California Marijuana Ban Gets Legislative Review After 96 Years

By Ryan Flinn and Michael Marois

Oct. 28 (Bloomberg) -- California’s Assembly will consider lifting its 96-year-old ban on marijuana, decriminalizing the drug and taxing it like alcohol, as the state seeks ways out of its worst financial crisis since World War II.

The Assembly’s Public Safety Committee will discuss the social, fiscal and legal implications of legalizing and regulating marijuana in Sacramento today, said Quintin Mecke, a spokesman for Assemblyman Tom Ammiano.

It would be the first time the issue has been considered by the Legislature since the ban on marijuana use went into effect in 1913, according to a statement from the San Francisco Democrat.

“It is time to take our heads out of the sand and start to regulate this $14 billion industry,” Ammiano said in the statement. “By doing so, we can enact smart public policy that will bring much-needed revenue into the state and improve public safety by utilizing our limited law enforcement resources more wisely. The move toward regulation is simply common sense.”

Ammiano introduced Assembly Bill 390 in February. If passed, it would add $1.34 billion to California’s annual revenue based on sales tax and a $50-an-ounce excise levy, according to the state’s tax administrator, the Board of Equalization.

The bill will have its first policy hearing in January, Mecke said. The $14 billion figure cited by Ammiano is his estimated value of both illegal and medical marijuana, he said.

Budget Deficit

Since February, Governor Arnold Schwarzenegger and lawmakers have cut $32 billion from spending, raised taxes by $12.5 billion and covered $6 billion more with accounting maneuvers to close a budget deficit that threatened the largest U.S. state with insolvency. State officials predict a total of $38 billion in deficits in the next three fiscal years.

A Field Poll conducted in April showed that 56 percent of registered voters in California supported legalizing and taxing marijuana. Voter initiatives are under way to have legalization measures on next year’s election ballot.

Schwarzenegger is personally opposed to legalizing marijuana, said Aaron McLear, a spokesman, though he’s not against today’s hearings.

“If it’s something that people think there should be a robust discussion about, then it’s something we should do,” McLear said yesterday to reporters in Sacramento.

Paul Chabot, founder of the Coalition for a Drug Free California, said the proposal “just sends the wrong message.”

‘Enough Problems’

“We have enough problems with alcohol and prescription drug abuse throughout California and the nation,” Chabot said in an interview yesterday. “The last thing we need to do is legitimize one more thing which is already responsible for sending more users to drug rehab than any other drug combined.”

Chabot, 35, who is running for the state Assembly, said the issue is a personal one for him, as he entered rehab for marijuana use at age 12. He said the potential revenue from taxing marijuana would be offset by increased health and law enforcement costs to communities.

The bill would also extend taxation to medical marijuana. California is one of 14 states allowing some marijuana use for health reasons, according to a U.S. Justice Department statement, and in July, Oakland voters approved a measure making their city the first in the U.S. to tax it.

On Oct. 19, President Barack Obama’s Justice Department told federal prosecutors not to seek criminal charges against those who use or supply the drug for medical purposes in accordance with state laws, reversing the previous Bush administration approach.

Focus for Feds

The federal guidelines don’t legalize marijuana. The Justice Department will focus its resources on “serious drug traffickers while taking into account state and local laws,” Attorney General Eric Holder said in a statement.

The Bush administration had said it would pursue charges in medical marijuana cases, even in those states.

Marijuana, produced from the cannabis plant, can be smoked or ingested. Its recreational use is illegal in the U.S. Advocates of medical use say marijuana can ease cancer patients’ nausea from chemotherapy, help treat glaucoma, stimulate AIDS patients’ appetites and ease pain for multiple sclerosis sufferers.

To contact the reporters on this story: Ryan Flinn in San Francisco at rflinn@bloomberg.net; Michael B. Marois in Sacramento at mmarois@bloomberg.net

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