POT CLUBS FACE SCRUTINY

Proposal Would Regulate Growing S.F. Industry.

Two years after local voters passed a pro-medical marijuana measure, San
Francisco may finally update its "see no evil" policy and begin regulating
its dozens of dispensaries.

The City has seen "an explosion of new medical marijuana clubs," according
to Supervisor Ross Mirkarimi, a Green Party member who plans a public
hearing on an estimated 34 clubs. Health Department records show that from
2003 to 2004, the number of patients requesting medical marijuana ID cards
doubled to more than 7,000.

"After seeing the rise of this cottage industry in San Francisco, questions
abound as to what The City might do to benefit from this commerce,"
Mirkarimi said. "I'm not looking in order to infringe on their business,
but I want to bring them into the sunshine."

Mirkarimi's hearing will address possible licensing fees, zoning
requirements, safe access guidelines and consumer protections. Currently,
The City allows the clubs to operate in a black-market limbo, free from
prosecution or onerous planning hurdles.

Jason Beck, who owns the Alternative Herbal Medicine pot club on Haight
Street, welcomed the increased scrutiny and regulation.

"Whatever types of regulation we can impose that benefit the patients would
be great and will only provide us with more legitimacy," said Beck, adding
that some city clubs simply sell pot for profit, with nothing in the way of
patient consultation or care.

A business license could also help dispensaries obtain insurance, Beck
said, adding that a permitting fee would be a way for the clubs to pay a
tax into city coffers.

Currently, all an aspiring medical marijuana shopkeeper needs in order to
open is a willing property owner. Wayne Justmann, who was the first in line
when The City began issuing medical marijuana ID cards, said the time is
right for The City to define what constitutes a dispensary.

He pointed to a Haight Street smoke shop owner who one day put a medical
marijuana sign in the window and started selling pot out of pickle jars.

"Because you have six pickle jars with cannabis in them, that makes you a
cannabis club?" he asked. "I'm offended."

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HUGE RISE IN DEMAND

Demand for medical marijuana has grown sharply since the Health Department
began issuing ID cards four years ago.

Year: Cards issued

2000: 754

2001: 2,089

2002: 2,270

2003: 3,085

2004: 7,014

Number of San Francisco cannabis clubs: 34.

Regulations: None

Number of Oakland cannabis clubs: Four.

Regulations: Four-club limit within the city, $5,000 to $20,000 licensing
fee, zoning, monitoring