Posts Tagged ‘DEA’
By Kevin Gray
When eight former DEA chiefs signed a letter to US Attorney General Eric Holder earlier this month, demanding that the feds crack down on Washington and Colorado, the states which voted last November to legalize marijuana, there was more than just drug-war ideology at stake. There was money.
Two of the elder drug warriors, Peter Bensinger (DEA chief, 1976–1981) and Robert DuPont (White House drug chief, 1973–1977), run a corporate drug-testing business. Their employee-assistance company, Bensinger, DuPont & Associates, the sixth largest in the nation, holds the pee stick for some 10 million employees around the US. Their clients have included the biggest players in industry and government: Kraft Foods, American Airlines, Johnson & Johnson, the Federal Aviation Administration and even the Justice Department itself.
“These are not just old drug war architects pushing a drug war model they’ve pushed for 40 years,” says Brian Vicente, a Denver lawyer and co-author of Colorado’s Proposition 64, which legalized marijuana for recreational use. “These guys are asking Eric Holder to pursue prohibition policies that line their own pockets.”
Bensinger and DuPont both deny money is their motive. “It’s true we might benefit from keeping marijuana illegal,” says DuPont. But he argues it’s equally true that marijuana legalization could benefit his bottom line, putting forth the old drug-war line that legalization would create more users.
“The more success legalization has, the better it is for our business because they are creating a problem for employers,” he says. “That would be smart for us.” DuPont also points out that only 15% of their business is made up of training employers to detect the warning signs of drug and alcohol abuse and supplying third-party testing. But both men are involved in industry-controlled lobbying groups like the Drug & Alcohol Industry Testing Association, which backed the Drug Testing Integrity Act of 2008, outlawing products that help people beat drug tests and keeping their business healthy.
By inserting themselves into the legal-pot debate, Bensinger, DuPont and other drug warriors benefit by promoting their own legacies and bolstering their own business, lobbying and consulting interests—even in the face of an increasingly skeptical public. A 2011 Gallup survey showed that half of Americans favor legalizing weed. “This letter that they signed is their attempt to once again become relevant within the public policy debate that has largely turned its back on such archaic viewpoints,” says Paul Armentano, deputy director of the pro-marijuana nonprofit, National Organization for the Reform of Marijuana Laws (NORML).
The time-honored revolving door between government and business swings fast and often. It can be straightforward, like the appointment of banking behemoth Goldman Sachs’ alumni as economic policymakers by recent presidential administrations. But when it comes to the drug war, the family tree is more like a thicket of interests among law enforcement, federal and state prisons, pharmaceutical giants, drug testers and drug treatment programs—all with an economic stake in keeping pot illegal.
Bensinger and DuPont are longtime allies of the marijuana prohibition group that sent the letter to Holder, Save Our Society from Drugs (SOS), which was founded by Mel Sembler, a Florida shopping-mall magnate, and his wife, Betty. The Semblers also founded Straight Inc.—a drug-treatment program that used sleep deprivation, beatings and psychological abuse to treat 10,000 teenage patients, in nine states, from 1976 to 1993, at $1,400 a month plus a $1,600 per patient evaluation fee, raking in millions. Straight wasshut down after investigations in state after state corroborated the hundreds of complaints. But the Semblers, longtime major Republican Party fundraisers, retain their influence as behind-the-scenes bankrollers of the anti-drug faction.
The department of the White House drug czar, otherwise known as the Office of National Drug Control Policy (ONDCP), is another arm of the government’s war on drugs that can be lucrative to incumbents. Andrea Barthwell, MD, former deputy drug czar during President George W. Bush’s first term and his point person against medical marijuana, has earned a living both treating drug addicts and lobbying against policies that weaken marijuana laws—and cut into her own bottom line.
As a past president of the American Society of Addiction Medicine (ASAM)—a group that opposes medical marijuana, and whose members’ business model could be threatened by legalized marijuana, since two-thirds of its clientele are court-ordered pot users trying to avoid jail time—Barthwell has been one of its fiercest attack dogs. In ASAM campaigns against Oregon and Illinois’ medical marijuana initiatives, she called those who favor medical marijuana “cruel” and “snake oil salesman.” She denounces this pain-relief and anti-nausea approach for patients with cancer and AIDS because, she claims, it is unregulated and unproven (the Institute of Medicine declared medical marijuana useful in 2003, and since then many studies, and many more users, attest to its benefits.)
Yet Barthwell was happy to jump from the ONDCP to the payroll of GW Pharmaceutical in 2005, lobbying for the Canadian company’s Sativex—a liquefied marijuana spray, extracted from whole plant cannabis, for the same pain benefits. Even as the American Medical Association and federal lawmakers maintain that pot has no medicinal value, Big Pharma is applying for dozens of cannabis-based new medicines in order to take hold of of the $1.8 billion medical marijuana industry, as NORML’s Paul Armentano pointed out five years ago in the Huffington Post.
Barthwell, like Bensinger and DuPoint, also has a financial stake in the prohibition treatment culture. She is founder and CEO of EMGlobal LLC, parent company of the Chicago-based Two Dreams Outer Banks drug treatment center, and is also a director of Catasys Inc., which provides substance abuse programs and behavioral health management services to companies, health plans and unions—a role for which she received $77,994 in compensation in 2011.
When it comes to the drug war, money rolls into whichever corporate pockets are willing to play ball, whether it’s big-time lobbyists or broadcast TV networks. Barry McCaffrey—President Clinton’s second-term drug czar and a former Army general, who also signed the recent letter to Holder—was in charge of the purse strings at ONDCP. He oversaw a money-soaked, ham-handed propaganda campaign: In 1999, his office hired PR giant Fleishman-Hillard (at $10 million a year), which encouraged TV networks to slip anti-drug messages into sitcoms and dramas in exchange for ad time worth millions. The secret effort allowed networks to avoid running PSAs, freeing up airtime for paid ads. Networks also gave the ONCDP advance copies of scripts to review. It’s estimated that between 1998 and 2000, the networks received up to $25 million in benefits.
At the same time, McCaffrey was sharpening his stick for the battle against medical marijuana, flatly denying that patients in pain could receive relief from pot. After he left the drug czar’s job, he went on the payroll of military contractors, promoting their interests in the Iraq war as a frequent talking head on national network TV, never disclosing his financial ties.
Lobbying your former employer—whether it’s the government itself or taxpayers who foot the bill—is the No. 1 way one-time public servants can serve themselves. The same is true of current state-paid employees, like cops and other law enforcement personnel whose job it is to crack down on illegal weed smoking. As Armentano notes, federal grants that target illegal drug use are a major source of funding for local police coffers, paying for new hires, equipment and coveted overtime pay.
John Lovell, a lobbyist for police associations in Sacramento, California, not only obtains those grants, he is a front-line fighter on behalf of the cops to keep pot illegal. When California weighed Proposition 19 to legalize marijuana in 2010, Lovell helped manage the opposition campaign. During the fight, according to a reviewof lobbying contracts by Republic Report, Lovell’s company received $386,350 from police groups, including the California Police Chiefs Association. The same report noted that Lovell helped local police departments apply for drug war money from President Obama’s American Recovery and Reinvestment Act. In 2009 and 2010, state police groups sought some $75 million from the feds to conduct a Campaign Against Marijuana Planting. Lovell represented one such group.
Indeed, law enforcement agencies around the country could lose as much as $11 billion in taxpayer money if marijuana prohibition is repealed, according to Harvard economics professor Jeff Myron. Weed arrests account for half of all drugs arrests in the US. The tangled money trail can seem at times like something from a smoke-filled Cheech and Chong plot.
