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Marijuana's Black Market: Will It Stay Or Will It Go?

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Marijuana's Black Market: Will It Stay Or Will It Go?

Marijuana's Black Market: Will It Stay Or Will It Go?

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STEVE INSKEEP, host:

In most of the country, marijuana remains illegal. But in states that have approved marijuana for medical use, it has created many gray areas. Consider the state of Colorado: 65,000 people have signed up for Colorado's medical marijuana registry in the past nine months. Many have started shopping at the state's growing number of dispensaries.

This booming industry is creating a headache for state regulators and law enforcement. Now, all this week, NPR is taking a look at the new marijuana and today, Colorado Public Radio's Megan Verlee asks what all these changes mean for the old marijuana market: the corner dealer.

MEGAN VERLEE: To figure out what's going on with the marijuana black market, I talked with economics professors; I talked with law enforcement; I pestered defense attorneys; I even found a dealer - who wouldnt talk on tape. But - and I know it's a stereotype - everything they all said, you can pretty much learn it just by chatting up the crowd at a jam-band concert. I met these girls trying to score tickets outside a sold-out Disco Biscuit show, in the college town of Boulder.

Unidentified Woman #1: Well, I haven't bought any weed from anyone beside the club since I got my card, like, a month and a half ago.

Unidentified Woman #2: And I mean I don't even have my card and I still haven't bought it from anybody though(ph) - it's like, 'cause all of my friends have their cards.

VERLEE: If you're a pot dealer in Colorado, Andreana, Rebecca and Libby here might just be your worst nightmare - college girls with disposable incomes and medical marijuana cards.

Unidentified Woman #3: It's just way safer, it's better quality, and you just, like, I don't know, it's just way easier.

Unidentified Woman #2: I mean I don't think I've dealt with, like, a drug dealer in, like, months.

Unidentified Woman #3: It's kind of nice.

(Soundbite of laughter)

VERLEE: A year ago, Colorado only had a handful of dispensaries. Today, there are hundreds. Many of their customers must have been buying from somewhere before. The rules of economics should dictate that as people move into the above-ground market, the underground shrinks, right? Patrons here seem to back up that idea. Dealers complain about a bad economy, losing customers.

This girl says the friend she buys from is having a hard time.

Unidentified Woman #4: It's really tough. It's slow. It's people that aren't, like young, or older people, or people that don't have the money, that get their cards.

VERLEE: Those who are still buying illegally give a couple of reasons: They're comfortable with their dealer, or they don't like the idea of putting their name on a government registry, even one that's supposed to be confidential. And then there are those like this young man. He flew in from the East Coast that day for the concert, and spent the afternoon price-shopping marijuana.

Unidentified Man: We found that if you go to a dispensary, it's more expensive; if you go through a buddy, least expensive. Speaks for itself.

VERLEE: Of course, there's no consumer price index for pot in Denver, but Commander Jerry Peters has a pretty good idea. He heads a drug task force in the metro area.

Mr. JERRY PETERS (Drug Task Force Commander): An ounce of marijuana goes anywhere for - between 270, 280 to about 400 an ounce, the average being about 300 an ounce, roughly, that we're seeing in different dispensaries that we see. In the black market, though, when we're out making buys, we buy an ounce of marijuana, it's about 150 bucks.

VERLEE: That's a 100 percent markup just to go legit.

With a difference like that, Peters thinks there will always be enough price-sensitive smokers out there to keep some kind of black market afloat. But the dealers who've stayed underground may soon be seeing a bit more competition.

Here's why. Until recently, Colorado had no statewide regulations for marijuana dispensaries or growers. And that led to a gold rush - or a green rush, if you will - of entrepreneurs trying to stake their claim on the market. Now, legislators are reining that in, making it harder to get a doctor's recommendation, and outlawing people with felony drug convictions from working in the industry. That may force some dispensary owners back into the black market.

Denver attorney Rob Corry specializes in medical marijuana law.

Mr. ROB CORRY (Attorney): I've heard this from at least a half-a-dozen people in the past two or three days. They say, I'm easily accustomed to doing it underground, I've done it underground for 10 years, and I'll just go right back to it.

VERLEE: If Colorado succeeds in closing some of the loopholes in its medical marijuana law, it could be a mixed blessing for the state's dealers. They might regain some market share, but they may also have to fight harder for their piece of it.

For NPR News, I'm Megan Verlee in Denver.

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