Saturday, April 30, 2011

Calif grand jury probes small-town pot farm plan

Officials in the small California farming town of Isleton faced legal scrutiny Wednesday over their licensing of a medical marijuana growing operation to raise revenue for the struggling city.

The mayor, city manager, police chief and others were subpoenaed by Sacramento County prosecutors to testify before a grand jury.

A letter to the City Council from District Attorney Jan Scully's office said the decision to allow the farm likely breaks state and federal laws. Most officials were expected to plead the Constitution's Fifth Amendment against self-incrimination.

Marijuana is banned by U.S. law but allowed for medical use under a California measure.

"I have never seen anything like how the district attorney is treating us. It's over the top, downright hostile," City Manager Bruce Pope told the San Francisco Chronicle. "We're not going to just take it lying down."

The farm on the edge of the town of 800 people about 40 miles south of Sacramento is set to open this summer. The planned 4,000-square-foot facility would have 14 greenhouses when completed.

Delta Allied Growers agreed in a contract approved in October to pay the city the greater amount of $25,000 a month or 3 percent of gross receipts in exchange for the permit to operate the farm. The city's annual budget is about $1.3 million.

"This is a small-scale, secure, R&D-focused facility operating under a legal permit from the city of Isleton," said Delta Allied spokesman Scott Hawkins.

The city of Oakland last summer approved a similar but larger-scale plan to license four industrial-scale pot-growing operations. That effort was placed on hold after warnings from prosecutors that city officials could face criminal charges and growers would not be immune from a federal crackdown.

Isleton has faced controversy before over other revenue-raising endeavors. The city made as much as $400,000 annually in the 1990s from concealed weapons permits issued by the police chief, the Chronicle reported.

The state eventually shut down the program, and the police chief was fired.

A grand jury probe in 2008 called for the city to disband, claiming it was "in a state of perpetual crisis."

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