In 2009, the California Police Chiefs Association posted on their website a position paperagainst pot for pain, courtesy of a group called Friends of the DEA. “Requiring the DEA unequivocally to take a ‘hands-off’ approach, no matter how egregious the dispensary’s practices, will not serve the best interests of patients. Uncontrolled proliferation of dispensaries will seriously undercut our FDA drug approval system and deprive patients of important regulatory protections,” the group argued. What the paper didn’t note was that Friends was a lobbying group headed by Michael Barnes, a former Bush appointee to the drug czar’s office, as first pointed out by CounterPunch that year. The nine-page, heavily footnoted position paper was written by none other than Andrea Barthwell, MD, the promoter of Sativex, which is likely to receive FDA approval soon.
Among the biggest financial winners from the war on pot are private prisons and the army of DEA agents, local deputies and SWAT teams who help fill them up. Since 1980, federal prisons have ballooned some 790% because of the war on drugs, which began in earnest the previous decade. Private prison companies have seen their business soar. Corrections Corporation of America (CAA), the largest operator in the US, with 60 facilities and a 90,000-bed capacity, had $1.7 billion in tax-payer-funded revenue last year. The GEO Group, a worldwide player with 53,000 beds, pulled in $1.6 billion in government-funneled revenue.
In its 2010 annual report, CAA is fairly transparent about its stake in the anti-drug battle: “Any changes [in laws] with respect to drugs and controlled substances or illegal immigration could affect the number of persons arrested, convicted and sentenced, thereby potentially reducing demand for correctional facilities to house them.” Last year, both companies stuffed millions of dollars into the pockets of Washington lobbyists to pressure lawmakers to maintain the status quo, as revealed in an investigation by Laura Carlsen in March’s Counter Punch magazine.
“My most powerful adversity is the police-prison industry,” says former cop–turned–drug policy specialist Howard Woolridge, who lobbies lawmakers for marijuana reform for Citizens Opposing Prohibition. “They can say, ‘If you don’t vote for more prohibition, we will tell people you are soft on drugs on and soft on crime.’ The Fraternal Order of Police is looking out for their 326,000 members’ paychecks. If they say you’re soft on crime, they can move upward of 2% of the electorate. In a close election, that’s victory and defeat.”
Vincente doesn’t doubt that the Bensingers, Bathwells and McCaffreys are fervent believers in their anti-pot mission, even as they earn their living on its front lines or flanks. The same people who wrote to Holder battled Vincente’s initiative as well. “It’s what they do—they get together and sign letters,” he says. For the older fighters, says Paul Armentano of NORML, “Their motivation is the fact their failed polices have been proved wrong. All they have is the ability to try to intimidate a couple of high-ranking officials. Most of America has moved on.”
Attorney General Eric Holder may recognize this. He has told members of the Senate that the Obama administration is still formulating its policy toward the states that legalized pot. “We are considering what the federal response to those new statutes will be,” Holder said at a Senate Judiciary Committee hearing this week. “We will have the ability to announce what our policy will be relatively soon.”
So far he has not answered the drug warriors’ letter.
by Erik Altieri
Last month, Congressman Jared Polis (D-CO) introduced legislation, House Resolution 499, which would effectively end the federal prohibition on marijuana and allow states to set their own policies.
House Resolution 499: The Ending Marijuana Prohibition Act of 2013, would remove marijuana from the Controlled Substances Act, transfer the Drug Enforcement Administration’s authority to regulate marijuana to a newly renamed Bureau of Alcohol, Tobacco, Marijuana and Firearms, require commercial marijuana producers to purchase a permit, and ensure that federal law distinguishes between individuals who grow marijuana for personal use and those involved in commercial sale and distribution.
You can read the full text of this measure here.
Congress needs to hear from you, please take a minute and click here to quickly and easily write your Representative and urge him or her to support the Ending Federal Marijuana Prohibition Act of 2013!
Washington, DC: A three-judge panel for the US Court of Appeals for the District of Columbia last week denied petitioners request to overturn the Obama administration’s July 2011 rejection of an administrative petition that sought to initiate hearings regarding the reclassification of marijuana under federal law.
Petitioners sought a hearing regarding whether existing science contradicts the federal categorization of cannabis as a Schedule I controlled substance that possesses “a high potential for abuse;” “no currently accepted medical use in treatment;” and “a lack of accepted safety for the use of the drug … under medical supervision.” The Court affirmed the position of the US Drug Enforcement Administration that, at this time, insufficient clinical studies exist to warrant a judicial review of cannabis’ federally prohibited status.
Petitioners are expected to appeal the decision.
For more information, please visit: http://safeaccessnow.org. Full text of the decision, Americans for Safe Access et al. v. Drug Enforcement Administration, is available online here: http://americansforsafeaccess.org/downloads/CRC_Appeal.pdf.
OAKLAND, Calif. — In the summer of 2007, the owners of Harborside Health Center, then and now the most prominent medical marijuana dispensary in the U.S., were reflecting on their rapid rise. Steve DeAngelo had opened the center with his business partner in October 2006, on a day when federal agents raided three other clubs in the San Francisco Bay Area. “We had to decide in that moment whether or not we were really serious about this and whether we were willing to risk arrest for it,” DeAngelo said. “And we decided we were going to open our doors. And we did, and we haven’t looked back since. The only way I’ll stop doing what I’m doing is if they drag me away in chains. And as soon as they let me out, I’ll be back doing it again.”
DeAngelo, looking at his desktop computer during an interview that summer, threw his hands up and shouted, “Yes!” Hillary Clinton, campaigning for president in New Hampshire, had just told a video-camera-wielding marijuana-policy activist that, if elected, she would end federal raids on pot clubs in California. That meant that all three leading Democratic candidates — including the ultimate winner — had vowed as president to leave DeAngelo and his business alone. Within a year of opening, the shop was bringing in $1 million a month in sales.
President Barack Obama made good on his campaign promise shortly after taking office. “What the president said during the campaign, you’ll be surprised to know, will be consistent with what we’ll be doing in law enforcement,” Attorney General Eric Holder said in March 2009. “What he said during the campaign is now American policy.”
In October, the Department of Justice followed up with what became known as the “Ogden memo” — a missive from Deputy Attorney General David Ogden telling federal law enforcers that they should not focus federal resources ”on individuals whose actions are in clear and unambiguous compliance with existing state laws providing for the medical use of marijuana.”
Steph Sherer, the head of Americans for Safe Access, a California-based medical marijuana group, was thrilled when she saw the Ogden memo. The group quickly put out a press release touting it.
“We were so beside ourselves in so many ways that we were finally recognized by a government agency, that our press release was victorious,” Sherer said. “What our nuance was, we said, ‘Great, we have an administration that will have a dialogue with us, this is a major step forward.’”
Some members of the medical marijuana industry, however, took a less nuanced view. “Instead, the reaction [from cannabis industry people] was, ‘OK, we’re all in the clear, it’s time to expand our businesses and bring in outside investors,’” Sherer said.
Encouraged by the Ogden memo and DeAngelo’s public assertions of his million-dollar monthly revenue, medical pot shops flooded Montana, Washington, and other states. Legislatures in 18 states, plus the District of Columbia, have now approved marijuana for medical purposes. Twelve, including DC, have laws allowing dispensaries. Local officials in California’s Mendocino County and in towns like Chico moved forward with plans to regulate medical marijuana as well. Before 2009, there were roughly 1,000 pot shops across the country. Today, there are 2,000 to 2,500, according to Kris Hermes, a spokesman for Americans for Safe Access.
“Nobody can argue that the number of medical marijuana shops in California and Colorado didn’t grow at an exponential rate directly because of this” Ogden memo, said a former senior White House official who worked on drug policy and, like other former and current members of the Obama administration, requested anonymity in order to speak about internal debates.
