Pubdate: Thu, 19 May 2016
Source: Orange County Register, The (CA)
Copyright: 2016 The Orange County Register
Author: Brooke Edwards Staggs


Orange County's restrictive marijuana environment might look quite 
different after Nov. 8.

As Californians prepare to vote on legalizing recreational marijuana, 
residents of several local cities will decide whether to regulate and 
tax medical marijuana businesses for the first time.

Late Tuesday, the City Council for cash-strapped Placentia voted to 
not only allow its first licensed cannabis dispensary, but also to 
permit the county's first regulated commercial cannabis cultivation 
and manufacturing sites. Leaders in the city may now put a special 
cannabis tax before voters.

Placentia is hardly alone. Voters in Costa Mesa and Laguna Beach will 
consider initiatives that could double the number of cities in the 
county that permit pot shops. While efforts there started with 
residents, leaders in both cities have seen the writing on the wall 
and are looking to put their own competing plans on the November ballot.

Garden Grove also is holding workshops to get public input on the 
idea of allowing medical pot dispensaries and other types of 
marijuana businesses.

And still more could be coming. Residents and governments have until 
Aug. 12 to submit initiatives for this year's fall ballot.

The city proposals are happening independently of the upcoming state 
vote on legalizing recreational pot. Even if a majority of voters in 
November agree to let all Californians over 21 use marijuana, every 
city in the state will still have a right to decide whether to allow 
dispensaries, grow sites, delivery services and other 
cannabis-related businesses in their borders.

Instead, the city-by-city push to establish clear pot rules seems to 
be a response to new regulations on medical marijuana signed by Gov. 
Jerry Brown in October. The Medical Marijuana Regulation and Safety 
Act, which takes full effect in 2018, creates a system to license, 
tax and regulate cannabis for the first time in the 20 years since 
Californians legalized the plant for medicinal use.

Many in the cannabis industry say the state law is why local leaders 
are suddenly open to their business, often reversing longstanding opposition.

"There has definitely been a shift over the past year," said attorney 
Randall Longwith, who helped qualify one of Costa Mesa's citizen initiatives.

David Weidenbach, who owns the Costa Mesa cannabis packaging company 
Collective Supply and helped draft the state law as a board member 
for the California Cannabis Industry Association, said the new law 
provides a framework that cities can use as they craft local pot ordinances.

"Now that there is a statewide regulatory system, local 
municipalities are much more willing to discuss how to properly bring 
cannabis into their community."


The new state regulations prompted officials in Placentia to reverse 
a ban on dispensaries that's been on the books since 2008.

A split City Council this week approved a law that will allow one of 
each type of marijuana business that can be licensed under the new 
state regulations. That includes one dispensary, one cultivation 
site, one manufacturing site, one testing lab, one transportation 
service between businesses and one delivery service for consumers.

The law will also allow the city to add another pot shop and 
cultivation site, plus let the manufacturing business grow its own 
supply, after 18 months.

The 3-2 vote came after hours of discussion from a divided council and public.

"I am a five-year breast cancer survivor," resident Linda Lucio said. 
"I would hope that if I had to resort to something such as an edible 
medical marijuana product, it would be accessible to me in my hometown."

Other residents spoke out against allowing pot businesses to open in Placentia.

"I have witnessed firsthand the dangers of marijuana," said Andrew 
Bremer, a police officer in Orange who has four young children and 
has lived in the city for eight years. "We do not need to bring this 
problem into our wonderful little city."

City Administrator Damien Arrula said the ordinance includes safety 
provisions such as background checks on employees, security systems 
at shops and limited operating hours. And the City Council will 
choose which applicants get a license in each category after a public hearing.

Placentia has faced insolvency for years, after a failed 
transportation project and the recession drained its reserves.

Things got worse in April, when its No. 2 finance officer was 
arrested on charges of embezzling $4.3 million from the city. Now 
Placentia is projecting a deficit of more than $6 million in the 
coming fiscal year.

It's unclear how much the pot industry might help.

So far, the city's marijuana ordinance calls only for establishing 
fees for businesses that would cover the cost of administering the 
new program. Arrula said they haven't yet decided if they want to 
also tax pot sellers, which would require a proposal on the ballot so 
residents can weigh in.


Mayor Bao Nguyen and Councilman Phat Bui are leading a task force 
that's studying options for allowing medical marijuana dispensaries 
and other related businesses to open in Garden Grove.

Nguyen said "everything is on the table," with ongoing talks about 
also allowing cultivation and delivery services.

The city banned marijuana dispensaries in 2008. Leaders have 
discussed regulations in the past, but the ban has never been lifted.

Still, Nguyen said, there are 30 or so unlicensed dispensaries 
operating in Garden Grove. So the City Council voted, 4-1, a couple 
months back to consider regulating them so they can at least reap 
some benefits from the businesses.

The task force is looking at how pot shops operate in other cities 
and gathering input from residents, businesses and industry members 
through a series of workshops this month.

The City Council has asked staff to incorporate feedback from the 
workshops into a ballot measure that includes a tax on dispensaries, 
which would have to go before voters. A draft of that measure is due 
back by the first week of June.


Costa Mesa cannabis activists qualified two similar initiatives for 
the ballot two years ago. This fall, they'll finally get to put their 
proposals before voters, though they'll likely face stiff competition 
from a city-backed measure that's still in the works.

One resident-driven initiative would allow up to eight dispensaries 
in the city, while the other sets the limit at four. Both would tax 
sales at 6 percent on top of the city's existing sales tax.

In reaction, the city is pitching its own plan to allow medical 
marijuana dispensaries, just as Santa Ana did in 2014.

The tax rate and other details of the city measure are still being 
worked out. However, initial plans would let zoning ordinances and 
free-market competition dictate the number of dispensaries by 
relegating them to a couple parts of the city.

With that area limited to west of Harbor Boulevard and north of the 
405, Longwith argued it would amount to another "de facto ban" by the city.

"In reality, it's not going to give any access at all," he said, 
noting there is limited property available in the proposed business zone.

Longwith knows there will be weight behind whatever initiative the 
city settles on. So he said he's hopeful the city will back an option 
that will allow dispensaries to set up shop.

Residents will be able to vote on all three initiatives on Nov. 8. If 
more than one passes, whichever proposal gets the most votes will become law.


Laguna Beach residents also have gathered enough support to get an 
initiative on the November ballot to allow the first licensed medical 
marijuana dispensaries in a city that's banned all pot shops since 2009.

The initiative  proposed by resident Elizabeth Toomey and her nephew 
Corey Aufhammer  would permit one medical marijuana dispensary for 
every 10,000 residents. That would mean two shops at the city's 
current population of 23,341.

The proposal states dispensaries couldn't be near schools or each 
other. They'd be chosen through a lottery system, similar to the one 
used in Santa Ana, but with preference given to existing unlicensed 
dispensaries. And if recreational use is legalized, they could start 
selling to all adult customers.

Calling that initiative "sloppy," the City Council voted to put a 
competing, city-backed measure on the November ballot.

The Laguna Beach Police Department is recommending the city allow 
only one dispensary, with more limited options on where it could 
locate. Police also recommend taxing pot shop sales, plus trading the 
lottery system for a competitive process with an evaluation committee 
that would choose which shop would be allowed to open.

The city also might float a third initiative, a rule that would would 
reinforce the city's current ban on all dispensaries.

Full drafts of the city's proposed measures are slated to come back 
to the council for discussion in June.

Staff writers Denisse Salazar and Chris Haire contributed to this report.
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MAP posted-by: Jay Bergstrom