A Great Idea in West Hollywood for Marijuana Regulation

Amidst Chaos Elsewhere, WeHo Calmly Regulates Pot Clubs

Thursday, August 6 – By WeHo News Staff, West Hollywood

West Hollywood, California (Thursday, August 6, 2009) - Against a storm
of controversy over proliferation of pot clubs in the LA region and
municipalities' inability to come to grips with the phenomenon, West
Hollywood calmly stayed ahead of the curve by re-regulating its medical
marijuana dispensary law to provide added security and peace of mind.

The formative Medical Marijuana ordinance designed during a
proliferation of dispensaries in 2004-05 comes up against an expiration
at year's end, so the city moved to license them, giving them
broader oversight over the shops.

The new law caps the number at four and makes them an automatically
permitted use category for zoning purposes while creating a licensing
process for the city's medical marijuana dispensaries.

The licensing process adds requirements such as criminal background
checks and compliance with State Attorney General Guidelines.

Additionally, the city will add language to the licensing category that
will regulate cultivation of medical marijuana, stymieing any new
"nurseries" that might wish to operate inside city limits.

The moves come against a backdrop where nearby cities such as Los
Angeles and Long Beach struggle with a proliferation of the dispensaries
in their cities.

Long Beach enacted an ordinance controlling the dispensaries early this
week, citing a lack of any ordinance regarding medical marijuana.

That city has at least 39 dispensaries operating in it, with five opened
within the past 14 days.

Los Angeles recently cracked down on illegally opened dispensaries,
which number as many as 600 by some estimates, which opened under a
loophole in that city's medical marijuana laws.

One dozen shops now operate between La Brea Ave. and La Cienega Blvd. on
Melrose Avenue, compared to the four that operate along Santa monica
Boulevard in that same stretch.

In other quarters, efforts to tax the many-billion dollar business have
cropped up.

In Oakland last month, residents passed a first-ever tax on medical
marijuana sold in their city by a four-fifths vote.

Assembly member Tom Ammiano (D-SF) introduced a bill to tax and regulate
marijuana like alcohol as a way to generate revenue for the
revenue-starved state coffers.

Two ballot measures have been filed and are collecting signatures to
legalize marijuana for those over 18 and to "sin-tax" it, a
potential multi-billion revenue stream that could build schools.

West Hollywood has always been a "safe haven" for medical
marijuana, in fact, the Proposition 215 and AB 420, the initiative and
state law regulating the sale of medical marijuana, were written by
Wehoans – Rev. Scott Imler and then-Assembly member Paul Koretz.

When medical marijuana dispensaries descended upon the city in 2004-5 in
large number (the city had nine in 2005). By attrition, that number has
been reduced to four, with one operating illegally.

West Hollywood, as have most municipalities, initially regulated the
dispensaries through a conditional use permit (CUP), however, staff
foresaw difficulties arising from allowing CUPs because such permits run
with the land, proffering future operating rights on a parcel rather
than on a business's operation.

Likewise, they cited an illegal weapons cache discovered in a 2007 raid
on a Fairfax dispensary for wanting the ability to do criminal
background checks of new owners, denied them under a CUP.

Foreseeing the possibility that new ownership might even sub-leasing a
facility to the highest bidder, potentially bringing in criminal
elements, added urgency to their request for more regulatory control
over the businesses.

The staff report expressed fear "that unscrupulous potential
operators will be able to `game the system.'"

Don Duncan, who operates Los Angeles Patients & Caregivers Group (LAPCG)
dispensary, told WeHo News that he saw the city's reasoning for
wanting increased opportunities for prevention and enforcement.

"They're concerned about new ownership creating a situation
where they have no control; it makes sense," he said.

Assistant deputy city manager Lisa Belsanti explained that the existing
four dispensaries had comported themselves according to agreements made
with the city, many of which they offered up as part of the collegial
negotiations between the Medical Marijuana Task Force made up of law
enforcement, club owners and appropriate city staff.

Sheriff's crime figures for 2007-2009 showed a minimum of criminal
complaints at the city's shops, with only one robbery, a couple of
attempted or successful burglaries, one fight and half dozen
"disturbances. "

That compares favorably to nearby dispensaries in Los Angeles; we
reported Monday on the capture of a suspect in a robbery-related
execution-style shooting of a security guard at a nearby (8th and
Wilshire) dispensary in October, as well as a recent robbery at 3rd and
Laurel Avenue.

