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About The daily Astorian. (Astoria, Or.) 1961-current | View Entire Issue (Aug. 7, 2018)
3A THE DAILY ASTORIAN • TUESDAY, AUGUST 7, 2018 Oregon has pot oversupply, Colorado hits the mark Prices have plummeted By GILLIAN FLACCUS and KATHLEEN FOODY Associated Press PORTLAND — Two of the first states to broadly legal- ize marijuana took different approaches to regulation that left Oregon with a vast oversupply and Colorado with a well-bal- anced market. But in both states prices for bud have plummeted. A new Oregon report by law enforcement found nearly 70 percent of the legal recreational marijuana grown goes unsold, while an unrelated state-com- missioned Colorado study found most growers there are plant- ing less than half of their legal allotment — and still meeting demand. The reports offer case stud- ies for California and other pot- friendly states as they ramp up their legal pot industries. They also underscore some key differ- ences in how broad legalization was handled that have helped shape differently evolving mar- kets in each state. The Oregon study released by the Oregon-Idaho High Inten- sity Drug Trafficking Area — a coalition of local, state and fed- eral agencies — includes the medical and general-use markets and the illegal market, despite gaps in data on illicit marijuana grows. It noted Oregon still has a serious problem with out-of- state trafficking and black mar- ket grows — and the top federal law enforcement officer in Ore- gon demanded more coopera- tion from state and local officials Thursday in a strident statement. “What is often lost in this discussion is the link between marijuana and serious, inter- state criminal activity. Over- production is rampant, and the illegal transport of product out- AP Photo/David Zalubowski A worker waters marijuana plants at the Colorado Harvest Company in Denver in 2017. AP Photo/Andrew Selsky A marijuana harvester examines a bud that is going through a trimming machine near Corvallis in 2016. of-state — a violation of both state and federal law — contin- ues unchecked,” said Billy Wil- liams, U.S. attorney for Oregon. “It’s time for the state to wake up, slow down and address these issues in a responsible and thoughtful manner.” The Colorado study, released Thursday, focuses on the legal, general-use mar- ket, and researchers at the Uni- versity of Colorado Boulder’s business school and a Denver consulting firm had access to state tracking data to produce the first-of-its-kind analysis. Colorado sales of broadly legalized marijuana began in 2014, roughly two years before Oregon allowed marijuana to be sold at non-medical retail stores. From the beginning, Colorado had stricter regulations for its growers than Oregon did. Colorado gave existing medical marijuana growers the right of first refusal for licenses, cutting down right away on a potential source of black mar- ket production. The state also requires growers to show they have sold 85 percent of their output before allowing them to expand their growing opera- tion, said Beau Whitney, senior economist at national canna- bis analytics firm New Frontier Data. “That was the right approach, and we’ve made that recommen- dation to other state regulators to do that because if you exclude the medical folks from entering the market, then there could be propensity for diversion” to the black market, he said. “Colorado has done a good job in sizing the market. In Ore- gon, it’s going to take a while for that balance to be established.” Oregon didn’t give exist- ing medical marijuana growers priority over new applicants as Colorado did, and it also didn’t cap licenses. That created a per- fect storm of endless licenses for all comers paired with less incentive for medical growers to enter the new industry. In June, the Oregon Liquor Control Commission, which oversees general-use mari- juana, did put a pause on issu- ing new grow licenses to work through a monthslong backlog of applicants. The Legislature will likely consider steps to get a handle on oversupply in the 2019 session. The Pacific Northwest state also had to contend with a long-entrenched culture of ille- gal marijuana cultivation along its border with California, where there are near-perfect outdoor growing conditions. That tradition of illicit mari- juana has created a nightmare for law enforcement agencies in rural, heavily forested coun- ties already stretched thin by budget cuts. The Oregon report, for example, noted nearly 15,000 pounds of marijuana with a street value of $48 million has been seized heading to 37 other states. That doesn’t include illegal pot snagged at Portland International Airport. “I know a lot of the legal industry in Oregon has been asking for stepped-up enforce- ment to combat illegal opera- tions, but there doesn’t appear in those conversations a clear owner of the law enforce- ment,” Whitney said. Although Colorado has been more successful in find- ing a balance between supply and demand, retail prices for bud, or marijuana flower, have plummeted in both states about 50 percent since 2015. That statistic could be deceiving, however, because most growers are now culti- vating their crop for conver- sion into the increasingly pop- ular oil extracts that wind up in everything from soaps to vape pens to edible gummies to salves. It takes 10 times more dried flower to make an oil extract and much of the dried flower is going to that market, Whitney said. Oregon day care audit will focus on background checks By BRAD SCHMIDT The Oregonian A delayed audit of Oregon’s child care system will exam- ine whether day care providers with troubling criminal histo- ries are properly prohibited from caring for children, offi- cials told The Oregonian. Auditors will also identify barriers that regulators face when conducting required background checks. The audit is tentatively set for completion and public release in spring 2019. Auditors in July confirmed the scope of their review after a monthslong wait. Gov. Kate Brown originally requested an audit in October 2017 follow- ing extensive coverage of child care regulatory gaps by The Oregonian and the death of an infant at a Portland day care. Brown’s office in October proposed a “small audit” exam- ining how the Office of Child Care, the Department of Human Services and law enforcement interact when investigating child safety at licensed day cares, public records obtained by The Oregonian show. But Brown’s office in Jan- uary asked auditors from the secretary of state to delay the audit by 90 days. Brown’s dep- uty chief of staff, Berri Leslie, asked for the delay to ensure the launch of a pilot project to improve coordination between childcare and human services divisions. Auditors now say they won’t examine that work and instead will focus on Oregon’s efforts to effectively run back- ground checks of day care providers. The audit will compare Ore- gon’s list of day care provid- ers against a slew of databases, including the FBI fingerprint check and state criminal repos- itories, sex offender registries WANTED and abuse or neglect informa- tion, spokeswoman Laura Fos- mire said. 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Malone said she was pleased that the Colorado study found about 32 metric tons of mari- juana flower left in inventory by the end of 2017. “That’s not even close to some of the figures you see from others states,” Malone said. “So I’m a little bit proud of that.” $ Third Dimension was established in 1989 when Fred Meyer opened. At Third Dimension Salon, each and every associate is committed to going the extra mile to guarantee you look and feel your best. You’ll see it in the quality services, hair products and personalized attention you receive every time you visit our salon. Great looks at prices you’ll love. Just walk in or call for an appointment! A CareOregon Company Mon-Fri 9am - 7pm Sat 9am-6pm | Sun 12-5pm 133 S. Hwy 101 Warrenton 503-861-0850
