LOCAL CHAMBER AND BUSINESS LEADERS DISCUSS IMPLICATIONS OF PROP.64 BY JASON R. MILLER

Prop 64 meeting photo This comes after the states of Washington and Colorado made it legal to use Marijuana. The Chambers special guest speaker was Special Investigations Division and PIO Lieutenant Ed Varso of the Escondido Police Department.

Lt. Varso started by saying that “according to recent polling Prop 64 will pass”. According to polling done statewide California Counts survey done for KPBS San Diego and other PBS stations in California by The Institute for Social Research at Sacramento State says that Prop.46 has “overwhelming support from Democrats but also a majority of support from Republicans in the state. Eighty percent of Democrats said they would vote for the proposition in
November, while 53 percent of Republicans said they would vote for it.”

Varso said that  “it(Prop. 64)will go into effect the day after the election on November 9th, 2016” but “that the state of California will not have any regulatory rules in place until January 1st of 2018.” and “the issuing of licenses and collection of taxes.”

Adults aged 21 and over would “be able to carry 1 ounce of Marijuana or 8 gram’s of concentrated cannibals.” Varso also said “that people would be allowed to grow up to six plants at their residence whether it is indoors or outdoors for their own personal use.” and “Local landlords do have the right to evict people who grow marijuana on their property.”

The City of Escondido, however, passed an updated ordinance in January of this year excepting the following parts of the law: Designates State agencies to license and regulate marijuana industry. Imposes state excise tax of 15% on retail sales of marijuana, and state cultivation taxes on marijuana of $9.25 per ounce of flowers and $2.75 per ounce of leaves.
Exempts medical marijuana from some taxation. Establishes packaging, labeling, advertising, and marketing standards and restrictions for marijuana products. Prohibits marketing and advertising marijuana directly to minors. Allows local regulation and taxation of marijuana.
Varso also noted, “that since the City of Escondido opted out of these parts of the law, that the city would not be able to befit from the proposed tax befits from the law.”

Reporters Note: itsI should note that if Prop.64 passes as Lt. Varso suggests; people driving through the City of Escondido could possess the drug in their vehicle without fear of getting pulled over by the Escondido PD. I asked Varso about how this will change on November 9th; he gave me an example: “Say if a person drives from the beginning of Escondido to Valley Center with marijuana,it’s legal under the new law” and “their’s very little we(Escondido PD) can do about it” says Varso. Also, sellers of marijuana from outside of the City of Escondido could also deliver orders to customers within the city limits. This in effect would override two parts of Escondido current ordinance which prohibit these two things from happening. Again those parts of the ordinance would only be in effect until the aforementioned date of November 9th, 2016.

Varso stated that the new law “would significantly reduce the remaining penalties regarding the consumption and possession of marijuana.” He also said that it would “reduce the penalties for juveniles from minor drug crimes to drug counseling.” State and Local law enforcement “would also be prevented from going after people under federal laws after the local law (Prop.64) is enacted.” “The penalty of selling of marijuana to children under the age of 18 will remain the same under the new law” according to Varso.

Escondido Police Chief Craig Carter and a small task force recently went to the state of Colorado to examine the effects the ramifications from their version of the law. Lt. Varso talked about some of their findings. According to local and state officials “Emergency Room visits in result of marijuana went up by 86%, and 115% with children up to young adults. Violent crime was up statewide by 15%” resulting from the new law. And finally “car insurance, home prices and rents all rose by 15%.”

I contacted Shawn Conner, Captain of the San Diego Regional Office for the California Department of Insurance to asking him how this would affect insurance rates in California after the new law goes into effect ; an official who does not want to be named from the Sacramento office got back to us saying “that we can’t even begin to estimate how this would affect insurance rates in the state of California.” This reporter was also contacted in relation to this story by Janet Ruiz who represents the independent non-profit Insurance Information Institute in San Francisco; she tells me “we don’t know if rates will go up at all” she used car insurance as an example and pointed to the following factors used by car insurance companies in determining rates: the driver’s safety record, the number of miles driven annually, the driver’s years of experience.  She also says “it is illegal under Proposition 103 to raise someone’s insurance rates before an accident or accidents happen,” and “cannot discriminate against a person because of gender or race.” Reporters Note: In this case, Insurance Companies cannot use Proposition 64 to raise rates because nothing has happened yet; rates are based only on prior incidents which are explained in Proposition 103 that was passed back in 1988. Ruiz also tells me “it will take 3 to 5 years before we know how this(Prop.64) will affect insurance rates in the state of California.”

About half way through Lt. Varso’s presentation there was an impromptu Q & A session; one person asked how banks were supposed to do business with owners of marijuana when the banks were FDIC Insured and where would the tax revenue come from since it is a cash business; Varso’s response “It is a cash business, and the dispensaries or facilities in Colorado have had the exact same problem where it is cash only and they can’t just show up to deposit their money or revenue at the bank .” Varso also says they “are subject to robberies” and “we have them already in San Diego with some dispensaries being robbed.” On tax revenue, Varso said, “he has heard the same argument that it would be challenging for the state to really know if they are getting all the tax revenue they’re supposed to.”

One gentleman instead of asking a question decided to give a 10-minute speech on the Prohibition years(1920-1933).  He also disagreed with Lt. Varso’s presentation and the information Chief Carter’s task force brought back from Colorado saying “he called the Chamber of Commerce and the Denver Police Department and their police chief,” gentleman continues “they say(Colorado officials)there really has been no sky fall, people aren’t leaving the dispensaries or running over and shooting heroine.”  The man finally asked “are they(the government) tracking the purchases” and “if he was going to lose his gun rights because he or his family consumed marijuana” citing the Gun Control Act of 1968 which states “Gun owners who are caught illegally handling cannabis may face severe punishment due to federal statutes that set mandatory sentencing for drug offenses involving firearms at five years in a federal prison for the first gun and 25 years for each additional one. Varso responded, “That this isn’t the world seen by Ed Varso or the Escondido Police Department, it is data we have out there showing some of law enforcement concerns of what this(Prop.64) may look like for us.”
Reporters Note: This reporter should note that according to records a man was convicted under the Gun Control Act of 1968 for possessing marijuana; Weldon Angelos was sentenced to 55 years in federal prison back in 2002 for caring marijuana with a few handguns in his possession. Angelos story made national news on ABC News’s Nightline. In May of this year, Angelos received an early release after the person who prosecuted him had a change of heart. For more on Weldon Angelos’s story go to: http://abcnews.go.com/US/federal-judge-regrets-55-year-marijuana-sentence/story?id=28869467

I asked Rorie Johnson the CEO of The Escondido Chamber of Commerce whether the Chamber has taken a position on Proposition 64 she told me “the Chamber has not yet taken a position, but will have one soon.”

To read the full version of Proposition 64 you can go to: http://www.oag.ca.gov/system/files/initiatives/pdfs/15-0103%20%28Marijuana%29_1.pdf?

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