MEMORANDUM. Planning Commission. Date: May 10, City Attorney s Office / Police Department. Medical Marijuana Ordinance RECOMMENDATION

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1 MEMORANDUM To: From: Planning Commission City Attorney s Office / Police Department Date: May 10, 2011 Subject: Medical Marijuana Ordinance RECOMMENDATION Adopt Resolution recommending Council approval of a Medical Marijuana Ordinance banning Medical Marijuana Dispensaries in Morgan Hill (Attachment A). The proposed ordinance would define a Medical Marijuana Dispensary ( MMD ) as any facility or location where medical marijuana is made available to two or more primary caregivers, persons with identification cards or qualified patients and prohibit such facilities in all zoning districts of the City (Exhibit A to Resolution). Under the ordinance, patients could receive medical marijuana from a primary caregiver or at a licensed medical clinic, hospice, or other state licensed medical facility. Staff recommends prohibiting MMDs in Morgan Hill for the following reasons: The cultivation, possession, distribution or use of marijuana is illegal under both federal and state law. The ordinance would conform the City s land use regulations to the general principal that land uses that further or facilitate illegal activities are not permitted uses. Land use regulation is a matter of city council legislative discretion. Based on the experiences of cities around the state and of the Morgan Hill police department (as detailed in this report), staff anticipates an increase in crime and negative secondary effects if MMDs are allowed to open and operate in the City. There is a lack of budget, personnel or police resources to stop, control or regulate illegal activities at MMDs. Though the Compassionate Use Act provides for a defense against marijuana cultivation and use, nothing in the Act or any other law permits the operation of a MMD where such a use is not allowed under land use regulations.

2 OVERVIEW In 1996, California voters approved an initiative ( Proposition 215 ), titled the Compassionate Use Act ( CUA ), exempting certain patients and their primary caregivers from criminal liability under state law for the possession and cultivation of marijuana. In 2003, the Legislature enacted additional legislation relating to medical marijuana. Since that time, there has been substantial growth of MMDs which sell medical marijuana in various cities in California. In October of 2009, the City Council adopted an ordinance clarifying that uses unlawful under state or federal law or not specifically permitted under the municipal code are unpermitted uses. While these provisions do not specifically prohibit medical marijuana dispensaries, under existing law and court decisions a MMD is not currently permitted in Morgan Hill. Given certain federal and state law developments explained below, staff recommends the Council adopt the draft ordinance to alleviate any ambiguity and specifically classify Medical Marijuana Dispensaries as a prohibited land use in the City. BACKGROUND Since the adoption of Proposition 215, there has been uncertainty and varying approaches in the implementation of the voter initiative, both as a matter of penal law enforcement and of local land use regulations. Though certain cities interpreted Proposition 215 as to permit the establishment of storefront dispensaries as a means to distribute marijuana for use under Proposition 215, most cities have not permitted MMDs as a legal land use or have taken no action leaving the regulation of medical marijuana use as mostly a criminal enforcement matter. In 2009, the U.S. Department of Justice announced that it would not enforce Federal law as it relates to medical marijuana distribution facilities that meet state law. This criminal enforcement deference to state law caused the focus to shift from the general marijuana prohibition under federal law to the interpretation of Proposition 215 and implementation under state law. Because land use regulation is a power of local governments, cities and counties have had to clarify how to treat land uses that applicants declare to be for uses permitted under the CUA. In the past few years, some cities (e.g. San Jose, Los Angeles) have experienced a rapid increase in the number of MMDs that have opened within their jurisdiction under the guise of the CUA. This occurred during the time these cities did not have clear regulations in place. Both cities have had prolonged debates about how to reduce the number of MMDs due to uptick in criminal activities, complaints from parents, residents and businesses, and the cost of responding to such activities and complaints. As made clear by the California Attorney General and court decisions, the intent of Proposition 215 and follow up State legislation is to allow people with legitimate medical needs (and their caretakers) to grow marijuana individually and collectively for medical purposes, and to ensure they are safe from criminal prosecution. Over time, this has grown into the presence of large member-based distribution outlets of marijuana, with the product purchased from outside sources.

3 The proposed ordinance is a land use regulation that would prohibit Medical Marijuana Dispensaries as a use within the limits of the City. It does not establishes additional or change penal proscriptions or enforcement against manufacture, possession, use or distribution of marijuana. Therefore, individuals with medical needs and their caretakers who cultivate, use or collectively share marijuana in manners permitted under the CUA as interpreted by the state Attorney General could continue to claim exemption from criminal prosecution as long as such activity does not require a land use permit under the City s land use regulations. EXISTING POLICIES Federal Laws and Enforcement In general, the Federal Drug Enforcement Agency sets the guidelines and standards for drug policy in the country and the U.S. Attorney General decides what laws to enforce. The following is a brief description of those federal parameters: State Laws The Federal Controlled Substance Act ( CSA ) was adopted in It states that it is unlawful to manufacture, distribute, dispense, or possess any controlled substance. The Federal Government s view is that marijuana is a Schedule I substance, which is classified as having a high potential for abuse. Further, the federal view is that use of marijuana for medicinal purposes is not an accepted treatment method in the United States, and it has not been accepted that marijuana is safe to prescribe as a drug or other substance under medical supervision. Because of this position, marijuana cannot be prescribed or dispensed in the same way as legal drugs, which is why marijuana is not available from doctors or pharmacies. In March 2009, U.S. Attorney General Eric Holder Jr. announced it would no longer enforce the federal laws prohibiting distribution or possession of marijuana for medicinal purposes, allowing states to have the final say in the matter. It was also stated that dispensaries that use medical marijuana as a storefront for dealers of illegal drugs would be prosecuted. In a more recent announcement, Attorney General Holder s office stated they will prosecute people for growing, selling, and possessing marijuana in California if they are not in compliance with State law. In two 2011 letters to the City of Oakland and Governor of Washington, the Attorney General s office has affirmed their authority to enforce the CSA against individuals and groups that engage in large-scale manufacture and distribution of marijuana. California has passed laws and general regulations allowing the cultivation, distribution, possession, and use of marijuana for specific medical purposes, as detailed below:

