In the shadows of these snow-capped B.C. mountains, small growers are running a billion-dollar industry
NELSON, B.C. — Down a short driveway nestled in the woods and pocked with potholes, a hulking cannabis-production facility sits hidden from the eyes of law enforcement and thieves.
“Phil”, a medium-to-large-scale cannabis producer, invited Postmedia to his facility in B.C.’s Kootenays region under an agreement that his identity and location would be protected.
He stands outside the building in a black T-shirt, a warm smile on his slender face.
Since the early 1970s, the southeast B.C.’s Kootenay-Rockies region has been a key player in the nation’s cannabis industry — in the shadows of snow-capped mountains, scattered along the grassy banks of glassy rivers, a billion-dollar black market quietly keeps Canadians stoned.
Some 150,000 people live here, many of them farmers who have set aside patches of land and corners of chicken coops to cultivate small crops of lush indicas and sativas — infamous “B.C. Bud” that is estimated to comprise 40 per cent of the cannabis produced in the nation.
Police and industry insiders believe thousands of these small growers contribute to this aromatic cash crop, estimated to be worth anywhere from $2 billion to $7 billion province-wide.
Phil is kind but exceedingly cautious. He gently reminds us about the agreement to protect his identity, made for the sake of his wife and children, employees, his crop, and industry colleagues.
He says he fears “prosecution and persecution,” but wanted to speak out about concerns that impending legalization will destroy his industry.
Inside, the facility is divided into rooms for mothering and trimming, propagation, growing and budding.
In the trimming room, dozens of potted cannabis plants grow shoulder-high. Motorized lights slide back and forth. Fans gently hum.
In 2011, Phil began to acquire Designated Person Production Licences under Canada’s now-defunct Marihuana Medical Access Regulations (MMAR) that continue to allow him to grow 294 cannabis plants. From these, he is permitted to legally supply 60 grams of dried cannabis each day to a trio of patients he met through a trade organization.
Sometimes, producers like Phil grow more than their patients will buy. They are required to destroy this excess cannabis, but don’t. It winds up in dispensaries across the country.
The federal government maintains that the only legal commercial sources for marijuana are the 35 Licenced Producers authorized by Health Canada, who operate with licenses issued by Health Canada under the Access to Cannabis for Medical Purposes Regulations (ACMPR). Illegally supplied dispensaries and compassion clubs are not authorized to sell cannabis for any reason. Police have the power to shut them down.
Phil explained that he sells some of his crop to a trio of dispensaries. He wouldn’t divulge details about this arrangement, but said many producers do this because growing for sick patients —many of them on income assistance —can be a money-loser for producers as they struggle to pay down massive debts from the cost of building facilities, purchasing supplies and paying wages.
They fear such cozy arrangements will fall apart if the licenced producers seek to have their black-market competitors shuttered when legalization arrives.
Sgt. Mike Wicentowich of the RCMP’s provincial general investigation section has been involved with enforcement at hundreds of cannabis facilities in the Kootenays since 2000, when one of his first investigations was of a shootout over an outdoor grow.
“If you’re growing it illegally, we still treat it like a crime — that’s the directive,” he said. “But the legal ones, it’s actually refreshing. We’ve taken a lot of work off our plates as police so we can focus on other things, and we’re focusing on the harder drugs, which I do believe are way more destructive.”
With the cannabis industry, explained Wicentowich, police are primarily concerned about organized crime, the proximity of production facilities to schools and residential neighbourhoods, and the violence that can occur when valuable crops are ripped off by thieves.
He has worked cases of growers in the Kootenay region being assaulted, tied up, or shot at for their crops.
Within the Kootenay area, specifically, the mom-and-pop growers — the small guys operating legally — were targets of violent criminals doing home invasions with weapons,” he said, noting that often such ripoffs aren’t reported.
‘There was one particular incident where two men using imitation firearms attempted to rob a medicinal grow in the Slocan Valley, and actually one of the gunmen got stabbed.”
Wicentowich said Kootenay police are also aware of the flow of cannabis from small producers to dispensaries.
But as long as a dispensary is a “well-run place that is respectable, that is open to the police, that allows inspection, that doesn’t sell to kids, that monitors and regulates,” officers won’t be in a rush to shut it down, Wicentowich said.
