If the first rule of negotiation is to ask for way more than you need, then work your way down, San Jose has just made a cheeky offer to medical cannabis clubs.
This afternoon the San Jose City Council will convene a heated meeting over its first-ever ordinance to regulate the fifty or so clubs currently operating within the city. The ordinance would make citizens pay $95,000 for a chance to randomly win one of ten coveted permits. Permit holders would then face a wide array of restrictions on their operations, including one rule mandating that no cash be exchanged for their product.
While 354 California cities have stuck their head in the sand by either passing temporary moratoriums or avoiding the topic, and 141 cities have bulldoggishly banned clubs, only 41 have passed regulations. San Jose's are set to be among the most expensive and high-maintenance.
Local collectives — many with strong East Bay ties — are livid, and protesting their way to City Hall this week. San Jose's Medicinal Cannabis Collectives Coalition (MC3) says the measure is illegal and will cost the city millions of dollars in subsequent lawsuits.
“These are measures that have proved unworkable in other jurisdictions, so it makes no sense to repeat those errors and cause a drain on the city's limited finances,” MC3 stated.
San Jose City Attorney Rick Doyle said state laws gives the city enough wiggle room to be harsh. The ordinance is a work-in-progress based on limited information, he said, and the council could modify it today.
“A lot of this is experimental,” Doyle said. “We'll see where the city council wants to take it.”
For example, the city does not know how many dispensaries it actually has. It also doesn't know how the chief of police would oversee the $95,000-a-ticket lottery. “I don't think we thought that far down the line,” said Doyle.
Citizens are not driving the process either. Neighborhood complaints have led to the closure of just one dispensary, according to Doyle. The proposed rules are coming from the planning and the police department, who say the $95,000 fee would cover the costs of administering clubs.
“It's a huge cost,” Doyle said. “That's what the police department and the city manager says it's going to cost. The question to the council will be is: Do they want to have full cost recovery or do they want to have a fee that they believe — I won't say is more reasonable — but something that is less than $95,000.”
Clubs would be limited to commercial zones like medical parks, and banned from industrial areas near tech companies, yet they would be forced to grow on-site — which is a light-industrial process.
“Planners are making that determination. That's the proposal,” Doyle said.
The unprecedented, rather communist “No Cash” proposal for collectives is legal under San Jose's interpretation of state law, Doyle says. “A true cooperative or collective doesn't allow for sale of marijuana. This is something being recommended by city staff and we'll see what the council wants to do with that.”
One other initial idea from staff — limiting collective members to only San Jose citizens — has already been retracted, and more language stands to change today. Furthermore, the council is looking at an additional pot tax to go before local voters this fall.