Arizona Republic: “More than 1,000 people have commented on the proposed medical-marijuana rules so far, responding most heavily to a handful of areas that include the definition of doctor-patient relationships and medical directors and limitations on where dispensaries get marijuana. . . .Department officials identified the top 10 suggestions as of Wednesday, including:”
Arizona Republic: “Glendale is proposing a zoning amendment to limit registered non-profit medical marijuana dispensaries to manufacturing and industrial areas of the city. City staff will host a meeting to gather public comments on the proposed zoning code amendment. Under Proposition 203, the only distance limit prohibits dispensaries from locating within 500 feet of schools.”
The Arizona Association of Dispensary Professionals (AZADP) fired a shot across the bow of the Arizona Department of Health Services today when AZADP issued a press release called “AZDHS and MPP Acting in Collusion to limit access to Dispensary Applicants, Monopolization abuses outlined in letter to Arizona Heath Department.” The article starts:
“We believe that the AZDHS has been influenced by and is conspiring with other organizations, namely the Marijuana Policy Project, (MPP) and their recently established association, the Arizona Medical Marijuana Association, (AzMMA), to create an elitist and monopolistic program where only the wealthy influential, informed sponsors of MPP will qualify for one of the 125 licenses. We believe that the following evidence will show that the AZDHS in collusion with MPP are intentionally developing program rules that are so complicated and costly so as to preclude otherwise qualified applicants merely on the basis of wealth and influence. We believe it is the intention of MPP to control the marketplace.”
If you are interested in obtaining a medical marijuana dispensary license in Arizona, this article is a must read.
FYI: According to a search of the Arizona Corporation Commission’s website today, there is no entity in Arizona called “Arizona Association of Dispensary Professionals,” but Allan Sobol reserved the name Arizona Association of Dispensary Professionals, Inc., on 11/21/10.
Phoenix New Times: “Proposed restrictions on Arizona’s voter-approved medical marijuana law are worse than illegal, says one Valley doc — they’re ‘cruel and unreasonable.’ Edgar Suter, a Mesa doctor of nuclear medicine, writes in an a lengthy call-to-arms today that the state Department of Health Services’ suggested rules concerning Proposition 203 probably violate the 1998 Voter Protection Act.”
Arizona Medical Marijuana: “The Green Leaf recently asked Dr. Ed Suter, a board certified physician and medical marijuana activist, to share his thoughts on the first draft of medical marijuana regulations released on Dec. 17 by the Arizona Department of Health Services. Here’s his reaction:”
Arizona Republic: Phoenix Planning and Development Services Director Debra “Stark said the city tried to strike a balance with its zoning laws that would be strict enough to protect the community and neighborhoods, but not too strict that they wouldn’t be allowed in the city at all. Phoenix divided medical marijuana land uses into three categories“
Americans for Safe Access: “A Narcotics Task Force (NTF) made up of local and state law enforcement agencies aggressively raided 5 collectively-run medical marijuana delivery services on Monday, Tuesday and Wednesday this week, arresting at least 13 people on felony charges and holding them on bails of up to $100,000. Several of those arrested were charged with child endangerment, after Child Protective Services (CPS) removed at least 6 children from the homes of 3 different families.”
Press Telegram: “The future of Long Beach’s medical marijuana regulations – and potentially of medical marijuana throughout the state – is in question after an appeals court ruling Wednesday. The 2nd District Court of Appeals ruled that a Los Angeles County Superior Court judge must reexamine his decision Nov. 2 upholding Long Beach’s new medical marijuana ordinance. At issue is whether Long Beach’s issuance of permits for medical marijuana collectives is a violation of federal law, which considers marijuana an illegal drug.”
Whatever the outcome of the case when it is reconsidered by the trial court, the losing party will surely appeal. It appears that in the not too distant future a California appellate court will determine if federal law preempts California law. If the appellate court answers the question in the affirmative, that could be the beginning of the end of California’s medical marijuana law and other states that have legalized medical marijuana can expect to have the same battle in their courts.
On October 19 , 2009, “Attorney General Eric Holder announced formal guidelines for federal prosecutors in states that have enacted laws authorizing the use of marijuana for medical purposes. Those guidelines are contained in a memo from Deputy Attorney General David W. Ogden.” The following is the text of the Department of Justice medical marijuana letter.
