But on Monday, council members said: "Not so fast." In an 8-2 vote, they adopted a new 7 percent tax on dispensaries, as city voters approved last month.
The council put off for another day the burning questions of bans, caps on the number of cannabis clubs and even their basic legality.
Council members Pete Constant and Rose Herrera voted against the motion, saying the legality and regulation of the pot clubs needed to be resolved before taxation. Councilmember Kansen Chu was not present.
"We need the money, pure and simple,'' said Mayor Chuck Reed in support of the vote. He later added that he, too, was concerned that current city regulations seem to hold that all pot sales are illegal.
The vote came at the end of an impassioned special meeting. The council chambers were crowded with people arguing against any ban or heavy restrictions on what they insisted is legal medicine.
While relieved there was no ban, dispensary owners and medical marijuana movement leaders reacted with some dismay to the new tax, which will take effect early next year.
"Most people would be against taxing something that the city refuses to recognize as legal," said marijuana activist Lauren Vasquez, despite the overwhelming voter support for Measure U on last month's ballot.
Nearly 80 percent of city residents who weighed in on the question -- some 184,000 people -- blessed the measure, which proposed a tax of up to 10 percent of pot sales to help pay for city services like police, street maintenance, parks and libraries.
Still, the legal right to medical marijuana has become hugely contentious throughout the state over the last year. Dispensaries have proliferated since the Obama administration indicated it would take a softer stance on medicinal marijuana laws.
Without regulations, San Jose has gone from a handful of clubs to a hundred, even though they remain technically illegal under city zoning codes.
Even with the state coming up with legal guidelines, local jurisdictions have crafted a patchwork of ordinances to handle the issue. Several major California cities allow and regulate their marijuana dispensaries, including San Francisco, Oakland and Los Angeles. Some local towns, such as Gilroy and Los Altos, have banned them all together. Others, like San Jose, are still struggling with some sort of unified policy.
And to complicate an already complex issue, a local narcotics task force has begun a series of raids on the dispensaries, under the theory that they are profit-making and therefore illegal under California law. State guidelines and some legal precedent suggest that medical marijuana distribution should be non-profit, but what exactly constitutes a "profit" remains highly debatable.
During Monday's council meeting, Santa Clara County Supervising Deputy District Attorney Frank Carrubba -- who helped develop the city manager's plan to ban the clubs -- said he thought it was possible all the marijuana dispensaries in the state are illegal. Many in the audience responded with amazed laughter.
State voters in 1993 passed Prop. 215, decriminalizing marijuana for the treatment of medical conditions with a doctor's recommendation. But pot advocates and foes alike say the law is the most vague of any medicinal marijuana statute in the country.
It was from this legal foundation that many of the city administration's recommendations sprang. City Manager Debra Figone suggested the council ban the existing dispensaries, then hold a lottery and select up to 10 collectives to legalize and heavily regulate.
Each chosen collective would have to pay $104,645 registration fee. That money, Figone proposed, would pay for five additional city staff -- including three police officers -- to monitor and regulate the new collectives.
Under her plan, the collective also could not sell marijuana; instead, they could create pot sharing operations, with each member performing a duty.
But there was some cynicism toward the manager's proposal, especially in light of Measure U's seeming mandate. Councilman Sam Liccardo archly asked city lawyers how the collectives could pay for required security if they could not make any money from their operations.
Perhaps the most resistant to Figone's proposal was Councilman Pierluigi Oliverio, who has long championed regulating the cannabis clubs. He scoffed that he did not see how a bartering system for marijuana would work.
Oliverio had proposed his own plan to reduce the number of dispensaries to about 30 and create an ad hoc committee to bring forth a proposed ordinance.
The council rejected his plan for now. Instead, broader regulatory and legal issues were referred to the council's Rules Committee, which will take them up at an unspecified point in the future.
In the meantime, Oliverio said the passage of Measure U -- and the council's Monday vote -- will help winnow the number of local pot clubs. He predicted some dispensaries won't allow themselves to be audited and others won't pay the tax, so they'll be shut down.
"It's going to thin out the herd," he said.
Source: Mercury News
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