4 In 1996, the voters of California passed Proposition 215, known as the Compassionate Use Act ( CUA ). The purpose of the CUA was to give individuals the right to obtain and use medical marijuana as deemed appropriate and as recommended by a physician. The CUA ensures patients and primary caregivers will not be subject to state or local criminal prosecution for the possession or cultivation of marijuana for medical purposes. In 2003, the State Senate passed and the Governor signed into law SB 420, the Medical Marijuana Program Act ( MMPA ), which codified the regulations for the possession, distribution, and use of marijuana for medical purposes, as described in the CUA. In 2008, California Attorney General Brown published guidelines for the security and non-diversion of marijuana grown for medical use. These guidelines are a helpful tool for law enforcement to perform duties effectively and in accordance with California law. It assists patients and caregivers on how they may cultivate, transport, possess, and use medical marijuana under California law. In addition, it provides the framework for collective/cooperatives and provides greater direction to ensure marijuana used for medical purposes is secure and does not find its way to non-patients or illicit markets. (Attachment B). Morgan Hill Regulations The City Council passed a moratorium prohibiting the establishment of MMDs in 2007 in order to study the issue and attempt to resolve inconsistencies between federal and state law. That initial moratorium was extended and expired in February of The City adopted an ordinance in October 2009 clarifying that any use that is prohibited under state or federal law, or that is not specifically permitted under the City s regulations, is a prohibited use. MMDs are not a specifically permitted use. Nonetheless, the City has received numerous inquiries regarding the use of certain sites in the City for dispensary operations. The issue of Medical Marijuana has been highlighted locally when a MMD (Medileaf) opened in Gilroy. Through lengthy court proceedings, the City eventually forced the closure of Medileaf. In addition to the use ordinance, in April of 2010, the Council adopted an ordinance updating business license requirements and clarifying which business must have a City business license. While these provisions do not specifically prohibit MMDs, under existing law and court decisions, a MMD is not permitted in Morgan Hill. Other Cities Medical Marijuana cooperatives, collectives and dispensaries have recently been a hot topic for California cities. For years after Proposition 215 was passed, only a few cities in the state allowed these facilities, while others followed the federal rules that made cultivation, possession and distribution illegal. This changed in the past couple years, most likely in response to the current Presidential administration s decision regarding enforcement of marijuana offenses. As a result, most cities in the state have taken specific action to either prohibit the distribution

5 facilities, adopt moratoriums to allow time to study the issue; or pass ordinances that allow them under specific conditions. The following table shows the current status of cities in Santa Clara County: Campbell Banned (use conflicts with state or federal law) Cupertino Banned (use not expressly permitted) Gilroy Banned (explicit) Los Altos Banned (explicit) Los Altos Hills No Action (city is residential only no other uses allowed) Los Gatos Moratorium Milpitas Banned (explicit) Monte Sereno No Action (city is residential only no other uses allowed) Mountain View Banned Palo Alto Banned (use not expressly permitted) San Jose Allowed but limited to 10 Santa Clara Moratorium Saratoga Moratorium Sunnyvale Banned (explicit) The following table shows what the cities and counties have enacted state-wide: Ordinances regulating MMDs Moratoriums on MMDs City Ordinances 42 City Moratoriums 103 County Ordinances 9 County Moratoriums 15 Total 51 Total 118 Bans on MMDs Totals Cultivation City Bans 143 Moratoriums and Bans % County Bans 12 Ordinances 51 16% Total 155 *Americans for Safe Access 2/18/11 State law allows individuals with a physician s recommendation to cultivate marijuana for their personal use. The law allows each person with a doctor s recommendation to maintain no more than six mature or 12 immature plants. A person cannot sell the marijuana they grow, but can provide it to their cooperative or collective.

