In Berkeley, efforts to expand the city’s medical cannabis industry have been slowed as contention between state and federal marijuana policies causes confusion among business owners, local governments, legal experts and patients alike.
Berkeley has already begun to see the effect of federal lawmakers butting heads with officials in states where medical cannabis has been legal for years. The debate boils down to disagreement between those who advocate state’s rights in medical cannabis regulation and federal entities reluctant to leave the management of any kind of drug — illicit or medical — up to differing interpretations between regions.
However, reports that Oakland intends to double the number of dispensaries it licenses should come as no surprise given the financial difficulties that California cities have faced in recent years. In cities like Oakland, annual sales taxes from marijuana dispensaries generate millions.
Alternatively, the tax revenue Berkeley brings in from medical cannabis is “really not significant” to the city’s overall revenue, totaling just $161,193 in 2011, according to city spokesperson Mary Kay Clunies-Ross.
Last fall, the U.S. Department of Justice sent letters to dozens of dispensaries and collectives across the state, warning owners they were not complying with federal standards and could be subject to closure and even jail time if they did not close down their businesses immediately. Several San Francisco businesses closed as a result.
Dan Rush, the national director of the Medical Cannabis and Hemp Division at United Food Commercial Workers International Union, estimates that the letters could put roughly 300 Berkeley dispensary jobs at risk. Another round of letters was just sent out last week, the effects of which will become apparent in the coming months, Rush said.
Berkeley currently has three dispensaries, but the city is in the process of developing regulations to permit a fourth dispensary in line with Measure T, a ballot measure passed in November 2010 that also allows six new cultivation centers to open in the city.
The city has charged its Medical Cannabis Commission — for which Rush is also the chairperson — with the task of defining regulations, to be submitted to and voted on by the City Council later this year. The process appears to have been delayed by the lack of clarity at the state level.
“There’s been discussion about calling a break until there’s some kind of ruling from the Supreme Court,” Rush said at a meeting of the commission Thursday.
However, commissioners seem determined to continue refining the process for businesses looking to apply for a dispensary permit.
The distinction between dispensaries and collectives varies from city to city. In Berkeley, dispensaries are permitted establishments that operate in commercial districts, while collectives must be operated out of a residence outside of a commercial or manufacturing district.
In December, the city sent “cease and desist” letters to two local collectives, warning that they were wrongly operating as dispensaries and would be subject to a fine of $500 a day if they did not halt operations immediately.
Perfect Plants Patient’s Group at 2840-B Sacramento St. was one of the collectives identified. It was also notified that it was violating Measure T’s stipulation forbidding it from operating within 600 feet of a school.
40 Acres Medical Marijuana Growers’ Collective was the other collective that received a letter warning that it is violating the city’s municipal code by operating as a dispensary in a commercial district. The collective closed its doors at 1820 San Pablo Ave. and reopened recently at a new location.
Although no Berkeley dispensaries have closed yet, rumors have circulated that Berkeley’s largest and oldest dispensary — Berkeley Patients Group — recently received a letter from the U.S. Attorney notifying them that they are in violation of the 1,000-foot limit between dispensaries and schools stipulated by federal law.
BPG has yet to confirm whether or not they have received such a letter.
A bill submitted by state assemblymember Tom Ammiano (D-San Francisco) to the state assembly on Feb. 24 could alleviate some of the confusion between state and local policies for medical cannabis.
The Medical Marijuana Regulation, Control, and Taxation Act of 2012 would establish a state Board of Medical Marijuana Enforcement, which would deal with registering and regulating medical marijuana businesses as well as levying fines and penalties for violations, according to the bill’s text.
Adelyn Baxter is the lead city government reporter.