UMCP State Compliance Ordinance

Revised 10/1/12 UnionMCP.org ORDINANCE NO. ___________ An ordinance establishing interim regulation of Medical Marijuana Dispensaries in light of recent appellate court decisions and California Supreme Court actions and pending more complete regulation. WHEREAS, the Compassionate Use Act (CUA) of 1996 provided immunities to prosecution under state law for marijuana cultivation, possession, transport and sale for qualified patients and their caregivers, and the Medical Marijuana Program Act (MMPA) of 2003 clarified and expanded those protections and also extended protection from prosecution for properly organized and functioning medical marijuana patient associations; WHEREAS, until 2010 when the City passed its Medical Marijuana Ordinance (MMO), Article 5.1, Chapter IV of the Los Angeles Municipal Code (LAMC), hundreds of medical marijuana collectives, cooperatives, dispensaries, businesses and cultivation operations (collectively, Medical Marijuana Establishments) opened without oversight or regulation by the City, such that there may have been 850 or more storefront locations in existence as well as uncounted cultivation sites; WHEREAS, the MMO as subsequently amended by the Temporary Urgency Ordinance No 181530 (TUO) was viewed as so overly restrictive by the entire medical marijuana community that it was treated as an existential threat by them; WHEREAS, the medical marijuana community as a whole therefore responded to the MMO as amended with a large number of lawsuits that were consolidated in Los Angeles Superior Court in MJ Collectives Litigation: Americans for Safe Access et al. v. City of Los Angeles, Lead Case No. BC433942 (Consolidated Litigation) , Judge Anthony J. Mohr presiding, resulting in an injunction by Judge Mohr that has largely frozen the Citys ability to enforce the MMO; WHEREAS, settlement talks in the Consolidated Litigation broke down when a compromise could not be reached for regulation that both the City and a significant portion of the medical marijuana community could accept; WHEREAS, although the City has recently prevailed in the Second Appellate District in its appeal of Judge Mohrs injunction in the Consolidated Litigation in 420 Caregivers, LLC et al. v. City of Los Angeles, B230436, the case has been accepted for review by the State Supreme Court, suspending the appellate decision and keeping in place Judge Mohrs injunction until the case is ruled on by the State Supreme

