HomeMy WebLinkAbout17 - Medical Marijuana DispenseriesCITY OF NEWPORT BEACH
CITY COUNCIL STAFF REPORT
Agenda Item No. 17
June 28, 2005
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: Aaron C. Harp, Assistant City Attorney
Ext. 3131, aharp(a ) city.newport- beach.ca.us
SUBJECT: Report describing the measures taken to alleviate the conditions which led
to the adoption of Interim Urgency Ordinance No. 2005 -7 regulating
medical marijuana dispensaries
RECOMMENDED ACTION:
Receive and file the report.
BACKGROUND:
On May 24, 2005, after conducting a noticed public hearing, the City Council of the City
of Newport Beach enacted Ordinance No. 2005 -7, an interim urgency ordinance making
findings and establishing a temporary moratorium on the establishment and operation of
medical marijuana dispensaries in the City.
Ten days prior to the expiration of the interim urgency ordinance, the City Council must
issue a written report describing the measures taken to alleviate the condition which led
to the adoption of the ordinance. Accordingly, the City has prepared this report in
satisfaction of the requirements of Section 65858.
PUBLIC NOTICE:
Public notice was provided in accordance with all applicable laws.
Prepare by: Submitted by:
Aaron C. Harp, Assistant City Attorney Robin Clauson, City Attorney
Attachment: Report of the City Council of the City of Newport Beach on the Interim
Urgency Ordinance Regulating Medical Marijuana Dispensaries
REPORT OF THE CITY COUNCIL OF THE CITY OF NEWPORT
BEACH ON THE INTERIM URGENCY ORDINANCE REGULATING
MEDICAL MARIJUANA DISPENSARIES
I. Introduction
On May 24, 2005, after conducting a noticed public hearing, the City Council of the City
of Newport Beach enacted Ordinance No. 2005 -7, an interim urgency ordinance making findings
and establishing a temporary moratorium on the establishment and operation of medical
marijuana dispensaries in the City. Pursuant to Government Code Section 65858, the interim
urgency ordinance shall remain in effect for forty -five days, after which it may be extended by
the City Council for an additional ten months and fifteen days.
Ten days prior to the expiration of the interim urgency ordinance, the City Council must
issue a written report describing the measures taken to alleviate the condition which led to the
adoption of the ordinance. Accordingly, the City has prepared this report in satisfaction of the
requirements of Section 65858.
II. Background to the Adoption of the Interim Urgency Ordinance
In 1996, the voters of the State of California approved Proposition 215, which was
codified as Health and Safety Code Section 11362.5, et seq., and entitled the Compassionate Use
Act of 1996. The intent of Proposition 215 was to enable persons who are in need of medical
marijuana for medical purposes to obtain and use it under limited, specified circumstances.
On January 1, 2004, SB 420 went into effect. SB 420 was enacted by the Legislature to
clarify the scope of the Compassionate Use Act and to allow cities and counties to adopt and
enforce rules and regulations consistent with SB 420 and the Compassionate Use Act. The
Newport Beach Municipal Code does not address or regulate in any manner the existence or
location of medical marijuana dispensaries.
After receiving inquires from persons interested in establishing medical marijuana
dispensaries, the City Council considered and enacted Ordinance No. 2005 -7 establishing a
temporary moratorium on the establishment and operation of medical marijuana dispensaries in
the City.
The City Council adopted Ordinance No. 2005 -7 because it found that: (1) because a
significant number of cities, including cities in the County of Orange, have prohibited or heavily
regulated medical marijuana dispensaries, there was a substantially increased likelihood that such
establishments would seek to locate in the City of Newport Beach; (2) other California cities that
have permitted the establishment of medical marijuana dispensaries have witnessed an increase
in crime, such as burglaries, robberies, and sales of illegal drugs in the areas immediately
surrounding such dispensaries; and (3) the United States Supreme Court was considering the
validity of the California Controlled Substances Act in the California case of Raich v. Ashcroft,
(2003) 352 F.3d 1222 (subsequently renamed Gonzalez v. Raich).
The City Council also found that issuing permits. business licenses, or other applicable
entitlements providing for the establishment and /or operation of medical marijuana dispensaries,
prior to: (1) the United States Supreme Court resolving the conflict in state and federal law on
the subject of medical marijuana, (2) the City's completion of its study of the legality, potential
impact, and regulation of such facilities; and (3) resolving any zoning conflicts based on the fact
that no zoning currently exists in the City for such dispensaries, would pose a current and
immediate threat to the public health, safety, and welfare, and that a temporary moratorium on
the issuance of such permits, licenses, and entitlements was thus necessary.
III. Pleasures Taken Since the Adoption of the Interim Urgency Ordinance
A. The United States Supreme Court's Decision in Gonzalez v. Raich.
On June 6, 2005, the United States Supreme Court decided the case of Gonzales v. Raich.
