Bay Area Medical Pot Takes One Step Forward, Two Steps Back 

The region's medical cannabis industry is experiencing more downs than ups lately. Notes from four of the front lines.

Berkeley could add a fourth licensed brick-and-mortar dispensary by the end of the year, now that the March 20 deadline to apply for such a business license has passed. The city has three existing permitted dispensaries — Berkeley Patients Group, BPCC, and CBCB — a number that's been unchanged in a decade, said Charles Pappas, a member of the Berkeley Medical Cannabis Commission.

In 2010, Berkley voters approved adding a fourth dispensary, but the city council dragged its feet for three years and then spent a year working on a new, more intense application process for adding a new club.

Pappas said seven or eight groups — including his own — applied for the permit by last Friday's deadline. The biggest hurdle for applicants continues to be finding a location. Pappas said his team spent several months looking for a landlord willing to rent to a new dispensary. Many landlords fear property forfeiture under federal drug laws. Berkeley Patients Group is currently in court facing forfeiture charges stemming from the five-year-old crackdown on California medical marijuana business by US Attorney Melinda Haag. "We had trouble finding landlords for a lot of places," Pappas said. "When we did get a hold of them, it was pretty much a 'no' a lot of times and a lot of hang-ups."

Now that the applications are in, applicants will go through a four-stage selection process that includes a medical marijuana aptitude test. Applicants can change their intended dispensary location mid-process, if needed.

Asked why he wanted to endure all the hassle of opening a dispensary, after his last one, Divinity Tree in San Francisco, was closed by a federal forfeiture threat, Pappas replied: "I'm dedicated, you know? The Divinity Tree was so special and such an accomplishment. I want to have that in Berkeley. It's my home, really. I'm a disabled guy. I came here forty years ago and I built my life here. I want to help my community."

Up next, Berkeley is working to finish an application process for up to six medical cannabis cultivation facilities — which were also approved by voters in 2010.

Richmond

Last week, the City of Richmond formally decreased the number of dispensary permits it has available from six to three. Richmond has three open, licensed dispensaries and a fourth that has been unable to find a location. For years, operators seeking to open dispensaries have faced numerous hurdles, including strict city zoning laws, lack of leasable space, and NIMBYs.

In addition to reducing the available number of dispensary permits, the Richmond City Council voted on March 17 to approve the creation of two new permits for businesses that make medical cannabis chocolates and other infused foods.

Vallejo

The cash-strapped city of Vallejo —which declared bankruptcy in 2008 — is rejecting millions of dollars in voter-approved tax revenue from dispensaries and is instead moving to spend hundreds of thousands of dollars to close all cannabis outlets.

On Tuesday, March 24, Vallejo city staffers were scheduled to ask the city council for a total of $260,000 over two years to pay for police, code enforcement, and city attorney time to shut down all medical cannabis dispensaries in the city.

The action comes despite the fact that in 2011, Vallejo voters approved Measure C — which levied a 10 percent tax on medical marijuana sales in the city. The city has about two dozen dispensaries operating without local regulations, plus an unstoppable fleet of unlicensed delivery services.

Vallejo's longtime mayor, Osby Davis, is on a mission to cleanse the city of pot. Elected in 2007, Davis, a fundamentalist Christian, told The New York Times in 2009 that he wanted to turn Vallejo into a "city of god," and equated the "sin" of marijuana use with murder and homosexuality. He was reelected in 2011.

"He's on a crusade, and he's been on one for a very long time," said attorney Scott Candell, who represents medical cannabis businesses in Solano County. Vallejo dispensaries have also been fighting with each other instead of shoring up community support, Candell said.

In January, Davis led a council move to ban all dispensaries from Vallejo. When that failed, the council voted to regulate dispensaries by first ordering that all clubs be closed. The council and the mayor also instructed the city to reject Measure C tax revenue from all clubs, totaling roughly $700,000 per year.

Santa Cruz

As we head into the annual spring planting season, Santa Cruz County's relatively wide-open medical marijuana industry appears headed for a reckoning. Prompted by neighborhood complaints about a proliferation of illegal gardens, the Santa Cruz County Board of Supervisors was scheduled earlier this week to consider a ban on all non-personal cannabis cultivation. An alternative proposed ordinance would allow the county's seventeen dispensaries to use a maximum of three cultivators who could grow on limited sites totaling less than three acres countywide.

Santa Cruz supervisors will also consider raising the 7 percent cannabis business tax — which brings in $1 million annually — to offset the cost of cops and code enforcement going after an estimated 139 known illegal grows.

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