Cannabis Initiatives Drive Cities To Risky Interpretations Of Election Code

YUCCA VALLEY– (March 25) The rash of voter initiatives relating to permitting medical marijuana dispensaries to function within several San Bernardino County municipalities is testing the limits of California election law. In the cities/towns involved – Upland, San Bernardino, Adelanto, and Yucca Valley – there are some basic similarities. Each has political leadership, i.e., a city or town council, which is on balance opposed to liberalizing local ordinances to allow pot shops to proliferate. Each of those municipalities finds itself struggling financially in the aftermath of the just-concluded, five year-running economic downturn that has deprived them of revenue. And in each municipality there is also a cadre of marijuana legalization advocates who have pushed for the city/town allowing medical marijuana dispensaries being set up. In all four, those advocates contemplated using the initiative process to put a measure on the ballot to have their respective city’s voters make the decision on whether the current local ban on the marijuana clinics should be abandoned, believing the voters in general are more favorably inclined to the idea than their elected officials. Along the way, those advocates have sought to promote the law change by touting the revenue-generating possibilities of taxing the marijuana sales.
In 209,000-population San Bernardino, the actual logistics of gathering the requisite number of signatures on the petition for the initiative – ten percent of the city’s registered voters – proved too daunting. But San Bernardino had filed for Chapter 9 bankruptcy protection in 2012, and the city officials have grown increasingly desperate to find some form of revenue enhancement. Into that mix was thrown the idea of allowing marijuana clinics to set up in the city, pursuant to a taxing regime that would pour ten percent of the clinics’ profits into city coffers.
In July 2014, San Bernardino City Attorney Gary Saenz, taking stock of the number of pot shops sprouting up in the county’s largest city, offered his view that the cost and difficulty of shutting down dispensaries made the city’s ban on the enterprises that has existed since 2010 “futile.” The council formed a legislative review committee composed of three council members to study the issue and promised to reconsider the issue. Saenz said the city was contemplating allow some dispensaries to function under a strict set of guidelines that would include significant licensing fees. Meanwhile, a proponent of licensed clinics, Karmel Roe, undertook an ultimately unsuccessful effort to gather enough signatures to get a dispensary permitting initiative on the ballot. A Redlands-based attorney who had previously been the city manager of Adelanto, James DeAguilera, threatened legal action against the city over its continuing enforcement of the ban.
During the discussion of the concept of legalizing medical marijuana sales in the county seat, many entrepreneurs were emboldened, and some took the risk of opening dispensaries in the belief that in the liberalizing atmosphere, they would be able to operate unmolested. That ultimately proved to be a fallacy, however, as they were able to stay in business for a short time but were slapped back when the city rejected the idea of allowing some dispensaries to operate legally. Earlier this month, the police department and city code enforcement division embarked on concerted operations to close them down, seize their wares and cash on hand and serve them with court orders enjoining them from persisting in their operations.
In Adelanto, where a state of financial crisis had been officially declared by the city council in June 2013, Johnny Salazar, the owner of the Green Tree Health Healing Clinic, a medical marijuana dispensary, earlier this year began promoting the idea of having the city sanction such operations, which would be regulated and taxed. Salazar encountered rough sledding at first, as the council in general, and council member Charley Glasper in particular, were adamantly opposed to the concept of allowing Adelanto to be put on the map as one of the few San Bernardino County cities embracing marijuana sales, even if it offered a means of providing needed revenue. But as Salazar dialogued with city officials, discussing the possibility of putting a dispensary permitting initiative on the ballot, Glasper, who remained in opposition to the whole idea of permitting marijuana sales in the city, softened. He appeared to be willing to have the city council use its authority to schedule such a vote, if, he reasoned, the city could piggyback another vote on a city-sponsored initiative to impose a sales tax or utility tax on its residents and if Salazar would pay for the costs of the special election for those initiatives. Glasper hopefully calculated that the city’s voters just might pass the tax measure and reject the marijuana clinic proposal and for that reason was on the verge of voting to put the measure on the ballot. Salazar, however, was unwilling to bankroll the special election, angling instead to have the council simply adopt an ordinance establishing dispensaries meeting certain criteria permission to operate. For Glasper and the remainder of the council that was a deal-breaker, and the concept has been abandoned.