Court, and also suspending the appellate finding that the Citys Ban Ordinance did not constitute a ban because it permits collectives of three or fewer persons; WHEREAS, in October 2011, the Second Appellate District of the California Court of Appeal, whose jurisdiction includes Los Angeles, ruled in Pack v. City of Long Beach, 199 Cal.App.4th 1070 (2011), that cities and counties could not issue permits or otherwise authorize marijuana possession, cultivation, transportation or sale in contravention of federal law under the principle of federal preemption; WHEREAS, on August 22, 2012, the State Supreme Court dismissed review of, threw out and depublished Pack, so that it is not in effect and of no precedential value; WHEREAS, with Packs demise there is now no extant federal preemption challenge and the City is free to issue permits to Medical Marijuana Dispensaries if it wishes to do so; WHEREAS, any concerns that federal preemption issues may once again be raised can be avoided by an ordinance that imposes restrictions on Medical Marijuana Dispensaries but does not authorize or permit them; WHEREAS, although the City voted to ban medical marijuana businesses on July 24, 2012 (Ban Ordinance), the Ban Ordinance was overturned by a successful referendum petition and is not presently in effect, nor will it ever be in effect unless it passes a Citywide vote; WHEREAS, competing appellate decisions as to whether cities and counties can ban Medical Marijuana Dispensaries or Medical Marijuana Establishments (City of Riverside v. Inland Empire Patients Health & Wellness Center, 200 Cal.App.4th 885 (4th Dist. 2011) upheld their right to ban while City of Lake Forest v. Evergreen Holistic Collective, 203 Cal.App.4th 1413 (4th Dist. 2012) and County of Los Angeles v. Alternative Medicinal Cannabis Collective et al. (Second Appellate District Case No. B233419 (LASC Case No. BC45789)) found that cities and counties cannot ban) have been granted review by the State Supreme Court, such that the legality of banning is presently up in the air, and ban ordinances will have no legal standing if the State Supreme Court rules in favor of Evergreen and Alternative Medicinal Cannabis Collective and against Inland Empire; WHEREAS, any contention by the City that a ban is in place due to expiration of the MMO will, if acted on, bring about additional litigation and has yet to be tested in the courts;
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WHEREAS, the City Attorney has held a narrow interpretation of the MMPA, advising the City that only collective cultivation is a protected activity, that all or almost all members of a collective must cultivate and that they must do so at the same site at which they distribute medical marijuana to the collective members in order to earn protection under the MMPA, and that any form of transportation and any form of sale of medical marijuana is unprotected by the MMPA, and has drafted ordinances in line with this narrow interpretation; WHEREAS, Los Angeless Second Appellate District in People v. Colvin, 203 Cal.App.4th 1029 (2nd Dist. 2012) disagreed entirely with such a narrow interpretation of the MMPA, finding that there is no numerical or percentage restriction in the MMPA as to how many collective members need cultivate and that collective members can validly participate in collective cultivation in other ways than actual cultivation; that there is no location requirement in the MMPA regarding cultivation so that cultivation may happen in quite different locations from the sites of other operations of a collective and that transportation may occur between the sites, as long as a closed circuit of cultivation, transportation and distribution is maintained within and between collective members; and that sales and/or reimbursements may occur so long as no profit is derived after expenses; WHEREAS, the Supreme Court declined to review Colvin such that Colvin is to be considered binding case law and precedent; WHEREAS, any ordinance based on the City Attorneys narrower interpretation of the MMPA would fall to a Colvin challenge; WHEREAS, during the pendency of the Consolidated Litigation and during the uncertainty resulting from the aforementioned appellate decisions, Los Angeles has not sought to enforce most of its MMO, but instead has issued tax certificates to any Medical Marijuana Dispensary that applies, and in response the number of Medical Marijuana Dispensaries in Los Angeles has increased far beyond the number in existence at the time the MMO was established, such that there may be now over 2,000 unregulated Medical Marijuana Dispensaries in Los Angeles; WHEREAS, claims by the police department of increased crime around Medical Marijuana Dispensaries have never been substantiated with statistically reliable data, and in fact crime levels across the City have continuously dropped even while the number of Medical Marijuana Dispensaries in the City has exploded, and a new UCLA study has concluded that crime levels do not rise and may even decline around Medical Marijuana Dispensaries due to the increased security measures around such establishments;

