Two of SF's most venerable cannabis dispensaries get shut down

Cathy Smith, founder of HopeNet, shut down her once bustling club yesterday.
Tim Daw

Sadness, anger, and confusion hung thick in the fragrant, smoky air of two of San Francisco's oldest and most prominent medical marijuana dispensaries – HopeNet in SoMa and Vapor Room in Lower Haight – during their last day in business yesterday, the latest victims of an aggressive federal government crackdown on the industry.

Throughout the day, vendors, patients, neighbors, and well-wishers stopped in to say goodbye and commiserate over a trend that just doesn't make sense to them, or to the local politicians and city officials that have spent years setting up a regulatory structure that had legitimized the cannabis industry, which thrived as the rest of the economy suffered through the recent recession.

“I've always treated this as if it were just a nice coffee house. I'm not an outlaw,” said Martin Olive, whose Vapor Room was a friendly community gathering place and active member of the local business community that gave away free bags of vaporized marijuana to low-income patients on a daily basis. “I almost forgot I was breaking federal law. It was so normal, so legitimate.”

Despite previous promises to respect state laws legalizing medical marijuana, President Barack Obama and federal agencies under his control did a sudden about-face last year, with the Drug Enforcement Agency threatening landlords with property seizure, the Justice Department threatening prison sentences, and the Internal Revenue Service doing audits and refusing to allow routine business expenses.

The result has been the forced closure of eight of San Francisco's 24 licensed dispensaries in the last seven months, with more closures likely in the coming months. Almost all of the remaining clubs have been forced to deal only in cash after the feds threatened their bankers and credit card companies. The industry that grows and sells California's biggest cash crop is essentially being driven back underground, hurting patients and the sometimes gritty neighborhoods that dispensaries had improved with security systems and a flow of customers that put more eyes on the streets and cash in the pockets of nearby stores and restaurants.

“The people that live here are afraid the neighborhood is going to come back in here. We took care of the entire block. Before us, it was all dealers, so there's a safety issue,” HopeNet founder Cathy Smith told me as the once-welcoming club on 9th Street near Howard was reduced to bare walls, noting that the owner of the Starbucks on the corner told her he expects his business to drop by 15 percent.

Olive shared the concerns expressed at HopeNet, which he considers “a sister dispensary,” one that also had a generous compassion program for giving cannabis to low-income patients and offering other free services like yoga.

“I'm curious to see what this neighborhood looks like in six months. I know what it was like six months before we got here,” Olive said of his club's opening in 2004.

But for now, it's over. Vapor Room continued to do business for most of the day yesterday, but HopeNet was already stripped bare and essentially shut down, and by 3:30pm they removed the cash register and their pot stock. “The signs are down, we're no longer a pot club, break out the beer,” announced Smith's son, Bill, a member of the cooperative, referring to one of the many tight restrictions of what the city allowed in clubs. “I'm the only one making light of things today, as a coping mechanism. I laugh so we don't cry.”

Like the patients, vendors, and local officials we spoke to – who you'll hear from in an upcoming Guardian cover story looking the end of medical marijuana's golden age – Olive and Smith are grappling with a federal crackdown they say has myriad downsides and no benefits to anyone but federal agencies that profit from drug-related seizures and the criminal syndicates that now have less competition.

Both Olive and Smith say they voted for Obama in 2008, they believed his statements that he wouldn't go after businesses that complied with state and local law, and now they feel betrayed.

“I feel fucked by it, betrayed is too easy a word,” Howard said.

“It's complicated emotions that I'm feeling – let down, confused – at the end of the day, I don't understand why this is happening,” Olive said. “It's a community tragedy, it really is.”

Like MediThrive and other recently shuttered clubs, both Vapor Room and HopeNet will still be operating as delivery-only services, but the future seems less certain now that their direct, brick-and-mortar connection to their community has been severed.

They urge those concerned about the crackdown to contact their political representatives, and to turn out today (Wed/1) at 4pm for a funeral march that starts at Haight and Steiner streets near the now-shuttered Vapor Room and goes to the Federal Building on Golden Gate Avenue, where there will be a rally and speeches starting at 5pm.


"Despite previous promises to respect state laws legalizing medical marijuana, President Barack Obama and federal agencies under his control..."

