Global Ganja Report

The IRS has ordered Oakland's Harborside Health Center, biggest cannabis dispensary on the West Coast, to pay $2 million in taxes, ruling that the collective may not deduct standard expenses such as payroll and rent. "They're attempting to tax us out of business," protested owner Steve DeAngelo. Ironically, the same day he received the IRS letter, DeAngelo was photographed handing the Oakland treasury a $360,000 check —third installment of $1 million in city taxes  Harborside generated in 2010.

The Oakland City Council on July 26 passed an ordinance that will double the number of medical marijuana dispensaries in the city, to eight from the current four—the Oakland Patient Center, the Purple Heart Patient Center, Coffeeshop Blue Sky, and the Harborside Health Center. The new ordinance was passed with an amendment that provides the city with access to all the dispensaries' financial information. And accompanying legislation imposes a $5,000 application fee and a $60,000 annual regulatory fee on each dispensary. The Council put off discussion of amending the city's cultivation ordinance, which would regulate large-scale cannabis farms, until the Public Safety Committee reconvenes in the fall. (Office of the City Clerk, City of Oakland, July 26; San Francisco Chronicle's Oakland Blog, July 13)

Entertainment Weekly's Inside TV blog reports July 20 that the Discovery Channel has announced a "docu-soap reality show" entitled Weed Wars, set in Oakland's Harborside Health Center, the USA's largest medicinal cannabis distributorship. Set to air this fall, Weed Wars will follow the day-to-day dealings of Steve DeAngelo, owner of the establishment, which serves some 80,000 clients. 

The East Bay Express' Legalization Nation blog reports July 13 that organizers expect up to 30,000 to pack Frank H. Ogawa Plaza in front of Oakland City Hall on Sept 3-4 for the International Cannabis and Hemp Expo 2011—dubbed "Mardi Grass" by blogger David Downs. Tickets for the event just went on sale for $18, marking the first time Oakland has turned over public space for a a paid cannabis-oriented event. Plans call for three entertainment stages, some 400 industry vendors, dozens of food trucks, guest celebrities, and heavy hitters from the movement. The expo will also feature an open-air "215" area for medical cannabis patients.

Dubbed the "Wal-Mart of Weed," the 10,000-square-foot weGrow store, set to open this weekend at 1537 Fulton Ave. in Sacramento, is the first franchise for a company that calls itself a supply and training destination for legal cannabis cultivators. The enterprise started in Oakland last year as a warehouse store called iGrow. Now the Oakland location is being reorganized as a distribution hub for a network of retail hydroponics outlets. The Sacramento store—billed as "the first honest hydro store"—is to be followed by weGrow stores in Arizona, Colorado, New Jersey and Oregon in coming months.

Oakland's Harborside Health Center, the self-proclaimed world's largest cannabis dispensary—handling an annual $22 million in transactions—is being audited by the US Internal Revenue Service. Since late last year, the IRS has been auditing 2008 and 2009 federal tax returns for the Oakland location, one of two outlets Harborside operates for 70,000 medical cannabis users. The other facility is in San Jose.

Oakland City Attorney John Russo has withdrawn his legal counsel from plans to tax and license large-scale cannabis farms, and told the City Council to hire their own attorney.

The city's original cannabis cultivation ordinance set no limits on the size of the cultivation facilities, which would operate as stand-alone businesses separate from dispensaries. The council had hoped to start licensing the farms as early as last month, but suspended action on the licenses in December so the ordinance could be revised to more closely comply with state law.

Oakland's City Council is considering a new medical cannabis cultivation plan that would scale back the size of the growing operations and tie them more directly to dispensaries, according to a draft obtained by local media. Written up by council member Desley Brooks, the changes are meant to address legal concerns over the original plan, which would have allowed for four large-scale farms to supply several dispensaries.