The Ogden memo, however, was not the beginning of the end of the war on pot. Instead, it kicked off a new battle that still rages. Since the memo, the Department of Justice has cracked down hard on medical marijuana, raiding hundreds of dispensaries, while the IRS and other federal law enforcement officials have gone after banks and landlords who do business with them. Fours years after promising not to make medical marijuana a priority, the government continues to target it aggressively.
The war has played out not just between federal authorities and the pot industry, but between competing factions within the federal government, as well as between local and state officials and the more aggressive federal prosecutors and drug warriors. As officials in Washington fought over whether and how to continue the war on pot, U.S. attorneys in the states helped beat back local efforts to regulate the medical marijuana industry, going so far as to threaten elected officials with jail. The willingness of elements within the Department of Justice, including its top prosecutors, to use their power in brazenly political ways is, in many ways, the untold story of Obama’s first-term approach to drug policy.
‘THE LANDSCAPE HAS CHANGED’
As president, Obama did his best to laugh off questions about marijuana. His own experience with weed had been positive, having spent his high school years hanging out with the “Choom Gang,” a bunch of his stoner buddies in Hawaii. A young Obama coined the term “roof hits” to describe the act of sucking in pot smoke floating near a car roof, and was known to hog extra hits from a joint by jumping around a circle of smokers, snatching the weed and saying, “Intercepted!”
The Drug Enforcement Administration and federal prosecutors, however, found nothing funny about it. “I believe there’s this notion out there that the marijuana industry is just full of organic farmers who are peacefully growing an organic natural plant and that there’s no harm associated with that,” U.S. Attorney Melinda Haag told San Francisco public radio station KQED last March. ”And what I hear from people in the community is that there is harm.” Marijuana, Haag said, could stunt brain development in children and act as a gateway drug to other substances. It may also, she warned, lead to armed robberies at dispensaries and grow operations, putting innocent bystanders at risk.
Federal authorities were determined to keep up the fight against pot legalization in any form, medical or recreational. Fighting that political battle often meant carrying out high-profile raids in the midst of legislative debates. In March 2011, agents swept through Montana, seizing property and arresting owners as part of a nationwide crackdown on medical marijuana. They timed the Montana raids to coincide with a legislative debate and votes in the state legislature over the future of medical marijuana, using law enforcement to shift the debate in their favor.
The raids led to images on the evening news of guns, drugs, and men in handcuffs. It imbued medical marijuana with a sense of criminality — even though it was legal under state law — and soured the political climate against it. Before the raids, state lawmakers had been debating two approaches: Repeal the voter-passed medical marijuana law altogether, or create a system of state-regulated and controlled dispensaries. The raids disabused Montanans of the notion that the federal government would allow states to regulate marijuana policy as they saw fit. The bill to sanction dispensaries was a casualty of the crackdown.
Instead, the Montana legislature voted to repeal the law, but Democratic Gov. Brian Schweitzer vetoed it – burning a branding iron through it at a public event. Lawmakers sent him a new bill leaving the law in place, but strictly curtailing it, and disallowing dispensaries. He allowed it to become law without his signature.
People who felt they’d been baited into the business by the federal government cried foul and began fighting to stay out of prison. The team defending Chris Williams, a Montana medical marijuana provider who was arrested and charged with drug trafficking, reached out to a Huffington Post reporter, who had broken the news of Holder’s announcement that he would lay off medical marijuana, asking him to testify. “Case law in our circuit indicates we may be able to introduce evidence concerning entrapment, such as quotes by govt. officials in news articles, if the writer of the article can testify to the authenticity of the statements,” said an investigator.
The judge in the case, however, ruled that defense attorneys could in no way mention the federal policy — either Holder’s statement or the Ogden memo. Williams was convicted and faces a mandatory minimum of more than eight decades in prison, though the judge has ordered mediation on the sentence overseen by a different judge, an unusual step.
In a separate case now in court, former University of Montana quarterback Jason Washington, a hometown hero, was fingerprinted by the FBI while in the process of setting up a dispensary, apparently as part of an effort to rationalize the growing industry. Washington’s lawyers hoped the FBI’s documented cooperation with the establishment of the business would undermine the effort to imprison its owner. Last week, however, Washington was convicted, and faces two mandatory minimum sentences of five years each.
Federal officials in Washington state ran the same play that had worked to such effect in Montana. As state lawmakers debated legislation to license dispensaries, federal prosecutors said they felt excluded. “There didn’t seem to be a recognition that the use and sale of marijuana is against federal law,” Michael Ormsby, U.S. attorney for the Eastern District of Washington, complained to The New York Times. “No one [in the legislature] consulted with me about what I thought of what they were going to do and did I think it ran afoul of federal law.”
In early April, Democratic Gov. Christine Gregoire, anticipating the bill’s passage, wrote a letter to the Justice Department asking what the federal response to the law would be. Ormsby and the other U.S. attorney with jurisdiction in Washington sent back a fire-breathing letter threatening to prosecute anyone involved with the dispensaries, asserting — falsely — that the Ogden memo was strictly limited to “seriously ill individuals,” when in fact it referenced any individual who followed state law.
A week after the legislature passed the bill and sent it to Gregoire to sign, the DEA carried out coordinated raids on dispensaries in eastern Washington.
The next day, on April 29, Gregoire vetoed the licensing bill. “The landscape has changed,” she explained. “I cannot disregard federal law on the chance that state employees will not be prosecuted.”
In Rhode Island, a U.S. attorney fired off a similar letter to Independent Gov. Lincoln Chafee that same month, as the governor considered whether to create state-run medical marijuana dispensaries, which the state legislature had authorized in 2009, before Chafee took office. the governor scrapped the planned “compassion centers.”
“Federal injunctions, seizures, forfeitures, arrests and prosecutions will only hurt the patients and caregivers that our law was designed to protect,” Chafee said.
Similar scenarios played out in Arizona and Hawaii, with raids and federal intervention followed by state officials backing off attempts to regulate dispensaries. The New York Times, rarely quick to ascribe motives to law enforcement on the news side, noted federal authorities’ timing.
“As some states seek to increase regulation but also further protect and institutionalize medical marijuana, federal prosecutors are suddenly asserting themselves,” the newspaper wrote that May.
For federal officials, the crackdown was necessary because things had accidentally gotten out of their control, said a former White House official. “If you read the memo, with the exception of a few words you maybe could’ve worded better, it’s really not that different from current law,” he said. “It took us by surprise, I will tell you, the way it was received in the beginning, and then the media ran with that narrative, that this was a change in policy and Obama’s gonna allow medical marijuana shops. The smart legalizers ran with that too, even though the really smart ones knew, when you read that memo, there really wasn’t much of a change from the Bush administration. All of a sudden, it took on a life of its own.”
Another official contended pro-marijuana legalization groups “distorted” the Ogden memo, a characterization the groups dispute.
“The distortion certainly wasn’t on our side,” Steve Fox, director of government relations for the Marijuana Policy Project, told HuffPost. “The Ogden memo said it wasn’t going to be a priority of the Department of Justice to prosecute individuals who were acting in compliance with state law. It was pretty straightforward, and a lot of people invested a lot of money based on that guidance and put their necks on the line, and some of those people are now being sent to prison by the Department of Justice after that memo had been issued in 2009.”
Still, the consequences of the Ogden memo were unequivocal. Sherer traveled to Montana just before the crackdown to train owners on “raid preparedness.” She asked rooms full of pot shop owners how many had opened their doors because of the Ogden memo. Nearly all raised their hands, she recalled.
Pushing the memo, she thought, as she stared out at the crowd now in dire legal jeopardy, had been a mistake.
A FIGHT FOR CLARIFICATION
The Ogden memo, despite the press coverage — including here at HuffPost — held loopholes an aggressive prosecutor could drive a battering ram through. “Nor does this guidance preclude investigation or prosecution,” it reads at one point, “even when there is clear and unambiguous compliance with existing state law, in particular circumstances where investigation or prosecution otherwise serves important federal interests.”