6 Cultivation is a greater concern when marijuana is grown in large quantities in residential homes known as grow houses. There are many safety issues associated with grow houses; such as: dangerous electrical wiring, unsafe changes to the structure, and the possible safety concerns on the surrounding residents from having a large amount of an illegal substance grown in residential locations. Public Safety staff is particularly concerned that the recent fires and robberies have occurred at residential grow houses. MMDs are required by State law to obtain their marijuana from their members, which could mean allowing homeowners to cultivate the plant. Cultivation is also possible in larger commercial operations, such as those recently allowed in Oakland. Cultivation requirements and restrictions would be included in an ordinance, should MMDs be allowed in Morgan Hill; otherwise, the State law minimums allowed for plant cultivation would be the standard. Legal Alternatives to Marijuana The ingredient in marijuana that provides relief for those with serious medical conditions is THC. According to the U.S. Drug Enforcement Administration, a pharmaceutically-available, FDA approved product called Marinol is available, which contains synthetic THC as the active ingredient. Marinol comes in the form of a pill, and is available at pharmacies. Although proponents of medical marijuana claim that Marinol does not help all medical conditions, and may not be as effective as marijuana, it does have value in that it can be distributed through existing, legally operating pharmacies, meaning separate MMDs would not be necessary for its distribution. This is important because pharmacies are located throughout the City and are required to store, distribute and track what is dispensed. Criminal Activity and Adverse Secondary Effects Concerns Public Safety staff is concerned with the secondary effects and adverse impacts related to medical marijuana. These impacts have been documented statewide in a report written by the California Police Chiefs Association (Attachment C). As reported by the Cal Chiefs, MMDs often lead to an increase in crime, including burglaries, robberies, violence, illegal sales of marijuana to, and use of marijuana by, minors and other persons without medical need in the areas immediately surrounding such medical marijuana distribution facilities. Recent negative impacts in Santa Clara County have been directly linked to marijuana dispensaries and marijuana growers. The only city in Santa Clara County currently permitting MMDs is San Jose; although the city recently decided to limit the number to 10. There have been three recent armed takeover style robberies at San Jose marijuana dispensaries. These violent crimes are similarly patterned after the robberies Southern California marijuana dispensaries have experienced over the past few years. Attachment D is a report from the San Jose Police Department documenting numerous criminal incidents related to medical marijuana in the period from January 1, 2010 to April 14 of 2011.

7 Here too in Morgan Hill, negative secondary effects are associated with the distribution and use of marijuana. These include criminal acts, large cultivation operations, house fires, and other negative impacts on the community. These incidents are detailed in Attachment E. The concern of Public Safety Staff is that such incidents could greatly expand if MMDs are permitted; negatively effecting the health and safety of the citizens of Morgan Hill. Public Health All medicines distributed by pharmacies are regulated by the United States Food and Drug Administration (FDA). FDA approval is required in order for a specific, finished medication to be marketed and distributed to patients. Scientific testing of marijuana for medical use is not performed at professionally recognized and regulated laboratories. The FDA is responsible for protecting and promoting public health. They have a safety protocol in place to alert and protect consumers of possible product contamination. This program results in the ability to recall products should they present health or safety concerns for the consumer. Marijuana growers and dispensary operators have no oversight and cannot validate the safety of their product. Land Use Concerns This use is relatively new, and use patterns are not well known. It is possible that MMDs have similar impacts as any other business in an area. It is also possible that an MMD could disrupt an existing neighborhood with more traffic and a possible increase in crime due to the presence of an illegal drug (when not used for medical purposes). Specific land use concerns documented in other cities by the Cal Chiefs include marijuana smoking in public and in front of children in the vicinity of dispensaries, loitering and nuisances and a loss of trade for other commercial businesses located near dispensaries. APPROACHES There are two broad options that can be chosen with this issue: either prohibit MMDs in the City or allow them with clear criteria, regulations and conditions. Both options have positive and negative effects. This issue is scheduled to be brought before the City Council at the May 25, 2011 meeting. Option A: Prohibit MMDs in Morgan Hill (recommended) This option would require the Council to introduce and adopt an ordinance specifically prohibiting MMDs in the City. Positive Effects Removes the possibility of illegal activity at MMDs, including profit oriented dispensaries. Reduces secondary negative social impacts that could arise by restricting the ability to obtain marijuana in the City.

8 Avoids complicated and potentially expensive enforcement efforts. Avoids land use compatibility issues between MMDs and surrounding uses and businesses. Negative Effects Does not respond to the compassionate care concerns of Proposition 215. Removes the ability for Morgan Hill patients to obtain medical marijuana from collectives or cooperatives in their own City. The proposed ordinance defines a MMD as a facility where medical marijuana is made available to two or more primary caregivers, persons with identification cards or qualified patients. This would allow a patient to receive medical marijuana from a primary caregiver in the patient s home, but would prohibit the distribution to any other person. In addition, the proposed ordinance would allow patients to receive medical marijuana at a licensed medical clinic, hospice, or similar facility. Option B: Allow MMDs in Morgan Hill, subject to regulations and controls This option would allow MMDs in the City at limited or defined locations with conditions and restrictions. Areas of regulations to be addressed include: Limiting the number or size of such MMDs. Restricting MMDs to certain land use zones in a city. Requiring minimum distances from certain types of land uses, such as schools, parks, residential areas, day care etc. Registering and permitting MMDs to facilitate operational and security regulations. Requiring the payment of regulatory fees to defray costs of administration, enforcement and monitoring. Taxing sales. Limiting areas or size of cultivation area. There are various approaches and issues that should be evaluated and resolved if the regulatory option is chosen. Whereas Option A to prohibit MMDs requires a relatively straightforward ordinance, Option B is more complex and requires decisions on the appropriate location, necessary use restrictions, public review process, and degree of oversight by the City in the operations of a MMD. A sample regulatory ordinance from the City of Santa Rosa is included as Attachment F. A sample cultivation ordinance is included as Attachment G. The effects of allowing MMDs pursuant to regulations in Morgan Hill could include: Positive Effects Allows local, legal access to medical marijuana for authorized patients in the community.

