Medical Marijuana Dispensaries Testify at Taxpayers' Hearing in Sacramento

March 17, 2008
Sacramento, CA -- More than a half-dozen medical marijuana dispensary operators from across the state are expected to testify tomorrow at 1:30pm before the State Board of Equalization (BOE) at its Taxpayers' Bill of Rights Hearing. Dispensary operators from southern and northern California, joined by medical marijuana advocates, will be in Sacramento to discuss the significant contribution of $100 million in annual sales tax revenue to an ailing state budget. While sales tax on medical marijuana clearly benefits the fiscal health of the state, that funding is threatened by increased interference from the federal government.
What: Medical marijuana dispensary operators and advocates testify at the Board of Equalization's Taxpayers' Bill of Rights Hearing
When: Tuesday, March 18, 2008 at 1:30pm
Where: Hearing Room 121 at the BOE, 450 N Street in Sacramento
Why: Medical marijuana annual sales tax revenue of $100 million is threatened by continued federal interference
Who: Testimony will be heard from dispensary operators in Los Angeles, Sacramento, San Francisco, Berkeley, Santa Rosa, and Santa Cruz
"Medical marijuana dispensaries are doing their best to comply with state law," said Kris Hermes, spokesperson for Americans for Safe Access (ASA), one of the advocacy groups testifying tomorrow. "One hundred million dollars annually in sales tax revenue is not small change," continued Hermes. "However, by continuing to shut these facilities down, the federal government deprives the state of this money at a time of fiscal crisis."

According to recent estimations by multiple advocacy groups, California's hundreds of medical marijuana dispensaries contribute to the state budget at least $100 million annually in sales tax revenue. The State of California began collecting sales tax revenue from medical marijuana dispensaries in October 2005, after a policy decision that year by the BOE. However, the same facilities that are expected to comply with this policy are currently under attack by the federal government.

Enforcement tactics by the federal Drug Enforcement Administration (DEA) have had a devastating impact on dispensaries in California. In 2007 alone, the DEA raided more than 50 medical marijuana dispensaries in at least 10 different counties across the state. Also, in 2007, the DEA launched a new tactic in its attempts to undermine state law by disseminating more than 300 letters to landlords of dispensaries, threatening the property owners with criminal prosecution and asset seizure if they continued to lease to dispensaries.

"The sales tax collected by medical marijuana dispensaries in one year could fund the construction of two large schools or 2,000 elementary and high school teachers," said ASA Chief of Staff Rebecca Saltzman. "By robbing California of this much needed revenue, the federal government is not only harming thousands of patients that rely on this medicine, it is also impeding the state's ability to fund critical aspects of its infrastructure."

The federal government's efforts to undermine California's medical marijuana law have not gone unnoticed by local and state lawmakers. Letters from concerned local officials in 2007 prompted U.S. House Judiciary Chair John Conyers to issue a statement in December expressing his deep concern and calling for DEA oversight hearings. Since then, Mayors from Oakland and Santa Cruz, as well as the Berkeley City Council and the San Francisco Board of Supervisors, have all registered their opposition to federal enforcement against medical marijuana. In addition, State Senator Carole Migden (D-San Francisco) introduced SJR 20 earlier this year, calling for an end to federal interference and urging Congress and the President to establish policy consistent with the compassionate use laws of California. Most recently, in February, former BOE Chair Betty Yee co-authored an opinion piece with Senator Migden harshly criticizing DEA tactics in California, emphasizing the harm to both patients and the state.

Further information:
ASA Fact Sheet on Sales Tax: http://americansforsafeaccess.org/downloads/sales_tax_fact_sheet.pdf
Copy of State Senate Joint Resolution 20, calling for an end to DEA interference: http://americansforsafeaccess.org/downloads/SJR_20.pdf
BOE notice sent to dispensaries in 2007 alerting them to the new sales tax policy: http://www.boe.ca.gov/news/pdf/medseller2007.pdf
Opinion piece by Betty Yee & Carole Migden: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/15/ED0UV1RNP.DTL

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