Big Bucks Needed To Open Long Beach Pot Dispensary


Long Beach dispensaries like The Giving Tree will be “giving” hefty licensing fees to the city under a plan approved Tuesday by the City Council.

​Don’t even think about opening a medical marijuana dispensary in Long Beach, California, unless you have a healthy bank account — and you’re willing to bet five figures on it, still with no guarantee of actually getting a shop.

The Long Beach City Council approved fees and charges at Tuesday’s meeting that start at $14,742 and could total more than $26,000 just for the application, then tens of thousands more each year, reports Harry Saltzgraver at The process outlined in the Medical Marijuana Collective Implementation Plan will be managed through the Department of Financial Management, but will also include participation by a number of other departments — each of which seems to have their hands out.

“The fees reflect the very complicated ordinance approved by the City Council,” said City Manager Pat West before Tuesday’s meeting.
“It makes sense,” West said. “You want to go through a thorough application process before you grant one of these. But all we’re doing (with the fees) is cost recovery.”
The thing is, the application fee will be unrefundable — so the process is an expensive gamble for dispensaries currently within 1,000 feet of each other. On September 30, Long Beach will conduct a lottery, with organizations chosen first getting their preferred location. Others, even after laying out the five-figure registration fee, will simply lose their money.
The initial application fees are designed to recover the costs several city departments will incur while “processing” the application, according to Lori Ann Farrell, director of finance for Long Beach.
The departments with their hands out, hoping for their share of that medical marijuana money, include Financial Management, Police, Fire, Health and Development Services.
The revenue will be divided among the various cash-hungry departments based on the amount of work involved, according to Farrell.
The proposed initial application fee for any marijuana dispensary in Long Beach is $14,742. If a separate cultivation site is applied for, another $11,584 will be charged upfront.
That $26,326 is only the first payment to the city, mind you. The staff report also recommends an annual shakedown, I mean “annual regulatory permit fee,” as well.
That fee depends on the number of members of each collective, and starts at a hefty $10,000 annually for organizations with 500 or fewer members. The annual fee jumps to a whopping $20,000 for dispensaries with 501 to 1,000 members, $25,000 for up to 1,500 members and an astounding $30,000 a year for those with 1,501 or more patients.
More than two dozen patients and dispensary operators testified that the fees were onerous and would eliminate truly nonprofit small collectives, but were roundly ignored by the dollar-dazzled city council.

Photo: South Coast AQMD
Long Beach Council member Tonia Reyes Uranga

​Efforts by Council members Tonia Reyes Uranga (Seventh District) and Rae Gabelich (Eighth) to exempt small cooperatives of 10 or fewer members were rebuffed.
Similarly ignored was a reasonable effort by Val Lerch (Ninth District) to levy only actual costs before the lottery, with the rest of the fee due if a dispensary is successful in being awarded a location.
The council voted 5-3 to accept the recommendation, with Uranga, Gabelich and Lerch voting “No.” Council member Robert Garcia was absent.
While the formal action was only to approve the new fees — the council passed an ordinanceon March 8 to regulate dispensaries — there was also a report on implementing the already-passed plan.
According to the staff report, there will be six steps in the program:
1. Public workshops to educate potential dispensaries about the application and permit process.
2. Establishing an application period.
3. Creating site review and inspection timetables.
4. Public noticing.
5. Regulatory permit hearings.
6. Final operator selection process.