“People think that dispensary owners are just rolling in dough, and that is just not the case.” A window into a broken, out-moded system with Wanda James, one of the industry's most innovative businesswomen
As an ex-military officer and restaurateur, Wanda James was not expecting to go into the cannabis business. But when James learned her half-brother had been sentenced to ten years in prison for possessing just four ounces of marijuana, she was appalled and moved to action. With her political background of working for Barack Obama’s National Finance Committee in 2008, managing election campaigns, and running for Congress, she saw that it was time to change the narrative for people of color in the marijuana business. Now, a co-owner with husband Scott Dura of Simply Pure, a successful dispensary in downtown Denver with 32 employees and revenues of $2.5 to $3 million a year, she is the first African American woman to own a marijuana dispensary in Colorado. Introduced to Document through Senator Kirsten Gillibrand, she spoke to us about her expertise as grower, the stringency of marijuana tax laws, tax codes, and the continuing challenges presented by running a business still classed as illegal by the federal government.
Daisy Prince—It’s not every day that a senator gives you a great lead so I thought I should follow up.
Wanda James—Kirstin [Gillibrand] is pretty terrific.
Daisy—She is. So how did you meet her?
Wanda—I am politically active here in Colorado and have been for years. Because of the work that I have done with cannabis and because she has been really outspoken on the whole cannabis industry, we were put together. We just really hit it off.
Daisy—Tell me about your journey as it obviously dictates to what you are doing now.
Wanda—Except for the five years that I was in the military, cannabis has always been a part of my life. I have always preferred to recreate with cannabis more so than alcohol. Coming off Barack Obama’s National Finance Committee in 2008, part of what we started to see was why mass incarceration was happening. Mass incarceration is primarily due to the arrest for the privatized prison systems for people of color that have been caught with cannabis. In 2008 and before, 800,000 people a year were arrested for simple possession. And one of those people was my brother who I met in 1999 at my father’s funeral.
“For $160 worth of cannabis my brother spent the next ten years in the prison system. And four of those years he spent in a maximum security privatized prison system where he was forced to pick cotton every day.”
Daisy—You met him at your father’s funeral? He was a brother you didn’t know growing up?
Wanda—I grew up with my father, an amazing guy, military guy, and we lived all over the world, but finally in Colorado. My world is predominantly white. I had never known anybody that was arrested for pot. When I met my brother, he told me he received a felony for four and a half ounces of cannabis. For $160 worth of cannabis my brother spent the next ten years in the prison system. And four of those years he spent in a maximum security privatized prison system where he was forced to pick cotton every day. When he told me that story I still didn’t believe it. It must have been something else. Did you beat up the guy, you know? Did you buy cocaine on the side?
I gave a lawyer friend of mine a look at his case. They opened up the file, didn’t read it, just looked at the first couple of lines, and went through the whole privatized prison system with me. Turns out, my brother never saw a lawyer. They went in front of the judge with his mother who was told because he was a minor, ‘Sign this and you can take your son home.’ She didn’t realize when she signed the paperwork that she made her son a felon and that he was then on probation. He did go home that day. Thirty days later he came back was given a piss test and he failed. And they immediately put my brother in jail.
Daisy—So, you met your brother in this horrible moment for both of you and came together and talked about his experiences, which obviously are horrible and very indicative of the prison system as it is in America right now. But how did you come to go into the pot business yourself?
Wanda— After Barack’s election we decided that our next business here in Colorado was going to be to open a dispensary. My husband and I wanted to change the narrative for people of color, and we knew they couldn’t make criminals out of us because we just spent ten months in the room with the President of the United States. Being military officers we have had our background checked forever—I was a lieutenant in military and O2.
When the opportunity came up to actually be one of the first to own a legal dispensary, we jumped at the opportunity to make it a political push. And then, very much to our surprise, MSNBC did the whole ‘Marijuana USA at the end of 2010’ and featured us. From there it has just blown up. So we became the first African Americans legally licensed in America to own a dispensary.
Daisy—That is fantastic. How big is the dispensary? It’s like a store?
Wanda—It’s about 2,000 square feet. And then we’ve got a 7,000 square feet grow facility attached to the license.
