<div id=\"wp_fb_like_button\" style=\"margin:5px 0 5px 5px;float:right;height:100px;\"><script src=\"http:\/\/connect.facebook.net\/en_US\/all.js#xfbml=1\"><\/script><fb:like href=\"https:\/\/cannitrol.com\/blog\/were-going-to-do-something-about-it-oregons-federal-prosecutor-holds-summit-on-black-market-marijuana\/\" send=\"true\" layout=\"standard\" width=\"450\" show_faces=\"false\" font=\"arial\" action=\"like\" colorscheme=\"light\"><\/fb:like><\/div><div class=\"media_block\"><\/div>\n<div class=\"row\">\n<div class=\"large-10 large-centered small-12 columns\">\n<div class=\"entry-meta-date\">Published: Feb 2, 2018, 10:32 am \u2022 Updated: Feb 2, 2018, 3:42 pm <span class=\"single-comments-link\" \/><\/div>\n<p class=\"byline\">By <strong>Gillian Flaccus<\/strong>, <em> The Associated Press<\/em><\/p>\n<p>PORTLAND, Ore. \u2014 Oregon\u2019s top federal prosecutor said Friday the state has a \u201cformidable\u201d problem with marijuana overproduction that winds up on the black market and that he wants to work with state and local leaders and the pot industry to do something about it.<\/p>\n<p>U.S. Attorney Billy Williams convened the unprecedented summit of influential federal law enforcement representatives, state officials and marijuana industry scions after Attorney General Jeff Sessions withdrew an Obama administration memo that had guided states with legalized weed on how to avoid federal scrutiny.<\/p>\n<p>The meeting included representatives from 13 other U.S. attorney\u2019s offices, the FBI, the U.S. Postal Inspection Service, the U.S. Forest Service and U.S. Customs and Border Protection. U.S. attorneys from California, Washington, Colorado, Idaho, Alaska and Montana attended in person.<\/p>\n<p>Gov. Kate Brown, a Democrat, told guests that Williams has assured members of her administration that \u201clawful Oregon businesses remain stakeholders in this conversation and not targets of law enforcement.\u201d<\/p>\n<p>The marijuana industry has been watching federal prosecutors in states with legalized weed like Oregon closely <a href=\"https:\/\/www.thecannabist.co\/2018\/01\/04\/jeff-sessions-rescinding-legalized-marijuana-policy\/95875\/\">since Sessions rescinded the so-called Cole memo<\/a>. U.S. attorneys in states where marijuana is legal under state law <a href=\"https:\/\/www.thecannabist.co\/2018\/01\/05\/prosecutors-pot-friendly-states-will-decide-crackdown\/96164\/\">now face the delicate question of how to do their jobs<\/a> and hew to the federal ban.<\/p>\n<p>Williams sought to calm fears among pot growers that his office would target legal growers in Oregon, but said the market has a problem that must be addressed. Everyone needs a \u201cbottom-line answer\u201d on how much excess marijuana is being produced and how much is being smuggled out to other states where weed remains illegal, he said.<\/p>\n<p>The surplus attracts criminal networks and generates money laundering, drug violence and environmental contamination from pesticides and draws down water supplies in rural communities, he said.<\/p>\n<p>\u201cHere\u2019s what I know in terms of the landscape here in Oregon, and that is, we have an identifiable and formidable marijuana overproduction and diversion problem,\u201d he said.<\/p>\n<p>Williams added: \u201cAnd make no mistake about it, we\u2019re going to do something about it.\u201d<\/p>\n<p>There is general agreement that <a href=\"https:\/\/www.thecannabist.co\/2017\/12\/05\/oregon-marijuana-operation-explosion\/93949\/\">some marijuana from Oregon does wind up in other states where it isn\u2019t legal<\/a>. Still, it\u2019s hard to say if pot smuggling has gotten worse in Oregon \u2014 where illicit pot farmers were thriving long before recreational legalization \u2014 or how much of the marijuana leaving the state filters out from the legal side.<\/p>\n<p>Williams <a href=\"https:\/\/www.thecannabist.co\/2018\/01\/12\/billy-williams-oregon-attorney-marijuana\/96649\/\">laid out his plans for the unprecedented event in a recent newspaper column<\/a>, saying Oregon has a \u201cmassive marijuana overproduction problem\u201d that is attracting cartels and criminal networks and sparking money laundering, violence and environmental woes.