Ads for medical marijuana dispensaries are helping keep some community newspapers healthy

Local newspapers in states where medical marijuana is legal are raking in advertising dollars from local dispensaries eager to let communities know they exist. Mostly, alternative weekly papers are taking advantage of this new "cash cow," reports Jeremy Peters of The New York Times, but community papers are also capitalizing on the steady flow of advertising money provided by dispensaries. (Photo by Reed Saxon, The Associated Press)

The decision by the Obama administration to not prosecute dispensary owners so long as they comply with state law allowed dispensaries to flourish, bringing increased advertising with them. Peters reports their advertising is filling gaps left when other local businesses close, and when classifieds move online. The Daily Chronicle in Bozeman, Mont., draws about $7,500 a month from dispensary advertising. The Independent of Colorado Springs said it hired a reporter and promoted three staff to full-time with advertising money from a section devoted to marijuana. UPDATE, Oct. 27: Colorado has started issuing licenses to medical-marijuana retailers, John Ingold of The Denver Post reports.

Use and sale of medical marijuana in some places could face stricter regulations if ballot initiatives pass next month, and some newspaper staffs fear this will have a big impact on their bottom line. Matt Gibson of The Missoula Independent told Peters 10 percent of the paper's income is from dispensary advertising and that the industry carried it through the recession. Others, like Marcia Martinek, editor of the Herald Democrat in Leadville, Colo., said her paper accepts advertising from dispensaries, but that the "medical marijuana thing hasn't been a big deal" for the paper. (Read more)