The people lining up to profit from Maryland’s legal medical-marijuana market include former sheriffs and state lawmakers, wealthy business executives and well-connected political donors, according to previously undisclosed public records obtained by The Washington Post.
Nearly 150 businesses are competing for up to 15 cultivation licenses that will be awarded starting this summer, the first footholds in an emerging industry that is already worth billions nationally.
Very few applicants have publicly discussed their plans. But through a public-records request and database searches, The Post identified more than 950 people working for or investing in prospective growing operations in Maryland. Among them: former Drug Enforcement Administration agents; the leader of a Maryland statewide police union; former heads of the Department of Natural Resources police; a former U.S. Capitol Police chief; and Eugene Monroe, the recently released tackle for the Baltimore Ravens who is the foremost advocate of medical marijuana in the National Football League.
They are competing against prominent executives with ties to Gov. Larry Hogan (R) and Bill and Hillary Clinton; successful pot growers from other states and countries; former law enforcement and state government officials and military leaders; doctors; a pastor; and a rabbi.
“There’s good money to be made off of it,” said Stanford “Neill” Franklin, a retired state police major who went from undercover drug busts on college campuses to advocating against drug laws and applying to grow marijuana. “But there also needs to be enough companies doing things aboveboard, ensuring children have as little access as possible . . . and being a positive force for the community.”
The entrepreneurs are drawn by Maryland’s tight restrictions on who can grow and sell marijuana and relatively few limits on who can buy it — rules that should maximize potential profits. Some consider medical pot a precursor to broader legalization, as it was in Colorado, the District, Oregon and Washington state. In Colorado, sales of medical and recreational marijuana last year totaled nearly $1 billion.
Applicants are “betting on the idea that the law will be expanded,” said Troy Dayton, chief executive of San Francisco-based Arcview Group, which researches marijuana-market potential. “The few people who get [licenses] are going to do really well.”
Medical marijuana has been legalized in 24 other states and the District; the law authorizing Maryland’s program was approved in 2014. The state was supposed to issue its first cultivation licenses in January. But a crush of applications, and bureaucratic growing pains, delayed the timetable until late July at the earliest.
In addition to choosing up to 15 growers, Maryland will award as many as 15 licenses to process marijuana, choosing from among 128 hopefuls, and select 94 businesses to sell the product, out of 811 applications. Some teams applied for all three licenses.
In an effort to make the selection process as fair as possible, the application materials seen by reviewers do not include the names of individuals involved with each venture.
Arcview estimated in February that cannabis sales in Maryland would total $9.7 million the first year, likely starting in mid-2017, and reach $60 million by 2020. But those projections will increase as Maryland loosens restrictions. Since February, for example, lawmakers have voted to allow dentists, nurse practitioners and others to recommend marijuana, in addition to doctors. The state commission is considering whether to categorize additional conditions — including autism — as appropriate for treatment with the drug.
Some observers say they expect Maryland to follow the example set by Arizona, which allows pot prescriptions for a wide range of conditions and logged sales of more than $200 million last year. Maryland lawmakers are watching states that have legalized recreational use of marijuana to weigh whether their legislature should do the same.
Growers of medical pot in Maryland “will have very, very viable plans to move into recreational cannabis,” said Darrell Carrington, a lobbyist on the medical-marijuana law and leader of a trade group.
The Post investigation shows that many applicant teams include current and former law enforcement or military officials. Some spent their careers cracking down on illegal drugs. Some changed their minds about pot after losing a loved one or watching a sick person benefit from medical cannabis.
Former DEA special agents Paul Higdon, Charles Tomaszewski and Patrick Witcher are advising several companies, while former IRS criminal division special agent Jacque Riordon is the compliance officer for AltPharm, a company headed by her nephew. Jon Tortora, a former Department of Homeland Security counterintelligence officer who leads anti-fraud programs for the Social Security Administration, is the managing member of cultivation applicant CWS LLC.
Former Cecil County, Md., sheriff Barry Janney, who still runs the county’s minimum-security jail, is part of the application submitted by True Health Chesapeake. In the same county, retired Syracuse, N.Y., police chief Dennis DuVal, who briefly played for the Washington Bullets in the 1970s, joined a company called Citiva Maryland. Former Allegany County, Md., police chief Bobby Dick is head of security for Peak Harvest Health, a role former U.S. Capitol Police chief Terrance W. Gainer has taken on for GTI Maryland. And former Army Major Gen. Roger R. Blunt, who once led the 12,000-member reserve unit at Fort Meade, is involved with Kisima Nursery LLC.
Franklin, the former state trooper, gave up on the war on drugs when a colleague was killed during an undercover buy in 2000. He and his former colleague, retired captain Leigh Maddox, advocate for legalization through a group called Law Enforcement Against Prohibition and applied for a growing license in Harford County, northeast of Baltimore. Their team, CBH Ventures, includes lobbyist Sara Love, who works for the American Civil Liberties Union but is acting on her own in the pot venture.
