It didn’t take long for green thumbs to invest in the medical marijuana industry after Oklahoma voters approved State Question 788 in 2018.
Since then, dispensaries have been popping up throughout town, but behind the scenes is the ever-expanding network of grow houses in Oklahoma. On the Oklahoma Medical Marijuana Authority’s list of licensed commercial growers, there are at least 143 operations in Cherokee County alone, although it’s unclear how many are currently functioning.
Forty-seven growers have Tahlequah listed as their primary location, including Gold Leaf Farms, where Julie Dixon and her boyfriend, David Jones, took advantage of an opportunity presented by Dixon’s mother. When she was left with a 45-acre farm after her husband died in September 2018, she asked Dixon if she wanted to start a grow operation. Both of Dixon’s parents were proponents of S.Q. 788, and she knew the positive impact it can have.
“We thought about it for a while, because it’s a huge risk you’re taking,” Dixon said. “You don’t know if the feds can come in at anytime and shut down your operation. You don’t have a bank, so you can’t necessarily get loans for these kinds of things. So it’s a little bit challenging, but we saw an opportunity and are trying to make it work.”
Oklahoma has become open territory for those hoping to establish themselves in the cannabis industry. Following other states that already legalized marijuana either recreationally or medicinally, the Sooner State has seen piles of cash flow through.
The Oklahoma Tax Commission reported medical cannabis retailers collected more than $831 million in revenue in 2020. Meanwhile, the industry nationwide is worth around $60 billion, and some analysts believe it could grow to $100 billion in a few years. But with most ventures, it takes money to make money.
Grow operators have initial licensing fees to pay for, as well as a myriad of equipment, such as lights, fans and dehumidifiers.
“And then, of course, the electric bills,” Dixon said. “Those are crazy.”
The job of a grower – especially for family-run ops – requires long hours and extensive research. The weather is a big factor for outdoor cultivators, which makes growing indoors even more important. Jones said they’re planning to finish a new barn at Gold Leaf so they can have more plants under a roof.
“Our niche is the high-quality weed. A lot of growers just grow outdoors and do quantity over quality. We’re going for organically grown, high-quality, top-shelf stuff,” Jones said. “We spent a lot of time studying, researching, listening to podcasts and watching YouTube, but the good things we’ve learned have come from doing it ourselves.”
Some operations span 100 acres and include multiple grow houses; others function with one or two small rooms. No matter the size, Okies won’t see evidence of their existence, as growers are supposed to keep facilities out of sight, which helps with security.
“The best thing is just don’t go blabbing about where your grow is,” Dixon said. “To have it remotely out on the farm was ideal for us. Trying to do an operation incognito in town probably wouldn’t work as well as being out in the country, where you know your neighbors.”
But there is a concern that of the many hidden green farms throughout Oklahoma, not not all are above board. Ryan Cooper, owner of 420 Gardens LLC, believes that “mega-grows” are interested in producing as much cannabis as possible, rather than ensuring their products are of the highest standards. He says some are even contributing to the black market.
“From my experience, these large farms are growing more or less for processors,” said Cooper. “They’re processing that probably into a distillate or a product they’ll take that and make edibles with. That’s easier to transport across state lines than it is bulk flower, and it’s being diverted into the black market.”
There is evidence to back up Cooper’s claim. In late April, the Oklahoma Bureau of Narcotics raided 20 greenhouses in Guthrie they say were part of a black market industry. An agent for OBN reportedly believes 10 of the people who were detained are from Taiwan and China, which leads to Cooper’s next theory: Many grow operations are being funded by out-of-state or out-of-country sources.
“We’ve had a very bad influx in the state of what we believe is a foreign investor coming in and playing the game on how the state question works,” he said. “That law established the business had to be owned 75 percent by somebody in Oklahoma – a resident of Oklahoma – and could only have 25 percent investment from out-of-state sources. Unfortunately, they kind of dropped the ball on what the clarification of a resident was. So basically, anybody who came in and bought a piece of property and established utilities in their name… is considered a resident.”
According to the BBC, one Oklahoma City attorney who helps clients secure cultivation licenses estimated he has about 300 Chinese clients. Oklahoma Gov. Kevin Stitt recently signed legislation that will require medical marijuana businesses to disclose any foreign investments. Failure to disclose information would result in the immediate revocation of the license.
The bill was originally requested by Oklahoma Attorney General Mike Hunter.
“The issue of foreign investors purchasing land and facilities in Oklahoma to get into the medical marijuana business is something folks in my district are increasingly concerned about, and one that is a concern throughout the entire state,” said State Sen. Casey Murdock, R-Felt. “This bill is aimed at creating transparency and accountability in our medical marijuana statutes when it comes to foreign investments.”
That was the not the bill’s initial intent; it originally placed a limit on the number of active medical marijuana commercial licenses. The state has around 10,000 active commercial licenses, according to the Oklahoma Medical Marijuana Authority. This legislation would have eventually cut that down to 8,000: 5,000 growers, 2,000 dispensaries, and 1,000 processors.
But the idea of preventing people from attaining licenses didn’t sit well with many. The Coopers, who run a small, micro-grow, think a free market is better than a limited one, even if wealthy investors are opening mega-grow ops.
“I’m for an open market,” he said. “Right now, we’re in the infancy of our industry and we’re leading the country in it, in our three years of operation. I think a free market, in time, will adjust itself to the level it’s going to support. Five years is not an unheard-of time to achieve that, and we’re just halfway there. I think a free market will sort all of that out.”