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Airone has said that he believes the burden on charitable organizations was an unintended consequence of Prop 64.
by Danielle Simone Brand · October 15, 2018
Sweetleaf Collective is a charitable organization founded in 1996 to provide free medical cannabis to those in need throughout the Bay Area. Primarily serving low-income HIV/AIDS and cancer patients via bicycle delivery, Sweetleaf was originally founded and run on a volunteer basis, using excess flower and shake donations from farms in Humboldt County. For the first ten years, Sweetleaf’s founder Joe Airone did the bulk of the work—accepting donations, communicating with patients, and organizing volunteers.
Recipients of Sweetleaf’s free medical cannabis face such severe health and financial challenges that many would not be able to afford both food and medicine. Patients like Ed Gallagher, a 67-year old blind veteran diagnosed with HIV, rely on Sweetleaf’s free medical marijuana for the three most common needs among seriously ill patients: appetite stimulation, pain relief, and mood elevation. For many patients, the cocktail of medications they must take to treat or control their condition robs them of quality of life. Medical cannabis helps.
In the early days of Sweetleaf, there were moments when Airone’s paying job demanded more from him, and the efforts of the organization slowed. But despite the challenges of running a charitable organization in one’s spare time, during the first decade, Sweetleaf Collective was able to build and serve a clientele of ten to twelve, mostly terminal, patients. In 2006, bigger donations started to flow in, and Sweetleaf was able to increase the number of patients served and hire part-time workers.
It was the 1996 Compassionate Use Act, or Prop 215, that allowed Sweetleaf and other compassionate care providers to begin operating. But recently, these charitable organizations have run into unexpected trouble. In 2016, voters approved Prop 64, legalizing cannabis for recreational use. Sales began in January of this year. Though counted as an overall win for the industry, the sale of cannabis is now regulated in such a way that makes all cannabis transactions—even donations-based ones—taxable at 15% of market value, in addition to all local taxes.
The permits required by Prop 64 in order to obtain cannabis from legal growers are costly as well. All of this puts undue financial burden on organizations like Sweetleaf that run on a small budget and do not produce revenue. Under the new tax regimen, Sweetleaf could be responsible for $50K-$200K in taxes and fees per year—an untenable situation. Cultivators, too, would be responsible for taxes on the product they donate—making them less likely to do so. Reducing the flow of free medical cannabis available to Sweetleaf’s recipients comes with a human cost. “We’re concerned,” said Airone, “because our patients are already terminal.”
According to their website, in 2017, Sweetleaf Collective was able to provide over 100 pounds of free cannabis to more than 150 patients. But since legal sales began in January 2018, Sweetleaf has distributed only 10-15 pounds of medical cannabis. Airone has said that while there are a few workarounds, the situation is complicated. For instance, cannabis cultivators can still donate product that was grown before 2018, but not after.
Airone has said that he believes the burden on charitable organizations was an unintended consequence of Prop 64. But remedying that burden has not proved easy.
Jeff Sheehy, former Supervisor for San Francisco’s District 8, authored amended regulations in the city to allow tax-exempt status for charitable organizations. However, SB 829, a bill introduced by Scott Wiener (D) earlier this year that would have exempted charitable organizations statewide from the new taxes passed both houses of the California legislature but was vetoed by Governor Brown on September 30th. It was a blow for compassionate care advocates across the state.
The fight for separate, non-commercial regulations for compassionate cannabis providers continues. Twenty or so organizations, such as the Weed for Warriors Project, Caladrius Network, and Wo/Men’s Alliance for Medical Marijuana, have joined with Sweetleaf to form the California Compassion Coalition in order to lobby toward that end. Today, Sweetleaf is raising funds to help offset the cost of legal fees, as well as their advocacy and education efforts.
Hopefully, the compassionate care and the recreational sectors of the cannabis industry can one day soon coexist in a way that makes sense to voters, legislators, and people in the industry. The people of Sweetleaf Collective want to be able to provide relief—both legally, and manageably. For Airone, the struggle is worthwhile. As he was quoted earlier this year: “These people have been counting on Sweetleaf and the compassionate cannabis that we provide, free of charge, to sustain their lives.”
Danielle Simone Brand is a mother of two, a die-hard idealist, and a breaker of conventions. She holds a BA from Dartmouth College and an MA from American University and has worked as a staff writer, an academic editor, and a researcher on issues of international conflict resolution.