Daisy—When you were in the military obviously you couldn’t smoke or ingest or whatever. Yet, in the military I believe that on days off one is allowed to drink? Can you tell me if — I don’t remember. Is that true or not?
Wanda—What is really upsetting about the military is any officer caught with any type of illicit drug goes directly to Leavenworth. However, young officers go to the officer’s club and get top shelf alcohol for 75 cents. The culture of drinking in the military is the more you can drink, the more you can hold your own, the longer you can stay up all night and drink and show up in uniform the next morning, the bigger hero you are.
Daisy—How do pot laws work in Colorado as it’s the first and maybe the most progressive, I believe, in terms of laws in the United States?
Wanda—It is probably the most restrictive at this point. We are actually fighting in Colorado to loosen up some of our restrictions given the fact that we are not the only state anymore that allows for cannabis sales.
People think that we make a lot of money in Colorado. I mean, we do a billion dollars worth of sales each year. We don’t get to keep very much of that at all. We are taxed at about 80% because of the 280E laws, a tax code that was created in the 1980’s, I believe it was George Bush Sr., to prevent the South Florida cocaine dealers from putting money into banks. They call it the Capone Law. Every drug dealer has always been brought down by what? Tax evasion. If they catch you selling illegal drugs, then they tax you at 80% which is a catalyst for taking your home and money out of the bank. When you start wondering why the federal government is being so slow to legalize when America is saying “Legalize!” It is because they are making money hand over fist.
Daisy—It seems like it would be a real labor of love. And pot plants are agricultural commodities. Plants are subject to disease. You could have a crop bad year or a good year.
Wanda—We sell cannabis to the masses, and our cannabis has to test clean. So everything gets sent to a testing lab. We can’t have any mold, mildew, pesticides—if you are buying cannabis in Colorado, rest assured it is absolutely clean cannabis. It’s safe.
Daisy—Is the level of stringency the same for edibles as well?
Wanda—Probably even more so for edibles. And we are tested at what we call parts per billion. Strawberries in America are tested at parts per thousand, cannabis is tested at parts per billion. So any type of pesticide or heavy metal and the product gets flagged and cannot be sold in the system and is immediately destroyed.
Daisy—Is it just you and your husband? Do you have any employees ?
Wanda—We’ve got about 32 employees.
Daisy—What are their roles?
Wanda—Just like any other company, I have a controller, my director of marketing, my GM, I’ve got my store manager, the assistant managers. I’ve got a grow manager. I’ve got packaging supervisors that package our cannabis. Inventory control. And then our budologists. They call them bud tenders, but ours are budologists, because they go through an amazing two month training program before you can get on my floor.
Daisy—It sounds like you are sort of like a wine grower.
Wanda—Outside of medicinal, where big Pharma gets involved with the lab type growing of cannabis, the cannabis industry will be very similar to the wine industry. You will have the Ernest and Julio Gallo’s that do a billion bottles a year. You will have craft wineries that do much smaller. It is exactly going to mimic the wine industry.
Daisy—What did you say was the Mouton Rothschild of cannabis edibles?
Wanda—I would say Simply Pure has one of the most amazing chocolates which is done by a woman that spent five years being trained as a French Parisian chocolatier. And the truffles that she makes are tempered perfectly.
“People think that dispensary owners are just rolling in dough, and that is just not the case. We are all hanging on until the federal government decides to get out of it.”
Daisy—Pot today is commonly known to be stronger than it was 20 years ago. Are you going to create it so that you can have the one glass of wine feeling? Not having a whole bottle?
Wanda—If you go to an alcohol store, you can buy a bottle of Everclear or you can get a great bottle of something that is not 80% proof. Cannabis is grown better now. My guess is that strawberries and cucumbers are grown better now than they were in the ʼ70s, you know? They are more flavorful. The more we learn more about agriculture and how to work with plants the better.
Daisy—Have things improved in terms of arresting people of color with cannabis possession?
Wanda—Yes. In Denver, we have decreased the rate of African Americans being arrested by 97%. Once we were arresting almost 16,000 people a year, now we are down to arresting a minuscule amount, and it is really is people who are trying to illegally deal. In Colorado, opioid use has dropped; drunk driving has dropped. Teen use has not moved; it has stayed the same. Given the explosion of cannabis, the fact that it stayed the same, we think, is a victory. So the positives far outweigh any of the perceived negatives.