October 19,2009
MEMORANDUM FOR SELECTED UNITED STATES ATTORNEYS
FROM: David W. Ogden, Deputy Attorney General
SUBJECT: Investigations and Prosecutions in States Authorizing the Medical Use of Marijuana
This memorandum provides clarification and guidance to federal prosecutors in States that have enacted laws authorizing the medical use of marijuana. These laws vary in their substantive provisions and in the extent of state regulatory oversight, both among the enacting States and among local jurisdictions within those States. Rather than developing different guidelines for every possible variant of state and local law, this memorandum provides uniform guidance to focus federal investigations and prosecutions in these States on core federal enforcement priorities. (more…)
Phoenix New Times: “Next spring means all kinds of green in Arizona. Sometime in April, medical marijuana will be available to qualified patients across the state, and as we’ve already pointed out, that means big business in the form of dispensaries, doctor recommendations, and grow houses. But most people can’t afford to launch any of the above businesses, and many won’t qualify under the Arizona Department of Health’s super-strict proposed guidelines. Luckily, there are plenty of fringe businesses one can start. Here are eight business proposals that could get a piece of the Pot, Inc. pie:”
San Luis Obispo Tribune: “Twelve San Luis Obispo County residents were arrested this week after a two-month investigation into mobile marijuana dispensaries on the Central Coast. The investigation began after law enforcement agencies learned that several people were selling marijuana through mobile dispensaries in San Luis Obispo, Santa Barbara and Monterey counties, according to a news release from the San Luis Obispo County Narcotic Task Force.”
Boulder Weekly: “Add one of Boulder County’s local financial institutions, Elevations Credit Union, to the ever-growing list of financial institutions that are refusing to do business with Colorado’s medical marijuana dispensaries. Elevations started sending letters to its commercial account holders in January saying that its “Member Due Diligence Program” requires identifying the nature of each of its business accounts. ‘With the growing number of medical marijuana dispensaries and related business,’ the letter says, ‘we must determine if your business provides any of the following services: Sale of marijuana, production of marijuana, storage of marijuana’.”
128 T.C. No. 14
UNITED STATES TAX COURT
CALIFORNIANS HELPING TO ALLEVIATE MEDICAL PROBLEMS, INC., Petitioner
v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 20795-05
Filed May 15, 2007
P provided counseling and other caregiving services (collectively, caregiving services) to its members, who were individuals with debilitating diseases. P also provided its members with medical marijuana pursuant to the California Compassionate Use Act of 1996, codified at Cal. Health & Safety Code sec. 11362.5 (West Supp. 2007). P charged its members a membership fee that generally reimbursed P for its costs of the caregiving services and its costs of the medical marijuana. R determined that all of P’s expenses were nondeductible under sec. 280E, I.R.C., because, R determined, the expenses were incurred in connection with the trafficking of a controlled substance.
Held: Sec. 280E, I.R.C., precludes P from deducting its expenses attributable to its provision of medical marijuana.
Held, further, P’s provision of its caregiving services and its provision of medical marijuana were separate trades or businesses for purposes of sec. 280E, I.R.C.; thus, sec. 280E, I.R.C., does not preclude P from deducting the expenses attributable to the caregiving services.
Matthew Kumin, Henry G. Wykowski, and Willian G. Panzer, for petitioner.
Margaret A. Martin, for respondent.
LARO, Judge: Respondent determined a $355,056 deficiency in petitioner’s 2002 Federal income tax and a $71,011 accuracy related penalty under section 6662(a) . (Note 1) Following concessions by respondent, including a concession that petitioner is not liable for the determined accuracy-related penalty, we decide whether section 280E precludes petitioner from deducting the ordinary and necessary expenses attributable to its provision of medical marijuana pursuant to the California Compassionate Use Act of 1996, codified at Cal. Health & Safety Code sec. 11362.5 (WestSupp. 2007). (Note 2) We hold that those deductions are precluded. We also decide whether section 280E precludes petitioner from deducting the ordinary and necessary expenses attributable to its provision of counseling and other caregiving services (collectively, caregiving services). We hold that those deductions are not precluded.
