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Oregon's Medical Marijuana Program: Still Smokin' but Drawing Fire

David Serchuk,|Special to CNBC.com
Thursday, 19 Apr 2012 | 4:08 PM ET
Marijuana
AP
Marijuana

Oregon is perhaps the Shangri-La of the "legalize marijuana" movement — but there's a potential storm on the horizon that could ruin its tranquility.

Not only was it the first state to decriminalize pot in 1973, years before its glamorous neighbor to the south, but its medical marijuana program has operated with few glitches since it began in 1998. Now, in one of the nation's most liberal states, medical marijuana is an issue in a top statewide election race.

"Because of a certain hippie ethos, some people think Northern California is too crowded, so they moved to Oregon," says Allen St. Pierre, executive director of the National Organization for the Repeal of Marijuana Laws, Norml. "The southern part of the state along the I-5 corridor is like California North. There is a big marijuana ethos out there."

Oregon has 55,807 registered users in its medical marijuana program — an astounding 1.4 percent of its population. Out-of-state residents are even eligible for medical marijuana licenses a year at a time. Thus far, the state has denied only 1,373 application.

Oregon vs. Other States

So why has Oregon's program managed to flourish with little or no controversy while those of Colorado, California, and Montana are under heavy fire?

St. Pierre says it's because Oregonians never pursued the “dispensary” model of distribution, where licensed users show up to buy the drug in any number of forms. This helps citizens avoid the possibility of law enforcement raids, which has been the case in other states.

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Dispensaries have drawn the ire of neighborhood groups that don't want them operating near schools and other public places for children.

Oregon's medical marijuana law essentially keeps the drug at home. Licensees are allowed to possess up to 24 ounces and 24 plants (six mature) at a time.

Experts say this works out to a fairly large bounty of weed to anyone who would qualify for the program, vastly reducing the need for black or gray market acquisitions. As a result, many consumers grow their own weed, and those who don’t are allowed to connect with one of the state’s many legally sanctioned growers.

“Basically the system has worked because of that high threshold,” says St. Pierre. “Had they set the threshold at a couple of ounces, the burgeoning retail market would have exploded five to 10 years earlier.”

The swelling retail market to which St. Pierre refers is the fairly recent — though still small — phenomenon in which marijuana collectives, akin to farmers markets, have begun thriving in major Oregon cities. As for-profit sales remain illegal in Oregon, collective participants try to skirt the issue by either setting up a barter system for the weed, or by asking those who attend for donations.

Patients pay $150 per year to be part of the system, fattening state coffers to the tune of $8.4 million last year.

Pot, Politics and the People

Though profitable, popular, and largely successful, the state's medical marijuana system is a hot issue in the race for state attorney general, which pits two Democrats, Ellen Rosenblum, a state judge and former assistant U.S. attorney, against Dwight Holton, whose career as a prosecutor includes a stint as U.S. attorney for Oregon.

In June 2011, while he was U.S. attorney, he and other state law enforcement officials served notice that the Oregon law protected medical marijuana users from state prosecution but not federal authority, and that neither state nor federal law permitted cultivation and distribution.

Holton, who once called the administration of the state's law a "train wreck," has addressed the complexity.

"Dwight Holton does not support repealing the law whatsoever," says his spokeswoman Jillian Schoene. "[He] is the only one working to preserve the law and protect its integrity."

On her website, Rosenblum says she won't waste "limited tax dollars ... prosecuting people for possessing small amounts of marijuana," and will "protect the rights of medical marijuana patients."

The race — which polls show to be close — has riled the pro-marijuana lobby and touched on key issues in the legalization debate:

  • What's the best use of limited law enforcement resources and what some consider a victimless crime?
  • Collateral damage to communities from the manufacturing, trafficking and consumption of non-sanctioned individuals exploiting the medical marijuana law.
  • And conflicting state and federal statutes and enforcement policies, which have created a problematic gray area.