The Man Behind Prop. 19: Richard Lee on Marijuana's Chances

Few non-criminals can accurately be described as "marijuana entrepreneurs," but that's what Richard Lee is.

Since California legalized medical marijuana in 1996, he's become something of a cannabis commerce don in Oakland, opening up legitimate (depending on whom you ask) businesses around the activity of weed smoking: in 1999 he opened the Bulldog Coffeeshop, which has doubled as a medical-marijuana vendor to card carriers, and in 2007 he founded Oaksterdam University, a college that will teach you how to grow and sell marijuana at campuses in Oakland, Sebastopol (an hour to the North), Los Angeles, and Flint, Michigan.

He's pushed for legalization along the way, helping to pass a law in Oakland that effectively decriminalized marijuana and called for city a city taxation scheme. This year, California voters will pass judgment on his paragon effort to date: Proposition 19, the ballot initiative to legalize pot statewide.Richard Lee - Getty Images.jpg

Lee drafted Prop. 19 and put it on the ballot despite opposition from the established players in the marijuana legalization community. National groups like Drug Policy Alliance told him 2010 was a bad year and that 2012 would be better, given the broader turnout of a presidential race.

Staid voices in the political pot scene also told Lee he was writing it wrong. Prop. 19, as it was drafted, would only legalize possession and personal cultivation statewide; it would be up to individual cities and counties to allow, regulate, and tax commercial growth and sale, as well as public places (nightclubs, for instance) where pot could be smoked in public. This was wrong, Lee was told: a more statewide model--a mandated regulatory regime to treat pot like alcohol across the state, with the state collecting taxes--was the only way to sell legalization to the public.

Lee ignored that advice, spending over $1.45 million of his companies' money to put Prop. 19 on the ballot (it qualified in June, surpassing the needed 433,971 signatures), and here we are. Prop. 19 stands a reasonable chance of passing on November 2, with polls conflicted on its probable fate.

Find below an interview with Lee on legalization, its chances, and what will happen if Prop. 19 succeeds.

How is business at Oaksterdam?

It's good. We're bringing in lots of students form all over the country, so that's good for the city, selling lots of hotel rooms and other business for the city.

How many students do you teach per year?

We have about a hundred in our weekend seminars that we have a couple [of] per month, and then we have a few hundred students enrolled in our semester programs at any one time, we have three semesters a year, so we're over 12,000 now ... for the first three years.

Is marijuana going to be legal in Californa next year?

If Prop. 19 passes. It looks like at the moment it's going to.

You've put this measure on the ballot in 2010 against the advice of some other voices in the marijuana legalization establishment who thought that 2012 would be a better year. Why did you want to go ahead in 2010?

Well, I think the issue can't wait. We've been proven right that the campaign has made this a legitimate political issue, and it's been real nice to have a lot of the people who were against it last year call me up and thank me up and thank me this year for doing it.

Prop. 19 leaves it up to counties to establish regulation and taxation regimes, which was another thing people disagreed with. What's better about your bill?

First of all we had to do it that way because of federal law. We could not set up a positive conflict [with federal drug law], otherwise it would get thrown out in the courts--you understand the difference between mandating that you do something against federal law and just eliminating the state laws against it and changing the state law to allow cities and counties to break federal law. So really, we didn't have a choice.

As far as the different laws, we have that for everything else. Cities make up their own zoning and all kinds of other laws, so the argument that this is crazy and that it's only thing we do it for isn't true at all. We have different alcohol laws where cities decide what bars and restaurants and whatever can sell it.

Do you think the commercial licensing provision in Prop. 19, even though it doesn't set up a positive conflict, would survive a court challenge from the federal government?

Yes. The federal government can't change state law. They can't force the state to change its laws--there's pretty good case history on that.

What do you think the federal government's response will be if California legalizes under Prop. 19?

Well, did you see that Wall Street Journal piece about the Democrats looking to run more cannabis initiatives in 2012 to help them?

I did, and we've actually written about that idea too. [See Josh Green on the topic here.]

That can be a good sign that the Democrats see that this is an issue that's gonna help them, and so they're not gonna come out against it. Plus, Obama would have to come out against democracy and the will of the people voting, so I think there's a lot of reasons why they won't. But we don't know what they'll do.

At the same time, both Jerry Brown and Barbara Boxer have endorsed the No on 19 campaign. Were you surprised by that?

No, and honestly that may be helping us in the polls because there's such an anti-incumbent mood. We may have to send them a thank-you note, just like they will owe us a thank-you note for helping to get them elected by bringing out the young Democratic voters.