FINDINGS OF FACT
Certain facts were stipulated and are so found. The stipulation of facts and the exhibits attached thereto are incorporated herein by this reference. When the petition was filed, petitioner was an inactive California corporation whose mailing address was in San Francisco, California. Petitioner was organized on December 24, 1996, pursuant to the California Nonprofit Public Benefit Corporation Law, Cal. Corp. Code secs. 5110-6910. (West 1990). (Note 3) Its articles of incorporation stated that it “is organized and operated exclusively for charitable, educational and scientific purposes” and “The property of this corporation is irrevocably dedicated to charitable purposes”. Petitioner did not have Federal tax-exempt status, and it operated as an approximately break-even (i.e., the amount of its income approximated the amount of its expenses) community center for members with debilitating diseases. Approximately 47 percent of petitioner’s members suffered from Acquired Immune Deficiency Syndrome (AIDS); the remainder suffered from cancer, multiple sclerosis, and other serious illnesses. Before joining petitioner, petitioner’s executive director had 13 years of experience in health services as a coordinator of a statewide program that trained outreach workers in AIDS prevention work. (more…)
Los Angeles Times: “Oakland —California’s most cannabis-friendly city has temporarily suspended a plan to permit and tax four large marijuana-growing facilities because of ongoing legal concerns. The Oakland City Council voted 7 to 1 this week to send the measure back to legal staff for reworking after the city received a letter from the Alameda County district attorney” The DA said:
“It remains an open question whether public officers or public employees who aid and abet or conspire to violate state or federal laws in furtherance of a city ordinance, are exempt from criminal liability”
Los Angeles Times: “In cases involving small amounts of marijuana, some people aren’t willing to uphold the law in court. . . . a phenomenon that prosecutors say they are increasingly mindful of as marijuana use wins growing legal and public tolerance: Some jurors may be reluctant to convict for an offense many people no longer regard as serious. ‘It’s not on a level where it’s become a problem. But we’ll hear, ‘I think marijuana should be legal, I’m not going to follow the law’ “
Kingman Daily Miner: “Arizona residents interested in obtaining a medical marijuana card or opening a medical marijuana dispensary will find themselves digging deep into their pockets and poring over 47 pages of strict rules.”
Arizona Republic: “With state health officials still designing rules to regulate the cultivation, distribution and possession of medical marijuana, police departments in Arizona say there is little they can do to prepare to enforce the law until those guidelines are complete.”
Here’s Sedona’s time line for adopting its medical marijuana zoning ordinance:
Planning and Zoning Commission Discussion:
Tuesday, January 4, 2011- 5:30 p.m. in City Hall Council Chambers
Thursday, January 13, 2011 – 3:30 p.m. in Vultee Conference Room
Planning and Zoning Commission Public Hearing and possible recommendation to City Council:
Tuesday, January 18, 2011 – 5:30 p.m. in Council Chambers
City Council Public Hearings and possible adoption:
Tuesday, February 8, 2011 – 4:30 p.m. in Council Chambers (tentative)
Tuesday, February 22, 2011 – 4:30 p.m. in the Council Chambers (tentative)
San Pedro Valley News Sun: “The City of Benson is taking a wait and see approach, as the state continues to sort out guidelines and code regulations for the medical marijuana measure passed by Arizona voters in November. . . . Luis Garcia, the city’s building official, said . . . Benson . . . will wait to propose a set of regulations before the Planning and Zoning Commission, or the City Council.”
One of the top priorities during the implementation of the Arizona Medical Marijuana Act in the coming months is to ensure good rules are developed (called Administrative Code) so medical marijuana can be regulated effectively. Rules that are clear, objective, well-researched, and that balance competing interests are absolutely critical in order to effectively implement a responsible medical marijuana program.
The goal is to develop rules that will ensure qualified patients have access to marijuana for their medical condition while preventing (to the extent possible) recreational marijuana users from accessing marijuana through the Act’s provisions. In addition, the rules should ensure that marijuana dispensaries act responsibly and have adequate security and inventory controls.
In order to achieve these goals we need your help. Input is needed from all Arizona residents so the most responsible set of regulations are in place to balance competing interests. Please consider reviewing the informal draft rules, either individually or with other members of your community, and submit your feedback using the electronic comment form. For additional information and tips on how to provide input, review Director Humble’s Call for Public Comment.
