POT CLUBS GROW BELOW CITY'S RADAR

Marijuana Operations Located in Back Rooms of Businesses

Thursday, August 07, 2003 - OAKLAND -- In the heart of Uptown, the
battered northern edge of downtown that City Hall has long sought to
revitalize, a new commercial district has sprouted: Oaksterdam.

Nurtured by the city's benign neglect, half a dozen cannabis
dispensaries and related suppliers have set up shop in a green
triangle bounded by 17th and 19th streets and Telegraph Avenue and
Broadway.

Several operate cafes in the front and direct medical marijuana
patients to back rooms or basements to get their supplies. Others look
more like nightclubs with guards posted outside to check
identification.

Unlike Amsterdam, however, where marijuana is legal but regulated,
cannabis clubs here are operating in a netherworld between federal,
state and local laws. Their activities may be lawful under
California's Proposition 215, but the feds have argued they are illegal.

And the city over the past few years has taken a laissez-faire stance,
providing no oversight and telling the police to steer clear.

Until things are sorted out, the clubs have no strong legal
protection, and since they are vulnerable to the U.S. Drug Enforcement
Agency, have been staying on the down-low. Staffers of clubs in the
Uptown area declined to be interviewed for this story.

The clubs have kept such a low profile that Mayor Jerry Brown, who has
been focusing on Uptown for a large redevelopment project and also
wants to move his charter school for the arts to the Fox Theater on
Telegraph and 18th Street, doesn't know much about them, said press
secretary T.T. Nhu. She said the mayor was seeking more information
from the city manager's office.

But with the neighborhood's nickname and the recent opening of several
more outlets, including a large one within the past month, the area is
gaining a reputation and a higher profile.

Attendees at the National Organization for the Reform of Marijuana
Laws (NORML) April conference in San Francisco took a field trip to
Oaksterdam to see what was billed as a model of peaceful, lawful
medical marijuana distribution for the rest of the country.

Dispensaries that are casting themselves as health care providers with
names like Compassionate Caregivers and California Advocate Relief
Exchange are operating alongside those whose names are associated with
recreational use.

The Bulldog Coffeeshop on Broadway has the same name and logo as the
famous Amsterdam hash bars, the SR71 Coffeeshop on nearby 17th Street
uses the name of a military reconnaissance plane also used to spy on
marijuana crops, and the new 420 Cafe makes a reference to the code
name for pot among users.

There are so many purveyors that the Fat Cat Cafe on Broadway posted a
sign on its window reading "This is not a dispensary." Too many people
were heading to the deli's upstairs seating area thinking they could
get their prescriptions filled, said one worker.

The clubs have generally been responsible tenants, and Joel Tena, aide
to Vice Mayor Nancy Nadel (Downtown-West Oakland), said the
councilmem-ber's office has gotten few complaints.

"Past problems have been solved through meetings facilitated by this
office," Tena said.

The new Lighthouse Community Charter School, which serves
kindergarteners, first-, sixth- and seventh-graders, opened last
August next door to California Advocate Relief Agency club in the
Floral Depot building at 19th and Telegraph. Jenna Stauffer,
co-director of the school, said the neighbors are subtle and
responsible.

But she said the proliferation of clubs is a concern.

"We walk around a lot, and it's interesting at best," Stauffer said.
"There are smells wafting out of the building and the children ask
about it."

Tena said Nadel is supportive of the clubs but believes the high
concentration of dispensaries in the neighborhood is becoming a problem.

The Sexual Minority Alliance of Alameda County (SMAAC) is one of those
that have complained -- loudly and repeatedly. SMAAC's drop-in center
for lesbian, gay, bisexual and "questioning" youth is sandwiched in
between the Lemondrop Cafe and Compassionate Caregivers, two cannabis
clubs.

The group, which is celebrating its fifth anniversary this weekend,
wants the city to regulate the clubs, much as they do liquor stores,
which must jump through regulatory hoops to open.

"Our goal is to give young people options, not introduce them to
smelling weed," said Roosevelt Mosby, SMAAC executive director. "The
smell is so strong in our basement that they don't have to buy it --
they can go down there and breathe deeply."

Mosby readily admits that many of the young people served by his
program have drug and alcohol problems, and it's a difficult
environment to operate in.

When the program moved there in 1998, only the Oakland Cannabis Buyers
Cooperative was on Broadway. The coop was the first and only program
to be deputized by the City Council to distribute medical marijuana.

Its founder, Jeff Jones, pioneered the voluntary standards that many
cannabis clubs have adopted in regulatory vacuum left by Proposition
215 -- which legalized medicinal marijuana for serious illnesses but
was very vague on the details.

The Oakland City Council tried to give the coop some protection, but
that didn't stop the Drug Enforcement Agency from shutting it down and
filing a lawsuit to keep it and five other Northern California clubs
closed.

The suit went all the way to the Supreme Court, which ruled that the
clubs could not use a medical necessity defense but left open some
legal avenues for the clubs to pursue. Those issues are now on appeal
before the 9th U.S. Court of Appeals.

The coop has not acted as a dispensary since 1998. Instead, it
continues to issue identification cards to patients, screening them
and their doctors and requiring annual renewals. It also sells hemp
products and literature and helps patients acquire vaporizers to
ingest the drug.

Jones said he could not comment on the issues surrounding the new pot
clubs in the neighborhood, though he has always been in favor of
stringent regulations for cannabis distributors. Some of the nearby
clubs accept the coop's cards, others don't, he said.

"I'm supportive of any agency that is trying to help people get
medicine," he said. "If there were no federal vacuum, I'd be all in
favor of the city regulating cannabis clubs."

But with the lawsuit still pending, the city has apparently been
turning a blind eye. No one in the city manager's office has worked
with the clubs since Mike Nisperos, who developed the agreement with
the coop, left two years ago, according to complaint investigator
Larry Carroll.

"There is no permitting or criteria they would have to go through
now," Carroll said.

The Planning and Zoning Department would treat them as a medical
services operation, like a drugstore or pharmacy -- provided they give
an accurate description of their operations, said Planning Manager
Gary Patton.

But Deputy City Attorney John Truxaw said he is "unaware of any group
that has gone to the city and sought a land-use permit as a medical
marijuana club. If it's not a commercial endeavor, and they are
operating under the city council ordinance, then they would not have
to."

Some of the clubs have current businesses licenses as retailers or
professional services providers; others have no records with the city.
It's unclear whether they operate as not-for-profits, as the coop did,
or whether they are paying business taxes based on their marijuana
sales.

And the police, acting in accordance with the council's policy and
swamped with higher priority needs, continue to give the clubs wide
berth.

"I keep extensive documentation about every nightclub in town, but I
couldn't tell you anything about these," said Lt. Ed Poulson, area
commander for downtown. "We'd give people a ticket for double parking
in front while they go in, but that's it. Because of our
interpretation of the council rule, if you are a cannabis club, we
don't do any enforcement."