Study: Medical marijuana will create 1,500 jobs in Arizona

Apr 23, 2013, 8:04 AM
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PHOENIX — When Arizona voters approved the use of medical marijuana in 2010, Steve Cottrell saw a way to combine his laboratory background and his interest in the plant he’d been studying since his 11-year-old son died of cancer more than a decade before.

Cottrell is now the owner of AZ Med Testing, a medical- marijuana testing laboratory. Dispensaries pay Cottrell and his business partner, Brenda Perkins, to test marijuana samples for mold and pesticides.

“We’re making money, but we definitely have our challenges,” he said. “But now that dispensaries are open, it’s moving forward.”

According to a study sponsored by the Regulated Dispensaries of Arizona Association, the jobs at AZ Med Testing are among estimated 1,500 that will be created by Arizona’s medical-marijuana industry.

Tim Hogan, an Arizona State University research associate who authored the study, used information from Oregon’s established medical marijuana industry to estimate the size of Arizona’s market

“It’s a pretty simple industry,” he said. “There’s not too much nuance. The main driving mechanism is how many patients.”

Hogan found that the industry had the potential to create not only 1,500 direct jobs for marijuana growers and dispensary employees but up to 5,000 indirect jobs at places like grocery stores.

Arizona has approximately 38,000 medical marijuana cardholders and is allowed 126 dispensaries, a percentage of the state’s operating pharmacies. Only a handful are open now.

Hogan said his study models only the straight economic impact of the industry instead of offering a more extensive cost-benefit analysis. The industry is small but should contribute to Arizona’s economy, he said.

“Given the size of the industry, it seems it will generate substantial income and tax revenue,” Hogan said.

In Colorado, which legalized the use of medical marijuana in 2000, dispensaries brought in nearly $200 million in sales and paid about $5.5 million in state sales tax in 2012, according to that state’s Department of Revenue.

Beth Wilson, an economics professor at California’s Humboldt State University and a faculty member in the school’s new Humboldt Institute for Interdisciplinary Marijuana Research, said much more study on medical marijuana is needed.

She said it’s possible that more states legalizing the drug for medical or recreational use could lead to marijuana megafarms run by tobacco companies instead of small businesses.

“No one can know for sure what the impact is,” Wilson said.

Michelle LeBas worked as an office administrator at a car dealership before becoming a dispensing agent at Bisbee’s Green Farmacy Natural Relief Clinic. She verified that patients have valid medical marijuana cards and then teaches them about different strains of the plant.

LeBas said the dispensary, which has three employees and an on-site doctor, faced scrutiny when it opened in late March.

“People just thought it was an excuse for stoners to do it,” she said. “But we’ve overcome that and we have people coming in here that genuinely need it. We’ve given them a completely new form of care.”

Green Farmacy Natural Relief Clinic serves about 100 patients and has provided 25 with new medical-marijuana cards.

Maricopa County Attorney Bill Montgomery has sought to block the state’s medical marijuana law since it went into effect. He said any study that discusses medical marijuana’s possible economic benefits is inherently flawed because the state loses more in criminal prosecution.

“It’s crock,” Montgomery said. “None of those studies that purport to show an economic impact take into account the criminal impact.”

It’s important to remember that all marijuana is illegal at the federal level, said Carolyn Short, chairwoman of Keep AZ Drug Free, a committee that formed in opposition to the 2010 ballot proposition that legalized medical marijuana.

She said economic models like the study commissioned by the Regulated Dispensaries of Arizona Association have to be done in a bubble because every part of the medical marijuana business violates federal law.

“Every single time a dispensary sells a joint or an ounce, they’re doing something illegal,” Short said.

At AZ Med Testing, Cottrell said the possibility of federal prosecution or a raid by the Drug Enforcement Administration hangs over his head each day. However, he said he remains focused on doing his job well.

“Sure, they could come down and knock our door down and arrest us for this plant material,” Cottrell said. “But there’s far more dangerous non-law-abiding people who are doing a lot worse than testing plants for pesticides, and we have to believe the DEA is going after them.”

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Study: Medical marijuana will create 1,500 jobs in Arizona