One of those federal interests was the continuation of current pot laws.
Pushed by political appointees, the Ogden memo, even with its loopholes, faced stiff internal resistance from career Justice Department prosecutors. “That’s just not what they do,” said a former Justice official. “They prosecute people.”
“One of the challenges is that condoning lawlessness is not okay,” another former DOJ official involved the medical marijuana discussions told HuffPost. “On the other hand, you’ve got the reality of resources and priorities. You just don’t go off and make cases just to make a point.”
With the 2011 crackdown underway, federal prosecutors needed some legal justification, some clarification to the Ogden memo. “Their argument was, look, anytime we go to anyone and try to say we’re going to crack down on you, they say, ‘Well, look at the Ogden memo. You can’t.’ They’d get that thrown back in their face,” one former Justice official told HuffPost.
Even supporters of the Ogden memo acknowledged it wasn’t a permanent fix, given the contradiction between state and local laws. But federal officials were surprised by how quickly states moved, writing laws around the Ogden memo.
U.S. attorneys led the rebellion with support from the DEA. Benjamin B. Wagner, a U.S. attorney in Sacramento, Calif., who is currently prosecuting medical marijuana distributor Matthew R. Davies, was particularly pushy, according to officials involved in the discussions. Ogden’s memo, the federal prosecutors argued, created uncertainty. They wanted a memo they could use to push state officials to crack down on their own.
The Ogden memo, or at least the public perception of it, stood in the way.
“There was a fight to get a clarification,” said one White House official.
Despite its name, the key players behind the Ogden memo were then-Associate Deputy Attorney General Ed Siskel and then-Principal Associate Deputy Attorney General Kathy Ruemmler, according to two people involved in the discussions. As two of Ogden’s top associates, they took the lead in drafting the memo.
By the time the push for second memo started, both had already been promoted to the White House. Working in the White House Counsel’s office, they had no say as their replacements at DOJ drafted a memo many contend undermined the Ogden memo. “There was nowhere to hide. They had to get on the bandwagon,” said the White House official involved in the process.
The politics around drug policy do not move in a linear, upward direction like, say, civil rights issues. As civil rights are expanded, the politics become reinforcing, as people become normalized to the new equality and reject the old intolerance as immoral. It’s by no means a smooth transition, but, for instance, the more gay weddings that are held, the more people come to accept the concept of gay marriage as uncontroversial.
But drug politics move in both directions. Drugs of all kinds — cocaine, heroin, speed — were fully legal at the turn of the 20th century, then banned over the next several decades. The pendulum swung back in the 1970s, with more than a dozen states decriminalizing marijuana. Then back again toward criminalization. Drugs are not like gay or interracial couples, where familiarity breeds acceptance. More drugs can lead, instead, to a public backlash.
Nearly everywhere that medical marijuana shops have proliferated, beginning in San Francisco in the early 1990s, there has been some negative public reaction. In the early communities, the public outcry was followed by a moratorium on new dispensaries and tight regulations on how they could operate. Well regulated shops have by and large been accepted where they have been allowed. It’s that pregnant moment in between that the shops are most vulnerable.
After 2009, the shops expanded faster than cannabis movement and industry organizers could keep up with. “People were telling themselves what they wanted to hear,” namely that the Ogden memo provided immunity from raids, said Sherer. “The proliferation got really out ahead of advocates.”
She watched the tragedy unfold. In the 1990s and 2000s, her group organized patients and others sympathetic to marijuana, and as soon as a shop was raided, the owner would immediately notify Americans for Safe Access, which would then send text messages to all its nearby activists. Before the evening news trucks could get to the scene, a throng of protesters would be outside the shop, often joined by local officials, denouncing the DEA. The resulting images in the media were a major blow to the feds. The DEA, Sherer said, signed up for Americans for Safe Access text alerts and would begin leaving the scene of a raid as soon as one went out. But that momentum was broken when the industry exploded.
The way to guard against a raid, said Sherer, had been to talk with neighbors, attend city council meetings, respond to complaints, and generally become a part of the community. “Make sure your community wanted you,” Sherer said she advised businesses. “I’ve been training people for 10 years that the number one reason people get raided is community complaints. The telltale sign of federal activity is the local community rejecting the dispensary.”
Medical marijuana shops’ protection had never been the law, it had been public opinion. With the perception in some local communities that the pot industry had gotten out of control, the DEA and U.S. attorneys were left with an opening.
THE EMPIRE STRIKES BACK
The drug warriors who had dug in at the DEA and Justice Department won their rear-guard action. The result was a new memo, issued by Deputy Attorney General James M. Cole, in June 2011.
“The second [memo] was kind of like The Empire Strikes Back,” a former DOJ official told HuffPost. “All the people who had been beaten the first time worked for several years to win one, and they won a round in the second one.”
Officially, DOJ took the position they were only further clarifying the Odgen memo, rather than throwing the guidance overboard. Its subject line promised it was merely “Guidance Regarding the Ogden Memo.”
Practically, however, the Cole memo gave U.S. attorneys more cover to go after medical marijuana distributors. The U.S. attorneys, “in unison, were saying, ‘We’re going to shut these down, this is the law.’ Holder could’ve said stop, but he didn’t,” said the White House official.
In August 2011, Justice officials told their local government leaders in the town of Chico, Calif., that they could personally be jailed if they went forward with legislation to regulate medical cannabis. Under criminal conspiracy laws, “all parties involved would be considered, including city officials,” city manager David Burkland wrote in a report on their meeting with U.S. Attorney Benjamin Wagner.
“Staff and Council’s involvement in implementing the marijuana ordinance could be interpreted as facilitating illegal activity associated with marijuana,” Burkland wrote. “U.S Attorney Wagner also stated that although the DOJ may lack the resources to prosecute every case, it intends to prosecute more significant cases to deter the activity of marijuana cultivation and unlawful distribution. In those cases, staff or elected officials will not be immune from prosecution under conspiracy or money laundering laws.”
In October 2011, four California-based U.S. attorneys held a remarkable joint press conference effectively declaring war on medical marijuana. “We were all experiencing the same thing, which is that everyone was saying … the U.S. attorneys are not going to take any actions with respect to marijuana in California because of the 2009 Ogden memo,” U.S. Attorney Haag told KQED. “So it’s fair game. We can have grow operations, we can have dispensaries, we can do anything we want with respect to marijuana. … That was incorrect.”
Haag said she launched her crackdown because she heard Oakland officials were preparing to license and regulate the industry, and allow large-scale growing operations in warehouses, which she opposed.
“What was described to me was that they were going to be quote ‘Walmart-sized.’ And I was hearing that everyone believed that would be okay, and that my office would not take any action. And I knew it isn’t okay. It is a violation of federal law,” Haag said. “If you actually read the so-called Ogden memo from 2009 from the Department of Justice, what it says is that U.S. attorneys will not ordinarily use their limited resources to bring actions against seriously ill individuals or their caregivers. That’s the direction we were given.”
Whatever the authors of the Ogden memo had in mind, the actual words they used said that resources should not be used to target “individuals whose actions are in clear and unambiguous compliance with existing state laws.”
“I didn’t think it was fair to stand by, be silent, let people pull licenses in Oakland, put millions of dollars into setting up a grow operation in a warehouse and then come in and take an enforcement action,” Haag said.
The prosecutor’s pursuit of fairness also took her to Mendocino County, where local officials had established an effective “zip tie program” to regulate its medical marijuana trade. Growers, after paying a licensing fee and submitting to police inspection, were given zip ties by the sheriff. Police officers who found bags of pot cinched by those ties then had reason to believe the product had been grown legally.
