Medical Marijuana Dispensaries Struggle with DEA Enforcement

As of August 26, 2012, the Drug Enforcement Administration exercised its right where federal law preempts state law if the two conflict with its recent crackdown on 23 medical marijuana dispensaries in Seattle (WA.) The DEA sent letters to business and property owners operating within 1,000 feet of schools and related prohibited zones warning them to move or close within 30 days or face stiff penalties. According to Jodie Underwood, DEA spokeswoman, said, “The DEA enforces federal law, and we’re going to continue to enforce federal law.”  In the Seattle Times article, DEA to medical-pot shops: Get away from schools now while Washington’s  medical marijuana law does not sanction dispensaries, in 2011, the State Legislature passed a law to legalize and provide regulations but it was a veto by the governor leaving these businesses still an unregulated industry. And earlier in 2011, 55 dispensaries were sent letters in Eastern Washington; and for those who didn’t take the mandatory steps were raided before the 30-day time period expired. Federal and CA State Laws Clash on Marijuana  on Free Legal Aid highlighted the same style of federal crackdown on California’s medical marijuana dispensaries using this strategy in states where medical marijuana laws exist. "We need to enforce one message for our students: Drugs have no place in or near our schools,” said Jenny Durkan, U.S. Attorney for Western District of Washington.

 

Another enforcement trend used by federal authorities in medical marijuana states is Section 280E from the U.S. Tax Code. This section disqualifies business deductions for trafficking in controlled substances. Therefore, even if state law allows marijuana for medical use, federal law classifies it as a controlled substance. However, cases from California, challenging this interpretation have prevailed with a U.S. Tax Court ruling that marijuana dispensaries can legally deduct expenses associated with all activities if it was also connected with care-giving. No tax relief is given when a dispensary only sells marijuana to patients as explained in Forbes article, Medical Marijuana Dispensaries Keep On Truckin’ Despite IRS.

 

Cities like Los Angeles and Seattle (with regard to medical marijuana dispensaries) have taken different approaches to local regulations. L.A.’s Ban on Marijuana Dispensaries Halted for Now NPR news story, this summer the Los Angeles city council passed a ban on all medical marijuana dispensaries, thus affecting 1,000 dispensaries within its city limits. However this ban known as “gentle ban” does allow dispensaries serving three or four patients or their caregivers to grow their own supplies. "It's inconceivable to think that three homebound patients suffering from spasticity, cancer, autism could somehow pull together the wherewithal to produce medicine with the potency and the medicinal effect of what's grown by the best cultivators on the planet,"  said Marc O'Hara, the executive director of Patient Care Alliance Los Angeles. The ban is on hold for now.

For Seattle, on September 20, 2012, citizens rallied and protested the recent DEA actions that coincided with similar protests in Arizona, California, Colorado, and Washington, D.C.  The Seattle city council plans to take steps through zoning regulations to close a loophole in state law about collective medical pot gardens from pooling resources or operating in the same space. According to Seattle seeks to close medical pot loophole with zoning rules (9/21/2012) in a press release, Council President Sally Clark stated,” My goal is for zoning regulations that minimize possible neighborhood impacts while providing reasonable access for patients.” The council’s new rules for growing, processing or dispensing of cannabis is limited to: 45 cannabis plants; 72 ounces of useable cannabis; an amount of cannabis product that could reasonably be produced with 72 ounces of useable cannabis. Currently, Seattle’s 150 medical marijuana businesses require a basic business license and compliance with city building-safety codes. “We want to create standards now so that we don’t repeat what is happening in Los Angeles, where law enforcement raids shut down operations of good and bad businesses alike, and eventually, City Council banned dispensaries altogether because there were few standards in LA to hold operators accountable. For this reason, I hope access point operators and neighborhood residents will agree that they each can benefit from consistency and accountability that these regulations will provide,” said Councilmember Nick Licata, Housing, Human Services, Health and Culture Committee Chair.                                                                                                    Susanne L Woodford, Freelance Writer