9 Accommodates alternative approaches to the treatment of illnesses, including the use of medical marijuana. Negative Effects Possible rise in crime activity with possibly easier access to marijuana by unauthorized users such as youths. Secondary negative social impacts and costs associated with more prevalent marijuana use. Potentially expensive enforcement required by the City and school districts to ensure the community does not experience a rise in crime from MMDs in the City. Difficult to apply conditions on approved MMDs because of the intrusive nature of the options necessary to ensure adherence to State laws. Possibility of profit-oriented MMDs in the City. FISCAL IMPACT If Council introduces the ordinance to prohibit MMDs in the City, the costs to the City to implement would be minimal. If Council were to direct staff to introduce an ordinance to permit MMDs in the City, it is estimated that staff time for regulation and enforcement would be high. Although fees could possibly cover the costs for regulating MMDs, secondary costs associated with regulating marijuana sales, cultivation, and use would be difficult to capture, such as legal and enforcement costs related to criminal activity and business violations. PUBLIC CONTACT Public contact was made through the usual posting of the Planning Commission Agenda on the City s official-notice bulletin board, on the City s Web site, and the availability of the agenda and report in the Office of the City Clerk. Notice of this meeting was also published in the Morgan Hill Times. Attachments: A - Resolution recommending approval of Ordinance (Ordinance is Ex. A) B - Attorney General Guidelines C - CA Police Chief s White Paper D - San Jose Incidents 1/1/10 to 1/14/11 E - List of Morgan Hill marijuana related incidents F - City of Santa Rosa Regulatory Ordinance G- City of Rocklin Cultivation Ordinance P:\staff reports\planning Commission\Medical Marijuana Ordinance.doc

10 Attachment A RESOLUTION NO. A RESOLUTION OF THE PLANNING COMMISSION OF THE CITY OF MORGAN HILL RECOMMENDING ADDING CHAPTER 9.16 TO TITLE 9 (PUBLIC PEACE, MORALS AND WELFARE) AND SECTION TO TITLE 18 (ZONING) OF THE MORGAN HILL MUNICIPAL CODE PROHIBITING MEDICAL MARIJUANA DISTRIBUTION FACILITIES WHEREAS, additions to the municipal code prohibiting Medical Marijuana Facilities were considered by the Planning Commission at their regular meeting of May 10, 2011, at which time the Planning Commission recommended approval of application ZA-11-07: City of Morgan Hill Zoning Amendment - Prohibiting Medical Marijuana Distribution Facilities. WHEREAS, testimony received at a duly-noticed public hearing, along with exhibits and other materials have been considered in the review process. NOW, THEREFORE, THE MORGAN HILL PLANNING COMMISSION DOES RESOLVE AS FOLLOWS: SECTION 1. The proposed zoning text amendment is consistent with the Zoning Ordinance and the General Plan. SECTION 2. The zone change is required in order to serve the public convenience, necessity and general welfare as provided in Section of the Municipal Code. SECTION 3. Exempt from CEQA. The Planning Commission determines and finds that this ordinance is exempt from the California Environmental Quality Act under section 15061(b)(3) because the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. SECTION 4. The Planning Commission hereby recommends approval of additions to the text of the Morgan Hill Municipal Code adding Chapter 9.16 to Title 9 (Public Peace, Morals And Welfare). All text amendments are recommended to be made as shown in attached Exhibit A. SECTION 5. The Planning Commission hereby recommends approval of additions to the text of the Morgan Hill Municipal Code adding Section to Title 18 (Zoning). All text amendments are recommended to be made as shown in attached Exhibit A. PASSED AND ADOPTED THIS 10 th DAY OF May 2011, AT A REGULAR MEETING OF THE PLANNING COMMISSION BY THE FOLLOWING VOTE: AYES: COMMISSIONERS: Benich, Koepp-Baker, Moniz, Mueller, Tanda

11 NOES: ABSTAIN: ABSENT: COMMISSIONERS: None COMMISSIONERS: None COMMISSIONERS: None ATTEST: APPROVED: ELAINE BUCK, Deputy City Clerk JOSEPH MUELLER, Chair