Tell it like it is:

"Despite previous *lies* to respect state laws legalizing medical marijuana..."

"Hope" and "Change we can believe in." Nothing but marketing slogans.

Posted by Guest on Aug. 01, 2012 @ 2:37 pm

It’s not clear to me how pot clubs were allowed to proliferate. Like most Californians who compassionately voted in favor of access to medical marijuana, I presumed the proposition was based on a pharmacy model.

Had I known the pot industry intended to model dispensation on alcohol at bars, I’d never have signed on.

The topic of marijuana dispensation can’t fully be discussed in San Francisco without mentioning that our Board of Supervisors historically has given the finger to residents who oppose pot clubs near their homes.

Our current legislative body is hostile to the needs of residents, because special interests hold sway over the limited district based power of any single member of the Board of Supervisors.

In working for safe, peaceful, and livable neighborhoods, residents confront every conflict of interest the current structure of the Board represents.

Not only pot clubs need to go, but also district elections for the Board of Sups must be done away with, once and for all.

Every supervisor must be held to answer in future to all residents.

Tom Ferriole

Posted by Tom Ferriole on Aug. 01, 2012 @ 8:26 pm

I will say up front that I am not well informed about issues relating to the Board of Supervisors, but I'd like to respond to a couple of the other issues you raise.

I don't think the model developed for the dispensing of medical marijuana is much like alcohol in bars, other than they are both store-front businesses and that the substances they dispense have intoxicating effects. The significant differences between the two, as I see them:
- Anyone who is over 21 and has I.D. to prove it can buy alcohol at a bar. Purchase of MM requires a physician's recommendation.
- Alcohol can potentially kill those who use it, either quickly through over-consumption or from a (shortened) lifetime of abuse. While abuse of MM can certainly have negative effects on the abusers life, it is never the direct cause of a user's life.
- Alcohol sold at a bar, all of it, must be consumed at the time of sale and on the premises. The majority of the MM sold is taken off the premises and consumed at the purchaser's home or elsewhere.
- Bar's are open until 2 am, and often contribute to late night noise pollution in their neighborhoods. MM dispensaries are generally open during normal or abbreviated business hours and do not contribute to late night noise pollution.

Regarding your statement that "pot clubs need to go," I have to disagree. As I illustrated above, medical marijuana dispensaries are less disruptive to neighborhoods than the well established "bars," and most (I will not say "all") have a demonstrably beneficial influence on the neighborhoods where they are located. As you don't give any reasons as to why pot clubs need to go, I can only assume that your belief is based on moral grounds; that use of marijuana by any but the terminally ill is immoral and a corrupting influence on society. However it seems that the majority of citizens in this city (and this state) do not believe that and voted accordingly.

I do want to thank you for your vote in allowing marijuana to be dispensed in this state for medical purposes. I also believe that careful regulation of the industry is important and that a state-wide regulation scheme with clear enforcement mechanisms might better serve both the industry and the communities in which it operates. The current aggressive prosecution of the industry by the federal government is not, however, the best means of such regulation and will almost certainly result in greater wealth and power for black-market, unregulated drug distributors as well as greater harm and risk to the users of medical marijuana.

Posted by T.M. on Aug. 02, 2012 @ 12:12 pm

Tom. What specifically are your objections to the dispensary model that Vapour Rooms and Hope.Net were modeled on? It seems to me, and their neighbours, that both businesses had an overwhelmingly posititive impact.

Posted by Tim D on Aug. 02, 2012 @ 10:14 am

Tom. What specifically are your objections to the dispensary model that Vapour Rooms and Hope.Net were modeled on? It seems to me, and their neighbours, that both businesses had an overwhelmingly posititive impact.

Posted by Tim Daw on Aug. 02, 2012 @ 10:16 am

...and yet you are all going to still vote for Obama, anyway.

He's laughing his ass off at you fools.

Funny that the evil McChimpyBushHalliburton let the clinics stay open...

Posted by Guest on Aug. 02, 2012 @ 12:08 pm

Wow this newz hurtz my soul so I created a graphic design about it:

Hope ---> Fear


Posted by Guest on Aug. 02, 2012 @ 2:09 pm