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Voters to decide on medical marijuana dispensaries

DEL MAR — Del Mar voters will decide the fate of medical marijuana dispensaries in their city. 

But even if the initiative receives majority support in the Nov. 6 election, there’s no guarantee stores will be allowed to open.

Bob Mahlowitz, a senior partner in the city attorney’s office, said many people believe that if they vote on an initiative and it passes, it can be law.

“That’s not the case until it’s taken to a court in some fashion,” he said. “No one has opined on the legality of it.”

Mahlowitz said the proposed ordinance, as written, contains misrepresentations and illegal and improper uses, meaning it may be “beyond the power of a city to enact.”

“It doesn’t matter that it’s the people who vote it in,” he said. “It can’t be done. It’s illegal.”

In June, council members were presented with a proposed initiative from the Patient Care Association of California, a nonprofit organization of medical cannabis collectives.

The group gathered enough signatures to qualify it for the November ballot. Of the 911 signatures collected, 552 were disqualified, including 363 from nonresidents, City Clerk Mercedes Martin said.

She said she asked the county registrar of voters to verify only the required 10 percent, or 298, because there is a per-signature charge, so 61 weren’t reviewed.

According to election laws, council members had three choices when the proposed initiative was presented — adopt it as written, place it on the fall ballot or order a report that had to be presented within 30 days.

They chose the latter.

The 28-page report with exhibits was made available to council members and the public at the July 18 meeting, during which Mahlowitz provided a summary.

The law precludes the city from making any changes to the proposed ordinance, which he said contains several flaws.

“Flat out, the initiative violates California sales tax laws,” Mahlowitz said. It proposes to tax medical marijuana at 2.5 percent higher than the state sales tax. Cities can only charge up to 1 percent more on the sale of goods, he said.

“The sanction for that under state law is that the Board of Equalization must cease collecting all sales taxes … from all businesses,” he said, adding that the nearly 2,000 businesses in the city would have to adopt new accounting procedures.

“It would impose significant expenses to all businesses in the city,” he said. “This is illegal. The city is not allowed to do this according to state law.”

He said cities that currently regulate medical marijuana dispensaries collect an excise tax, which is governed by different laws.

“That this proposal was going to have such a profound impact on the city’s businesses … probably would have impacted the willingness of Del Mar voters to sign the petition,” Mahlowitz said.

Noting the cultivation, manufacture or sale of marijuana is illegal, he also said the initiative would require city employees to violate federal law because they must issue permits authorizing businesses to distribute marijuana, making them subject to possible prosecution for aiding and abetting.

Many elements common in legislation are also missing, he said, including a lack of provisions for if and when permits may expire or be revoked.

As written, he said, some felons could operate the dispensaries. There are also no record-keeping or reporting mandates, landlord protections or parking requirements.

Most of the nearly 20 speakers at the meeting were not Del Mar residents. Many who support the initiative criticized council members for not allowing the Patient Care Association of California equal time to address the city attorney’s report.

For every supporter who spoke, there was an opponent who voiced concerns about the initiative.

“Dispensaries have become a Trojan Horse bringing illicit drug dealing to our neighborhoods,” John Byron said. “Unfortunately, as adults continue to debate this issue our teens are using marijuana at an increasing rate and not perceiving it as harmful.”

“I don’t think regulation and oversight of a controlled substance leads to greater crime,” Cynara Velazquez, of Citizens for Patients Rights, said.

“Pot shops will always be about profits, not compassion,” Nancy Logan said. “We do not want them in Del Mar.”

After more than two and a half hours that included two closed-session meetings, a presentation and public comment, council members were once again faced with three alternatives.

They could adopt the proposed ordinance, let voters decide in the November election or reconvene in 10 days to choose between those two options.

“I’m absolutely not in favor of adopting this ordinance as written,” Councilman Mark Filanc said. “The only other real option here is to submit this for a ballot measure.”

Council unanimously agreed to place it on the ballot, noting that delaying it another 10 days would not make the issue any less divisive.

“That in no way indicates my support for this initiative,” Filanc said.

Councilwoman Lee Haydu agreed. “There’s no way that I’m in favor of this but this is something that I think we have to do since we’ve had voters sign (to get) this on the ballot,” she said.

Councilman Terry Sinnott said Mahlowitz raised “some very strong concerns … that as a city we should be very worried about regarding taxes around laws that we might be breaking.”

“If the signers of the petition had known the details of the ordinance as proposed it would be my thought that they would not have signed the petition,” he said. “It puts the city of Del Mar in a very bad position.”

“It’s unfortunate that it has qualified for the ballot and we have no alternative but to put it on the ballot,” Mayor Carl Hilliard said.

Council members appointed Hilliard and Sinnott to write the direct arguments against and the rebuttal argument for the ballot measure.

Martin said it is estimated it will cost the city an additional $6,000 to $7,000 to add the initiative to the November ballot.