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WHEREAS, even though increased crime is not an issue, the City nevertheless wishes to expeditiously regulate Medical Marijuana Dispensaries in Los Angeles; WHEREAS, while previously the City has crafted ordinances for Medical Marijuana Dispensaries based only on the merits of the ordinances in abating perceived problems around Medical Marijuana Dispensaries, but took no thought to the viability of such ordinances in terms of their ability to gain adherents in the medical marijuana community, forestall and prevail in litigation and referendum petitions, and avoid becoming outdated by evolving caselaw; WHEREAS, the City wishes to regulate Medical Marijuana Dispensaries in Los Angeles in a way that will earn it the support of a significant enough portion of the medical marijuana community to reduce opposition and litigation; WHEREAS, many of the oldest Medical Marijuana Dispensaries in Los Angeles have proclaimed their commitment to closed circuit and not for profit operation as laid out in Colvin and contemplated in this Ordinance, such that they are not likely to oppose it; WHEREAS, the City wishes to regulate Medical Marijuana Dispensaries in Los Angeles in a way that will best position it to prevail in any subsequent litigation or referendum petition in opposition; WHEREAS, the City wishes to regulate Medical Marijuana Dispensaries in Los Angeles in a way that does not require banning, making it immune to litigation on the issue and immune as well to the consequences of any Supreme Court decision on the question; WHEREAS, while the City could base its ordinance on an overly narrow interpretation of the MMPA, Colvin as valid case law points to a more reasonable interpretation, and so the City wishes to regulate and reduce the numbers of Medical Marijuana Dispensaries in Los Angeles based on an interpretation of the MMPA in a way that aligns with Colvin and will avoid a Colvin challenge; WHEREAS, state law offers immunities to prosecution only to Medical Marijuana Dispensaries that are closed circuit and not for profit per Colvin, and all other Medical Marijuana Dispensaries receive no immunity and are subject to prosecution for violation of state law on marijuana possession and trafficking; WHEREAS, criminal enforcement by the City of state law would not be subject to the same lengthy litigation and administrative procedures that have attended City ordinances, and would provide an immediate deterrent to improperly run Medical Marijuana Dispensaries that would greatly reduce their numbers in Los Angeles; and
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WHEREAS, quickly eliminating Medical Marijuana Dispensaries that are not entitled to state law immunity would likely reduce the numbers of Medical Marijuana Dispensaries in the City and would leave only law-abiding operators, creating a climate in which it would be easier to reach an accommodation on a complete ordinance regulating them and would leave fewer to oppose any such ordinance through litigation; NOW, THEREFORE, THE PEOPLE OF THE CITY OF LOS ANGELES DO ORDAIN AS FOLLOWS: SECTION 1. PURPOSES AND INTENT It is the purpose and intent of this article to effectively regulate Medical Marijuana Dispensaries in a manner that will not be affected by and will survive any rulings made by the State Supreme Court on various appellate decisions presently under the high courts review regarding the regulation of medical marijuana associations, and in a manner that will reduce litigation in opposition and increase the likelihood of the City prevailing in any such litigation. It is further the purpose and intent of this article to regulate Medical Marijuana Dispensaries reasonably and fairly using the binding appellate decision People v. Colvin, 203 Cal.App.4th 1029 (2nd Dist. 2012), as a template for what kinds of Medical Marijuana Dispensaries are entitled to exemption from prosecution under state law for marijuana possession and trafficking, though no Medical Marijuana Dispensary of any kind is affirmatively authorized under state law or under this ordinance. It is further the purpose and intent of this article to reduce the numbers of Medical Marijuana Dispensaries in the City without giving rise to federal or state preemption issues. If is further the purpose and intent of this article to distinguish between Medical Marijuana Dispensaries in the City that are entitled to the protections of state law against prosecution for marijuana possession and trafficking, and those that are not, so that state law criminal sanctions can be brought to bear against those that are not exempted from prosecution, leaving the City with a smaller and more responsible core of law-abiding Medical Marijuana Dispensaries to regulate. SECTION 2. DEFINITIONS.

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A. The following phrases, when used in this section, shall be construed as defined below. Words and phrases not defined here shall be construed as defined in Sections 11.01, 12.03, 45.19.5, 45.21, and 56.45 of this Code. Location means any parcel of land, whether vacant or accompanied by a building, group of buildings, or accessory buildings, and includes the buildings, structures, yards, open spaces, lot width, and lot area. Marijuana shall be construed as defined in California Health and Safety Code Section 11018 and further shall specifically include any product that contains marijuana or derivatives of marijuana. Medical Marijuana Dispensary means any of the following: (1) Any location used to sell, offer after reimbursement or in return for membership dues or give away marijuana to a qualified patient, a person with an identification card, or a primary caregiver. (2) Any vehicle or other mode of transportation, stationary or mobile, which is used to sell, offer after reimbursement or in return for membership dues or give away marijuana to a qualified patient, a person with an identification card, or a primary caregiver. (3) Notwithstanding Subparagraphs 1 and 2 above, Medical Marijuana Dispensary shall not include any of the following: (a) Any location when in use by a primary caregiver to dispense, deliver or give away marijuana to a qualified patient or person with an identification card who has designated the individual as a primary caregiver, for the personal medical use of the qualified patient or person with an identification card, in accordance with California Health and Safety Code Section 11362.5 and 11362.7 et seq. (b) Any location when in use by no more than five qualified patients and/or their primary caregivers to cultivate, store, deliver, dispense or distribute marijuana only by that group of no more than five qualified patients and their caregivers and only to that group of no more than five qualified patients (c) The location of any clinic pursuant to Chapter 1 (commencing with Section 1200), a health care facility licensed pursuant to Chapter 2 (commencing with Section 1250), a residential care facility for persons with chronic lifethreatening illness licensed pursuant to Chapter 3.01 (commencing with Section 1568.01), a residential care facility for the elderly licensed pursuant to Chapter 3.2

