Weed Wars

Dispatches from the California Marijuana Front

March 10, 2011
As L.A. looks to shutter dispensaries, voters choose to cash in

As the city council in California's largest city seeks to shutter scores of medical marijuana dispensaries, Los Angeles voters just issued a resounding declaration: If you can't close 'em, tax 'em.

Fifty-nine percent of voters approved Los Angeles' "'M' for marijuana" Measure M, allowing the city to impose a five percent tax on gross dispensary receipts - on top of sales taxes they must pay to the state.

While pot taxes have been endorsed by many dispensaries and medical marijuana advocates as a path to political legitimacy, Measure M was fought by an L.A. dispensary association and strongly opposed by Americans for Safe Access, a leading medical marijuana patients advocacy group.

"We are in times when cash-strapped local governments are seeking creative and inventive ways to create local revenues," said Kris Hermes, an ASA spokesman. "But it's really unfortunate that it is on the back of our most vulnerable, the patients."

Meanwhile, as reported in the Sacramento Bee today, the state of California is aggressively pursuing sales taxes due from a medical marijuana industry that handles hundreds of millions of dollars in marijuana transactions. And cities are passing ordinances for new local taxes.

Los Angeles City Council member Janice Hahn said the city hopes to take in as much as $10 million from its new dispensary tax, even as it seeks to cap its number of dispensaries at 100 - down from as many as 800 at the wild L.A. market's peak last year.

In Oakland, where voters in November increased local dispensary taxes from 1.8 percent to 5 percent, the city is expecting an increase in medical pot revenues from $434,000 last year to $1.4 million this year. Sacramento is due to impose a four percent voter-approved medical pot tax on July 1.

Eleven California cities now have local medical marijuana taxes. San Jose, which has seen a boom in local cannabis clubs, has voter approval to impose taxes of up to 10 percent. Rancho Cordova, which doesn't permit dispensaries, has approval to impose a 12 to 15 percent tax, just in case some future City Council allows medicinal pot clubs to open in town.

A local news report on the L.A. pot tax and dispensary debate may be viewed below.

March 3, 2011
Partners of 'Wal-Mart of weed' file claims for unpaid services

20110226_AOC_weGrow_052w.JPGIn Sacramento, the first national franchise for weGrow, a cavernous hydroponics store marketing itself as a retail outlet for people growing marijuana for personal medicinal use, opened to fragrant fanfare Feb. 26.

But back in Oakland, where the parent store opened as iGrow in January 2010, some angry former partners are charging that they weren't paid for services there.

In e-mails to The Sacramento Bee, Amy Peterson, says her firm, Your Girl Friday Interiors, had to take weGrow in Oakland to small claims court because it didn't pay her for "branding concepts" and "marketing ideas" for the firms' plans to open weGrow franchise stores.

Edward Piatt e-mailed that he is owed payment for architectural services for the Oakland store, which is now a non-retail products distribution center. "I was never paid for my services and my hard work," Piatt said.

Dhar Mann, who founded iGrow and has been championing the launch of weGrow franchises in Sacramento and several cities to come, said in an interview that the claims are the result of a failed business partnership with a former associate, Derek Peterson, whom Mann said is married to Amy Peterson. He denied that he owes his former associates anything, declaring: "This is all going to be litigated over the next few weeks...We're going to defend these cases."

The East Bay Express reported that small claims actions were filed in Alameda County Feb. 22 on behalf of contractors and partners who charged they weren't paid for products or services.

The Sacramento weGrow store operates as an independent franchise. Mann has said other weGrow franchises are due to open this spring in Arizona, Colorado, New Jersey and Oregon.

Pictured: The budding nutrients product line at the weGrow store in Sacramento. Autumn Cruz/acruz@sacbee.com



About Weed Wars

Peter Hecht

From its pot fields to politics, California is the epicenter for America's marijuana discussion. This blog covers news, trends and people of the California marijuana story.

Contact reporter Peter Hecht at phecht@sacbee.com

» See the sacbee.com marijuana topics page

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