Do you realize how onerous the state's rules are for pot farms? The requirements are dizzying—the surveillance you have to have, the fences you have to build to a certain height, the tracking you must do for every plant, the security systems you have to put in place. Not to mention all the other things you have to have to grow marijuana—starting with, you know, marijuana (either seeds or starts), lights (or access to sunlight), fertilizer, water, and harvesting know-how. Not to mention all the other things business owners need, like start-up capital, facilities to house operations, and insurance. Several legal marijuana growers were kind enough to show us around for this glimpse at some of what's required to do this right.
1. ENOUGH TIME TO LET BABY MARIJUANA PLANTS GROW These young shrubs at Sea of Green in Seattle—a pot farm that uses a method involving a carpet of tiny plants, like little bonsai trees—grow from infancy to maturity in around 14 weeks, explains owner Bob Leeds. But the state only provided eight weeks between issuing licenses to marijuana growers and issuing licenses to stores. No wonder there's been such a limited supply. At Sea of Green's 7,000-square-foot indoor facility, many of the 4,200 upstarts are still immature.
2. TRACKING SYSTEMS Every marijuana plant gets a bar code and number that follows it from seed (or start) to harvest. Using a remotely operated tracking system, the state assigns each plant its own 16-digit identity and spits out a bar-coded tag from a printer located at each pot farm. This is supposed to prevent pot that's grown in Washington, where it's legal, from leaking into other states where it's not. But many see this system as onerous and ineffective; there's so much demand for legal pot within the state already (and so little supply), there's little risk it will leak out.
3. ENOUGH MONEY TO DO IT WITHOUT A BANK'S HELP Steven Dietz had to custom-design his facility in East Wenatchee—and build it from the ground up—in order to meet a panoply of state requirements. It cost him $500,000 out of pocket, including the purchase of 7.2 acres of land. "We paid 90 percent cash," Dietz says. "We had the money to do it, but if I was a person who wanted to get into this business and didn't already have the money, I couldn't do it. There are no banks, no financing" for marijuana businesses.
4. COMPLIANCE WITH HEAVY MONITORING REQUIREMENTS Among the exorbitant start-up expenses that hold back otherwise qualified entrepreneurs, the state requires farmers to install advanced video monitoring systems, locate farms in specific zones (which can require paying top dollar for land), and submit to extensive inspections. On the corner of this barn at Gecko Growers, one of 38 cameras sits above a satellite dish, which in turn relays information to state officials in real time about everything happening in the building. That way, the Liquor Control Board can monitor the pot farms remotely and in person.
5. EXPENSIVE SECURITY AND SURVEILLANCE The state is looking out for the safety of growers by mandating that they own security systems. However, there are strict rules about what kind of security system it must be. For example, the security system can't involve a security guard with a gun; grow ops aren't allowed to have firearms due to federal restrictions on simultaneously possessing drugs and guns. At this outdoor farm in Benton County, there are cameras every 15 feet along the fences. That white ball with the smiley face sitting on the fence is one of the cameras. Plus, on top of that, there's razor wire.
6. EXTENSIVE VIDEO MONITORING This monitor at Gecko Growers shows fewer than half of the 38 video feeds constantly recording activity in each growing room and everywhere else, as mandated by officials. On the other side of the Wenatchee River from Gecko Growers, Monkey Grass Farms co-owner Eric Cooper says state regulators told him to make his farm look like "a prison." They installed 45 cameras, at a cost of $35,000, and plan to install even more to satisfy regulators. "The only square inch I don't have covered is the bathroom," says Cooper. "I don't think we are treated fairly. An alcohol distiller doesn't have to install video cameras on every square inch. We have a lot of infrastructure. It makes it tough. It took two credit cards, and the rest was cash that we'd saved." Illicit and medical marijuana growers don't need to meet any of the standards that legal growers face. Dietz says, "I was at the house oversight committee in the legislature... saying I'm competing with the black market. I'm competing with someone who has no regulations."
7. EIGHT-FOOT-TALL FENCES The state requires outdoor farms to be surrounded by an eight-foot fence, which still isn't enough to keep out prowlers—which compels many growers to install razor wire (such as in that earlier photo). But it just so happens that in Douglas County, building codes ban eight-foot fences or walls; Dietz says he had to work around that requirement by building walls up to 15 feet high with support beams that technically count as structures (as seen in this photo). That forms a fortress-like barrier to satisfy the state's security rules and the local zoning regulations.
