Los Angeles To Close Hundreds Of Marijuana Shops, Tighten Rules

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Los Angeles Mayor Antonio Villaraigosa signed an ordinance that will shut hundreds of marijuana dispensaries in the city and impose stricter regulations on the 186 remaining stores.

The ordinance signed on April 30 caps a four-year effort by the city to address the proliferation of pot parlors, which the Los Angeles Police Department said led to an increase in crime.

The nation’s second-largest city saw an explosion of marijuana stores in recent years to more than 500, according to the ordinance. The outlets began opening statewide after California voters in 1996 approved a ballot measure allowing medical use of marijuana. San Francisco and Oakland limit the numbers of outlets.

The ordinance, approved by the City Council in January, caps the number of dispensaries at 70, while letting 116 that registered with the city before Nov. 13, 2007, stay in business.

Operators of the other dispensaries will receive letters this week telling them to close, according to Frank Mateljan, a spokesman for the city attorney’s office.

The remaining operators will be required to pay registration fees of $1,595 annually, Mateljan said. Employees will be subject to background checks and facilities subject to city inspection.

The ordinance also requires the dispensaries be located at least 1,000 feet from places such as schools, parks and child- care facilities.

A proposition on the statewide ballot in November would allow anyone over the age of 21 to possess, cultivate or transport marijuana for personal use. It would also permit local governments to tax marijuana production and sales, an estimated $15 billion a year business in California.



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Source: Bloomberg Businessweek
Author: Christopher Palmeri
Contact: BusinessWeek - Business News, Stock Market & Financial Advice
Copyright: 2010 Bloomberg Businessweek
Website: Los Angeles to Close Hundreds of Marijuana Shops, Tighten Rules - BusinessWeek
 
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