100 L.A. Pot Shops Closed, Many More May Have Opened

Tuesday, March 18, 2014

Proposition D (pdf) was supposed to bring some order to the chaotic Los Angeles medical marijuana scene when voters approved it last year, but dispensary owners and their customers are still operating in a haze.

Last week, City Attorney Mike Feuer announced that his office had closed more than 100 pot shops that weren't in compliance with the new law, which limits the number of dispensaries by various means. He said more than 300 people had been prosecuted; fines and probation were handed out, but no jail terms.

Meanwhile, the city's finance department reported that 300 more dispensaries had taken out business licenses since Prop. D took effect, although they would not be legal businesses.

No one knows how many dispensaries there are in the city, but estimates ranged from 700  to 1,000 last year. Prop. D aims to cap that at around 135. The law grandfathers in any shop opened before 2007, when the city tried and failed to establish a moratorium.  

While Feuer was adamant that the city would do whatever it takes to rein in dispensaries, it apparently won't stop handing out business licenses to deluded owners and prospective owners of pot shops.

The city has handed out 1,400 tax registration certificates to dispensaries since April 2011, but city officials have made it clear they are not licenses to actually operate a business. Around 300 have been issued since Prop. D took effect in June.

“There is an urban legend in Los Angeles that the mere receipt of a business tax registration certificate displays the lawfulness of a medical marijuana business—and that is false,” Feuer said at a press conference.

Legends die hard and hope springs eternal for those who think that the Los Angeles law will protect them from the feds, even if they are one of the privileged legal dispensary operators. Prop. D makes it clear that it is not meant to conflict with federal law, which bans the sale or possession marijuana for any purpose, recreational or medicinal.

Feuer said he has successfully fought off more than 20 challenges to the law and has hired two new attorneys to prosecute those involved with dispensaries, including those people who rent them space.

The city has a few extra dollars to pay for the drug crackdown. Los Angeles has collected $1.6 million in taxes from dispensaries since January 1, and $8.6 million since 2011. There was no word how much of that money came from legal businesses.

–Ken Broder


To Learn More:

More Than 100 Marijuana Shops Shuttered, L.A. City Attorney Says (by Emily Alpert Reyes, Los Angeles Times)

Medical Marijuana Dispensaries Bring in $8.6 Million in Taxes to Los Angeles Coffers (by Rick Orlov, Los Angeles Daily News)

Los Angeles Shutters More than 100 Pot Shops (by Kathleen Miles, Huffington Post)

L.A. Voters Restrict Pot Dispensaries, but the Medical Marijuana Fight Isn’t Over (by Ken Broder, AllGov California)

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