Within the Kootenay area, specifically, the mom-and-pop growers — the small guys operating legally — were targets of violent criminals doing home invasions with weapons
“The fact that we have these things is going to pull it out of the darkness, bring it into the light, make people feel safe, and probably reduce any kinds of violent crimes or robberies associated with marijuana trafficking.”
Detective Const. Nathaniel Holt of the Nelson Police Department said most complaints about cannabis producers come from neighbours upset about the smell.
Following any complaint, Holt’s first call is to Health Canada to confirm whether the producer has a license. If the producer has that paperwork, police aren’t legally authorized to stop them. Some flout this, but the majority do not cause problems, Holt said.
“Really, a lot of these people don’t want to be known,” he said. “They’re running a legitimate business that there is inherent risk involved in, and they don’t want to attract attention to themselves.”
Federal data shows there were 59 people charged with cannabis production in B.C. in 2015, down from 361 in 2011. By comparison, in Ontario, 271 people were charged in 2015, down from 363 in 2011. In Quebec, 683 people were charged, down from 997 in 2011.
Phil said in his five years in the industry, he has never rubbed elbows with organized criminals, whom he believes have turned to more lucrative drugs such as fentanyl and amphetamines.
“Most gangs aren’t actually interested in growing marijuana because it is very costly, it takes a long time to produce, it is risky.”
In Phil’s facility, a trio of trimmers — two women in their 40s and a man in his 20s — sit around a long table piled with clear tupperware bins labelled with the names of his proprietary strains. They wear blue nitrile gloves and use scissors — lubricated with organic olive oil — to snip leaves from pungent buds the size of hot dog buns.
Employees are cherished for their discretion. If a thief were to get wind of a producer’s grow cycle, it would put the crop at great risk.
Phil has three regular employees, with at least a dozen more on call for trimming days. They earn $20 to $30 an hour, based on experience.
He believes more than half of Kootenay residents are connected to the cannabis industry. They are part of a tightly knit community that meets for “shop talk” and helps members through hard times caused by insects, heat or humidity. Many depend on the cannabis industry to fund other non-cannabis business ventures and top up meagre wages.
“A lot of them are very quiet about it,” Phil said.
Michelle Mungall, the MLA for Nelson-Creston, doesn’t deny the role that cannabis plays in her riding.
“The type of industry that’s grown under the black market is very much a craft industry, so if we lose that craft industry, the big question for us is, ‘What will be the outcome on our local economy?’ Everyone predicts that it will be negative,” she said.
Mungall draws similarities between the cannabis and brewing industries, with room and demand for large-scale brewers such as Molson, but also space for local micro-brewers such as Nelson Brewing Company.
She believes cannabis users should be able to choose local craft cannabis.
“All of these (brewers) have a particular market and are doing quite well. They generate revenue for government, they generate jobs, they contribute to a local economy, and there should be no reason why marijuana is treated any differently.”
We step outside Phil’s facility and back inside through another door that brings us into a small storage room. Here, he has posted his three MMAR licenses, the patients’ identities blacked out by electrician’s tape to protect them.
He slips on an LED headlamp and opens a second door taking us into a pitch-black space where a row of plants are in their dark cycle to trigger budding. We stumble onward to yet another door, which Phil swings open to reveal blinding white light.
We quickly step into a white-paneled room the size of a two-car garage. Inside, a complex network of hoses and pipes feed nutrients and water to dozens of plants, some two metres tall, basking in the warm glow of lights with parabolic reflectors.
Phil pulls three pairs of sunglasses from his pocket.
Typically, he has six or seven strains growing, but today there are 13, including a sativa, a couple of indicas and some hybrids. He sniffs a bud the size of a Twinkie.
“It’s important for small-scale growers to be a part of the system because we offer much more diversity than bigger companies and corporations,” Phil said. “We’re always changing with the needs of the public and what the patients need.”
In Nelson, Alison VanNest, Chander Nath and Lita Moth run the Kootenay Compassion Collective. Inside are cozy rooms with massage tables and a place where patients can relax on couches.
Nath explained that all their products are sourced locally. They work with small growers to bring in strains requested by patients and fine-tune their stock to address particular ailments and needs.
