U.S. eyes medical marijuana industry

Kai Ryssdal: Here's today's industry and corporate story. There are big changes coming to the medical marijuana business. Federal prosecutors here in California announced a change in policy today, plans to target the storefront distribution of medical marijuana. Landlords who rent to pot dispensaries have been getting letters threatening criminal charges if they don't shut down within weeks.

Jennifer Collins reports from a city that had, at one point, more than 600 marijuana dispensaries. Right here in Los Angeles.


Jennifer Collins: Medical marijuana is a billion dollar business in Calfornia. Fifteen other states allow it.

Beau Kilmer with the Rand Corporation says there's a problem with that.

Beau Kilmer: Even though in those states it's legal to possess it for medicinal purposes, it's still prohibited by federal law.

And today, federal prosecutors in California announced a crackdown on dozens of storefront dispensaries. Mark Kleiman is a public policy professor at U.C.L.A.

Mark Kleiman: I think they've decided that having a billion dollar illegal industry flourishing in public is sort of bad for business.

Medical marijuana brings in over $100 million in taxes for California. Steve DeAngelo directs one of the largest dispensaries here, Harborside Health Center in Oakland.

Steve DeAngelo: All of that tax revenue will disappear if the federal government is successful in this effort to close down regulated access.

And it may prompt something else, says Keith Robinson. I found him ringing the bell of Hollywood Haze on Sunset Boulevard.

Collins: Are you a customer?

Robinson says if the feds truly crack down, he'll just find another supplier.

Keith Robinson: It's not going nowhere. It won't going to change anything. You close a couple of stores and you could always go into your ghetto 'hood and get weed.

Or says public policy professor Mark Kleiman, more likely, it'll cause the dispensaries to re-organize and offer home delivery services.

Kleiman: It'll be like pizza.

I'm Jennifer Collins for Marketplace.

About the author

Jennifer Collins is a reporter for the Marketplace portfolio of programs. She is based in Los Angeles, where she covers media, retail, the entertainment industry and the West Coast.

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