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MELISSA BLOCK, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Melissa Block.

ROBERT SIEGEL, host:

And I'm Robert Siegel.

This week, we've been talking about marijuana, specifically about the political and economic effect on states where its medical use is now legal. Business is booming in California, but in other states, the economic impact is proving harder to gauge. Montana Public Radio's Emilie Ritter reports on the relatively new medical marijuana business in her state.

EMILIE RITTER: The Montana Cannabis greenhouse sits just outside Helena city limits and houses around 1,500 plants. Its huge - at least half the length of a football field.

(Soundbite of greenhouse)

Mr. CHRIS WILLIAMS (Co-owner and Gardener, Montana Cannabis Greenhouse): This is actually skywalker. It's half mazar and half blueberry.

RITTER: Chris Williams is the head gardener and part owner in one of the states largest medical marijuana operations. On every square inch of floor space sits varying sizes of plants - some up to eight feet tall.

Mr. WILLIAMS: In the summer we actually stunt them a little bit because they'll grow, some plants, up to two, three inches in a day.

RITTER: Montana Cannabis started growing for 20 patients and now has more than 300. Williams and his business partners launched their grow operation in April of last year.

Mr. WILLIAMS: All of us had put together the financing we had, the equipment we had, our own personal savings and then a whole, whole lot of sweat equity.

RITTER: The three owners of Montana Cannabis invested a total $20,000 to start. Co-owner Tom Daubert says he cant think of any growers in the state who got traditional bank financing to launch medical marijuana businesses.

Mr. TOM DAUBERT (Co-owner, Montana Cannabis): I think most of the folks who were doing it started off with a lot of money, or they've got investors who have put up the money. There's a prevailing public image that this is an extremely profitable business. The reality is starkly different.

Mr. LYLE KNIGHT (CEO, First Interstate Bank): We're not here to discourage anybody from being an entrepreneur.

RITTER: Lyle Knight is president and CEO of Montanas biggest bank, First Interstate. His bank closed a handful of business checking accounts once it realized the business was growing pot.

Mr. KNIGHT: We are a member of the Federal Reserve System, and our primary regulator is the Federal Reserve System.

RITTER: Since medical marijuana is still illegal federally, Knight doesnt want to take the chance his bank could get punished for financing growers.

Mr. KNIGHT: The way I look at it, there's conflict and unknowns between federal law and state law. Our position is were going to let all this stuff get figured out first before we make a commitment one direction or another, so were just on the sidelines.

RITTER: None of the local banks whove opened business accounts for growers were willing to talk on the record. And since growers dont have to register with the state, getting information about how much money the industry generates is nearly impossible.

Montana's health department does require medical marijuana patients to register and pay a $25 fee for what's called a green card. So far, the state has collected at least $400,000 in patient fees.

(Soundbite of greenhouse)

RITTER: Back at the greenhouse, half a dozen employees stand at counter-height tables clipping buds, some are smoking it. Most of them are medical marijuana patients. Co-owner Tom Daubert says despite about $350,000 in sales last year, hes still not turning a profit.

Mr. DAUBERT: Last month we did in the neighborhood of $90,000 in sales, and that did not cover our costs.

RITTER: Thats because of $10,000 monthly utility bills, soil, nutrient and insurance costs. Since marijuana isnt taxed here, theres no real way for the state to keep a careful account of whats being sold. But Daubert says one economic measure is employment.

Mr. DAUBERT: I think almost everyone who's working for us right now would probably be living in some other state working construction somewhere where things are being built right now, were not for the opportunity and the option to work here.

RITTER: Montana Cannabis has 15 full-time employees with salaries up to $45,000 annually, and they all pay income taxes.

For NPR News, I'm Emilie Ritter in Helena.

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