Just before the county board of supervisors planned to vote on making the program official and permanent, Haag traveled to the county and, in a meeting with county counsel Jeanine Nadel, threatened the supervisors with legal action if they moved forward, according to a report by California Watch.
The board decided to squash the program, but Haag’s pursuit continued. She empaneled a grand jury and subpoenaed information from the county about its program, looking for the names of people who had registered as growers, as well as all financial information related to it. Mendocino has so far refused to provide the information and is fighting the subpoena in court.
Dan Hamburg, a former member of Congress who’s now a Mendocino supervisor, said that his fellow board members were well aware that if they created an ordinance, they’d be putting themselves at legal risk. “The Board of Supervisors knew the possibility that we could be charged by the U.S. attorney with aiding and abetting criminal behavior, or even a criminal conspiracy,” he said. “However, my worry was, and remains, the possibility of forfeiture.” Under forfeiture laws, the federal government can seize money and valuables connected with criminal activity.
The feds have demanded to know how much money the county has made registering cannabis growers, which Hamburg and others suspect means they have their eye on it. Hamburg said it was just short of a million dollars, far more of a hit than the county budget, with “deteriorating finances,” could withstand.
“Our county doesn’t have a million dollars to turn over to the feds,” Hamburg said.
Hamburg had opposed the initiative, and opposed publicizing it, arguing that it would put a target on Mendocino and draw the ire of the federal government. Now that he’s been proven right, he’s backing his colleagues in defending it.
Just as pot policy split the Justice Department into factions, it pitted local cops against each other as well. The sheriff strongly supported the zip tie program, but some below him had a hard time countenancing what they saw as sanctioning criminal enterprise. Hamburg said that Haag saw there were local law enforcement concerns with the program and exploited those divisions.
The tensions are evident in a 2011 county audit report.
The zip tie program “is by far the program that causes the greatest chasm of disagreement within the department,” reads the audit. Critics “believe the program is illegal, runs counter to overall crime prevention in Mendocino County, is potentially criminal friendly, reduces morale, and is poised to bring more crime to the County and potential corruption to the department.”
The U.S. and Mendocino are scheduled to go to court on Jan. 29. Hamburg said he’s optimistic, but the fight is draining county resources.
“The president said he has bigger fish to fry than Washington and Colorado legalizing marijuana,” Hamburg said. “But apparently his government doesn’t have bigger fish to fry than stopping Mendocino from attempting to regulate its marijuana situation.”
A MUMBO-JUMBO MESS
While the Justice Department escalates its fight against medical marijuana, the country is moving beyond it. In November, voters in Washington and Colorado approved initiatives legalizing the recreational use of marijuana. Recent polls show majority support for legalization of pot for any adult, sick or not.
At a recent congressional hearing, DEA head Michele Leonhart was nearly laughed out of the room for refusing to say that marijuana was less dangerous than heroin. Anew HuffPost/YouGov poll found just one in five people thought the drug war has been worth it.
Having lost the public, where does the Justice Department go from here? Where will Obama let it go?
“We have two states that legalized it for even recreational use. So you tell me what Obama’s policy is,” John Pinches, of Mendocino’s Board of Supervisors, told HuffPost. “It’s a mumbo-jumbo mess. It’s time for the federal government to come up with a reasonable policy.”
Complicating things further has been the Obama administration’s mixed signals on recreational pot. In theory, it shouldn’t matter whether states want to legalize marijuana for medical purposes or recreational ones. But DOJ officials considered proposed recreational marijuana laws as fundamentally different from those regulating medical marijuana.
States that passed medical marijuana laws were making a narrow judgement on medical use. DOJ officials believed, however, that states that legalized marijuana were declaring full-on war with federal law.
Holder highlighted the contrast in 2010 as California voters prepared to vote on a ballot measure, Proposition 19, legalizing marijuana for recreational use. Just weeks before the election, Holder wrote a letter stating that the feds would “vigorously enforce” federal law “against those individuals and organizations that possess, manufacture or distribute marijuana for recreational use, even if such activities are permitted under state law.”
Prosecuting medical marijuana wasn’t supposed to be a federal priority. Prosecuting recreational marijuana cases was.
The public had supported Prop 19 for much of the race, but the measure ended up failing, 53 percent to 47 percent. Holder’s intervention may very well have tipped the balance against it.
It was a different story in 2012, when Holder kept quiet about legalization initiatives in Washington, Oregon and Colorado, a move one former Justice official said showed how quickly the politics were moving on marijuana legalization. An adviser at the White House at the time said that drug policy officials worried about tipping the electoral balance against Obama in Colorado, a swing state in 2012, and so declined to intervene in either Washington or the Mountain State’s pot legalization initiatives, both of which passed by stronger margins than Obama won.
“He was not as active as in 2010,” the official said of Holder. “People were genuinely worried about Colorado. And you couldn’t talk about Washington without talking about Colorado.”
Walsh, the U.S. attorney in Colorado, was less concerned about the electoral stakes. His crackdown on medical marijuana shops that were fully compliant with state laws came in the heat of election season. Obama campaign officials feared a backlash would send likely Obama supporters into the camp of Libertarian candidate Gary Johnson.
The Obama administration never publicly backed Walsh’s effort, nor did it intervene in the election. Obama won Colorado handily — though 50,000 more people voted to legalize pot than voted to reelect the president. The implications of that margin were lost on nobody.
The feds elsewhere didn’t keep completely quiet. They just waited until after the election. Jenny Durkan, the U.S. attorney for the District of Washington, warned residents the day before her state’s law went into effect in early December that marijuana remains illegal under federal law.
“Regardless of any changes in state law, including the change that will go into effect on December 6 in Washington State, growing, selling or possessing any amount of marijuana remains illegal under federal law,” she warned.
California stands as an example of what may happen in other states if they continue with plans to legalize pot. In the spring of 2012, Richard Lee, Prop 19′s primary funder, came under attack. The feds raided Oaksterdam University, a school he founded in Oakland, Calif., to teach industry skills, as well as his home.
“This is one battle of a big war, and there’s thousands of battles going on all over,” Lee told HuffPost after the raid. “Before he was elected, [Obama] promised to support medical marijuana and not waste federal resources on this. … About a year and a half ago, the policy seemed to change. They’ve been attacking many states, threatening governors of states to prevent them from signing legislation to allow medical marijuana. They’ve been attacking on many fronts.”
In July 2012, the hammer came down on Harborside. The Justice Department served Harborside’s landlords with commercial property forfeiture proceedings on the grounds that it violates federal law. The city of Oakland backed Harborside, and the dispensary fought back in the court of public opinion, bringing forward sympathetic patients who would be harmed by the federal government’s actions.
One of them was Jayden David, now 6, who lives with a rare form of epilepsy. In his short life, he’s taken two dozen different medicines and has been rushed to the hospital in an ambulance 45 times. The boy’s condition, however, slowly began to improve when he started using medical cannabis to ease his chronic pain and seizures.
“He sings and smiles like a normal child now,” DeAngelo told HuffPost, claiming the child has seen an 80 percent reduction in his symptoms and can now spend twice as much time at school. Harborside helped develop a specialized cannabis tincture for Jayden that doesn’t have the same “high” side effects marijuana is commonly known for, he said.
Because DeAngelo is an activist first and a shop owner second, his willingness to go to prison has enabled a firmer stand against the feds. And he’s winning. In December, a state Superior Court judge delivered a sharp rebuke to the federal government: It could not enlist landlords in its drug war.
In January, in a second victory, a judge ruled that Harborside’s landlords could not order it to stop selling pot. The city of Oakland, on the happy end of more than $1 million in tax revenue from Harborside last year, filed suit against the federal government, demanding that it cease its prosecution of Harborside.