“It’s ironic, isn’t it?” Maddox said. “I’m a cop. This doesn’t make sense to anybody.”
Ismael “Vince” Canales, head of Maryland’s Fraternal Order of Police, said in 2013 that drug laws should not be watered down. Then a relative used marijuana to treat symptoms of multiple sclerosis. Today, Canales is an investor and head of security for a proposed growing operation headed by Josh Genderson, who has been growing and selling medical marijuana in the District for years — and pays Marcello Muzzatti, the former head of the D.C. police union, to protect his crop in the nation’s capital.
“The state has made the decision,” said Canales, a former homicide detective in Prince George’s County. “It’s not up to me to decide whether this is legal or not.”
George F. Johnson IV, a former Anne Arundel County sheriff, ended his law enforcement career as superintendent of the state Department of Natural Resources police, overseeing a unit that eradicated several illegal marijuana growing areas in state forests. He railed against legalization of pot when he unsuccessfully ran for Anne Arundel county executive in 2014.
But he, too, changed his mind after a friend introduced him to Gail Rand, an Annapolis woman who advocates for medical cannabis in hopes that it would help her epileptic son. Rand persuaded Johnson to become director of security for an applicant called Forward Gro Inc.
“It could be shoe sales,” said Doug DeLeaver, a former high-ranking state trooper who led police divisions in three state agencies and was recruited as security head for a different applicant, Curio Cultivation. “It could be anything that you are protecting.”
DeLeaver says he will leave his job as director of government affairs for the Maryland Transit Administration if Curio Cultivation gets a license. Ever the trooper, he carefully vetted the leader of the company before taking the job. That man was Michael Bronfein, one of several well-known business executives looking to break into Maryland’s cannabis industry.
Bronfein, 60, made a name for himself in health care, leading Maryland companies that provide prescriptions to nursing homes. He is managing partner at a private equity firm and part of a team that owns a stake in Baltimore’s Horseshoe Casino.
Bronfein was the top fundraiser for Kathleen Kennedy Townsend’s failed 2002 gubernatorial bid. He and his wife and business partner, Jessica Bronfein, have poured more than $60,000 into Maryland campaigns in recent years. They are among 146 people who have donated to all six of Bill Clinton’s and Hillary Clinton’s federal races.
For Curio Cultivation, Michael Bronfein teamed up with experienced growers from Maine and Canada to apply for cultivation, processing and distribution licenses. “I’m incredibly superstitious, so until I have a license, I really don’t want to talk about it,” Bronfein said in a brief phone conversation.
Other applicants were similarly guarded, including Republican donor Gary Mangum. Known as the “king of petunias,” he’s chief executive of Bell Nursery, which grows flowers sold at Home Depot. He is part of Forward Gro, the company that employs Rand, the pot activist, and Johnson, the former Anne Arundel sheriff.
Mangum, who declined an interview request, was on Hogan’s transition team and was appointed by the governor to the Maryland Stadium Authority. He has given $120,000 to state Republicans since 2010, hosted a Hogan campaign fundraiser at his Eastern Shore mansion and organized a celebration of the first anniversary of the governor’s election.
Retired federal judge Alexander Williams, a former Prince George’s County state’s attorney who co-chaired Hogan’s redistricting reform commission, is general counsel for applicant MMRC. Lionel Moore, who until recently was director of the family division of Prince George’s County Circuit Court, and his wife, Dominique Moore, a Baltimore housing commissioner, also are applying to grow medical marijuana.
Other politically connected applicants include Raj Mukherji, a New Jersey state lawmaker whose team operates a large cultivation center in his home state and unsuccessfully sought to expand to New York; and Edward Weidenfeld, a longtime Washington lawyer who was general counsel on Ronald Reagan’s 1980 presidential campaign and is working with D.C. pot entrepreneur Andras Kirschner.
Among the applicants with ties to Maryland state government is Michelle Gourdine, a top health official under former governor Robert L. Ehrlich Jr. (R) who serves on the board of the Maryland Health Benefit Exchange and is secretary of the University System of Maryland Board of Regents. There are also James Ronald DeJuliis, a former top labor regulator, and former state delegates Jon S. Cardin (D-Baltimore County) and David Valderrama (D-Prince George’s County).
Valderrama, who pushed unsuccessfully for medical marijuana as a lawmaker in the early 2000s, says he is trying to help a friend and assisted-living facility operator compete with more established rivals.
“It’s little guys going against the big guys,” he said.
Maryland businesses are supposed to get preference in the licensing process. But some out-of-state entrepreneurs have tried to circumvent that by setting up local subsidiaries or looking for local investors. While all but seven applicants to grow marijuana say they are Maryland-based, nearly a third of the applications include at least one person who has marijuana business ties in other states, according to disclosure records given to The Post.
