Proposed pot tax sparks a heated debate

February 08, 2011

Kevin Modesti, Los Angeles Daily News

Voters will face a familiar, burning issue on the March 8 city ballot: Marijuana. In contrast with last November's failed California proposition to legalize recreational pot use, Los Angeles' more complicated Measure M asks if the city should impose a hefty tax on medical-marijuana dispensaries.

Proponents say requiring dispensary operators to "pay their fair share" - in this case, 5percent of gross receipts - could raise $10million a year for the city's deficit-plagued general fund.

Opponents claim the proposal won't fly because medicine and the nonprofit organizations that dispense it cannot be taxed, and they worry that if the city makes revenue from dispensaries, it will be encouraged to allow more of them.

While the two sides debate the details, voters may be guided more by their general attitudes, such as their overall feelings about marijuana, said Jessica Levinson, who analyzes ballot initiatives for the L.A.-based Center for Governmental Studies.

"It really comes down to what's important to voters," Levinson said. "If they think, 'Yes, this is a measure that has problems, but people use medical marijuana and the city needs money,' then I think they would vote yes.

"If voters say, 'Morally, we're against the sale of marijuana no matter what the use is,' or if they're for medical marijuana but think the current system is being abused, then they would vote no."

Measure M was placed on the ballot by the City Council, which is trying to climb out of a $350 million budget hole in the next fiscal year.

It comes as the smoke clears from last November's marijuana initiative battles.

California's Proposition 19 would have legalized - and taxed - up to one ounce of marijuana for recreational use by adults. The initiative lost 53.5-46.5 percent. Its backers are talking about trying again in 2012.

At the same time last year, voters in nine California cities - including Sacramento, Oakland and San Jose - approved medical-marijuana taxes similar to what Los Angeles is considering.

Signatures on the official "Yes on M" argument include those of City Council members Janice Hahn and Paul Koretz, and Pat McOsker, president of the United Firefighters of Los Angeles City, Local 112.

"The city needs revenue. I know that as well as anyone," said McOsker, who says the Los Angeles Fire Department budget has shrunk to $495 million from $560 million two years ago, reducing the number of emergency responders by 156.

McOsker said United Firefighters' endorsement of Measure M doesn't mean it necessarily endorses medical-marijuana cooperatives, let alone recreational pot smoking.

"The voters of California decided (in 1996) that cooperatives are legal. What we're saying is they should pay their fair share (of taxes)," McOsker said.

The official "No on M" argument is signed by LAPD Chief Charlie Beck, Sheriff Lee Baca, District Attorney Steve Cooley and Council members Jan Perry and Bernard Parks.

"I think what we do (if Measure M passes) is we legitimize something that is against the law," Beck said in an interview. "Right now the law says we allow it to be dispensed because it's a medicine. We don't tax medicine. ... Let's be consistent."

Beck added: "These (dispensaries) are not good for your neighborhoods. If they become seen as a cash cow to (city officials) that are desperate, they're going to want more of them."

Measure M's opponents include the Oakland-based medical-marijuana advocacy group Americans for Safe Access, which contends a tax could make medical pot costlier for patients.

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