Rapid growth of cannabis collective raises concern

Kareem Cokes at the Forty Acres lounge, where he helps patients select medical cannabis. Photos: Frances Dinkelspiel

In the 21 months since it opened, the Forty Acres Medical Marijuana Growers Collective has seen its membership jump to more than 7,000 people, making it one of the fastest growing and largest cannabis businesses in Berkeley.

From a set of rooms located above the Albatross pub on San Pablo Avenue, Forty Acres has become more than just a place where people can obtain and consume medical cannabis. Started by African-Americans, run by African-Americans, Forty Acres aims to bring diversity to the medical cannabis movement and use the rapidly growing industry as a way to open up opportunities for the poor and disenfranchised.

The leaders of the collective actively reach out to marginalized young adults and encourage them to enter the group’s training program, where they can learn the nuts and bolts of bud tending, cultivation, patient intake methods, and how to assess product.

“There is a population of kids, high school dropouts, who are coming to us to learn,” said Toya Groves, a director and one of the four co-founders of the group. “This is a way the unemployable become employable.”


The size and composition of Forty Acres has quickly turned it into a force to which city officials pay attention. In January, City Council member Max Anderson appointed Groves, 35, a graduate of Albany High and UC Berkeley, to both the Medical Cannabis Commission and the Zoning Adjustments Board. Many observers believe that when Berkeley hands out a license for a new dispensary sometime this year or next, it will go to Forty Acres. Currently, only three dispensaries are licensed under city law.

“They made a strong case that the African-American community deserves a spot in the emerging cannabis market and they would represent those who have not had access over the years,” Anderson said about Forty Acres. “They are representative of efforts to diversify the movement. They represent something very positive.”

But the respect officials have for the group may have also led the city to overlook some troubling aspects of Forty Acres, including the fact it appears to be violating zoning laws (somewhat ironic since Groves is in charge of interpreting zoning laws), is staying open later than permitted, and is acting as a retail dispensary rather than a private cannabis collective.

“They don’t have to follow any rules since they are illegal,” said one prominent member of the cannabis community, who like everyone else interviewed from that industry, asked to be anonymous. “Forty Acres is a place where you join and money exchanges hand for marijuana. It’s a dispensary.”

City law states that collectives, a group of people coming together to cultivate and share cannabis, shall only operate in residential parts of Berkeley. Forty Acres is run out of a former residential apartment, but one in a commercial zone on San Pablo Avenue.

In addition, critics point out that Forty Acres’ sheer size makes it more like a dispensary than a collective. Forty Acres actively recruits members online and at hemp fairs, has 21 staff members, sells bongs and other retail goods, and advertises its services online and in newspapers.

The collective also appears to be operating outside the time parameters the city sets for dispensaries. Berkeley law only permits dispensaries to be open until 9 p.m., but Forty Acres is open until 10 p.m. during the week, and until midnight on Friday and Saturday.

In addition, Forty Acres is not paying city taxes on the thousands of dollars of cannabis it sells, giving it an unfair business advantage, according to critics. Measure S, adopted by voters in 2010, requires collectives to pay taxes.

“Everybody has a problem with this,” said a member of one of Berkeley’s three dispensaries who asked not to be named. “We all have to pay our taxes, pay fees, get licenses. They are not doing any of these things. Everybody else is doing things above board. They are running a dispensary without a dispensary permit.”

The Forty Acres booth at the International Hemp and Cannabis Expo in Oakland in September.

Forty Acres is paying state taxes, and would like to pay city taxes as well, but was turned down for a business license, said Groves. “We would love to pay city taxes,” she said. “We are asking how we can pay taxes to the city of Berkeley?”

Concern about Forty Acres runs high because the stakes are huge. In November 2010, Berkeley voters authorized the creation of a fourth medical cannabis dispensary. Numerous groups intend to vie for the permit, but many think Forty Acres will have an advantage because Berkeley city officials are impressed by the collective’s size and diversity.

“They believe that by building a following it will make it that much harder for the city to say no to them,” said one member of the cannabis community who also asked not to be named. His group intends to apply for the fourth dispensary permit.

The competition is so fierce that at least two Berkeley dispensaries sent some of its members to surreptitiously join Forty Acres and scope out their activities, according to a source.

Wendy Cosin, Berkeley’s Interim Planning Director and the former secretary of the Medical Cannabis Commission, said it came to her attention in February 2011 that Forty Acres was advertising, and she wrote Toya Groves and Chris Smith, its director, an email requesting they stop:

“Hi Chris and Toya,

“I saw an ad in the East Bay Express for 40 Acres and am again concerned that you are illegally operating a dispensary. When we spoke a few months ago, you assured me that you were a residential collective. I don’t think a residential collective would advertise as you are doing. In addition, while I understand that you may be operating from a residential apartment, the ordinance does not allow collectives (other than dispensaries) in commercial districts. San Pablo is Commercial-West (CW), which is a commercial zoning district. By advertising, you are bringing attention to what technically may not be allowed, even as a residential collective. Please let me know what is going on.  Thx.”