In Upland, initiative backers, with the support of the California Cannabis Coalition and the financial backing of Randy Welty, a strip club and marijuana dispensary owner, began circulating a petition for an initiative in October and in January turned over to the city clerk’s office petitions signed with 6,865 signatures, 5,736 of which were verified by the registrar of voters office as having been signed by registered voters in the city. This amounted to more than 15 percent of the city’s voters and by law qualified the initiative to be put on a special ballot no more than 105 days after the verification. Nevertheless, three members of the city council – Mayor Ray Musser, councilwoman Carol Timm and councilman Glenn Bozar – were philosophically opposed to Upland hosting such marijuana clinics. City attorney Richard Adams, sensing the direction the council majority wanted to take, researched the issue and referenced Section 17.158.100 of the coalition sponsored initiative, Article XIII C section 1(e) of the California Constitution and Proposition 26 approved by California’s voters in 2010 in propounding a theory that the initiative vote could be held off until the November 2016 general municipal election in Upland. The referenced section of the initiative calls for levying a $75,000 “fee” upon the applicants for a dispensary license. Adams said that the California Constitution and Proposition 26 required that any tax to be levied upon local residents by a municipality must be approved by voters at a general municipal election. The fee designated in the Upland marijuana dispensary initiative qualifies as a tax, Adams reasoned, and this gave the council leeway to postpone the initiative election until next year. Council member Gino Filippi and Debbie Stone sought instead to have the council approve a special election, at a cost of some $150,000 to $180,000, for June 2015. They did not get a crucial third vote and subsequently, Musser, Timm and Bozar supported putting the vote off until November 2016.
This was not the end of the matter, however, as Welty and the Cannabis Coalition, on behalf of the Upland voters who signed their petition, induced famed constitutional rights attorney Roger Diamond to file, on March 19, a petition for a writ of mandate with San Bernardino Superior Court, in which he stated the California Elections Code Section 9214 and Article 2, Section 11 of the California Constitution require that the city hold the special election this year and that Adams had misinterpreted Article 13c of the California Constitution as applying to a voter initiated initiative when it applies exclusively to an initiative initiated by a public entity such as a city.
“By its conduct respondents [i.e., Upland city officials] are violating the California constitutional guarantee of the right of initiative and petitioners’ rights under Elections Code Section 9214. There is no conflict between Article 13c of the California Constitution and Elections Code Section 9214,” Diamond asserted in the filing for a writ of mandate.
Furthermore, according to Diamond, the city of Upland mislabeled the $75,000 fee specified in the initiative as a tax. “Petitioners’ proposed medical marijuana dispensary initiative ordinance does not impose any general tax,” Diamond’s filing states. “Article 13c, Section 1 of the California Constitution defines a ‘general tax’ as ‘any tax imposed for general governmental purposes.’ Petitioners submitted evidence to respondents demonstrating conclusively that the $75,000.00 annual licensing and inspection fee established by proposed Section 17.158.100 of the proposed medial marijuana dispensary intiative petition would not be a general tax but rather a regulatory fee. Without any support in the record whatsoever, respondents have asserted and have allegedly based their position on the false claim that Section 17.158.100 is a general tax.”
In response to questions posed to him by the Sentinel in the wee hours of March 24 after a marathon city council meeting on the evening of March 23, Adams said that he was confident the city would prevail in a test of whether the $75,000 fee can be characterized as a tax. “We looked at that very thoroughly ahead of time,” he said.
The matter appears to be headed for a showdown, with possible precedent setting implication, in San Bernardino Superior Court.
Further east in San Bernardino County, in the incorporated East Mojave Desert town of Yucca Valley, another test of how far the election code can be stretched is playing out.
In Yucca Valley, advocates for the availability of medical marijuana in that town effectively overran the town council’s procedural blockade of local marijuana clinics by getting the requisite number of voter signatures on a petition to direct the town council to adopt a new code allowing dispensaries or otherwise put the matter to the ballot. The town council eventually acceded to the success of that initiative petition process, but in so doing altered the initiative from its original form. It is that altered version of the initiative that is going on the ballot. The California Election Code requires that initiatives to be voted upon cannot be changed from what the petitioners asked for. Thus the circumstance in Yucca Valley is bound to create a test case in which the legality of the entire process and the enforceability of the initiative, if it is indeed passed by the voters, may be called into question.
The Alliance for Safe Access of Yucca Valley, led by Jason Elsasser, began circulating the petition late last summer. The petition called for the city to permit the opening and operation of one medical marijuana clinic per 10,000 residents living in the town under a set of rules governing hours when the dispensaries can be operated and within zones outside the proximity of churches and schools.
Elsasser and the Alliance undertook their effort after the closure of another clinic, which had gotten its operating charter from the city by applying for a business license as an ‘herbal shop.”
Upon town officials learning that the enterprise was a dispensary, they initiated efforts to close it but were met by the owner’s threat of litigation. The town and the clinic owner arrived at an agreement by which the owner was able to remain in business for a specified period. Before that deadline elapsed, the operation proved lucrative enough for the owner to reach his financial goals and he voluntarily closed.
Advocates for the availability of medical marijuana asserted that there is considerable demand for medical marijuana in Yucca Valley and that the town council, by its efforts to prevent the operation of dispensaries in town, has been forcing customers to purchase the product from criminals selling it illegally or travel to other cities where clinics are permitted and where those municipalities have tapped the tax revenue available from the sales.
That argument proved persuasive enough to get more than ten percent of the town’s voters to endorse the petition for the initiative and the registrar of voters verified the requisite number of signatures as valid.
