Measure F carries with it perhaps the smallest financial benefit to the city, though its backers like something else about the proposal: the potential to further legitimize medical pot.

Measure F would create a new business tax rate for Oakland's four legally operating medical marijuana clubs, hitting them with a levy of $18 for every $1,000 in gross sales.

That compares to $1.20 for every $1,000 in gross sales the clubs now pay under the standard retail business tax.

The proposed tax could produce a windfall of $315,000 — $294,000 more than under the current rate — in the 2010 calendar year, according to an analysis from City Auditor Courtney Ruby's office.

The clubs see the ballot measure as a way to help the broader cause of medical marijuana.

"Criminals don't pay taxes," said James Anthony, an attorney for Harborside Health Center, one of the dispensaries. "Law-abiding citizens do. We are nothing if not law-abiding citizens."

Medical marijuana is legal under California law, but prohibited by federal law. But some see a turning point in how people across the United States view the use of marijuana for medical purposes. For example, Councilmember Rebecca Kaplan (at-large) noted that U.S. Attorney General Eric Holder has said the Obama administration will end the federal raids on medical pot clubs operating in California or other states that have protected medical use.


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"It is important that there be regulation and that there be a permit process and that there be taxation," Kaplan said. "Both because the city needs the revenue and to be sure that we weed out the bad actors."

Measure F came about after the clubs approached Councilmembers Kaplan and Nancy Nadel (Downtown-West Oakland) about instituting a new tax, Kaplan said.

The measure needs a simple majority to pass. Anthony said he expects the clubs, not patients, will absorb the cost of the tax.

— Kelly Rayburn