8. OTHER MEANS OF SELF PROTECTION Dietz also keeps a baseball bat by the door.
9. LIGHTING RIGS WITH VENTILATION A 400-square-foot room like this requires 4,000 watts of electricity, says Dietz, half of whose farm is indoors. Summer days in Eastern Washington often exceed 100 degrees, and these massive lighting rigs can scorch, so each lamp is encased in a ventilation tube that blows the heat outside so the plants don't wither.
10. MASSIVE AMOUNTS OF ELECTRICITY This large indoor facility in Eastern Washington, close to hydroelectric dams where electricity is cheaper, requires about a quarter-million watts of electricity for 250 lights. All that electricity travels through nerve centers like this one. For a farm with that many lights, right near hydroelectric dams, electricity costs about $4,000 a month. But in Seattle, electricity costs far more than that. Sea of Green is one-third the size of the Eastern Washington facility, yet estimates its power bill is $3,500 a month for its 7,000-square-foot garden. That's nearly three times the cost per square foot.
11. COPIOUS SUNLIGHT FOR OUTDOOR GROWERS The schedule for harvesting pot at this outdoor farm in Benton County, like all outdoor farms, is set strictly by Mother Nature. She controls the light switch (the sun), and at this northern latitude, daylight hours won't shorten enough to trigger flower growth until August or harvestable buds until October. The owner of this farm, who already owned the land and still spent $100,000 on start-up costs, says he put up the fences around the farm "when there was snow on the ground. One reason I could open as soon as I did is because I started spending money early." But the state didn't license many other growers in time. Due to early requirements to secure land before even getting a license, outdoor growers who could not plant early in 2014 won't harvest anything until fall of 2015.
12. COMPLIANCE WITH NEW EXCISE TAXES When voters passed a law legalizing pot in 2012, they also imposed a 25 percent excise tax at each stage of sale. "My price is $6 a gram plus excise tax," says Dietz, which raises the wholesale cost of a gram to $7.50. Others charge much more. But taxes are not necessarily where the biggest markups occur. Many retailers sell at double the price of their wholesale cost to make a profit, raising the price to $15 or $20 before taxes, then slapping another 25 percent tax on top for consumers. That can make a gram cost up to $25. "I think $20 including taxes is the new standard," Dietz speculates. The pot in this photo was $40 for two grams. The liquor board has the authority to lower tax rates in order to undercut the black market but so far has kept its hands off. "Every retailer wants more marijuana," Dietz says. "I am fortunate. There are not enough growers out there—there's not enough product, but that will change; there will be enough."
13. EXTENSIVE CUSTOM IRRIGATION SYSTEMS Even though well water is free, an irrigation system of spigots, hoses, and electric timers is required to water the plants.
14. COMPLIANCE WITH VERY SPECIFIC SIZE RESTRICTIONS The state has been strict about the size of farms—there are three tiers, ranging from 2,000 square feet to 30,000 (the largest we've seen are 21,000 square feet). State representative Cary Condotta, a Republican, says, "The economies of scale say a larger operation would lower costs. That is something for us to look at." And even then, there aren't enough farms. "The state needs more producers," Condotta says. He doesn't blame liquor-board members for going slow, but he predicts legislators will "make adjustments [to marijuana rules] in the next session" that begins in January. "The supply-and-demand issue will be settled in months, not years."
15. LADYBUGS—YES, HUNGRY, ADORABLE LADYBUGS Okay, not everyone needs ladybugs. But growers of indoor weed need some method of eradicating spider mites—arachnids that live underneath pot leaves and feast on the plants. Unchecked, they can devastate a marijuana crop. So to deal with them, growers use everything from soap sprays and tobacco juices to pesticides or chemical additives that can leave a residue on the plants. Or they use... ladybugs! These girls (and boys) eat spider mites without any mess. When we visited Sea of Green, they had just received a shipment of thousands of the critters, which were nibbling the mites, meandering among the planters, and flying through the through the air with their candy-apple wings. Leeds says that according to strict rules, "We can't say we're growing organic, but everything we're doing meets organic standards."