The town council initially balked at the idea, and called for a study of the situation, as is permitted by law. Eventually, town officials concluded that the success of the initiative drive made a vote on the matter inevitable, and they agreed to hold the election on June 2.
But prior to doing so, the city approved the creation of an ad hoc committee to study the citizen initiative, appointing Councilmen Merl Abel and Robert Lombardo to serve as the committee’s members. They initiated a round of discussions with Elasser and the Alliance for Safe Access of Yucca Valley, which turned into negotiations on the final form of the initiative to be voted upon.
A compromise initiative was hatched from that process.
According to a town staff report for the town council’s March 3 meeting, the revamped measure is in the main similar to the initiative endorsed by more than ten percent of the town’s voters “but with additional provisions to enhance regulations for the protection of public health, safety and welfare, and providing for the town’s recovery of certain fees and costs attributable to law enforcement and other operational expenses affected by dispensaries.” The 26-page initiative redraft, entitled Medical Marijuana Authorization and Regulation Initiative, dwells on certain details the original initiative language did not, such as restrictions on loitering, security and a financial audit.
On March 3, after council member Robert Leone, a former police officer, made a motion calling for simply adopting the initiative as drafted but saw that motion die for the lack of a second, the council voted to put the redrafted measure allowing on a special election ballot for June 2.
That initiative is to read, “Shall the Medical Marijuana Dispensary Authorization and Regulation Initiative Measure be enacted to allow the operation of medical marijuana dispensaries in the jurisdictional boundaries of the town of Yucca Valley at a rate of one dispensary per every 10,000 residents, and attendant provisions regulating such operations?”
Given Yucca Valley’s 20,700 population, the initiative, if passed would permit two dispensaries to set up operation in town.
A question remains, though, over whether the June 2 vote on the initiative, as it is now drafted, will be in compliance with the California Election Code. The initiative process in California calls for measures approved for the ballot in a voter-endorsed process be presented to the electorate in the exact form presented by the petitioners and approved by at least ten percent of the voters. Given that the initiative Elsasser and the Alliance for Safe Access presented to the voters is different from what the town’s voters will be voting on in June, the undertaking is out of step with the code.
Adams, who as city attorney in Upland has done considerable in depth research into the California Election Code as pertains to initiatives, said that the initiative to be presented to Yucca Valley voters on June 2 will deviate from what is specified under the code.
The vote is likely to yet go on, Adams said, if the process is not challenged. Outsiders or others without standing could not challenge the process the Yucca Valley Town Council approved, Adams said. But if the ballot initiative were to be challenged by an individual with standing, a day of reckoning will come for Yucca Valley, according to Adams.
“A challenge could only be made by an individual with standing,” Adams said. “Someone with standing would be one of the signers of the initiative petition.”
Yucca Valley Town Attorney Lona Laymon said substituting in the revised initiative was legal.
“The petition proponents and the town negotiated the revised measure pursuant to the provisions of Elections Code § 9604,” Laymon said. “Upon reaching a good faith compromise on a revised measure, the proponents of the initiative petition withdrew the original measure before it was acted upon by the town council and filed with the county registrar of voters.”
Laymon said the initiative language was not set in stone once the signed petitions were turned over to the town clerk.
“The statute allowing for negotiations with regard to the measure, Elections Code § 9604, creates the opportunity for negotiation as to the terms of any measure even after signatures have been obtained. Section 9604 permits proponents to ‘withdraw the measure at any time before filing the petition with the appropriate elections official, i.e., the county registrar of voters. While there is little case law interpreting Section 9604, we believe this plain statutory language would override a challenge to a negotiated measure placed on the ballot and/or the concurrent withdrawal of the original measure before filing—indeed, the statute is very clear in stating that proponents may ‘withdraw’ their measure before filing.”
Laymon added, “In terms of timing, please note that we interpret the phrase ‘filing with the appropriate elections official’ as referring to the filing of the measure with the County Registrar of Voters, not the Town Clerk. Here’s why: Subsection (a) of § 9604 dealing with local initiatives refers to filing with the ‘appropriate elections official.’ Subsection (d), however, makes a distinction that a withdrawal under §9604 is effective for a local initiative upon receipt ‘by the appropriate local elections official.’ This would seem to create a distinction between the election official charged with actually processing the election, i.e., the county registrar of voters and the local elections officer whose duty is to present the petition to the council in order to call the election, i.e., town clerk. Therefore, the statute allows the withdrawal of a petition any time before filing with the county registrar of voters, which was precisely the case in Yucca Valley.”
As to the potential launching of a challenge to the town’s action by an individual with “standing,” such as one of those who had signed the petition in the expectation that what was presented to him/her would be what was voted upon, Laymon said, “We are aware of cases granting citizen/signatory standing in the context of citizen initiatives. However, those cases involved a writ of mandate to compel the placement of a measure on the ballot, not to prevent the statutorily-authorized withdrawal and substitution of a compromise measure.”

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