12 Exhibit A ORDINANCE NO., NEW SERIES AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF MORGAN HILL ADDING CHAPTER 9.16 TO TITLE 9 (PUBLIC PEACE, MORALS AND WELFARE) RELATING TO MEDICAL MARIJUANA DISTRIBUTION FACILITIES AND SECTION TO TITLE 18 (ZONING) OF THE MORGAN HILL MUNICIPAL CODE PROHIBITING MEDICAL MARIJUANA DISTRIBUTION FACILITIES THE CITY COUNCIL OF THE CITY OF MORGAN HILL HEREBY FINDS AND DECLARES AS FOLLOWS: WHEREAS, Article XI, Section 7 of the California Constitution provides that the city may make and enforce within its limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws. WHEREAS, in 1970, Congress enacted the Controlled Substances Act ( CSA ) which, among other things, makes it illegal to import, manufacture, distribute, possess or use marijuana in the United States; and WHEREAS, in 1996, the voters of the State of California approved Proposition 215, known as the Compassionate Use Act ( CUA ) (codified as Health and Safety ( H&S ) Code Section et seq.); and WHEREAS, the CUA creates a limited exception from criminal liability for seriously ill persons who are in need of medical marijuana for specified medical purposes and who obtain and use medical marijuana under limited, specified circumstances; and WHEREAS, on January 1, 2004, the "Medical Marijuana Program" ( MMPA ), codified as H&S Code Sections to , was enacted by the state Legislature to clarify the scope of the Act and to allow cities and other governing bodies to adopt and enforce rules and regulations consistent with the MMPA; and WHEREAS, the CUA expressly anticipates the enactment of additional local legislation and provides: "Nothing in this section shall be construed to supersede legislation prohibiting persons from engaging in conduct that endangers others, nor to condone the diversion of marijuana for nonmedical purposes" (H&S Code Section ); and WHEREAS, the City Council takes legislative notice of the fact that several California cities and counties which have permitted the establishment of medical marijuana distribution facilities or dispensaries have experienced serious adverse impacts associated with and resulting from such uses. According to these communities, according to news stories widely reported and according to medical marijuana advocates, medical marijuana dispensaries have resulted in and/or caused an increase in crime, including burglaries, robberies, violence, illegal sales of marijuana to, and use of marijuana by, minors and other persons without medical need in the areas immediately surrounding such medical marijuana distribution facilities. The city council reasonably anticipates that the City of Morgan Hill will experience similar adverse

13 impacts and effects. A California Police Chiefs Association compilation of police reports, news stories and statistical research regarding such secondary impacts is contained in a 2009 white paper report available at: and WHEREAS, the City Council further takes legislative notice that the California Attorney General has adopted guidelines for the interpretation and implementation of the state's medical marijuana laws, entitled "GUIDELINES FOR THE SECURITY AND NON-DIVERSION OF MARIJUANA GROWN FOR MEDICAL USE (August 2008)" ( The Attorney General has stated in the guidelines that "[a]lthough medical marijuana 'dispensaries' have been operating in California for years, dispensaries, as such, are not recognized under the law ; and WHEREAS, the City Council further takes legislative notice that the experience of other cities has been that many medical marijuana distribution facilities or dispensaries do not operate as true cooperatives or collectives in compliance with the MMPA and the Attorney General Guidelines, and thus these businesses are engaged in cultivation, distribution and sale of marijuana in a manner that remains illegal under both California and federal law; as a result, the city would be obligated to commit substantial resources to regulating and overseeing the operation of medical marijuana distribution facilities to ensure that the facilities operate lawfully and are not fronts for illegal drug trafficking; and, furthermore, it is uncertain whether even with the dedication of significant resources to the problem, the city would be able to prevent illegal conduct associated with medical marijuana distribution facilities, such as illegal cultivation and transport of marijuana and the distribution of marijuana between persons who are not qualified patients or caregivers under the CUA and MMPA; and WHEREAS, the City Council further takes legislative notice that concerns about nonmedical marijuana use arising in connection with the CUA and the MMPA also have been recognized by state and federal courts. (See, e.g., Bearman v. California Medical Bd. (2009) 176 Cal.App.4th 1588; People ex rel. Lungren v. Peron (1997) 59 Cal.App.4th 1383, 1386 to 1387; Gonzales v. Raich (2005) 545 U.S. 1); and WHEREAS, the City Council further takes legislative notice that the use, possession, distribution and sale of marijuana remain illegal under the CSA (Bearman v. California Medical Bd. (2009) 176 Cal.App.4th 1588); that the federal courts have recognized that despite California's CUA and MMPA, marijuana is deemed to have no accepted medical use (Gonzales v. Raich, 545 U.S. 1; United States v. Oakland Cannabis Buyers' Cooperative (2001) 532 U.S. 483); that medical necessity has been ruled not to be a defense to prosecution under the CSA (United States v. Oakland Cannabis Buyers' Cooperative, 532 U.S. 483); and that the federal government properly may enforce the CSA despite the CUA and MMP (Gonzales v. Raich, 545 U.S. 1); and WHEREAS, the City Council further takes legislative notice that the United States Attorney General in 2008 announced its intention to ease enforcement of federal laws as applied to medical marijuana dispensaries which otherwise comply with state law. There is no certainty how long this uncodified policy will remain in effect, a February 1, 2011 letter from the Attorney General s Office to the City of Oakland suggests a policy change may be underway. The underlying conflict between federal and state statutes still remains; and