Arizona Republic: “The state health department released its first draft late Thursday, providing a glimpse at how the program may work in Arizona. The rules spell out who may qualify for medical marijuana, establish operating criteria for dispensaries and provide strict guidelines for doctors who may recommend marijuana.” Read the December 17, 2010, first draft of Arizona Department of Health Services’ proposed Medical Marijuana Regulations and DHS’ Call for Public Comment and Electronic Comment Form.
Phoenix New Times: “Before the release of draft rules on Proposition 203, Will Humble, the director of the state Department of Health Services, estimated 100,000 people a year might qualify for medical marijuana. Now, under the proposed regulations, only 10,000 to 20,000 people a year would qualify, he said in a news conference today. . . . The voters approved Proposition 203, and now the state wants to smother the new law with over-bearing rules.”
Read the text of the December 17, 2010, first draft of the Arizona Department of Health Service’s proposed medical marijuana regulations at Medical-Marijuana-Draft-Rules-101217.
Will Humble is the Director of the Arizona Health Services. The following is from a December 17, 2010, post on his blog:
“One of our top priorities as we implement the AZ Medical Marijuana Act over the coming months is to ensure that we develop good Rules (called Administrative Code) so we can regulate medical marijuana effectively. Rules that are clear, objective, well-researched, and that balance competing interests are absolutely critical in order to effectively implement a responsible medical marijuana program. Our goal is to develop rules that’ll ensure qualified patients have access to marijuana for their medical condition while preventing (to the extent possible) recreational marijuana users from accessing marijuana through the Act’s provisions. In addition, we want to develop Rules that ensure that marijuana dispensaries act responsibly and have adequate security and inventory controls. In order to achieve these goals we will need your help.”
Read the entire post.
Kingman Daily Miner: “Commissioners vote to send most restrictive zoning alternative to Council. People interested in opening a medical marijuana dispensary within the city limit may be facing some strict guidelines. The city of Kingman Planning and Zoning Commission recommended adopting the most stringent out of three possible zoning recommendations for the dispensaries Tuesday night.”
Arizona Republic: “The Scottsdale Planning Commission on Wednesday backed a text amendment establishing regulations to comply with a new state law that legalizes growing, manufacturing and dispensing medical marijuana in the city. . . .The commission voted, 5-1, to recommend dispensing, manufacturing and growing be allowed without a conditional use permit in the special campus zoning district as part of a hospital or medical campus. Also, dispensing and manufacturing would be allowed in the commercial office zoning district with a conditional use permit.”
Prescott Daily Courier: “the city [Prescott] has drafted an ordinance that would allow medical marijuana in accordance with the state ballot issue, Proposition 203. Planning Director George Worley stressed, however, that the city’s draft is still in the very preliminary stages, and that the UDC likely would rewrite the document before it goes back to Planning and Zoning.”
Prescott Daily Courier: The draft ordinance includes restrictions “such as limiting dispensaries to 1,000 square feet, with no more than half of the total being used for storage. The draft ordinance also would restrict the hours of operation, and ban the use of marijuana on the premises and the sale of paraphernalia. Dispensaries would be allowed in C-2 and C-3 (medium- and heavy-commercial) districts, while cultivation sites will be allowed only in C-3 districts.”
Arizona Republic: “The national marijuana-policy group that largely bankrolled Arizona’s medical-marijuana initiative held an educational forum Monday to explain key parts of the law, federal marijuana statutes and how medical-marijuana programs were implemented in other states”
Kingman Daily Miner: Kingman, Arizona, “City zoners will look at proposals Tuesday for cultivating, dispensing pot. The commission will be presented with three alternatives ranging from most to least restrictive that it may alter as it sees fit prior to issuing its recommendation. . . . Alternative 1, the most restrictive of the three, would allow for the cultivation of marijuana in the Rural Residential zoning district only and at least 2,500 feet from any alternative residential zoning, with dispensing allowed only in the I-2: Heavy Industrial zoning district. Any such dispensing facility would be limited to just a single, permanent structure no larger than 100 square feet, and sales of marijuana could only take place between 10 a.m. and 4 p.m. Monday through Friday.