<\/p>\n<p>The column came shortly after Attorney General Jeff <a href=\"https:\/\/www.thecannabist.co\/2018\/01\/04\/jeff-sessions-rescinding-legalized-marijuana-policy\/95875\/\">Sessions last month rescinded an Obama administration memo<\/a> that outlined the steps states with legalized cannabis could take to avoid scrutiny under federal law, where marijuana remains illegal.<\/p>\n<p>\u201cIn sum, I have significant concerns about the state\u2019s current regulatory framework and the resources allocated to policing marijuana in Oregon,\u201d Williams wrote in The Oregonian, adding the summit and the state\u2019s response to his concerns would \u201cinform our federal enforcement strategy.\u201d<\/p>\n<p>Darwin Roberts, a former federal prosecutor in Seattle who also worked on marijuana issues as a senior official in the Washington Attorney General\u2019s Office, said he wasn\u2019t surprised to see Williams\u2019 concerns. But he added the Justice Department is in a tough spot: If it shuts down states\u2019 marijuana programs, it will drive that activity back to the black market, where neither the feds nor state authorities have the resources to deal with it.<\/p>\n<p>\u201cThe <a href=\"https:\/\/www.thecannabist.co\/2017\/08\/17\/jeff-sessions-letters-marijuana-policy-alaska-colorado-oregon-washington\/86246\/\">Justice Department clearly is unhappy<\/a> that the states aren\u2019t doing more to stop marijuana activity outside the state legal system,\u201d Roberts said. \u201cI suspect that for DOJ to allow the states to keep making money off legal marijuana, DOJ will want to see a real commitment of state tax dollars to law enforcement efforts against black market growing and trafficking heading out of state.\u201d<\/p>\n<p>In his column, Williams said law enforcement in 16 other states have reported seizing marijuana from Oregon and postal agents have intercepted more than 2,600 pounds of pot in outbound packages and over $1.2 million in associated cash.<\/p>\n<p><strong>Related: <a href=\"https:\/\/www.thecannabist.co\/2017\/08\/07\/jeff-sessions-letter-oregon-marijuana-governor-kate-brown\/85524\/\">Jeff Sessions\u2019 letter to Oregon gov cites \u201cpervasive illicit cannabis cultivation\u201d<br \/><\/a><\/strong><\/p>\n<p>Advocates dismiss the idea that legalization has caused a spike in black markets sales. It\u2019s just that now, because it\u2019s legal, it\u2019s much easier to track it back, they said.<\/p>\n<p>\u201cWhen I moved to Oregon in 1979, cannabis was a billion-dollar crop then, so the notion that this is somehow caused by legalization or by the medical program is something that\u2019s misplaced,\u201d said Leland Berger, an attorney who specializes in marijuana cases.<\/p>\n<p>\u201cWhen it\u2019s intercepted out of state it\u2019s easier to document where it came from, but I\u2019m a little disappointed that it\u2019s viewed as a new and huge problem.\u201d<\/p>\n<p>States that have legalized marijuana for recreational and medical use <a href=\"https:\/\/www.thecannabist.co\/2017\/08\/25\/colorado-alaska-washington-oregon-sessions-marijuana\/86753\/\">have taken varying approaches to satisfying federal law enforcement priorities<\/a>, in an effort to pre-empt raids or even a Justice Department lawsuit that could undermine the newly regulated markets. They\u2019ve also adjusted their approaches as their markets matured.<\/p>\n<p>Oregon voters approved the sale of recreational marijuana in 2014, and it became legal the following year. The state has allowed medical marijuana since 1998.<\/p>\n<p>It now has about 900 licensed recreational growers, with more than 1,100 licenses awaiting approval and no cap on the number of licenses it will grant. Another roughly 25,600 growers in the state produce cannabis for medical marijuana patients. More than 500 retailers are licensed to sell recreational weed, with nearly 250 applications pending.<\/p>\n<p>Washington launched recreational sales in 2014, the same year as Colorado. <a href=\"https:\/\/www.thecannabist.co\/2014\/06\/30\/washington-legal-pot-preparations-delays-clouded-confusion-aggravation\/15046\/\">It started off with relatively low caps on the number of licensed retail marijuana stores<\/a> and for the size of grow operations. Both measures were designed to prevent an oversupply of cannabis that might make its way into the black market.