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When recreational marijuana sales became legal in Oregon nearly three years ago, on Oct. 1, 2015, mid-Willamette Valley residents lined up in Corvallis to buy “weed” from a handful of dispensaries.

Today, Linn and Benton counties have 20 recreational marijuana dispensaries approved by the state, about one for every 11,000 people in the area, according to the Oregon Liquor Control Commission, which supervises the state’s recreational marijuana program.

Competition in the marketplace has increased, and more pot shops could be on the way.

“The number has gone up and there are a couple of applications in with the OLCC right now,” said Dan Cochrane, co-owner of Beaver Bowls in Corvallis.

Still, there’s uncertainty among local shop representatives and an adult-use cannabis expert about what a local saturation point could be for dispensaries.

“We’re still early in the development of the legal, adult-use cannabis industry,” said Todd Dalotto, director of the Cannabis Research Committee, a Philomath based organization that works on legislative issues.

Anthony Vredenburg, manager of Mr. Nice Guy in Lebanon, said that he expects to see more shops locally — and Mr. Nice Guy, a chain with 17 shops in Oregon, will be expanding throughout the state.

“You can always look at how many bars are in town, compared to multiple weed shops. There are a lot of bars. They all seem to do well,” Vredenburg added. “I know there are a couple more shops coming in.”

Cochrane said things may be reaching a saturation point already in Corvallis, which currently has eight dispensaries. “I think there’s a solid number in Corvallis right now, and they’re pretty well spread out,” he added.

While Corvallis is the local leader in the cannabis industry, Albany has five recreational marijuana dispensaries approved by the state, Lebanon has four, and Tangent, Brownsville and Sweet Home each have one.

Linn County got its start in recreational marijuana a bit later than Corvallis and Benton County, though. The first recreational dispensary sales of pot in Linn County were in Albany in February 2017.

Older markets

Dalotto said that the adult-use cannabis industry could do better at meeting the needs of all its customers and potential customers.

“The older population is drastically underserved,” he added, suggesting that dispensaries should target that demographic.

Cochrane said that older residents are turning to cannabis to help with problems such as chronic pain.

“The over-60 population is the fastest growing population in the cannabis community. … Western medicine has failed them,” he added.

Over the years, the reputation of marijuana has changed drastically, and the stigma of the once-illegal product has lessened.

“By just about every measure it’s improved. There’s a reduction in what we call canna-bigotry,” Dalotto said.

Cochrane said one local dispensary, the Corvallis Cannabis Club, gave the industry a black eye, though. The OLCC has temporarily suspended the dispensary’s license due to a federal criminal investigation into a credit card fraud scheme that defrauded financial institutions of more than $1 million. Several people associated with the dispensary have been arrested.

“It was a total blow. I think it continued to add talking points or arguments for the prohibitionists. It’s incredibly unfortunate,” Cochrane said.

Still, many dispensaries, including Beaver Bowls and Mr. Nice Guy, donate to local organizations and do other philanthropic work.

“This is a big business, but I feel like it can be beneficial (for Oregon communities),” Vredenburg said.

While Dalotto said he’s seen acceptance in leaps and bounds, there’s still a long way to go, he believes.

Despite a growing sense of legitimacy, the expansion of recreational dispensaries could be constrained by a rather inconvenient fact, experts said. Marijuana remains illegal at the federal level, so dispensaries still face issues such small towns that frown on defying Uncle Sam.

Banking also is a problem due to the United States’ stance on cannabis. Dealing with large amounts of cash for pot purchases, payroll and even taxes — and many dispensaries remain in this position — isn’t easy, experts said.

If marijuana becomes legal at the federal level and those barriers are removed, business could flow much smoother and efficiently, creating additional openings in the marketplace. Legal businesses could flourish if they were allowed to operate like most legal businesses, experts said.

Nationwide legalization of marijuana, however, seems a very distant goal at present.

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Kyle Odegard can be reached at kyle.odegard@lee.net, 541-812-6077 or via Twitter @KyleOdegard.

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Business Reporter