Will Legalizing Marijuana Create Modern Bootleggers Across New England?

Sep 27, 2016

States that have legalized marijuana are contending with a new criminal tactic - smugglers who grow and process it for export to states where it remains illegal - and worth a lot more.

Colorado is the epicenter of the phenomenon, and it’s popping up in Oregon and Washington too. As Maine, Massachusetts and Canada consider legalizing recreational marijuana, the question arises - will the Northeast see a wave of new-age bootleggers?

During the Prohibition era, it was whiskey being run from Canada or Mexico to the U.S. Now it's marijuana that's being smuggled from Colorado, where it's been fully legal since 2014, to neighboring states and beyond.

It’s Andrew Freedman’s “number one concern.” Freedman directs marijuana policy for Colorado Governor John Hickenlooper. He says organized criminals are exploiting legal loopholes by collecting home-grow licenses that allow for as many as 99 marijuana plants each. And, he says, criminals are using the state's fully legalized pot economy as cover.

"Different ways you can use Amendment 20 and 64, the medical and the recreational, to kind of cloak yourself in legitimate growing,” said Freedman. “Unfortunately there are a lot of people who want to do that in order to sell out of state because there's a huge economic incentive to want to sell out of state right now."

For example, a pound of pot worth about $1,500 at the counter of a legal Colorado marijuana shop is worth 3000 dollars or more when it crosses the state border; instantly transmuted into a prized black-market commodity. And criminal gangs are moving in, creating a headache for Colorado law enforcement, danger to public safety, and a field day for the media.

The U.S. Drug Enforcement Administration says last year state highway patrols intercepted more than 3,500 pounds of marijuana destined for states beyond Colorado's border. That's just a tenth, they estimate, of the actual cross-border market - making it, conservatively, a $100-plus million dollar proposition.

And those numbers do not include busts of some pretty big syndicates – many of them recently involving Cuban nationals shipping high-potency product to Florida.

And for Colorado's neighboring states, it's a doubly-frustrating problem, because it’s not of their making.

"In Nebraska, Colorado's become ground zero for marijuana production and trafficking,” said Jon Bruning, Nebraska's Attorney General. He and his counterpart in Oklahoma are trying to sue Colorado and force it to overturn its marijuana laws.

"This contraband has been heavily trafficked in our state,” said Bruning. “While Colorado reaps millions from the production and sale of pot, Nebraska taxpayers have to bear the cost. Virtually every aspect of Nebraska's criminal justice system has experienced increased expense to deal with the interdiction and prosecution of Colorado marijuana trafficking."

One Nebraska study found border counties saw gradual increases in pot-related arrests, jailing’s and costs since medicinal marijuana was legalized in Colorado, and a surge in 2014, when the recreational pot law went into effect.

Marijuana advocates caution, though, that such statistics may be skewed by changes in enforcement strategies over time. The U.S. Supreme Court recently declined to review the complaint by Colorado's neighbors, which are looking for other venues to pursue their case.

Meanwhile, here on the East Coast, voters in Massachusetts and Maine are considering full legalization on the November ballot. Canadian Prime Minister Justin Trudeau is calling for legalization there. If any or all of those measures are approved, police in neighboring states are bracing for some new challenges.

Andrew Shagoury is the New Hampshire State Police Chief’s Association point-man on pot. If Maine or Massachusetts does go for legalization, he expects that at the least, problems such as small-scale smuggling and intoxicated driving will spill over the borders.

"If more does spill over, the direct effect I suspect will be more accidents with people under the influence - obviously that would be a public safety concern,” said Shagoury. “And I think politically you'd see more pressure for it to pass here too."

Massachusetts Attorney General Maura Healy expects organized crime to open up new fields of operation.

"What's going to stop a drug cartel from purchasing property, renting property here and running an operation at the property?” said Healy. “And that's something that could be situated next to a school, next to a hospital, in a suburban neighborhood. That's a real problem."

But some note that Colorado neighbors such as Nebraska and Oklahoma have relatively strict marijuana laws, creating a strong incentive for smugglers there. In New England there is a more relaxed culture around marijuana - every state in the region, except for New Hampshire, has decriminalized possession of small amounts of pot, and allowed use of medicinal marijuana - perhaps reducing potential black-market demand.

Essentially, says Vermont's Attorney General, William Sorrell, Vermonters are already growing enough pot to meet most of their smoking needs. But Sorrell is worried about the introduction of edible marijuana products into the regional marketplace.

"And I really think the regulators have to do a lot more effective work on quality control so that buyers know what is the THC content, what is a legitimate serving or portion because I think there has been and will continue to be a problem with over-ingestion of marijuana,” said Sorrell.

There are specific parts of the measures in Maine and Massachusetts that could make it harder for criminals to aggregate licenses for big grow operations. And there are provisions to regulate THC content. Alysia Melnick, communications director for the legalization campaign in Maine says there is much to learn from the Colorado experience.

“The way that the Maine initiative was designed was intended to limit the grow space, to provide for the Maine market in a way that did not overproduce and invite any kind of diversion,” said Melnick. “That's something that Maine will pay attention to and adjust if there needs to be adjustment in the future."

Melnick and other advocates of ending pot prohibition point to what they believe would be the most effective way to end the black market economy: legalize marijuana in every state.

This report comes from the New England News Collaborative. Eight public media companies coming together to tell the story of a changing region, with support from theCorporation for Public Broadcasting