The Bigger Picture: How Cannabis Businesses and Communities Thrive Together
One aspect of cannabis industry that rarely gets discussed is how the cannabis industry impacts local and state communities and the corresponding economies. As the industry grew in Colorado, supporting and ancillary industries have also grown alongside. If you have little or no experience in the industry, this might not be an area that you have thought about, but when you look at it, hundreds of companies have been directly stimulated by the growth of the cannabis industry in Colorado. Just to name a few: gardening supply stores, HVAC, electrical, plumbing, greenhouses, architects, engineers, lumber and building supplies, commercial and industrial real estate, interior design, flooring and window makers, installers, security, vault and safe companies, alarm monitoring and installation companies and janitorial services. Directly working with the industry, local government oversight (Department of Agriculture, Fire, Police, Water, Energy, etc.) community organizations, non-profits, and laboratories all saw increases in funds.
The indirect impacts are nearly immeasurable. Living in Denver for the last 20 years gave me a very good idea for what this city looked like before and after legalization. Gentrification? No. Cannibication… Cannabis legalization created a “second gold rush” in this town for some, and a “bust” for others. Homelessness increased with the swelling of the population, and there were not enough resources to care for all the people showing up in Denver looking to make it in the industry. Hundreds of people ranging in all ages and backgrounds moved to Colorado to escape marijuana persecution, and to live in a place where they could work for the industry and the cause. However, the climate of the industry changed, quickly. Regulations enforcement increased and to work in the industry, you had to jump through financial and legal hoops to obtain a badge or own a license. Many people got lost in the system and wound up on the streets, exposed to the elements and drugs other than marijuana. By the time Denver had finally recouped after the recession, houses had started flying off the rental and buyer’s market with the emerging industry. Housing prices spiked, and now we find ourselves in a city with not enough inventory and housing prices that are unaffordable. Cities have to learn how to use the inertia of the marijuana industry to ensure work and housing for all its residents and to ensure that the money being generated is being proportionately distributed to match the impacts the industry has on the communities.
States may face any number of social, political and economic challenges as they legalize cannabis. It is important that state regulatory agencies prepare themselves for the changes and the impact of the cannabis industry in their state. It is unlikely that every state will have the type of long-term boom that Colorado had. We have already seen the different approaches in each state and the challenges that come with it. For example, Oregon’s market is flooded with product, and it has driven prices to rock bottom. Likely a result of the relatively simple business license application process. It is important that the states legalizing cannabis learn from the examples of those who came before and consult experts in the industry to ensure a successful implementation of regulation and a complete understanding of how the market works.