Public speakers in support of the measure dominated; most spoke of the
need to keep the existing "community" medical marijuana
facilities in the city and granting them continuance in their locations
instead of forcing them to move, as they would have been under previous
code.

Three of the four dispensaries sit inside areas that violate the
conditional use permits under which they opened, either too close to one
another, or too close to a school or other proscribed location.

A consensus formed on the council that, because the dispensaries had an
exemplary record over the past two years, they would be grandfathered in
and allowed to remain in place under the new legislation.

Speakers also sought a citywide mechanism by which those in need of the
medicine but who were unable to pay for it could gain access to it; some
of the WeHo dispensaries have programs through which they give medicine
to those who cannot afford it, but others do not.

In council discussion, Jeffrey Prang noted how the city had
traditionally done what it thought was right, regardless of the federal
government's dislike.

The Bush Administration, in one of its DEA's first acts, raided the
city's first (and then, only) city-supported medical marijuana
facility, run by Scott Imler, in 2001.

This time would be no different, he declared.

"If the state government of federal government doesn't like it,
they can come tell us," said Jeff Prang defiantly.

To which Mayor Abbe Land added, "They've never hesitated in the
past."

On any taxation system by which the city could foster a
"compassionate medical marijuana bank" for lowest-income
residents, Michael Jenkins explained that the establishments are liable
for their revenue-based business tax as are other businesses.

Mayor Pro Tem John Heilman raised the idea of using an excise tax to
raise money to supply low-income residents with medicine, but in order
to increase a business's tax beyond the .48 percent currently
charged, the proposal must face a citywide vote.

Council member John Duran said that while "compassion is a good
thing, but I'm a little concerned at trying to compel
compassion."

He thought that providing vouchers might be a better approach to better
serving the lowest-income medical marijuana users.

He suggested that requiring any business to give away product would run
afoul of any number of laws, and the city needs to remain cognizant that
selling of marijuana is still a federal crime.

"I hope staff will get an opinion from the (state and US) Attorney
Generals, because this would be the first time," a city would be
buying a federally-banned substance.

Mr. Heilman suggested that staff require as a part of this licensing
legislation that they set up a compassion bank of their own, if they do
not already have such a system.

Mr. Heilman said he was troubled by the cultivation clause.

Being a dense city, he noted, "We're not geared up to do
cultivation of anything, marijuana, corn or wheat – we're just
not an agricultural community."

Ms. Belsanti responded that staff wanted the ability to regulate any
dedicated nurseries that might come into the city, as well as to craft
the ordinance in a way that prohibits existing dispensaries from doing
cultivation.

Mr. Duran noted the irony behind the city's attempt to quash
cultivation, since the whole purpose behind the original medical
marijuana law, Prop 215, was to foster patients' cultivation for
sharing through co-ops.

"We're standing behind 215 but regulating the essence out of
it," he said. "We're saying, `do not cultivate; buy pot
from dealers on the black market who are not regulated by 215."

All in all, the dispensaries felt the night and legislation went well,
expressing relief at being grandfathered in their current sites and
looking forward to working closely with the city on the new licensing
requirements.

The Farmacy's General manager, Bill Leahy, told WeHo News, "We
are thrilled to be grandfathered in; we love being in West Hollywood and
remain supporters of the community on many levels."

Mr. Leahy has been appointed to serve on the city's Eastside Project
Advisory Commission (PAC), which he called "an honor and a
privilege."

He wholeheartedly supported the changes, saying, "we try to be model
commercial citizens, and any guidance we get on how to be that, and any
input we can make to facilitate that, suits us."

Mr. Duncan mirrored those comments. "We're willing and eager to
do anything the city tells us to do. We're glad they involve us in
the planning, and the cooperative spirit is much appreciated. "

The unpermitted dispensary at 8921 Sunset Boulevard, Sunset Super Shop,
has received two citations for operating illegally.

The original owner of the shop closed it, say city code compliance
officers, and a new owner "bought" the business without applying
for or receiving a new CUP.

One of those citations is for operating without a conditional use permit
and another citation is for exceeding the city's numerical limit of
four medical marijuana dispensaries.

That case has been referred to the City Prosecutor for resolution.