“The level of integrity of growing is higher, people are personally involved and there’s a personal connection,” Moth said of the small growers they work with.
But there is fear about a new regulatory regime and how it might affect the producers who supply them. Moth said the industry plays a vital role in the generation of revenue in the community and the provision of well-paying jobs with flexible hours.
“You’ll see a lot of moms … involved in the propagation and harvesting of cannabis,” Moth said. “These dollars that are generated go right back into the economy.”
Chris Campbell, owner of the Nelson Potorium, also counts herself among those who may suffer if the black market industry is dismantled.
“The cannabis industry is a big part of our economy here, whether it’s acknowledged or not,” she said. “It would definitely affect the area if that was taken away.”
Cannabis and extracts sourced from Kootenay growers and tested by quality-assurance company Wagon Wheel Labs are displayed prominently inside a glass display case in her dispensary on the city’s downtown strip.
These products were meant to be destroyed by licenced producers but are instead “donated” to her store, she said.
“My experience is, certainly in this area, that the smaller producers have a more artisanal feel to their craft. They’re concerned about the quality, especially if it’s medicine for themselves.”
But not all are singing the praise of the black market small-scale growers.
The Cannabis Canada Association represents 900 workers and about 60 per cent of the companies regulated by the ACMPR, including major licenced producers such as Aurora Cannabis, Tweed Marijuana and Mettrum Health.
Executive director Colette Rivet called the licenced producer system a “gold standard,” recognized globally, and said the existence of the black market puts these producers at a disadvantage.
Rivet said licenced producers must keep their cost below the black market to ensure patients can access affordable cannabis. Operators and investors sink millions of dollars into establishing facilities capable of producing cannabis that meets stringent federal health standards. They are required to report to Health Canada how much they grow, sell and destroy.
With black market cannabis, there is no guarantee of quality and safety, she said.
“For instance, if you grow cannabis out in the field or a grow op, there could be enormous amounts of pesticide, fungus, mould. Because they don’t test, you don’t know what you’re ingesting.”
Rivet said licenced producers would have no authority to push out the small illegal growers. Could both co-exist within a legal system?
“The bottom line is we’re going to work within the law,” Rivet said. “So will there be room? It all depends on the government.”
Ian Dawkins, executive director of Cannabis Growers of Canada, which advocates for the inclusion of small- and medium-sized firms in the country’s legal marketplace, said he has had a positive conversation with B.C. Premier Christy Clark but has heard nothing from federal officials.
“I’m suspecting they hope that the problem will magically go away,” Dawkins said. “The rhetoric is that they consider everyone that we represent to be an illegal business who should be stamped out.”
An economist’s report commissioned by Dawkins’ organization took tallied 16,000 people licensed to work in the cannabis industry in Colorado. Comparing the state’s total population to that of B.C., the report estimated 13,700 people could be working in the province’s cannabis industry.
In California, where the population is comparable to that of Canada, there are an estimated 100,000 people employed in businesses related to marijuana, according to the California Cannabis Industry Association.
“These are real people with real full-time employment in the cannabis economy, paying for their families,” Dawkins said of B.C.’s cannabis workers. “These are basically seasonal agricultural jobs out here in the rural British Columbian communities. If that suddenly goes away, it’s not going to be replaced by anything. The licensed producers aren’t going to come to Nelson and hire 1,000 cannabis trimmers [and] dispensary staff. So, if all these people are unemployed, what’s the plan?”
Outside his facility, Phil tells us he wants Prime Minister Trudeau to consider that a system based on licenced producers and mail-order cannabis may not be what all Canadians want.
“I don’t know that legalization will actually bring anything good for small-scale growers,” Phil said. “I worry that our government is going to do what it has done before with many other industries, which is allow a monopoly to basically steal what began as a mom-and-pop industry in British Columbia, with a very loosely knit community of growers throughout the province — thousands of growers strong, producing very small amounts on a monthly or tri-monthly basis, but cumulatively adding up to a large economic engine.”
As our car rumbles down Phil’s driveway, his secret is swallowed up by the forest.
The pungent, piney aroma of Phil’s crop has clung to our gear and clothing, and lingers in the air.
Back in town, no one seems bothered by the smell.