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(commencing with Section 1569), a hospice, or a home health agency licensed pursuant to Chapter 8 (commencing with Section 1725), all of Division 2 of the California Health and Safety Code where: (i) a qualified patient or person with an identification card receives medical care or supportive services, or both, from the clinic, facility, hospice, or home health agency, and (ii) the owner or operator, or one of not more than three employees designated by the owner or operator, of the clinic, facility, hospice, or home health agency has been designated as a primary caregiver pursuant to California Health and Safety Code Section 11362.7(d) by that qualified patient or person with an identification card. (d) Any vehicle when in use by: (i) a qualified patient or person with an identification card to transport marijuana for his or her personal medical use, (ii) a primary caregiver to transport, deliver, or give away marijuana to a qualified patient or person with an identification card who has designated the individual as a primary caregiver, for the personal medical use of the qualified patient or person with an identification card, in accordance with California Health and Safety Code Section 11362.765, or , or (iii) a qualified patient or person with an identification card to transport marijuana for his or her State Compliant Association. (e) Any Medical Marijuana Dispensary Support Site as defined below where no more than five qualified patient member cultivators who work at that site receive their personal allotment of medical marijuana there, while all other members must receive the marijuana cultivated there at a Medical Marijuana Dispensary at another location. Medical Marijuana Dispensary Support Site means any site besides a Medical Marijuana Dispensary used to store or cultivate medical marijuana or any vehicle when in use by a member of a Medical Marijuana Establishment to transport medical marijuana on behalf of the Medical Marijuana Establishment. "State Compliant Association shall mean an association, collective or cooperative consisting exclusively of qualified patients and/or primary caregivers, that cultivates and provides medical marijuana exclusively by and for use of its registered members without profit net of all legitimate expenses in strict accordance with state law and so is eligible for exemption from prosecution under the Medical Marijuana Program Act, Section 11362.775 of the Health and Safety Code, for certain Health and Safety Code violations regarding medical marijuana possession and trafficking.

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Vehicle means a device by which any person or property may be propelled, moved, or drawn upon a street, sidewalk or waterway, including but not limited to a device moved exclusively by human power. B. The following words or phrases when used in this section shall be construed as defined in California Health and Safety Code Sections 1746, 11362.5, and 1132.7: Hospice, Identification card, Person with an identification card, primary caregiver and qualified patient. SECTION 3. REQUIREMENT TO PROVE STATUS. All Medical Marijuana Dispensaries must prove and achieve recognition that they are a State Compliant Association by demonstrating that they are operating as a closed circuit and not for profit association of qualified patients and their primary caregivers. SECTION 4. SUBMISSION OF PROOF. Medical Marijuana Dispensaries will have 60 days from enactment of this Ordinance to prepare and submit documentary proof of their State Compliant Association status. Medical Marijuana Dispensaries that begin operations after the enactment of this Ordinance will have 60 days from beginning of operations to prepare and submit documentary proof of their State Compliant Association status. Medical Marijuana Dispensaries may use lawyers, accountants or other third parties to assist them in preparing and presenting their proof. All documentary evidence submitted to the City and its respective representatives by Medical Marijuana Dispensaries seeking to establish State Compliant Association status is expressly exempt from disclosure under the California Public Records Act (CPRA) sections 6254(k), 6254 (n), and 6255. The right of a Medical Marijuana Dispensary and its members to privacy outweighs the publics interest in access to any information that would be submitted to prove State Compliant Association Status. SECTION 5. STATUS BOARDS. Medical Marijuana Dispensaries will demonstrate their State Compliant Association status before Status Boards. a. Status Boards will consist of one recognized medical marijuana patient advocate, one law enforcement representative and one retired judge or professional mediator. Decisions of the Status Boards will be by majority vote.

