Council members voted 12-0 in favor of the motion, which calls for no new certificates to be issued for “any medical marijuana collective business activity.”
The report goes on to say…
Some medical pot shops in the city are still allowed to operate due to exceptions in Proposition D, but finance officials said they are unequipped to determine whether a medical marijuana dispensary is in compliance and must leave the potentially complex legal question to be sorted out by city attorneys.
City leaders said collecting taxes while also banning medical marijuana businesses sends a mixed message, prompting them to simply cut off the issuance of any new tax registrations.
The ordinance approved by the City Council today calls for no new tax registration certificates to be issued for “any medical marijuana collective business activity.” The mayor must also sign off on the ordinance before it can go into effect.
Councilman Joe Buscaino said the few pot shops that are allowed under Proposition D had to have already registered by September 2007, so this new ordinance “finally puts an end to the issuance of business tax licenses to illegal pot shops in the city of L.A.”
He said by halting the issuance of new tax certificates to dispensaries, the city will be “inhibiting fraudulent activity” and curbing what appears to be an increase in dispensaries despite the enactment of Proposition D. Councilman Marqueece Harris-Dawson said a “mix” of illegal and legal pot shops has “hijacked storefronts” in his district for medical marijuana sales.
“This was one of the main issues that came up in almost every neighborhood house meeting,” he said.
Some city officials have accused medical marijuana dispensaries of using the tax certificates to trick landlords and others into thinking they are permitted businesses.
City Councilwoman Nury Martinez, who pushed to discontinue the tax certificates to illegal pot shops, told City News Service last fall that because she has been trying to shut down illegal pot shops in her district, it is insincere for the city to simultaneously collect taxes from them.
“They shouldn’t be operating, because they don’t fall within the law, and we shouldn’t be collecting taxes on these businesses that are illegally operating,” Martinez said. “As much as we try to shut the illegal ones down, they turn around and we issue a BTRC (business tax registration certificate) to them.”
LA City Council council.lacity.org/