When Illinois-based Green Thumb Industries was exploring a venture in Maryland last summer, executive Pete Kadens approached Eugene Monroe, then a tackle for the Baltimore Ravens. The company had heard from other Maryland-based partners that the football player was privately supportive of medical marijuana.
“You have to have residents and champions and influencers on the ground . . . who know the market, know the key people and know how the game is played,” Kadens said.
Monroe agreed to invest after spending two months vetting the company and considering other potential growers, Kadens said. He has closely watched the approval process, even attending commission meetings, and this year became a vocal advocate for using medical pot. Until now, his investment in Green Thumb Industries was not publicly known.
Some out-of-state applicants hail from Colorado’s thriving recreational market, while others are rebounding from a fiercely competitive process in New York that awarded five medical-marijuana licenses out of 43 applicants.
There’s Ethan Ruby of Peak Harvest Health, a grower and activist who learned the trade in Colorado before setting up shop in Minnesota and Connecticut and amassing more than $12 million for a proposed expansion into Maryland. And there’s Brian Vicente and Christian Sederberg, partners at a Colorado legal practice that advises cannabis businesses and calls itself “the marijuana law firm.”
Physician Greg Daniel created Alternative Medicine Maryland, a local subsidiary of his company based in Buffalo, N.Y., after narrowly missing out on licenses to grow medical pot in New York and Hawaii. Daniel, who founded and sold a national chain of urgent-care centers, calls marijuana “a pharmaceutical that needs to become mainstream.” He says he has close to $25 million to invest in a cannabis operation inside an old Black & Decker factory in Easton, Md., and is trying to secure research partnerships with Canada and Israel.
To knock on doors in Annapolis, he hired John Pica, a former state senator-turned-lobbyist, and former Baltimore housing commissioner Danny Henson. To help with security, he hired Tomaszewski, who worked as a DEA special agent in Baltimore in the late 1990s.
At least two of the five businesses that won cultivation licenses in New York — PharmaCannis and Columbia Care — have also applied in Maryland through subsidiaries set up in the state, the application documents show. Columbia Care is teaming up with David Guard, who operates a dispensary in the District, where medical pot has been allowed for six years.
There is also global interest in Maryland’s market. Yehuda Baruch, a physician who was the top regulator during the first 10 years of Israel’s medical pot program, is applying to grow the drug with the help of former Laurel, Md., mayor and state delegate Bob DiPietro.
Other applications appear to be completely homegrown, including the one submitted by Genderson, the fourth-generation owner of the wine and liquor store Schneider’s of Capitol Hill.
He said his experience selling alcohol made for an easy transition to growing medical marijuana in the District once it became legal, and to secure a license to grow in Massachusetts after that state began its medical cannabis program in 2013. He was so pleased with the security Muzzatti, the former D.C. police union chief, was providing for his pot plants in Washington that he sought out Canales, the head of the police union in Maryland, to do the same if he gets a license there.
Genderson’s partners include two longtime friends, Nelson Sabatini and Donald E. Wilson. Wilson, a physician, was dean of the University of Maryland School of Medicine. Sabatini headed Maryland’s Department of Health and Mental Hygiene, the agency that oversees the medical pot regulating commission.
Other members of Genderson’s family submitted a separate growing application, through a business called Rosebud Organics. Their investors include Rabbi Jeffrey Kahn, who sells the finished product at his dispensary in the District’s Takoma neighborhood. Kahn is also applying for his own dispensary license, and he says he hopes to operate storefronts just blocks apart from one another across the D.C.-Maryland line.
Kahn is not the only member of the clergy to see the medical value of pot. Gareth E. Murray, a former state delegate who is associate pastor of First Baptist Church of Silver Spring, is part of the application submitted by PhytaGenesis, which wants to grow on farmland in Charles County. Murray says the company should remain strictly medical and not venture into recreational sales.
Charles Mattingly’s marijuana dreams are also based in Southern Maryland, on the 27-acre former tobacco farm in St. Mary’s County he inherited from his grandfather.
After a foray into customizing cars and tinting windows, Mattingly wanted to return to farming. But he saw no money in tobacco. He went to a cannabis business conference in Las Vegas and began envisioning two large greenhouses and a processing facility on his land.
Mattingly hired a Colorado consultant to help with the application and growing, spoke with a former DEA agent about security, and convinced local county officials that a cannabis business could fit in with the community.
He says he has set aside $7 million for his venture, mostly from the sale of farmland, and has rented space for a possible dispensary in Mechanicsville, Md. He wants to buy a 20-by-20-foot reinforced steel door from a closing community bank and use it to build a backroom vault. And he is convinced that the federal government will soon change its views on marijuana, opening up industrial-scale markets for recreational pot or its sister product, hemp.
“That’s the next big thing here for local farmers,” Mattingly said. “This is going to be 10 times what they ever made on tobacco.”
Steven Rich contributed to this report.