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b. There will be at least one Status Board for each City district. The members of the Board will be nominated by the districts Councilperson. The Councilperson will ensure that there are sufficient numbers of Status Boards so that all applicants in the district are timely reviewed. c. Status Boards or their designees may engage in onsite inspections of sites and records during the application process to verify that the documentation presented to them by the applicant is correct. d. The board must follow the requirements of this ordinance and the criteria of the Colvin decision and the Attorney Generals Guidelines in determining State Compliant Association status. If they deny State Compliant Association status, they must describe the grounds for their decision in writing and lay out the specific deficiencies that prevented the Medical Marijuana Dispensary from achieving State Compliant Association status. e. Medical Marijuana Dispensaries must pay a nonrefundable fee of $5,000 to defray the fees and expenses of the Status Boards in reviewing their application and inspecting their sites and records. f. Medical Marijuana Dispensaries that are denied State Compliant Association status may re-apply once. If a Medical Marijuana Dispensary denied State Compliant Association status chooses to re-apply, it is given 60 days to cure all deficiencies and must be prepared for a re-hearing any time after 60 days. During re-application hearings, the Status Board may if they wish limit their inquiry to consider only the elements that were previously found deficient. Re-application requires another non-refundable $5,000 fee. g. Medical Marijuana Dispensaries may once appeal the decision of the Status Board to another Status Board chosen at random, either before or after they re-apply but not both before and after. Appeals require a non-refundable $5,000 fee. h. Any applying Medical Marijuana Dispensary found to have falsified application materials will have its application denied without an opportunity to reapply, and the proof of falsification gathered through inspection by the Status Board and/or its designees will be retained or turned over to another Status Board in the case of an appeal. An appeal may be made, confined only to appealing the decision that application materials have been falsified. If an appeal successfully reverses the decision that materials have been falsified, then the Medical Marijuana Dispensary may begin the application process over again.
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SECTION 6. FAILURE TO ACHIEVE STATE COMPLIANT ASSOCIATION STATUS. Medical Marijuana Dispensaries that apply and fail to receive State Compliant Association status before a Status Board and do not re-apply or appeal, or fail to receive State Compliant Association status after re-application and/or appeal, will be given a 30 day grace period to wind up operations and close down. No Medical Marijuana Dispensary that has so failed to achieve State Compliant Association status before a Status Board may operate in the City/County. SECTION 7. FAILURE TO APPLY. No Medical Marijuana Dispensary that fails to apply to achieve State Compliant Association status before a Status Board may operate in the City. Any Medical Marijuana Dispensary in the City that fails to apply to a Status Board to demonstrate and apply for Protected Status will be deemed in violation of this Ordinance and will be shut down for failure to follow this Ordinance. In addition, any such Medical Marijuana Dispensary may be the subject of investigation to determine if it is a State Compliant Association and if it is found not to be a State Compliant Association, it may be subject to prosecution for violation law related to marijuana possession and trafficking. SECTION 8. CERTIFICATES OF STATE COMPLIANT ASSOCIATION STATUS. Medical Marijuana Dispensaries that do not apply anonymously (see Section 12 below) that earn State Compliant Association status will be recorded as having earned State Compliant Association status and will receive a certificate to that effect (Certificate) for each cultivation, storage and dispensing site that they have documented, which they may post at those sites. It is the responsibility of State Compliant Associations to see to it that their Certificates are not stolen or copied. It will be a violation of this Ordinance to copy a Certificate or place it on a site other than the one to which it was assigned. Any Medical Marijuana Dispensary or State Compliant Association that posts a copied or stolen Certificate will be shut down as having violated this ordinance, and the State Compliant Association whose Certificate was copied or stolen will likewise be shut down for violation of this Ordinance. SECTION 9. NO PERMIT OR AUTHORIZATION. Section 7. Certificates and State Compliant Association status, if earned by a Medical Marijuana Dispensary, in no way represent a permit or authorization from the City