Daisy—What happens if you are caught with it under 21? Just for possession.
Wanda—One of the unintended consequences, and we have been working on fixing it, but the arrest of white kids went down by 9%, but it went up by 22% for latinos and it went up 52% for black kids. For whatever reason, you can’t just go to the principal’s office anymore, you have to get arrested. I don’t understand arresting children.
Daisy—In my day if you got caught smoking pot you got kicked out. You just got kicked out, that was it.
Wanda—You went home for three days and your parents got called. Mom and dad came down. Got grounded. It seems like common sense is slowly seeping out of America.
Daisy—Now, you would have to be brought up in front of juvenile court and have this on your record. If you’re seventeen then it’s a really big offense.
Wanda—We wanted to legalize so we stopped arresting people, but now we are indoctrinating kids younger into the police system. We’re working on fixing that.
Daisy—Would you be able to tell me what your revenues are per year?
Wanda—We do $2.5-3 million a year.
Daisy— What do you think is driving that? Marketing, wonderful product, location?
Wanda—A lot of folks have said that so many dispensaries are done in poor neighborhoods because they got zoned to poor neighborhoods. Ironically, we are on a corner of one of the hippest, hottest neighborhoods in Denver. We always joke that [we are] a wealthy black dispensary in a white neighborhood instead of a wealthy white dispensary in a poor black neighborhood.
Daisy—And would you say most of your clients are black or white?
Wanda—Most of our clients on a daily basis are white. Because of our status in the industry, 65% of our sales come from tourism. We’re a destination dispensary. The people that tend to come to us from out of state tend to be people of color.
Daisy—Any other thoughts or anything that you think we should chat about? I am fascinated by the tax code stuff.
Wanda—People think that dispensary owners are just rolling in dough, and that is just not the case. We are all hanging on until the federal government decides to get out of it. Hopefully, somewhere around 2020. Because even the banking issues, we’re still not allowed to have legal banks. You have to give the bank proof of your sales and every deposit on a monthly basis. You are literally audited every month by the bank.
Daisy—That is really onerous as a small business, but it’s better than having bags of cash, which is what it was before, right?
Wanda—We used to do payroll, and I would sit there with $50,000 in my office, and my employees would come in one at a time and I would count out, ‘here’s your salary’. It made payday dangerous for everybody. For the store, for the employee. Then even having to pay your taxes. We pay $144,000 a month in taxes and we are walking around with literally trash bags of cash, dropping them off at the Department of Revenue.
Daisy—When did they allow the banking with all of these stringencies to happen?
Wanda—So technically they haven’t. We have a bank account because, once again, reputation, and you have to be invited by the bank to open up a bank account. So there are a handful of legal bank accounts, but most of the dispensaries don’t have ‘legal bank accounts’ yet. And the game behind it is, unfortunately, you make up a company and open a bank account and try to put as little money in there as possible, so they can’t tell it is a dispensary right away. But most dispensaries will have five or six bank accounts a year because you get shut down every month.
Daisy—The system is broken, basically.
Wanda—The system is broken. California is going to be a $10 billion industry literally overnight once they get all of their licenses in place. We have to figure out banking. We can’t just have that kind of cash just floating around in the ozone with no place to put it.
Daisy—Are they drinking less as a result of legalization?
Wanda—Drunk driving has decreased in Colorado; opioid dependence has decreased in Colorado. On the medicinal side it [cannabis] takes care of the top issues that we have in America: chronic pain; mood, be it depression or anxiety; nausea, which I didn’t understand how prevalent nausea was, but anybody going through chemotherapy and a host of other things; and sleep disorders. And so there is your top five big Pharma: OxyContin, Ambien, all of those have been reduced dramatically in Colorado because people are turning to things that won’t destroy your liver, that won’t get you addicted. Quite frankly, if you are depressed or if you are tired, I mean what is wrong with feeling hungry and giggling a little bit? Those aren’t bad side effects.
Daisy—Do you think you will stay in this industry for the foreseeable future?
Wanda—I’m not going anywhere. This is what I do. Who would have thought that I would have had the opportunity to advise potential Presidents of the United States on this? I mean, that is really tremendous.