It’s good to see former students doing well, especially when they do well in innovative ways. That’s true for Daniel Garcia, who took my classes at Sonoma State University (SSU).
Now, he’s an insurance agent for the cannabis industry. That wasn’t a career option that guidance counselors offered him or any other student.
Garcia is bright, quick to see opportunities and to “think outside the box” which most SSU teachers urge undergraduates to do. Moreover, he’s ethical in a world that often leaves ethics in the dust.
Born in San Jose in 1985, he has lived in Santa Rosa since he was two years old. He attended local schools and Santa Rosa Junior College before transferring to SSU.
What I didn’t know about Garcia when he was a student, and that I learned recently, is that he worked part-time in the marijuana industry in Humboldt when he was an undergraduate.
“I was a trimmer in Garberville all through college,” Garcia told me. “I got to know the industry from seed to smoke.”
Now, he uses cannabis for a variety of ailments. “I’m a patient,” he said. “Cannabis helps alleviate my headaches and it helps me sleep at night. I’ve had back problems and I’d rather use cannabis than Vicodin, which has bad side effects.”
Garcia doesn’t smoke at work. He says that when he’s stoned, he’s been unable to focus on the details necessary to write insurance policies. So, he’s never under the influence of marijuana when he’s at his desk at Vantreo, a local agency, where he has clients rarely seen before in the insurance industry.
Garcia didn’t start writing policies for pot growers right after he left SSU. For a while, he worked at Chase Bank. But he soon grew weary of the corporate banking industry and switched to insurance, a move that has given him the freedom he wanted. Then, an acquaintance suggested that he get into the cannabis business on the insurance side.
For both personal and professional reasons he liked the idea, but he knew that he couldn’t just jump in and expect to land on his feet.
“I had to talk to people in the trenches and find out their wants and needs,” he explained.
He joined the Sonoma County Growers Alliance (SCGA) — the cannabis industry’s local lobbying group — and met Tawnie Logan, the organization’s first chairwoman. He attended public meetings and hearings and learned loads about local legislation.
After months of observation and study, he became an expert and might have written a thesis on the subject of cannabis in Sonoma County. Fortunately, he had a background in the business side of alcohol that came in handy.
“I had done insurance for the craft wine and beer industries, so I knew a few things about small business law by the time I moved over to cannabis,” Garcia told me.
He found that after voters approved Proposition 64 in November 2016, Sonoma County residents were much more willing to talk openly about cannabis than ever before. (Prop 64 legalized the adult use of marijuana. It goes into affect in January 2018.)
“After the passage of 64, conversations about cannabis were no longer whispered,” Garcia said. “People were more curious than ever before. They asked a lot of questions.”
So far, he only has two dozen clients, including lawyers, bookkeepers and industry consultants. In large part, that’s because most growers and dealers still operate underground and on the black market and don’t think of insurance.
He cannot legally insure clandestine pot operations, but as more growers and manufacturers apply for and receive permits he expects they’ll want policies. That’s the idea, anyway. So far just three carriers, including the California State Compensation Insurance Fund, offer insurance in the marijuana industry.
In the future, legal marijuana growers and manufacturers will be able to insure property, inventory and equipment, which can be costly.
“Landlords say they’ll rent space to people in the industry, but they have to have insurance,” Garcia explained. “Investors are saying the same thing.”
The future for small farmers and producers, he thinks, lies in the cooperative model. Indeed, it looks like the only way to survive in a highly competitive market with cannabis corporations at the top of the ladder.
Garcia is an assent in an insurance industry driven by assets. As a pot smoker, he knows that marijuana can be a potent substance that affects the mind. As a worker in the industry when he was a college student, he knows that pot has an underground history that’s difficult to leave behind.
“For a long time, the pot industry has been in the shadows,” Garcia said. “Now, there’s a knee-jerk reaction to stay under the radar.”
Give it a few more years and it just might change.
Some of the projected changes in the industry were outlined at an all-day marijuana event, “CannaBiz, Legally,” sponsored by Friedemann Goldberg, a Santa Rosa law firm, and held in September at the Friedman Event Center.
Garcia gave a PowerPoint presentation on cannabis insurance to about 100 attendees, many of them accountants, lawyers and consultants eager to get into the business.
Criminal defense lawyers have years of experience with clients who have been arrested for cultivating, transporting and selling marijuana. Now, they’re becoming experts in contracts and compliance.
Jeff Titus, a Santa Rosa lawyer who specializes in tax law, told the crowd they could expect that the Internal Revenue Service (IRS) would comb the records of every cannabis business.
“They have an office in Santa Rosa and they’ve already started to do audits,” he said. He advised: “Pay attention to details. Do everything with an audit in mind.”
Tim Ricard, who works for the county, told the “CannaBiz, Legally” crowd that as of September 8, 2017, 115 applications had been submitted, most of then for the cultivation side of the marijuana industry. That leaves an estimated 4,000 or so farmers who have not applied for permits. It seems clear that in Sonoma County outlawry and the black market will rule pot fields and warehouses for the foreseeable future.
Jonah Raskin, a professor emeritus at Sonoma State University, is the author of Marijuana: Dispatches from an American War, published in French as well as English, and shares story credit for the feature length pot film Homegrown.
