Tag Archives: Erik Miller
Last Tuesday afternoon, around 1:30pm, Rebecca, who describes herself as a “50ish” recent transplant from Los Angeles, headed over to the Berkeley Patients Group at 2747 San Pablo Avenue. For the past six months, ever since she moved north, Rebecca has gone to the medical cannabis dispensary once a month to get marijuana to help her with her insomnia brought on by menopause.
“It’s my favorite place,” said the Rockridge resident, who did not give her last name. “It just feels like a community place. The folks are very knowledgeable. I really rely on what they say.”
Rebecca does not know what she will do when BPG closes its doors on May 1, a casualty of the recent federal crackdown on dispensaries located within 1,000 feet of a school or park. She has visited other collectives, but none has made her feel as welcome as Berkeley Patients Group. … Continue reading »
Berkeley’s Medical Cannabis Commission agreed on Thursday to send a letter to the city manager expressing concern about the proliferation of cannabis collectives in areas that are not zoned for them.
The commission noted that two collectives – 40 Acres and Perfect Patient’s Plant Group – were operating much like dispensaries without having to comply with the numerous laws that regulate them, including getting licensed and paying taxes
“It is really important that we watch out for the interests of those people who are abiding by what is asked of them by the City of Berkeley,” said Commissioner Stewart Jones, referring to the three dispensaries currently permitted by the city. “I am concerned about an influx of (groups) coming into Berkeley. There are two now. Next week there could be two more.” … Continue reading »
It’s been four months since the Berkeley Patients’ Care Collective on Telegraph Avenue received formal notice that it owes the state $639,000 in back taxes, yet the group still doesn’t know how it is going to pay its bill.
The medical cannabis group, which has deliberately kept itself small to retain its customer-friendly atmosphere, sells about $1.8 million of medical marijuana each year, according to its manager Erik Miller. While that might sound like a lot, by law the group cannot make any profits. Those funds just pay for the cannabis, the rent, and the salaries of 11 employees. There are no hidden or stashed funds with which to pay back the government, he said.
“That’s the perception, that we are rolling in money here,” said Miller earlier this week. “It’s not true. I drive an 18-year old car.”
Complicating factors are the new taxes that Berkeley is imposing on its three dispensaries. The Patients Care Collective must pay a 2.5% tax on the cannabis it buys and a 2.5% tax on the cannabis it sells – on top of the state’s sales tax.
So far, the group has not passed on its increased costs to customers, said Miller. He is not sure what will happen when the collective has to start paying back the tax.
“I just couldn’t see raising the price higher. We’ve absorbed the (tax). We’ve cut expenses. We’ve all taken a pay cut in order not to raise the price for the patients.”
The state Board of Equalization is contending that the Berkeley Patients Group, one of the oldest and largest medical cannabis dispensaries in California, owes $6 million in back taxes, Berkeleyside has learned.
The board claims that the dispensary on San Pablo Avenue did not pay taxes on the medical marijuana it sold from July 2004 to June 2007 and now owes $4.4 million in taxes and about $1.6 million in interest.
The charges come on the heels of a September 2010 ruling in which the Board of Equalization determined that another Berkeley cannabis collective, Patients Care Collective, had to pay $639,000 for back taxes it owed from January 1, 2005 to September 8, 2008 on the sales of cannabis and marijuana cookies.
The Berkeley Patients Group, which has about 13,000 members and serves 800 to 1,000 patients each day, is contesting the charges, according to Elisabeth Jewel, whose firm Aroner, Jewel, & Ellis advises BPG on governmental regulations. Until February 2007, the laws regarding the collection of taxes for the sale of cannabis were murky, which is why the BPG did not pay, she said.
“There is no allegation of malfeasance in terms of collecting a tax and not paying it,” said Jewel. “The Berkeley Patients Group contends it was not clear to them that they had to pay sales taxes on what they consider medicine.”
The Board of Equalization will hold a hearing on the charges at its February 22-24 meeting in Sacramento. While the board would not officially confirm there is a claim pending against BPG, a spokesman did confirm the BPG hearing was on the agenda, which has not yet been made public. Berkeleyside learned about BPG’s late tax payments from a source close to the board, who asked not to be named.
Berkeley residents will vote on two ballot measures on Tuesday that could lead to a greatly expanded medical cannabis industry in the city – and hundreds of thousands of new dollars for the city’s coffers.
Measure T would increase the number of places that sell marijuana from three to four, and also permit six 30,000-square-foot indoor growing areas in the city’s industrial zone in West Berkeley. These places would not be open for customers, but would be used to grow cannabis, test it, distill it into tinctures or creams, or cook it into food products.
Measure T would also explicitly permit medical cannabis collectives to operate in residential neighborhoods, but limit the size of their grow operations to 200 square feet. Collectives are usually composed of a small group of people who come together to grow cannabis for their own use. Sometimes they sell their excess marijuana to the dispensaries.
Measure T would also dissolve the current Medical Marijuana Commission created by Measure JJ and replace it with one whose members are appointed by the City Council.
Measure S would place a tax on medical cannabis sales – up to 2.5% for medical cannabis and, if Proposition 19 passes, as much as 10% for recreational marijuana. Raising the tax from its current level of $1.20 per $1,000 of gross receipts to $25 per $1,000 of gross receipts would bring the city approximately $460,000 a year, according to a staff report.
The city’s existing dispensaries have split on whether to support Measures S and T. The Berkeley Patients Group, the city’s largest dispensary located on San Pablo Avenue, is in favor of the measures, while Berkeley Patients’ Care Collective, located on Telegraph Avenue, is opposed.
The Berkeley Patients Group, which has put money in the Yes on T measure as well as Proposition 19, supports the new measures because it would like to be more in control of the cannabis products it sells, according to spokesman Brad Senesac. Currently, the dispensary purchases marijuana, tinctures, and food products from independent growers and collectives. The BPG hand inspects all cannabis that comes into the dispensary to make sure it meets the group’s standards. BPG could better control its product if it also grew some, he said.
BPG would probably submit an application to be one of the organizations that sets up a grow operation in West Berkeley, said Senesac.
The Berkeley Patients’ Care Collective, in contrast, believes that Measure T gives too much power to the city council and does not leave enough decision making authority to those involved with the day-to-day workings of the medical cannabis business, said Erik Miller, a manager. He is not convinced that city council members will appoint people who really know the business since they have not been particularly friendly to the cannabis community, he said.
Measure T also gives the city council the power to make future amendments to the initiative, rather than turning it back to the voters.
“I don’t know why Berkeley voters would want to give up their rights to make decisions on this,” said Miller.
The BPCC is also concerned that the passage of Measure S will make medical cannabis too expensive for some of its customers since it will be taxed twice. The tax placed on marijuana will really be $50 per $1,000, not $25 per $1,000, said Miller. When the collectives sell the pot to the dispensaries, they will have to pay a tax on that transaction. When the dispensaries sell it to their customers, they must place a tax on the marijuana, said Miller. Those added costs will be passed on to customers, he said.
Wendy Cosin, the city planner who staffs the Medical Marijuana Commission, said she thought Measure S would permit this double taxation.
However, Measure T states that the new Medical Marijuana Commission will establish standards for any new dispensary that opens. Those new requirements will make it mandatory for a new dispensary to provide low-cost cannabis to low-income patients, as well as some organically grown marijuana.