<\/p>\n<p>As its industry grew, Washington merged its unregulated medical market with the strictly regulated recreational one. It now has more than 500 licensed retailers, though not all are operating, and nearly 1,200 licensed growers.<\/p>\n<p>In Oregon, the medical and recreational marijuana industries still operate separately, although <a href=\"https:\/\/www.thecannabist.co\/2017\/12\/05\/oregon-medical-recreational-marijuana-shops\/93955\/\">the number of medical pot dispensaries has dropped precipitously<\/a> as retailers move toward the more lucrative recreational cannabis sales.<\/p>\n<p>Oregon did not cap the number of pot producers, virtually guaranteeing an overproduction problem, said Seth Crawford, a former Oregon State University professor who\u2019s an expert on marijuana economics and cannabis policy. Crawford now runs an industrial hemp seed company.<\/p>\n<p>Coupled with Oregon\u2019s small population \u2014 4 million people total \u2014 and its reputation as a prime cannabis-growing location on a par with Northern California, a surplus was predictable here, Crawford said. He estimated Oregon growers produce up to three times the amount of marijuana that the state can absorb legally each year.<\/p>\n<p>\u201cYou created this huge industry that has nowhere to put its product,\u201d Crawford said.<\/p>\n<p>\u201cIf you were an investor and you had just dropped $4 million into a (marijuana) grow and you had thousands of pounds of flower that was ready to go but you had nowhere to sell it \u2026 if you want any of your money back, the only thing you can do is sell it on the black market,\u201d he said. \u201cIt was a system designed for failure.\u201d<\/p>\n<p><a href=\"https:\/\/www.thecannabist.co\/2017\/08\/23\/oregon-kate-brown-sessions-marijuana-letter\/86580\/\">Oregon has begun taking steps<\/a> to address diversion to the black market. The state will soon require medical marijuana growers to adopt a seed-to-sale tracking system that it uses for recreational marijuana. It is also allowing medical growers to sell some of their surplus to wholesalers for sale in recreational dispensaries as medical pot shops dry up.<\/p>\n<p>At a recent meeting of a medical marijuana advisory commission, members identified the pot surplus leaving Oregon as its No. 1 priority. Lawmakers are also taking the issue seriously: A bill last year to allow the governor to enter into sales compacts with other marijuana states didn\u2019t make it to a vote, but there is interest in reviving the idea.<\/p>\n<p>Those in the industry in Oregon are cautiously optimistic about the summit.<\/p>\n<p>\u201cIt\u2019s a brand-new industry operating legally under state law and illegally under federal law \u2014 and that\u2019s hard to balance. That\u2019s one of the purposes of this summit. Let\u2019s talk about it,\u201d said Anthony Taylor, president of Compassionate Oregon, which advocates for medical marijuana patients.<\/p>\n<p>\u201cI think everybody realizes it\u2019s a discussion that needs to happen.\u201d<\/p>\n<p><em>Associated Press writer Gene Johnson in Seattle contributed to this report.<\/em><\/p>\n<p>Follow Gillian Flaccus on Twitter at http:\/\/www.twitter.com\/gflaccus<\/p>\n<p>&#013; &#013; <\/p><\/div>\n<\/p><\/div>\n<p><!-- .row --> <\/p>\n","protected":false},"excerpt":{"rendered":"<div class=\"media_block\"><\/div>\n<p>Oregon&#8217;s top federal prosecutor convened a marijuana summit Friday to hear how state leaders plan to address the black market. <\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[45,6964,6813,77,5667,56,9,6833,5019,170,7500,1,3,61,1736],"tags":[2628,6967,6818,2655,5673,2636,6835,5022,2748,7501],"_links":{"self":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts\/8040"}],"collection":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/comments?post=8040"}],"version-history":[{"count":0,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/posts\/8040\/revisions"}],"wp:attachment":[{"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/media?parent=8040"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/categories?post=8040"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cannitrol.com\/blog\/wp-json\/wp\/v2\/tags?post=8040"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}