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for the State Compliant Association to engage in marijuana possession, cultivation or trafficking, which are illegal under both state and federal law. State Compliant Association status and the Certificates that denote State Compliant Association status merely identify the Medical Marijuana Dispensary as one exempt from prosecution in California for its violations of the Health and Safety Code relating to marijuana, so long as no other violation of any other law or ordinance is found at the State Compliant Association. State Compliant Association status and Certificates of same does not guarantee that the Medical Marijuana Dispensary may not be subject to investigation for any other crime or to determine if it has maintained its State Compliant Association status, nor protect it from arrest or seizure if it is found that other laws or ordinances have been broken or the Medical Marijuana Dispensary has failed to maintain its State Compliant Association status. SECTION 10. ADDITIONAL RESTRICTIONS. Nothing in this Ordinance limits the ability of the City to place additional restrictions on Medical Marijuana Dispensaries or State Compliant Associations. SECTION 11. MAINTAINING STATE COMPLIANT ASSOCIATION STATUS. a. State Compliant Associations must maintain the policies and procedures that entitle them to their State Compliant Association status and may be required from time to time to offer proof that they are doing so. Further ordinances may require that they re-apply every year to prove their State Compliant Association status, allow further or continuing inspections to verify their State Compliant Association status or, if practicable and not overburdensome, require systems and software that allow them to demonstrate their State Compliant Association status on a continuing basis. b. Any State Compliant Association that is discovered at any time to have in any way willfully misrepresented its State Compliant Association status by, for example, hiding, mischaracterizing or failing to document transactions, sites, money flows, acquisition, movement and dispensation of marijuana and the member status of those with whom it engages in transactions, will immediately lose its State Compliant Association status and be given 30 days to cease operations. SECTION 12. CRITERIA FOR STATE COMPLIANT ASSOCIATION STATUS. Each Medical Marijuana Dispensary must demonstrate the following to be considered a State Compliant Association:

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a. Every member of the Medical Marijuana Dispensary is a qualified patient with a written doctor recommendation that medical marijuana is of benefit to their medical condition. b. All medical marijuana of the Medical Marijuana Dispensary is cultivated, transported, stored, and distributed by and to members of the Medical Marijuana Dispensary only (closed circuit). Medical marijuana is not acquired from or distributed to nonmembers. c. Amounts cultivated within the closed circuit do not exceed the aggregate personal possession limits of the Medical Marijuana Dispensarys members. d. Amounts distributed to members are roughly commensurate with amounts cultivated after spoilage and other normal loss. e. The Medical Marijuana Dispensary and its members do not derive a profit from the cultivation, transportation, distribution and/or sale of medical marijuana net of legitimate expenses that include the following: 1. Rents, mortgages, property taxes, insurance, applicable sales and/or income taxes, fixtures, equipment, supplies, maintenance, repair, security, testing, accounting, tracking, costs of cultivation, and other normal expenses. 2. Salaries or fees to cultivators, managers and others who work within the Medical Marijuana Dispensary, commensurate with such salaries or fees in businesses or nonprofits for work at the same level of responsibility, expertise, training, experience, and time commitment, that take into account also the high-risk nature of the work, both from crime and from danger of federal prosecution. 3. Travel expenses for members engaged in business of the Medical Marijuana Dispensary. 4. The cost of subsidized or free patient services to members such as counseling and classes. 5. Contingency set-asides for political advocacy, for legal defense and for providing financial support to members prosecuted or incarcerated for marijuana offenses.

