Legal concerns spur Oakland’s suspension of plan for four big pot farms

California’s most cannabis-friendly city has temporarily suspended a plan to permit and tax four large marijuana-growing facilities because of ongoing legal concerns.

The Oakland City Council voted 7 to 1 this week to send the measure back to legal staff for reworking after the city received a letter from the Alameda County district attorney. The letter suggested not only that the city’s plan may violate the law, but also that elected officials could be legally liable.

“It remains an open question whether public officers or public employees who aid and abet or conspire to violate state or federal laws in furtherance of a city ordinance, are exempt from criminal liability,” Dist. Atty. Nancy O’Malley wrote in a letter earlier this month to Oakland’s mayor-elect, Jean Quan.

Federal law prohibits any use of pot, though the Obama administration has indicated it will largely allow states to enforce their own medical marijuana measures. California’s pot laws call for a closed loop between cultivators and patients, but federal officials met with Oakland City Atty. John Russo this fall to warn that the large-scale pot farms were probably out of those bounds.


Russo also provided his own memo to the council before approving its plan advising that it may run afoul of state law. The failure of Proposition 19, the marijuana legalization measure on last month’s state ballot, has also muddied the waters.

“If Prop. 19 had passed, the legality of this would have been a lot clearer,” said Dale Gieringer, longtime head of California NORML, which backs legalization. “There was a lot of enthusiasm: ‘Let’s get Oakland ahead of the curve on this because if Prop. 19 passes we are right there ready to go.’ ”

Under the Oakland law, operators would pay an annual fee of $211,000 to help fund a city enforcement staff. That cost effectively ensured massive-scale operations likely to provide enough marijuana to sustain the entire Bay Area medicinal industry, Gieringer said. Oakland alone has $28 million in sales a year. One prospective applicant proposed a 10,000-square-foot kitchen and two football fields’ worth of grow space that would produce about 58 pounds of marijuana every day, many times the amount now sold in Oakland.

Under state law, Gieringer said, collective or cooperative growing organizations providing marijuana to members are legal, but these growers would be supplying multiple dispensaries. A Berkeley ordinance passed by 82% of voters last month, in contrast, authorizes and taxes cultivators on a much smaller scale so the link to users could be maintained.


O’Malley focused in her letter on the narrow legal definition of “primary caregivers,” who she notes are allowed to cultivate for patients under California law if they have “consistently assumed responsibility for the housing, health or safety of that person.” But Gieringer said growers providing marijuana to a larger number of individuals do not tend to rely on that defense, turning instead to the provisions on collective cultivation.

O’Malley, who stressed that she was not making a determination on the measure’s legality, was pointed in her warning.

“Notwithstanding pronouncements by city officials or the enactment of the ordinance, the prosecuting agency in Alameda County is not providing any assurances that activities authorized by the ordinance, but not authorized under state or federal law, are permissible,” she wrote.

Oakland has led the state in efforts to regulate and tax cannabis operations in the medical marijuana era. Unlike Los Angeles and San Diego counties’ district attorneys, who take a narrow view of the law, both Russo and O’Malley have been supportive. O’Malley, a cancer survivor, said in her letter that her office has always “taken a very reasonable approach to enforcement of the marijuana laws” in light of the state laws governing medicinal cannabis.


But the plan to endorse four gigantic grow operations had sparked broad controversy by freezing out hundreds of small-scale growers who have been providing gourmet bud to city dispensaries. Many lobbied against the measure.

Councilwoman Rebecca Kaplan, the measure’s main proponent, said in a statement that she was optimistic that a workable compromise could be reached. The council will discuss proposed amendments to the law on Feb. 1. The council could have shelved the ordinance permanently but instead voted on a motion by Kaplan and another councilwoman to amend it.

“We’re poised to come back early next year with an amended system of responsible regulation,” Kaplan said.