(2005) 2005 WL 1321358 U.S., holding that federal laws that ban the use of marijuana for
medical purposes are constitutional. Specifically, the Court held that the Commerce Clause
grants Congress power to regulate purely local activities that are part of an economic class of
activities that have substantial effect on interstate commerce. The United States Supreme Court
also held that the application of the Controlled Substances Act provisions criminalizing
manufacture. distribution, or possession of marijuana to intrastate growers and users of
marijuana for medical purposes, as otherwise authorized by the California Compassionate Use
Act. did not exceed Congress' authority under the Commerce Clause to prohibit intrastate growth
and use of marijuana.
B. Response to the Gonzalez v. Raich Decision.
On June 6, 2005, California Attorney General Bill Lockyer issued an opinion that the
decision in Gonzales did not overturn California law permitting the use of medical marijuana and
that Californian's should contact their Congressional Representatives and Senator's and ask them
to take a fresh look at the federal laws that ban its use.
A possible response by the United States Congress to the decision in Gon-zales is that
federal laws that ban medical marijuana use may be modified. Because California law was not
overturned by the decision in Gonzales, any modification of the federal law's would have a direct
impact on the City.
C. Analysis of Proposition 215 and SB 420.
The City Attorney's Office has been conducting analysis of Proposition 215 and SB 420.
Currently. City Attorney's Office is still conducting its analysis; however. the City Attorney's
Office initial research has raised several issues regarding whether California law permits the
establishment of commercial facilities designed to dispense marijuana.
Specifically, Proposition 215 and SB 420 do not expressly provide for commercial
establishments designed to dispense marijuana, nor do they provide for other similar
establishments set up for the dispensing of marijuana. At this time, legal challenges have been
filed against cities that have enacted legislation banning medical marijuana dispensaries. A
resolution of these cases should shed light on the interpretation of Proposition 215 and SB 420.
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D. Impact of Medical Marijuana Dispensaries.
The City Attorney's Office and Planning Department has been conducting additional
research regarding the secondary impacts of medical marijuana dispensaries that have been
permitted in other cities.
As noted at the time Ordinance No 2005 -7 was adopted, the United States Department of
Justice's (DOJ) California Medical Marijuana Information report provided that large -scale drug
traffickers have been posing as "care givers" to obtain and sell marijuana. This opinion appears
to be supported by a recent action taken by the Los Angeles Police Department ( "LAPD ") and
Federal Internal Revenue Service (IRS) in Los Angeles.
Specifically, on May 11, 2005, after an eight -month investigation, LAPD Narcotics
Squad officers and IRS agents raided a medical cannabis club operating in West Hollywood,
arresting 14 people and seizing 300 pounds of marijuana product (wholesale value, $2.5 million;
retail value over S5 million) and between 5300,000 to 500,000 in cash.
According to LAPD spokesperson Sergeant Plow. surveillance found that the club
allegedly sold large amounts of marijuana to customers on a regular, sometimes daily, basis.
Sergeant Plow stated that the LAPD had "formed the opinion that the club was in violation of
Health & Safety Code 11360 (transportation, distribution or importation of controlled
substances) through the surveillance." Sergeant Plow told reporters that the establishment
regularly sold between 3 ounces to 1 pound quantities to people who made sometimes daily
buys. Apparently, there was an average of 235 visits a day to the club. Sergeant Plow concluded
that the establishments actions constituted "drug dealing, not medicine dispensing."
Other secondary effects can be seen by the increases in illegal drug activity, illegal drug
sales, robbery of persons leaving dispensaries. loitering around dispensaries, falsely obtaining
"identification cards" to qualify for medical marijuana, and other increases in criminal activity.
For example, on December 27, 2003, five anned masked men burst into the Alternative Herbal
Health Services clinic in the 400 block of Haight Street in San Francisco. According to the
owner Jason Beck. the robbers grabbed 23 eight vials of marijuana from behind the counter,
worth as much as 51,500. When Beck leaned over to see what the suspects looked like and
pressed the alarm behind the counter, lie was then pistol- whipped in the head five times by
different suspects, as they tried to get him to stop pressing the alarm and open the cash register.
In response to the incident, Captain Tim Hettrich, the City of San Francisco's head of
narcotics, said he has long worried about potential robberies at medical marijuana clubs.
Captain Tim Hettrich stated that "[o]ne of my major concerns has been that these people are
vulnerable and there is a tremendous amount of cash on hand."
On a related note, on or about May 16, 2004, Mr. Beck was robbed at his home.
Specifically, two intruders kicked down the door of his house, put a gun to his head and fleeced
the place of several thousand dollars' worth of marijuana along with other valuables.
Other examples include: (1) the robbery of the University Medical Marijuana Club which
was robbed three times in one year resulting in the closure of the club; (2) men who kicked in the
window of a medical marijuana dispensary in Oakland and tried to rob the dispensary; and (3)
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thieves that broke into a medical marijuana dispensary in Alameda County robbing the safe as
well as persons present.
E. Regulation of Medical Marijuana Dispensaries.
The City Attorney's Office and Planning Department has conducted additional research
regarding how other cities are regulating medical marijuana dispensaries. Specifically, the City
Attorney's Office and Planning Department are currently reviewing regulations adopted by
Huntington Beach, Oakland, Berkley, Elk Grove, and Citrus Heights.
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