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6.

Charitable contributions to the community.

7. Research and development and education and training for members working for the Medical Marijuana Dispensary. 8. Refunds of excess cash to the membership.

f. The Medical Marijuana Dispensary is at least 600 feet away from a K through 12 school per state law. SECTION 13. NON-CRITERIA FOR STATE COMPLIANT ASSOCIATION STATUS. Section 11. Medical Marijuana Dispensaries do not need to demonstrate any of the following to be considered a State Compliant Association: a. That all medical marijuana is cultivated at the dispensing location. Per Colvin, there is no location or distance requirement in state law for cultivation which may even occur outside the City or the county to earn exemption from prosecution, so long as all medical marijuana is cultivated and transported within a closed circuit only by members of the State Compliant Association. b. That all or most members engage in cultivation. Per Colvin, there is no numerical or percentage requirement in state law for collective cultivation to earn exemption from prosecution. Members may participate in collective cultivation solely through their membership, their allocation of their personal possession limits to be cultivated by the Medical Marijuana Dispensary, and the reimbursements they offer for their medical marijuana, or they may make other kinds of contributions besides engaging in cultivation. c. That they do not engage in sales or otherwise accept reimbursements or engage in other exchanges of monies. Per Colvin, engaging in sales, reimbursements or other exchanges of monies does not nullify the exemption from prosecution for State Compliant Associations so long as no profit is derived thereby per Section 9e above. SECTION 14. FIFTH AMENDMENT PROTECTIONS. Section 12. Since marijuana possession and trafficking is illegal under both state and federal law, Medical Marijuana Dispensaries may do any or all of do the following to protect their Fifth Amendment rights against self-incrimination and the rights, if any, of

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their patient members under the Health Insurance Portability and Accountability Act of 1996 (HIPAA): a. They may require that all documentary evidence they present to a Status Board is held in strict confidence by the Status Board, is never copied or passed on by the Status Board, and is returned or destroyed after application and appeal. b. They may redact the names and addresses of their cultivators (who are at particular risk of federal prosecution and of robbery) in their documentary evidence, if they believe they can nevertheless sufficiently demonstrate State Compliant Association status. c. They may submit evidence anonymously through a third party verifier licensed by the City to verify and provide proof on their behalf: 1. Third Party Verifiers may not be members of the Medical Marijuana Dispensaries they verify. 2. Third Party Verifiers may be charged a licensing fee by the City and may charge for their services. 3. Although they may charge a fee to Medical Marijuana Dispensaries that are their clients, Third Party Verifiers are bound to report their findings accurately even if it is to detrimental to their clients. Third Party Verifiers found to be purposely misrepresenting the evidence and status of a Medical Marijuana Dispensary before the Status Board will lose their license and may be prosecuted for civil and/or criminal violations. 4. Medical Marijuana Dispensaries that receive State Compliant Association status through a Third Party Verifier will receive their Certificates via the Third Party Verifier. However, since the City will be unable to cross-check such a Certificate found at a location against its own records, the Third Party Verifier must be continuously available at any time for the life of the Certificate to verify that a Certificate is properly located with its State Compliant Association. SECTION 15. REQUIREMENTS DO NOT CONTRAVENE PRESUMPTION OF INNOCENCE.

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This Ordinance in no way infringes on the rights of individuals and Medical Marijuana Dispensaries to be entitled to a presumption of innocence in a court of law. A Medical Marijuana Dispensary that fails to receive State Compliant Association status must still, if prosecuted, be proved by the City to be guilty of marijuana possession or trafficking. Medical Marijuana Dispensaries that operate openly are already in open violation of state law against marijuana possession and trafficking. Under state law they are nevertheless granted the privilege of exemption from prosecution under certain limited circumstances. This Ordinance requires them, not to prove their innocence to a Status Board regarding state marijuana laws, but to demonstrate that there are entitled to the privilege of exemption from prosecution for their violation of the law.

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