As of about a week and a half ago, neither of the two mega-donors in the marijuana legalization scene--George Soros and Peter Lewis--had chipped in on this. Is that still the case, or have you gotten anything from them?

Yeah, the last I heard they haven't.

Have you talked to them?

Uh-huh. They're looking at it. They're considering it.

Do you need an influx of cash at the end to put this over the edge?

I guess it depends on what happens with the opposition, if they raise a lot of money, whether we need to try to counteract their campaign.

If Prop. 19 passes, how many counties do you think will go ahead in the next couple years and allow for commercial sale and set up regulation and taxation systems?

There's about nine cities that halve already put adult cannabis tax referendums on their local ballots to be ready when Prop. 19 passes. Six cities passed adult legalization initiatives or resolutions back in 2006 or so. I think there's a number of places that will move ahead.

At times you've pitched this as a solution to California's budget crisis, but since counties would be reaping the tax benefit, do you think Prop. 19 can make a significant budgetary impact on the state?

Yes, and not just from the direct taxes but the indirect taxes, like I was talking about all the students we're bringing in from out of state [to Oaksterdam University]. Over half of our students, of our hundred first weekend seminars, are from out of state, so that's a lot of hotel rooms and jobs and taxes traded there, and all the other food and things people spend money on. When I go to Amsterdam, I spend more on hotels and transportation and everything else than I do on cannabis products, but I go there for the cannabis.

So it could be a boon to the California tourism industry.

Exactly, and some people have talked about how it could help the California housing market, 'cause there'd be a lot of people who say, "I'm going to move there where it's legal instead of worrying about being arrested here." California is losing population--there's a lot of people moving out of the state.

It's been argued that Prop. 19 would prohibit employers from testing...

That's not true. Go to our website and check out or legal opinions and everything.

Do you see any circumstance in which the federal government could deprive California of federal funding in response to Prop. 19?

Well, there is some history of the feds doing stuff like that with forcing the states to raise the drinking age to 21, otherwise they'd take away highway funding. But again it comes down to what helps get people elected, and as this issue now is starting to go past 50 percent, I think the politicians are realizing that it's not a whipping boy anymore, or an easy thing to just say you're against. Did you see the debate with Jerry Brown and Meg?

I didn't.

He didn't really come out against 19. He's been kind of waffling, realizing that this could help him a lot. so he didn't really come out against it this time...

He was against it, then he was neutral, now he's against it again but even his "against" isn't that strong. He's basically kind of said something about how we can't get compete with China if more people are getting high. It's not really very substantial debate on the issue.

So you're on the record as saying more people getting high will not hurt our competition with China?

Well, we don't know exactly how many more people will get high than now. I mean look at the kids: 85 percent say they can already get it, and 40 percent do, and you go to the Netherlands where only 20 percent of the kids do it, so it makes you think it's like the forbidden fruit, and other things are actually increasing consumption. So there's no definite proof that it's gonna go up.

Do you think the Prop. 19 model, as opposed to mandated statewide regulation, is going to become a model for other ballot initiatives in 2012 in different states?

Exactly. Colorado has two initiatives people are working on already for 2012, and Washington state I'm sure will try again. They were working on one this year but didn't get enough signatures, and Oregon and maybe Massachusetts and Michigan have a lot going on too.

Aside from a court challenge, do you think that if a few counties legalize commercial sale that federal law enforcement will try to shut it down?

I think it'll most likely be similar to the history of Prop. 215 [which legalized medical marijuana in California in 1996] where the feds did come in and harass and bust a few people, but in the long run they're losing the war, and here were are 14 years later and they haven't been able to stop that either.

The other thing you gotta remember is, you know about [state Assemblyman Tom] Ammiano's bill, so that will theoretically--if the legislature could ever get it together to pass it, and if the governor would sign it--it's a statewide system of regulation, and then the other thing a lot of people say is that there is no immediate taxes because you know it waits on the locals to put it in their tax provisions, sales tax would be collected immediately just like it's already, the Board of Equalization says they're already collecting about $105 million a year from the medical dispensaries, so there would be sales taxes on the adult cannabis as well as the local taxes until the legislature gets together and can do state excise taxes.

If Prop. 19 doesn't pass, are you going to try again in 2012?

I'm sure there's going to be an effort in 2012, so we'll see what happens.

If you guys pass this, what do you think the reaction will be in the rest of the country?

I think there's gonna be a lot of hope given to a lot of people out there that laws are gonna change around the rest of the country, just because historically things have started in California, just like they did with medical marijuana, and a lot of other social rights issues.