14 WHEREAS, an ordinance prohibiting medical marijuana distribution facilities, and prohibiting the issuance of any permits, licenses and entitlements for medical marijuana distribution facilities, is necessary and appropriate to maintain and protect the public health, safety and welfare of the citizens of Morgan Hill. NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF MORGAN HILL DOES ORDAIN AS FOLLOWS: Section 1. Chapter 9.16 (Medical Marijuana Distribution Facilities) is hereby added to Title 9 (Public Peace, Morals and Welfare) of the Morgan Hill Municipal Code as follows: Chapter 9.16 MEDICAL MARIJUANA DISTRIBUTION FACILITIES Definitions Operation of medical marijuana distribution facilities prohibited Violation penalty Public nuisance Definitions. (a) A medical marijuana distribution facility is any facility or location, whether fixed or mobile, where a primary caregiver, a person with identification cards or a qualified patient makes available, sells, transmits, gives or otherwise provides marijuana to two or more primary caregivers, persons with identification cards or qualified patients, as defined in California Health and Safety Code section et. seq., or any facility where qualified patients, persons with identification cards and primary caregivers meet or congregate collectively and cooperatively to cultivate or distribute marijuana for medical purposes under the purported authority of California Health and Safety Code section et. seq. (b) Medical marijuana distribution facility shall not include the following uses, so long as such uses comply with this Code, Health and Safety Code Section et seq., and other applicable law: (1) A clinic licensed pursuant to Chapter 1 of Division 2 of the Health and Safety Code. (2) A health care facility licensed pursuant to Chapter 2 of Division 2 of the Health and Safety Code. (3) A residential care facility for persons with chronic life-threatening illness licensed pursuant to Chapter 3.01 of Division 2 of the Health and Safety Code. (4) A residential care facility for the elderly licensed pursuant to Chapter 3.2 of Division 2 of the Health and Safety Code. (5) A hospice or a home health agency, licensed pursuant to Chapter 8 of Division 2 of the Health and Safety Code. (5) A hospice or a home health agency, licensed pursuant to Chapter 8 of Division 2 of the Health and Safety Code Operation of medical marijuana distribution facilities prohibited. Medical marijuana distribution facilities, as defined in this chapter, are declared to be unlawful and prohibited uses in all zoning districts in the City of Morgan Hill Violation penalty. (a) Any person found to be in violation of any provision of this chapter shall be subject to the enforcement remedies set forth in Title 1, at the discretion of the city.

15 (b) Each violation of this chapter and each day of violation of this chapter shall be considered as separate and distinct violations thereof Public nuisance. Any use or condition caused or permitted to exist in violation of any of the provisions of this chapter shall be and is hereby declared a public nuisance and may be abated by the city pursuant to the procedures set forth in Chapter Section 2. Section is hereby added to Chapter (General Provisions) of Title 18 (Zoning) of the Morgan Hill Municipal Code as follows: Medical marijuana distribution facilities. Medical marijuana distribution facilities, as defined in Chapter 9.16, are prohibited uses in all zoning districts in the City of Morgan Hill. Section 3. Severability. If any section, subsection, subdivision, paragraph, sentence, clause, or phrase in this chapter or any part thereof is for any reason held to be unconstitutional or invalid or ineffective by any court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this chapter or any part thereof. The City Council hereby declares that it would have passed each section, subsection, subdivision, paragraph, sentence, clause, or phrase thereof irrespective of the fact that any one or more subsections, subdivisions, paragraphs, sentences, clauses, or phrases be declared unconstitutional, or invalid, or ineffective. Section 4. Effective Date; Posting. This ordinance shall take effect on, The City Clerk is hereby directed to publish this ordinance pursuant to of the Government Code. Section 5. Exempt from CEQA. The City Council determines and finds that this ordinance is exempt from the California Environmental Quality Act under section 15061(b)(3) because the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA.

16 EDMUND G. BROWN JR. Attorney General DEPARTMENT OF JUSTICE State of California GUIDELINES FOR THE SECURITY AND NON-DIVERSION OF MARIJUANA GROWN FOR MEDICAL USE August 2008 In 1996, California voters approved an initiative that exempted certain patients and their primary caregivers from criminal liability under state law for the possession and cultivation of marijuana. In 2003, the Legislature enacted additional legislation relating to medical marijuana. One of those statutes requires the Attorney General to adopt guidelines to ensure the security and nondiversion of marijuana grown for medical use. (Health & Saf. Code, (d). 1 ) To fulfill this mandate, this Office is issuing the following guidelines to (1) ensure that marijuana grown for medical purposes remains secure and does not find its way to non-patients or illicit markets, (2) help law enforcement agencies perform their duties effectively and in accordance with California law, and (3) help patients and primary caregivers understand how they may cultivate, transport, possess, and use medical marijuana under California law. I. SUMMARY OF APPLICABLE LAW A. California Penal Provisions Relating to Marijuana. The possession, sale, cultivation, or transportation of marijuana is ordinarily a crime under California law. (See, e.g., [possession of marijuana is a misdemeanor]; [cultivation of marijuana is a felony]; Veh. Code, [possession of less than 1 oz. of marijuana while driving is a misdemeanor]; [possession with intent to sell any amount of marijuana is a felony]; [transporting, selling, or giving away marijuana in California is a felony; under 28.5 grams is a misdemeanor]; [selling or distributing marijuana to minors, or using a minor to transport, sell, or give away marijuana, is a felony].) B. Proposition The Compassionate Use Act of On November 5, 1996, California voters passed Proposition 215, which decriminalized the cultivation and use of marijuana by seriously ill individuals upon a physician s recommendation. ( ) Proposition 215 was enacted to ensure that seriously ill Californians have the right to obtain and use marijuana for medical purposes where that medical use is deemed appropriate and has been recommended by a physician who has determined that the person s health would benefit from the use of marijuana, and to ensure that patients and their primary caregivers who obtain and use marijuana for 1 Unless otherwise noted, all statutory references are to the Health & Safety Code