Groves replied to Cosin later that day:

“We appreciate your concern and are currently looking into it.  We will follow up with you after the holiday.”

This Forty Acres ad ran in the East Bay Express.

Cosin did not talk further with Groves about the matter, she said. Forty Acres continued to run its ad in the East Bay Express for another six weeks, according to a check of the papers.

Cosin said she did not refer the matter to the zoning department because she never got a formal written complaint about Forty Acres.

“Enforcement happens if we get complaints or someone is causing problems with neighbors,” said Cosin. “If we received a complaint they were acting as a dispensary we would follow up, but we don’t go looking for violations. We respond to it, but don’t do it proactively.”

Some of the people working at Forty Acres. From left: Patrick Brown, who is in the training program, Craig Hiliard, one of the DJs, Chris Smith, a founder, and Toya Groves, a founder and member of Berkeley’s Medical Cannabis Commission and Zoning Adjustments Board.

Numerous members of the cannabis community said they had complained to the city and that Forty Acres’ operations were an open secret.

Groves, who became a cannabis patient in 2009 after her right arm was almost severed in a car accident caused by a drunk driver,  told Berkeleyside that she and Chris Smith, another founder, had once lived in the apartments now used by Forty Acres, so she thought that made them qualify to stay there. Also, they set up shop before the passage of Measure T in November 2010, which clarified the law on where collectives can operate. She also said there is no law prohibiting a collective from advertising.

Some people in the cannabis community think the city is taking a hands-off approach because officials want to encourage diversity in the industry. While the patients in the city’s three dispensaries are all races, the leadership is primarily white.

“They don’t know what to do,” said one dispensary member. “The people who run Forty Acres made a big stink [during meetings to talk about the ballot measures for November 2010] about how there wasn’t enough diversity in the medical cannabis community. They are hyping up that they are African-American owned and run and none of the other three dispensaries are.”

Groves disagrees with this assessment. “I am uncomfortable with people bringing up that we are playing the race card,” said said. “We are being ourselves. Our intentions are good.”

This dispensary member is concerned that permitting Forty Acres to violate zoning laws will set a bad precedent and lure dozens of other collectives to open up in commercial areas in Berkeley. If the city cracks down on the new businesses, they could just point to Forty Acres and say there is a precedent.

“If word gets out you can open a dispensary in Berkeley by not calling it a dispensary, we will have a 100 opening just like in San Jose,” said the man. “When everybody finds out Berkeley is open season, there is going to be mayhem. My worry is we are going to have a Wild Wild West kind of thing.”

City Council member Kriss Worthington had not heard reports that Forty Acres might be violating zoning regulations, but does not think the city is deliberately ignoring what is going on there. When Berkeley was considering placing new cannabis measures on the ballot, it became clear that there were many gray areas surrounding collectives, he said. While the city closely monitors dispensaries, it takes a hands-off approach to collectives.

“I don’t think the city bureaucracy is paying attention to what ethnicity a collective is,” said Worthington. “I think the city is not paying attention to collectives and has not been called upon to differentiate between collectives and dispensaries. If people are asking questions, then the city might be required to find out what the difference is.”

Groves, who is vice-chair of the Medical Cannabis Commission, has said one of her goals for the commission is to create a how-to handbook for collectives and dispensaries to eliminate confusion over what is and what is not permitted. She said the line between collectives and dispensaries in California law is not clear.

“There is nothing now that says what a dispensary should act like,” said Groves. “We don’t have a storefront (Forty Acres operates out of a second-story space) so we are not regulated via the retail laws.”

In the meantime, Forty Acres is trying to operate a safe space for people who benefit from medical cannabis. The African-American community, traumatized by poverty, discrimination, and violence, has been self-medicating with marijuana for generations, long before it was called medical cannabis, she said. People were forced to smoke pot in secret, and Forty Acres is trying to show people both how cannabis is a medicine that can help anxiety, depression, and post traumatic disorder from violence, and that it can be prescribed by a doctor, said Groves.

When Groves, Smith and the other co-founders started Forty Acres in December 2009, they found that many African-Americans did not know they could get a prescription for cannabis. To jump start the collective, Groves and Smith paid for 200 people to go to the doctor to see if they qualified for medical cannabis, she said.

One of the goals of Forty Acres is to change the equation, from where African Americans were consuming cannabis in secret, or dealing it on the street, to out into the open, said Groves. That’s why Forty Acres reaches out into the community and takes people are unemployed and trains them as cannabis entrepreneurs, she said.

“We don’t want to be illegal,” said Groves. “We want to be legal, to be transparent. We want to provide for our families. We want to open the door to other people.”

Clarification: 10.03.11: Berkeleyside changed the word “youth” to “young adult” to clarify that Forty Acres does not have anyone under 18 in the training program. When Toya Groves used the word “kids,” she said she was referring to people who may not have completed high school but were over 18. This may not have been clear. The words have been crossed out and replaced in the above article.