The Justice Department may respond to the legalization of recreational marijuana in Washington and Colorado in several ways. One option would be to go after low-level marijuana users as scapegoats and seek a court ruling that would declare federal law trumps state law. One of the more extreme options, which officials acknowledge is currently being weighed by the department’s Civil Division, would be to preempt the laws by suing the states in the same way the feds sued Arizona over its harsh immigration law. Federal authorities could sue Washington and Colorado on the basis that any effort to regulate marijuana would violate the federal Controlled Substances Act.
“The question is whether you want to pick that fight,” a former Justice official said.
Washington Gov. Jay Inslee and Attorney General Bob Ferguson met with Holder on Tuesday, but the U.S. attorney general declined to say whether the Justice Department would fight Washington’s new marijuana law. Inslee said the state will move forward implementing the law.
States have traditionally taken the lead when it comes to prosecuting low-level drug cases. Just 1,414 defendants across the country faced a lead charge of misdemeanor drug possession on the federal level in 2009, compared with 28,798 individuals who faced federal drug trafficking charges. Absent a massive influx of resources, the DEA, prosecutors and federal courts don’t have the capacity to handle small-time possession cases. The feds have to rely on their state-level counterparts.
But beyond the practical considerations about enforcement, several former Justice Department officials contended the feds will have little choice but to preempt legalization laws because they represent a massive encroachment on an issue of federal importance. The officials said they didn’t see how the government could allow a law that so directly contradicts the will of Congress to stand, regardless of political implications.
Whatever the Justice Department ends up deciding might matter less than whether the prosecutors choose to follow instructions. Regardless of memos emanating from Washington, it appears that the prosecutors are the ones truly calling the shots.
CORRECTION: This article has been revised to clarify Montana Gov. Brian Schweitzer’s action on legislation that would have repealed the state medical marijuana law. Schweitzer vetoed the repeal measure, then allowed a modified version to pass without his signature.
by Erik Altieri
In a 28-page decision, the US Court of Appeals for the District of Columbia Circuit has denied petitioners request to overturn the July 2011 denial by the Drug Enforcement Administration to initiate proceedings to reschedule marijuana under federal law.
In October 2002, the Coalition to Reschedule Cannabis, a coalition of reform organizations including NORML, ASA, Patients Out of Time and High Times, among others, petitioned the DEA to reschedule marijuana as a Schedule III, IV, or V drug. Following years of administrative delay, on July 8, 2011, the DEA denied the petition, finding that “[t]here is no currently accepted medical use for marijuana in the United States,” and that “[t]he limited existing clinical evidence is not adequate to warrant rescheduling of marijuana under the CSA.”
Petitioners then sought review in the federal Court of Appeals, alleging the decision by the DEA was arbitrary and capricious when it concluded that marijuana lacks a “currently accepted medical use” and has a “high potential for abuse.” They ask this court to remand the case to the DEA for reconsideration of its decision.
Written by Senior Circuit Judge Edwards, the decision ruled “On the record before us, we hold that the DEA’s denial of the rescheduling petition survives review under the deferential arbitrary and capricious standard. The petition asks the DEA to reclassify marijuana as a Schedule III, IV, or V drug, which, under the terms of the CSA, requires a ‘currently accepted medical use.’ The DEA’s regulations, which we approved in Alliance for Cannabis Therapeutics v. DEA, 15 F.3d 1131 (D.C. Cir. 1994), define ‘currently accepted medical use’ to require, inter alia, ‘adequate and well-controlled studies proving efficacy.’ Id. at1135. We defer to the agency’s interpretation of these regulations and find that substantial evidence supports its determination that such studies do not exist.
“In its scientific and medical evaluation,” the court held, “DHHS concluded that marijuana lacks a currently accepted medical use in the United States. In reaching this conclusion, DHHS applied the DEA’s established five-prong test, which requires a known and reproducible drug chemistry, adequate safety studies, adequate and well-controlled studies demonstrating efficacy, acceptance of the drug by qualified experts, and widely available scientific evidence.”
“We will not disturb the decision of an agency that has ‘examine[d] the relevant data and articulate[d] a satisfactory explanation for its action including a rational connection between the facts found and the choice made.’”
In this case, we need only look at one factor, the existence of “adequate and well-controlled studies proving efficacy,” to resolve Petitioners’ claim.
At bottom, the parties’ dispute in this case turns on the agency’s interpretation of its own regulations. Petitioners construe “adequate and well-controlled studies” to mean peer-reviewed, published studies suggesting marijuana’s medical efficacy. The DEA, in contrast, interprets that factor to require something more scientifically rigorous.
In making this assessment, we must “remind ourselves that our role in the Congressional scheme is not to give an independent judgment of our own, but rather to determine whether the expert agency entrusted with regulatory responsibility has taken an irrational or arbitrary view of the evidence assembled before it.
The DEA’s construction of its regulation is eminently reasonable. Therefore, we are obliged to defer to the agency’s interpretation of “adequate and well-controlled studies.” Judged against the DEA’s standard, we find nothing in the record that could move us to conclude that the agency failed to prove by substantial evidence that such studies confirming marijuana’s medical efficacy do not exist.”
Petitioners are considering their legal options at this time.
Take California. While the state has had medical marijuana dispensaries for more than 15 years, it remains a target for federal law enforcement officials, where the U.S. Drug Enforcement Administration arrested nearly 8,500 people for marijuana-related offenses between 2004 and 2010.
California’s hardly alone. Several other states with dispensaries have seen an increase in both arrests and the confiscation of marijuana plants. However, a look at DEA records shows what appears to be an uneven enforcement policy among pot-friendly states over the past several years.
For example, while arrests and eradication in California climbed fairly steadily in the seven-year time frame, they remained essentially flat in Maine. Colorado, meanwhile, saw a reversal in both trends halfway through the time period.
Americans for Safe Access, which advocates the legalization of medical marijuana, says the Justice Department has conducted nearly 200 raids on dispensaries and growers since President Barack Obama took office.
“The assault on medical marijuana patients currently under way by the Obama administration is unprecedented in this country’s history,” said Steph Sherer, the organization’s founder and executive director. “The intensity and breadth of the attacks has far surpassed anything we saw under the Bush administration and has resulted in the roll-back of numerous local and state laws, not just in California.”
The government’s focus on the industry has taken many lawmakers and medical marijuana activists by surprise. During his presidential campaign four years ago, Obama vowed to maintain a hands-off approach toward pot clinics and dispensaries that adhere to state law.
Perhaps not surprisingly, California, which legalized marijuana in 1996 and has long been considered a hub for the pot community, has been the state most targeted by federal officials. In 2004, the DEA made 869 marijuana-related arrests, seizing 1.2 million plants that were cultivated to produce marijuana buds. Both numbers climbed steadily through 2009, according to statistics provided by the DEA, peaking at 1,738 arrests and 7.5 million plants. (In 2010, the numbers slipped slightly to 1,591 arrests and 7.4 million plants.)
California and federal officials have been at odds for years over medical marijuana, since the Controlled Substances Act still classifies the drug as illegal. Federal prosecutors have frequently targeted dispensaries that make profits, noting California law requires those facilities to run as not-for-profit collectives. Those dispensaries, though, are often significant sources of tax income.
Michigan may not boast the hard arrest and confiscation numbers that California does, but federal officials have been even more active there since medical marijuana was legalized in 2008. Arrests have climbed 223 percent since legalization (from 290 in 2007 to 647 in 2010). Plant seizures have increased by 68 percent in that time, according to the DEA.
Similarly, Montana, which legalized medical usage in 2004, saw a slight increase in arrests (with the biggest spike coming the year dispensaries opened) between 2004 and 2010. Last year, though, federal officials executed a series of raids that largely shut down pot providers in the state.