17 medical purposes upon the recommendation of a physician are not subject to criminal prosecution or sanction. ( (b)(1)(A)-(B).) The Act further states that Section 11357, relating to the possession of marijuana, and Section 11358, relating to the cultivation of marijuana, shall not apply to a patient, or to a patient s primary caregiver, who possesses or cultivates marijuana for the personal medical purposes of the patient upon the written or verbal recommendation or approval of a physician. ( (d).) Courts have found an implied defense to the transportation of medical marijuana when the quantity transported and the method, timing and distance of the transportation are reasonably related to the patient s current medical needs. (People v. Trippet (1997) 56 Cal.App.4th 1532, 1551.) C. Senate Bill The Medical Marijuana Program Act. On January 1, 2004, Senate Bill 420, the Medical Marijuana Program Act (MMP), became law. ( ) The MMP, among other things, requires the California Department of Public Health (DPH) to establish and maintain a program for the voluntary registration of qualified medical marijuana patients and their primary caregivers through a statewide identification card system. Medical marijuana identification cards are intended to help law enforcement officers identify and verify that cardholders are able to cultivate, possess, and transport certain amounts of marijuana without being subject to arrest under specific conditions. ( (e), ) It is mandatory that all counties participate in the identification card program by (a) providing applications upon request to individuals seeking to join the identification card program; (b) processing completed applications; (c) maintaining certain records; (d) following state implementation protocols; and (e) issuing DPH identification cards to approved applicants and designated primary caregivers. ( (b).) Participation by patients and primary caregivers in the identification card program is voluntary. However, because identification cards offer the holder protection from arrest, are issued only after verification of the cardholder s status as a qualified patient or primary caregiver, and are immediately verifiable online or via telephone, they represent one of the best ways to ensure the security and non-diversion of marijuana grown for medical use. In addition to establishing the identification card program, the MMP also defines certain terms, sets possession guidelines for cardholders, and recognizes a qualified right to collective and cooperative cultivation of medical marijuana. ( , , ) D. Taxability of Medical Marijuana Transactions. In February 2007, the California State Board of Equalization (BOE) issued a Special Notice confirming its policy of taxing medical marijuana transactions, as well as its requirement that businesses engaging in such transactions hold a Seller s Permit. ( According to the Notice, having a Seller s Permit does not allow individuals to make unlawful sales, but instead merely provides a way to remit any sales and use taxes due. BOE further clarified its policy in a - 2 -

18 June 2007 Special Notice that addressed several frequently asked questions concerning taxation of medical marijuana transactions. ( E. Medical Board of California. The Medical Board of California licenses, investigates, and disciplines California physicians. (Bus. & Prof. Code, 2000, et seq.) Although state law prohibits punishing a physician simply for recommending marijuana for treatment of a serious medical condition ( (c)), the Medical Board can and does take disciplinary action against physicians who fail to comply with accepted medical standards when recommending marijuana. In a May 13, 2004 press release, the Medical Board clarified that these accepted standards are the same ones that a reasonable and prudent physician would follow when recommending or approving any medication. They include the following: 1. Taking a history and conducting a good faith examination of the patient; 2. Developing a treatment plan with objectives; 3. Providing informed consent, including discussion of side effects; 4. Periodically reviewing the treatment s efficacy; 5. Consultations, as necessary; and 6. Keeping proper records supporting the decision to recommend the use of medical marijuana. ( Complaints about physicians should be addressed to the Medical Board ( or which investigates and prosecutes alleged licensing violations in conjunction with the Attorney General s Office. F. The Federal Controlled Substances Act. Adopted in 1970, the Controlled Substances Act (CSA) established a federal regulatory system designed to combat recreational drug abuse by making it unlawful to manufacture, distribute, dispense, or possess any controlled substance. (21 U.S.C. 801, et seq.; Gonzales v. Oregon (2006) 546 U.S. 243, ) The CSA reflects the federal government s view that marijuana is a drug with no currently accepted medical use. (21 U.S.C. 812(b)(1).) Accordingly, the manufacture, distribution, or possession of marijuana is a federal criminal offense. (Id. at 841(a)(1), 844(a).) The incongruity between federal and state law has given rise to understandable confusion, but no legal conflict exists merely because state law and federal law treat marijuana differently. Indeed, California s medical marijuana laws have been challenged unsuccessfully in court on the ground that they are preempted by the CSA. (County of San Diego v. San Diego NORML (July 31, 2008) --- Cal.Rptr.3d ---, 2008 WL ) Congress has provided that states are free to regulate in the area of controlled substances, including marijuana, provided that state law does not positively conflict with the CSA. (21 U.S.C. 903.) Neither Proposition 215, nor the MMP, conflict with the CSA because, in adopting these laws, California did not legalize medical marijuana, but instead exercised the state s reserved powers to not punish certain marijuana offenses under state law when a physician has recommended its use to treat a serious medical condition. (See City of Garden Grove v. Superior Court (Kha) (2007) 157 Cal.App.4th 355, , ) - 3 -

