IN BERKELEY, 2 MEASURES WOULD GROW CANNABIS INDUSTRY

Dispensaries Are Split Over Marijuana Production and Tax Proposals

Berkeley residents will vote on two ballot measures Tuesday that
could lead to a greatly expanded medical cannabis industry in the
city - and hundreds of thousands of new dollars for the city's coffers.

Measure T would increase the number of locations where marijuana is
sold from three to four, and also permit six 30,000-square-foot
indoor growing areas in the city's industrial zone in West Berkeley.
These places would not be open to the public, but would be used to
grow cannabis, test it, distill it into tinctures or creams, or cook
it into food products.

Measure T would also explicitly permit medical cannabis collectives
to operate in residential neighborhoods, but would limit the size of
their growing operations to 200 square feet. Collectives are usually
composed of a small group of people who come together to grow
cannabis for their own use. Sometimes they sell their excess
marijuana to dispensaries.

Measure T would also dissolve the current Medical Marijuana
Commission created by Measure JJ and replace it with one whose
members are appointed by the City Council.

Measure S would place a tax on medical cannabis sales - up to 2.5
percent for medical cannabis and, if Proposition 19 passes, as much
as 10 percent for recreational marijuana. Raising the tax from its
current level of $1.20 for every $1,000 of gross receipts to $25 per
$1,000 of gross receipts would bring the city approximately $460,000
a year, according to a staff report.

The city's existing dispensaries are split on whether to support
measures S and T. The Berkeley Patients Group, the city's largest
dispensary, located on San Pablo Avenue, is in favor of the measures,
while Berkeley Patients' Care Collective, located on Telegraph
Avenue, is opposed.

The Berkeley Patients Group, which has donated money to the Yes on T
campaign as well as to Proposition 19, supports the new measures
because it would like to be more in control of the cannabis products
it sells, according to spokesman Brad Senesac. Currently, the
dispensary purchases marijuana, tinctures and food products from
independent growers and collectives. The BPG hand-inspects all
cannabis that comes into the dispensary to make sure it meets the
group's standards. BPG could better control its product if it also
grew some, Senesac said.

BPG would probably submit an application to be one of the
organizations that sets up a grow operation in West Berkeley, said Senesac.

The Berkeley Patients' Care Collective, in contrast, believes that
Measure T gives too much power to the City Council and does not leave
enough decision-making authority to those involved in the day-to-day
workings of the medical cannabis business, said Erik Miller, a
manager. He said he is not convinced that City Council members will
appoint people who really know the business, since they have not been
particularly friendly to the cannabis community, he said.

Measure T also gives the City Council the power to make future
amendments to the initiative, rather than turning it back to the voters.

"I don't know why Berkeley voters would want to give up their rights
to make decisions on this," said Miller.

The BPCC is also concerned that the passage of Measure S will make
medical cannabis too expensive for some of its customers, since it
will be taxed twice. Miller said the tax placed on marijuana will
really amount to $50, not $25, per $1,000. When the collectives sell
pot to dispensaries, they will have to pay a tax on that transaction.
When the dispensaries sell it to their customers, they must also
place a tax on the marijuana, said Miller. Those added costs will be
passed on to customers, he said.

Wendy Cosin, the city planner who staffs the Medical Marijuana
Commission, said she thought Measure S would permit this double taxation.

However, Measure T states that the new Medical Marijuana Commission
will establish standards for any new dispensary that opens. Those new
requirements will make it mandatory for a new dispensary to provide
low-cost cannabis to low-income patients, as well as some organically
grown marijuana.

What they are saying about Measure T:

Opponents: Grow facilities attract crime and break-ins. Increasing
the number in Berkeley will increase criminal behavior. With six
dispensaries of 30,000 square feet each, more than four acres of land
will be used for the cannabis industry.

Proponents: Most crime occurs in facilities that are illegally
growing pot for recreational use. All new dispensaries and grow
operations will have to submit a security plan to the police
department for approval.

Opponents: Measure T gives the City Council too much authority over
marijuana laws. The council could expand the cannabis industry
without going back to voters for their approval.

Proponents: The City Council needs the ability to amend the law
according to changing social and economic dynamics. Most likely, any
major changes to the law would be vetted through the city's public
hearing process.

Opponents: The current Medical Marijuana Commission is made up of
representatives from the dispensaries who know the ins and outs of
the industry. The City Council may appoint people who are not
familiar with the business.

Proponents: The current commission does not reflect the diversity of
the community. City Council members can change this by appointing
members from different ethnic and economic backgrounds. The measure
also states that the new nine member commission shall have at least
one member from the dispensary community, one from the collective
community and one a cultivator who is independent from any dispensary.

Opponents: The existing law prohibits dispensaries from locating
1,000 feet from any public school. The new law reduces that buffer to 600 feet.

Proponents: The old law did not prohibit dispensaries near private
schools; the new one does.

Opponents: Allows collectives to operate in residential neighborhoods
with no permitting process.

Proponents: Collectives are permitted under California law and
Berkeley does not have any legal authority to prohibit them. Measure
T gives the city the authority to insist that collectives comply with codes.

Opponents: The six 30,000 square foot grow facilities add up to more
than four acres of indoor space for growing marijuana. These will
consume a huge amount of energy.

Proponents: Measure T establishes a code compliance requirement,
demands that any new cannabis business use energy offsets and urges
that organic methods be used as much as possible.

Who supports Measure T: All members of the Berkeley City Council,
state Sen. Loni Hancock, Assemblywoman Nancy Skinner, the Oakland
Tribune, the San Francisco Bay Guardian, Apothecary Genetics (a seed
breeding company in Southern California).

Who opposes Measure T: Former Mayor Shirley Dean, former police Chief
Dash Butler, former Alameda County Assistant District Attorney Jack Radish.