Since New Mexico legalized medicinal marijuana in 2007, however, arrests (which were never noteworthy to begin with) have dropped — from 16 in 2006 to just 4 in 2010 — while confiscations have generally fallen over the years, but spiked in 2010, with more than 8,400 plants destroyed.
It’s worth noting that these DEA statistics, while interesting, do not paint a complete picture. The agency focuses on big targets and distributors (including growers who work within the boundaries of the state law as well as those who do not). Its numbers do not include individuals who are arrested on possession charges, something that’s largely done on a city and county basis.
DEA officials play down the numbers, noting there are intangible factors that cause them to fluctuate each year.
“It’s difficult to draw conclusions based on the superficial data you’re looking at,” says Todd Scott, an agent who has worked with the DEA for 17 years. “What prompts a raid on [a dispensary] is a whole host of factors. I think there’s a misconception that a particular raid is a medical marijuana raid. If you find a grow, you don’t often know prior to that that it’s a ‘medical marijuana grow’.”
The reasons for the raids vary, as they do with any criminal investigation. There are some red flags, though. For instance, if a dispensary is suspected of illegally trafficking pot to people without prescriptions, that could attract federal attention. If a grow operation is of a substantial size (with tens of thousands of plants), that too can turn heads (since it’s such a flagrant violation of the Controlled Substances Act). Growers and dispensaries, though, say there has not been an obvious pattern to recent raids.
Nowhere is the fluctuation more in evidence than Colorado, where medicinal pot has been legal since 2000. From 2004 to 2007, arrests and eradications varied somewhat, but not wildly. They peaked at 341 in that period, while the DEA destroyed between 5,000 and 7,500 plants per year. In 2008, though, things changed considerably.
Plant eradications skyrocketed to over 30,000, while arrests fell to just 36. The numbers ebbed and flowed a bit more in the following two years, but arrests remained low, while more plants were destroyed.
Meanwhile, in Rhode Island (which legalized the drug for medicinal purposes in 2006), the threat of raids and employee prosecution from the U.S. Attorney’s office has kept dispensaries from opening. But looking at the DEA’s arrest record, no one seems to be taking much notice of the pot trade in the state. Through 2010, federal officials had only made nine arrests — and destroyed just 16 plants.
The DEA notes that cases tend to roll from one to another. An arrest in one incident can lead to tips about other illegal activity, which can explain the discrepancies. And since federal officials focus their efforts on larger busts, some operations might be too small to capture their attention.
“We are a proactive agency,” says Scott. “We don’t have to wait for a bank to get robbed or a car to get stolen to launch an investigation. As a federal agent, is it a productive use of my time to investigate a guy with five plants? Probably not. Is it worth my time for a guy who’s growing 500 plants? Well, probably so. But is there a number [that constitutes a cut-off point]? No.”
Special To The SF Examiner
The federal Drug Enforcement Administration has asked The City’s Department of Public Health to turn over records for 12 of San Francisco’s remaining 21 medical cannabis dispensaries, according to emails obtained by The San Francisco Examiner.
On Jan. 18 and again Jan. 27, Special Agent David White of the DEA’s financial investigative team sent emails to the health department asking for business licenses, health permits, ownership information and yearly inspection forms for the 12 dispensaries.
Last year, White requested information on five other San Francisco dispensaries, issuing a subpoena to obtain private information not normally released via a records request. The landlords of those dispensaries then received letters from U.S. Attorney Melinda Haag, who warned of property forfeiture and 40-year prison terms unless the dispensaries shut down.
All five dispensaries closed, though two have since become delivery-only services.
Health department Deputy Director Colleen Chawla said her agency complied with the DEA’s most recent request.
White did not respond to a request for comment. Agent Casey McEnry, a DEA spokeswoman, said the agency only comments on cases actively in the courts.
On Oct. 7, the four U.S. attorneys for California announced a coordinated, statewide crackdown on what they called the “medical marijuana industry.” Since then, hundreds of dispensaries have closed, mostly in Sacramento and San Diego counties. Five have closed in San Francisco, and one in Marin.
Stephanie Tucker, a spokeswoman for The City’s Medical Cannabis Task Force, is concerned by the prospect of 12 more dispensaries closing.
“It’s a clear indication that Melinda Haag is not using the discretion of her office to go after bad players as stated at her October 2011 press conference,” Tucker told The SF Examiner on Thursday. “Instead, they are targeting the regulated community who operate with a permit, in compliance with state and local laws, transparently and in good standing with The City and their community.”
Medical marijuana advocates also are rankled by what they call inaction taken by city leaders.
In 2008, then-Mayor Gavin Newsom sent a letter to members of Congress asking them to intervene in the DEA’s “undermin[ing] of California’s state medical marijuana laws.” Newsom’s successor, Mayor Edwin Lee, has yet to comment on the crackdown publicly, and on Thursday he did not respond to requests for comment on the health department emails.
The Board of Supervisors passed a resolution in support of dispensaries in the fall, but has not taken action since.
“There’s a definite void in leadership here,” Assemblyman Tom Ammiano, D-San Francisco, told The SF Examiner on Thursday, adding that federal law enforcement is “undermining the will of the voters” encapsulated in Proposition 215, which legalized marijuana for medicinal use when it passed in 1996.
“I understand this is a radioactive issue for some people, but too bad — it’s the law of the land,” Ammiano said.
There were 26 dispensaries in San Francisco in October. After The City briefly suspended its permitting process, the Planning Commission is scheduled to hear applications for two new dispensaries at its meeting next week.
San Francisco was the first city in California to license and regulate medical marijuana dispensaries under its Medical Cannabis Act, which became law in 2005. Much of The City’s regulations are stricter than what is allowed under state law.
Dispensaries pay local and state sales taxes. The health department inspects them once a year to ensure that they comply with city and state laws. All of San Francisco’s dispensaries were found to be in compliance during the most recent inspections.
Open and shut
Last month, the DEA asked city officials for information on 12 of San Francisco’s remaining 21 medical cannabis dispensaries. They are:
Good Fellows Smoke Shop, 473 Haight St.
Re-Leaf Herbal Center, 1284 Mission St.
The Green Cross, 1230 Market St.
Grass Roots, 1077 Post St.
Emmalyn’s, 1597-A Howard St.
Bay Area Safe Alternatives Collective, 1326 Grove St.
SF Medical Cannabis Club, 120 10th St.
Waterfall Wellness, 1545 Ocean Ave.
Hope Net, 223 Ninth St.
Valencia Street Caregivers, 208 Valencia St.
Vapor Room, 607A Haight St.
Shambala Healing Center, 2441 Mission St.
Last year, the DEA made similar requests for information on five other dispensaries. Those dispensaries then closed after receiving threatening letters from U.S. Attorney Melinda Haag. Those dispensaries were:
Mr Nice Guy, 174 Valencia St.
Divinity Tree Wellness Co-op, 958 Geary St.
Medithrive, 1933 Mission St.
Market Street Collective, 1884 Market St.
Sanctuary, 669 O’Farrell St.
Read more at the San Francisco Examiner: http://www.sfexaminer.com/local/2012/02/dea-digging-san-franciscos-medical-marijuana-dispensaries#ixzz1mI6WGKM3
Published: February 11, 2012
OAKLAND, Calif. — As the stubborn economic downturn has forced this city to take painful steps to balance its budget in recent years, it has increasingly turned to one of its newer industries to raise much-needed revenues: medical marijuana dispensaries.
The city has raised taxes on marijuana dispensaries several times in the past few years, and last year it collected $1.4 million in taxes from them — nearly 3 percent of all the business taxes it collected. Now Oakland plans to double the number of dispensaries it licenses, to eight from the current four, in the hopes that it can collect even more revenue.
