Monday’s state Supreme Court ruling that cities can choose to ban medical marijuana dispensaries counts as a setback—assuming setbacks can be measured by nothing lost, nothing gained.
According to local medical marijuana collective operators and advocates, the court’s unanimous decision did little more than uphold the status quo, after the city of Riverside’s decision in 2009 to declare a moratorium and shutter 56 dispensaries. The ruling now upholds bans in about 200 other California cities, including local municipalities such as Palo Alto and Gilroy.
But the same industry experts who dismiss the court’s decision as inconsequential also see a silver lining. The road to legalization is now paved for radical change in coming years.
“Patient access is a now a checkerboard, and that doesn’t make any sense,” says James Anthony, an attorney out of Oakland who specializes in cannabis dispensary land use. “Hopefully, regulation coming out of the state level will mandate, or at least encourage, local governments to control the zoning but not control whether or not medicine is accessible.”
Assemblyman Tom Ammiano (D-San Francisco), author of one of two bills working their way through the state legislature, says he hopes the Riverside decision will prompt lawmakers to action.
His bill would form the “Division of Medical Cannabis Regulation and Enforcement” within the Department of Alcoholic Beverage Control (ABC). Meanwhile, Senate President Pro-Tem Darrell Steinberg (D-Sacramento) and Sen. Mark Leno (D-San Francisco) have their own bill—SB439—that would regulate medical cannabis activity in-state.
“There’s every reason to believe the legislature, with the pro-tem’s support in the senate, will support medical cannabis regulation,” Anthony says. “Next year, we implement those changes.”
The real push for outright legalization is scheduled for 2016.
Despite poll numbers showing that a majority of Californians now supports the regulation of marijuana similar to alcohol, a lesson was learned from Prop. 19’s failure in 2010: Go to voters during a Presidential election, when turnout is greater.
“It’s a rookie move to try and push for 2014,” Anthony admits.
San Jose Mayor Chuck Reed announced Tuesday he was happy with the court’s ruling, but his city is “focused on providing a balanced approach to regulating medicinal marijuana so those who are seriously ill might have access in compliance with state law, while protecting our neighborhoods.”
Reed then went on to show the inherent conflict in such an approach by noting that “none of the facilities currently operating in San Jose is doing so legally. Our zoning code doesn’t have provisions for medical cannabis facilities.” This hasn’t stopped the city from attempting to collect a 7 percent sales tax on gross receipts from the city’s 100 or so collectives.
San Jose councilman Ash Kalra noted the “inconsistent” approach San Jose has taken, as it castigates collectives for illegal activity and then puts out a collection plate.
“That’s part of the ‘Catch-22,’” Kalra says. “I don’t think anyone has a problem taking the tax money from them, but at the same time there’s not much guidance that we’re providing, because we don’t have [a city] ordinance in place.”
Attempts to enforce the tax have been ineffective at best, and San Jose Councilman Sam Liccardo agrees that local governments are often unequipped to handle a drug that is still listed federally controlled substance.
“Cities don’t have the capacity to regulate drugs and shouldn’t be put in that position,” Liccardo says. “What we need is the [Food and Drug Administration] to deal with this, so we have legitimate pharmacies instead of these fly-by-night dispensaries.”
All things considered, it’s been a tough go lately for Bay Area dispensaries. U.S. Attorney Melinda Haag has been threatening dozens of San Jose landlords with prison time if they didn’t evict their pot-peddling tenants, and there is some debate if she is following U.S. Dept. of Justice orders or “going rogue” in some kind of cannabis jihad.
One collective owner tipped off the Oakland-based East Bay Express to the intimidating letters, according to an article last month.
“Haag threatened the landlord with property forfeiture, 40 years in prison, and asset seizure, among other penalties,” the article states.
San Jose, for one, finds itself in a sticky position when it comes to endorsing Haag’s efforts, as the city now collects more than $3 million a year in tax revenue while consistently experiencing budget shortfalls. Liccardo’s office says a public meeting is scheduled for May 21, when the city will discuss raising the cannabis sales tax to 10 percent. On June 4, the City Council could consider passing the new rate.
Dave Hodges, founder of the San Jose Cannabis Buyers Collective, says the local marijuana business tax is pointless until the city recognizes its dispensaries as legally legitimately zoned businesses. He’s not opposed to paying taxes, he says, but he will sue the city over the legality of the current tax until the city comes up with a legit zoning category for local pot clubs.
“We are opposed to paying a tax when doing so is ‘illegal under San Jose law,’” he wrote to the city on Monday. “If the city implemented a registration or permit process legally allowing cannabis clubs, we would be more than willing to pay the current tax and drop our lawsuit.”
Josh Koehn contributed to this report.