Pubdate: Sat, 04 Aug 2012
Source: Arizona Daily Sun (AZ)
Copyright: 2012 Arizona Daily Sun
Author: Howard Fischer


PHOENIX -- State officials will award the first-ever licenses to
legally sell marijuana this coming week under what one prosecutor said
is a cloud of having them shut down the moment they open their doors.

The big day comes Tuesday when state health officials will pull out a
device most resembling the machine used to pick lottery numbers.

In fact, that's really what it is: a lottery to determine which of the
486 applicants are going to walk away with a certificate that awards
them permission -- pending final inspection -- to be one of the 126
sites where marijuana can be sold. In areas where there are multiple
applicants for the same neighborhood, the business whose pre-numbered
ping pong ball that the machine spits out is the winner.

And the competition is even tighter than that.

State Health Director Will Humble said no one applied for a license to
sell medical marijuana in 27 of the state's 126 "community health
analysis areas." Most of those are Indian reservations, though there
was no interest in setting up shop to sell marijuana in Green Valley
or San Luis.

And 24 areas others had only one applicant, meaning that organization
already is a winner.

So that leaves 462 applicants vying for the 75 remaining

Humble figures that the first dispensaries could be operating in two
weeks. But he said these are likely to be by applicants in areas where
there was no competition, giving them a head start on their paperwork
and planning their security and inventory control systems that the
state has to approve before they can open their doors.

But the big question is how long those doors will remain open, and
whether the winners will ever be able to recoup their investment,
ranging from the start-up costs and lease payments on buildings to the
$5,000 non-refundable application fee.

"I have been told that the newly appointed U.S. Attorney for the
District of Arizona, John Leonardo, fully intends to prevent any
dispensaries from operating in Arizona by seizing each and every one
as it opens and commits violations of the (federal) Controlled
Substances Act," claimed Yavapai County Attorney Sheila Polk in a
letter to Gov. Jan Brewer.

She pointed out that, Arizona's 2010 voter-approved medical marijuana
law notwithstanding, the drug remains illegal here for all under
federal law. And a dispensary license not only grants the right to
sell but also to grow the drug.

Polk, writing on behalf of 13 of the state's 15 county attorneys,
chided Brewer's health department for licensing both cardholders and
dispensaries in spite of that conflict.

"We believe it is bad public policy for one arm of the government to
facilitate marijuana cultivation and use while another arm of the
government is moving to close it down," she wrote.

The letter drew a sharp retort from Bill Solomon of the U.S.
Attorney's Office, calling her representation on his agency's position
on medical marijuana dispensaries "inaccurate."

"The Department of Justice is focusing its limited resources on
significant drug traffickers, not seriously ill individuals and their
caregivers who are in compliance with applicable state medical
marijuana statutes," Solomon said.

Polk, however, told Capitol Media Services she's not

She said that Ann Scheel, who was acting U.S. Attorney before
Leonardo's appointment, sent a letter to Brewer saying that her office
intends to "vigorously enforce the Controlled Substances Act" and that
compliance with state medical marijuana laws is not a defense.

Solomon, however, said that does not mean users are in

"We don't intend to focus our resources on cancer patients or other
seriously ill individuals," he said.

Polk, however, said that's not her only source.

"I had spoken to a former DEA agent who tells me that the U.S.
Attorney's Office does intend to seize and close down the
dispensaries," she said. And she said federal prosecutors in
California have gone after several retail sellers there.

Solomon, pressed specifically on what that might mean about going
after dispensaries which are selling the drugs, Solomon said he could
not provide a definitive answer. "What I can tell you is we will
continue to focus on large-scale drug traffickers," he said.

Whether raids are coming or not, Polk said state employees should not
administer the program in the face of contrary federal law.

"It makes no sense for one arm of the government to be licensing
dispensaries and another arm of the government to be shutting them
down," she said.

Humble, however, continues down the road to Tuesday's drawing
undeterred. Nor is he concerned that his agency might be taking
application money from and licensing dispensaries that could be
immediately shuttered by federal agents.

"This is a free-market society," he said. "People make decisions about
what businesses they're going to jump into based on their own analysis
of their own risks and benefits."

Humble said no one has kept the conflict between state and federal law
a secret.

But all the talk of shutting down dispensaries also depends on the
feds finding them first.

The 2010 voter-approved law specifically exempts from public records
laws not only the names of those who will get a license but the
addresses where they are located. Humble said he is obligated, though,
to provide a list to anyone with a medical marijuana card.

"Now, cardholders can take that email and give it on their own
Facebook account," he continued, as they are not subject to the
confidentiality requirements. And Humble said he expects at least some
dispensary operators to come forward publicly, if for no other reason
than to advertise for customers.

And if federal agents want the list? Humble said they probably ought
to have a court order to get him to surrender it.

In the meantime, Humble is preparing for Tuesday's drawing. But that
does not mean anyone will be opening up shop on Wednesday.

"It's really just an allocation," he said of the process. Winners then
have to complete paperwork to be certified as a marijuana dealer.

"That still doesn't allow them to sell," Humble explained. He said
health officials have to do a final inspection of everything from the
business plans to the security of the facility.

There also needs to be an inventory control system in place to keep
some of the product from going out the back door for illegal sales.
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