19 In light of California s decision to remove the use and cultivation of physicianrecommended marijuana from the scope of the state s drug laws, this Office recommends that state and local law enforcement officers not arrest individuals or seize marijuana under federal law when the officer determines from the facts available that the cultivation, possession, or transportation is permitted under California s medical marijuana laws. II. DEFINITIONS A. Physician s Recommendation: Physicians may not prescribe marijuana because the federal Food and Drug Administration regulates prescription drugs and, under the CSA, marijuana is a Schedule I drug, meaning that it has no recognized medical use. Physicians may, however, lawfully issue a verbal or written recommendation under California law indicating that marijuana would be a beneficial treatment for a serious medical condition. ( (d); Conant v. Walters (9th Cir. 2002) 309 F.3d 629, 632.) B. Primary Caregiver: A primary caregiver is a person who is designated by a qualified patient and has consistently assumed responsibility for the housing, health, or safety of the patient. ( (e).) California courts have emphasized the consistency element of the patient-caregiver relationship. Although a primary caregiver who consistently grows and supplies... medicinal marijuana for a section patient is serving a health need of the patient, someone who merely maintains a source of marijuana does not automatically become the party who has consistently assumed responsibility for the housing, health, or safety of that purchaser. (People ex rel. Lungren v. Peron (1997) 59 Cal.App.4th 1383, 1390, 1400.) A person may serve as primary caregiver to more than one patient, provided that the patients and caregiver all reside in the same city or county. ( (d)(2).) Primary caregivers also may receive certain compensation for their services. ( (c) [ A primary caregiver who receives compensation for actual expenses, including reasonable compensation incurred for services provided... to enable [a patient] to use marijuana under this article, or for payment for out-of-pocket expenses incurred in providing those services, or both,... shall not, on the sole basis of that fact, be subject to prosecution for possessing or transporting marijuana].) C. Qualified Patient: A qualified patient is a person whose physician has recommended the use of marijuana to treat a serious illness, including cancer, anorexia, AIDS, chronic pain, spasticity, glaucoma, arthritis, migraine, or any other illness for which marijuana provides relief. ( (b)(1)(A).) D. Recommending Physician: A recommending physician is a person who (1) possesses a license in good standing to practice medicine in California; (2) has taken responsibility for some aspect of the medical care, treatment, diagnosis, counseling, or referral of a patient; and (3) has complied with accepted medical standards (as described by the Medical Board of California in its May 13, 2004 press release) that a reasonable and prudent physician would follow when recommending or approving medical marijuana for the treatment of his or her patient

20 III. GUIDELINES REGARDING INDIVIDUAL QUALIFIED PATIENTS AND PRIMARY CAREGIVERS A. State Law Compliance Guidelines. 1. Physician Recommendation: Patients must have a written or verbal recommendation for medical marijuana from a licensed physician. ( (d).) 2. State of California Medical Marijuana Identification Card: Under the MMP, qualified patients and their primary caregivers may voluntarily apply for a card issued by DPH identifying them as a person who is authorized to use, possess, or transport marijuana grown for medical purposes. To help law enforcement officers verify the cardholder s identity, each card bears a unique identification number, and a verification database is available online ( In addition, the cards contain the name of the county health department that approved the application, a 24-hour verification telephone number, and an expiration date. ( (a); (a)(3)-(4); ) 3. Proof of Qualified Patient Status: Although verbal recommendations are technically permitted under Proposition 215, patients should obtain and carry written proof of their physician recommendations to help them avoid arrest. A state identification card is the best form of proof, because it is easily verifiable and provides immunity from arrest if certain conditions are met (see section III.B.4, below). The next best forms of proof are a city- or county-issued patient identification card, or a written recommendation from a physician. 4. Possession Guidelines: a) MMP: 2 Qualified patients and primary caregivers who possess a stateissued identification card may possess 8 oz. of dried marijuana, and may maintain no more than 6 mature or 12 immature plants per qualified patient. ( (a).) But, if a qualified patient or primary caregiver has a doctor s recommendation that this quantity does not meet the qualified patient s medical needs, the qualified patient or primary caregiver may possess an amount of marijuana consistent with the patient s needs. ( (b).) Only the dried mature processed flowers or buds of the female cannabis plant should be considered when determining allowable quantities of medical marijuana for purposes of the MMP. ( (d).) b) Local Possession Guidelines: Counties and cities may adopt regulations that allow qualified patients or primary caregivers to possess 2 On May 22, 2008, California s Second District Court of Appeal severed Health & Safety Code from the MMP on the ground that the statute s possession guidelines were an unconstitutional amendment of Proposition 215, which does not quantify the marijuana a patient may possess. (See People v. Kelly (2008) 163 Cal.App.4th 124, 77 Cal.Rptr.3d 390.) The Third District Court of Appeal recently reached a similar conclusion in People v. Phomphakdy (July 31, 2008) --- Cal.Rptr.3d ---, 2008 WL The California Supreme Court has granted review in Kelly and the Attorney General intends to seek review in Phomphakdy