“This is general fund revenue — it all goes into the melting pot,” said David McPherson, the city’s tax and revenue administrator. “When you’re making decisions about what to continue keeping or not, it goes into that decision process. If you don’t have that money, then you’re making other decisions about ‘Are we going to close the libraries on Monday?’ ‘Are you going to end up cutting a cop?’ ‘Are you not giving funds to our arts and things that help our kids?’ ”
Sometimes lost in the discussion of medical marijuana is the extent to which it has become a small but growing source of new tax collections for cities and states that have been struggling to balance their budgets for more than four years now.
Colorado Springs collected more than $700,000 in taxes from the medical marijuana industry in 2011. It is not a lot of money for a big city. But given the harsh steps the city has taken in recent years — in 2010 it shut off a third of its streetlights to save $1.2 million — every bit helps.
Denver collected more than $3.4 million last year from sales tax and application and license fees, according to preliminary figures. The State of Colorado collected $5 million in sales tax from medical marijuana businesses last year, more than twice what it collected the year before.
Taxing marijuana is a relatively new field, and cities and states are taking different approaches to raising revenues.
Maine decided that medical marijuana should be subjected to the state’s 5 percent sales tax — unless the marijuana is baked into brownies. In that case, it is taxed at a higher 7 percent rate that the state levies on prepared foods.
Oregon closed a budget gap last year in part by raising the annual fees it charges people with doctors’ notes to join the state’s medical marijuana program. In October, the state doubled the fee to $200 a year — with reduced fees available to people on food stamps — to raise an estimated $6.7 million a year to pay for other health programs.
Of course, some of the money raised must be used to administer the medical marijuana programs and, in some cases, to increase regulation of the industry.
Budget planners always deal in uncertainties like whether tax revenues will rebound or how much it will really cost to provide services. But projecting medical marijuana revenues adds other layers of complications, including whether the federal government will shut down the dispensaries that state and local governments have decided to allow.
After signaling in 2009 that it would not normally pursue groups providing marijuana to sick patients, the Justice Department has cracked down on dispensaries in a number of states in recent months. The Internal Revenue Service has targeted a number of dispensaries that pay federal taxes as well, arguing that they are not entitled to the regular business deductions they have claimed because they should be considered drug trafficking organizations.
It has made life complicated for cities.
“What we do know is the federal government has made it complicated and the state government has made it complicated and it all flows downhill to us,” said Mayor Chuck Reed of San Jose, Calif., which collects about $2.5 million in taxes from the 100 marijuana dispensaries that have opened in the city.
Here in Oakland, medical marijuana is booming. Just a few blocks from City Hall is Oaksterdam University, which offers training for people in the industry with classes in state and federal law, civics, legal business structures and various “methods of ingestion.”
The biggest dispensary in the city by far, Harborside Health Center, has 104,000 customers and employs 120 people, 90 percent of whom are from Oakland, in well-paying jobs with good benefits.
Its executive director, Stephen DeAngelo, helped lead the movement several years ago to have the city tax the marijuana industry. “At that time, the city was talking about closing down some really beloved institutions,” he said, adding that Oakland’s fiscal plight led the center to think about ways of helping the city. “What better way of doing that than with a tax?”
But when the city tripled the tax rate to 5 percent in 2010, he worried. “I thought 5 percent was a bit excessive,” Mr. DeAngelo said, but he added that the center was able to absorb the costs. Now, he said, the center is among the biggest taxpayers in Oakland.
Oakland will probably not be able to double its tax collections by doubling the number of dispensaries. Mr. McPherson, the city tax administrator, said that in many cases the same pool of medical marijuana users would simply be choosing from more places. But opening a dispensary near the Berkeley border, he said, might capture some of the Oakland residents who currently go to a dispensary in Berkeley.
Mr. McPherson said the city stood to reap more of what he called the “secondary benefits.”
“You’ve got accountants that are working for them, you’ve got all the security companies that are working for them, you have labs that are working for them, you have bakeries that are baking all the edibles, you have union employees that are getting great benefits, you have delivery services, hydroponic stores, doctors get some benefit,” he said. “It’s the secondary market that gains from this, and all of those pay business taxes to us.”
For medical marijuana advocates, it’s a backhanded slap in the face.
Despite earlier pronouncements showing tepid support for states’ medical marijuana laws, the Obama administration last year reversed its position. Since then the DEA has exponentially increased its “investigations” into dozens of dispensaries around the state.
The tactics used by the DEA, under other circumstances, would probably be considered unethical, even thuggish. The agency has made demands for private information not normally released, even though dispensaries are already inspected on a yearly basis by state officials.
They have even issued letters to landlords threatening prosecution and prison time if the dispensaries were not shut down.
Medical marijuana advocates are frustrated that the DEA and the U.S. attorneys are going after legal, compliant operations instead of focusing their attention on untaxed, illegal operations.
Still more aggravating is what advocates see as a lack of action on the part of The City to change that. Instead of the fighting against the crackdown, the city has largely cooperated with the DEA, suspending its permitting process last fall to prevent the opening of any new dispensaries.
And while the city’s Board of Supervisors passed a resolution in support medical marijuana last fall, they have not taken any action since.
“There a definite void in leadership here,” said state Assemblyman Tom Ammiano, D-San Francisco. Federal enforcement, he claims, is “undermining the will of [California] voters,” who voted to legalize marijuana for medical use way back in 1996.
Unfortunately, the outlook for dispensaries probably won’t improve anytime soon.
By Matthew Stensland-Bos
More at SFBay: http://sfbay.ca/2012/02/10/medical-marijuana-crackdown-gets-tighter/#ixzz1m19zbJ2h
Americans for Safe Access is appealing the federal government’s refusal to reclassify cannabis for medical use. ASA is asking a federal appeals court to compel the federal government to make cannabis available for medical use.
The legal action comes in response to the federal Drug Enforcement Administration (DEA) denial of a petition by the Coalition for Rescheduling Cannabis (CRC), of which ASA is a member. That petition was originally filed in 2002 and only acted on by the DEA when the CRC sued the government for unreasonable delay.
“The Obama Administration, like those before it, is playing politics with medical cannabis at the expense of sick and dying Americans,” said ASA Chief Counsel Joe Elford, who filed the appeal today. “But now the government will have to answer in court why it continues to ignore the overwhelming weight of scientific evidence.”
Since 1970, two other rescheduling petitions have sought to restore cannabis to the list of recognized medicines, but the medical record was reviewed only once by the courts in 1994. Since then thousands of peer reviewed articles have been published on research exploring the medical applications and potential of cannabis and the cannabinoids that are its constituent chemicals.
ASA argues that the federal government acted arbitrarily and capriciously in ignoring medical research and practice, with the result that legal access to cannabis is being denied to the millions of patients throughout the United States who may benefit from it.
The DEA was only able to deny the therapeutic value of cannabis by applying different evaluative criteria to cannabis than other drugs, misrepresenting social science research, and relying on unsubstantiated assumptions, according to ASA’s brief.
ASA is urging the court to “require the DEA to analyze the scientific data evenhandedly,” and order “a hearing and findings based on the scientific record.” That record was even more conclusive in 2002 than it was in 1988 when the DEA’s Chief Administrative Law Judge reviewed it and ruled that denying medical access was “unreasonable, arbitrary and capricious.” Since the CRC petition was originally filed, considerably more peer-reviewed research has been published that shows the benefits of cannabis for treating a variety of serious conditions, and its therapeutic value has been more widely acknowledged. For instance, the National Cancer Institute, a division of the federal Department of Health and Human Services, has added cannabis to its list of Complementary Alternative Medicines, noting that it has been used therapeutically for millennia.
ASA argues in its appeal that the additional scientific evidence of the last decade is relevant and must be considered.
The original petition on behalf the CRC was filed by attorneys David Holland and Michael Kennedy. The CRC is comprised of several individual patients and advocacy groups, including Patients Out of Time and ASA.