City officials have no authority to undo marijuana sales ban in Ontario, law says

John Porter of Ontario holds up two varieties of cannabis – one for medical use, one to alleviate back pain that frequently sends him to the chiropractor and the second to manage anxiety. He said supports ending Ontario’s ban on commercial cannabis sales. (The Enterprise/Jayme Fraser)

ONTARIO – As the debate continues over Ontario’s proposed sales tax, some think they have a better solution to the city’s money troubles: marijuana.

Advocates have been insistent, particularly on social media, that the city is missing a cash cow by not allowing dispensaries to open in Ontario.

They have been critical of city officials for ignoring the idea.

There’s a problem with their solution, though.

Under Oregon law, city officials can’t authorize the marijuana stores to open.

Only a public vote on a ballot measure could undo the city’s decision three years ago to bar dispensaries from opening.

Even then, city officials say, pot sales wouldn’t be enough to cover what they said Tuesday will be a $1.6 million budget shortfall. The 1 percent sales tax on May’s ballot is projected to raise $3.8 million, with the additional money going to expand some services. Ontario Mayor Ron Verini said the subject of legalizing the sale of marijuana has come up at several city council meetings in the past.

“We have decided if the community really does have an interest in allowing dispensaries, whether medical or recreational, they have the opportunity to place it on the ballot,” said Verini.

In November 2014, voters statewide approved a measure legalizing marijuana and opening the door for dispensaries.

Voters in Malheur County, however, opposed the measure by nearly 70 percent. In Ontario, the vote was 1,588-911 against marijuana sales. By law, counties and cities could continue prohibiting commercial sales of marijuana if at least 60 percent of county voters said no to the state measure.

A year after the state vote, the Ontario council voted to ban dispensaries.

The Ontario council could repeal that earlier ordinance – but that’s about all it could do.

After repealing the edict, the council by state law would be required to seek voter approval to allow the dispensaries.

Local residents themselves can place the issue on the ballot, the process used to refer the city-approved sales tax to voters.

“No one is stopping anyone from putting it on the ballot,” said Marty Justus, Ontario city councilor.

Justus said councilors believe the voters already spoke during the state vote on marijuana. Verini said he wouldn’t oppose a move by the council to place the issue on the November ballot.

“If the council wants to readdress it again and possibly put it on the ballot, that’s fine. But at this point we are so involved with the issue of the one-penny tax that, in this case, we have to concentrate on what we have in front of us,” said Verini.

Adam Brown, Ontario city manager, said he wasn’t aware of anyone planning to petition to put marijuana on the ballot. Petitioners would have to file proposed ballot language with the city before they could collect signatures.

If Ontario allowed marijuana sales, the city could collect up to 3 percent in tax. The tax, too, requires voter approval.

Projected revenue from marijuana sales wouldn’t cover the city’s budget chasm, said Brown. He estimated the city would get about $500,000 off marijuana sales.

 “It would absolutely save some critical services,” said Brown.

Norm Crume, Ontario council president, agreed with Brown.

“It will help. But if it’s $500,000 or $600,000 compared to the true need of over $3 million, it doesn’t cover it by any stretch,” said Crume.

The state imposes a 17 percent tax on marijuana, distributing money to the state school system and sending 10 cents of every tax dollar collected to cities and counties that allow dispensaries. The closest to Ontario are two dispensaries in Huntington, in Baker County. Rita Quintero, Ontario, was among those responding to a Facebook post by the Malheur Enterprise last week seeking opinions on local marijuana sales.

“I think it would be good for Ontario,” she wrote. “They already have it here and this would certainly fix the financial flow in Ontario.”

She was one of several commenters who said marijuana revenue could help Ontario.

Nyssa resident Mark Stevens said dispensaries would furnish jobs along with tax money.

Vale High School graduate Taylor Rembowski, said Malheur County is “missing out,” regarding tax revenue from the sale of marijuana. Rembowski is more familiar with the issue than most. He owns Oregon Euphorics, a marijuana dispensary in Bend.

“The way I look at it is you can do the sales tax or float bonds but this is kind of a gimmie. You can still do all of those things and still get revenue from the cannabis industry,” said Rembowski. Ontario resident Duane Cowperthwait commented on Facebook that “trading one problem for another isn’t a solution,” regarding marijuana dispensaries in Ontario.

Ontario resident Danny Perkins Sr. said he isn’t in favor of legal marijuana in Ontario.

“I disapprove of any and all mind-altering or numbing substances. If you need either alcohol or marijuana to get through life, you need to work on your life,” wrote Perkins, Sr.

Brown said another factor city leaders must consider is the long-term impact of legal marijuana sales in Ontario.

“The unknown is what more burden it would impose on the system in terms of impaired drivers, impaired people. I have not seen an unbiased study on that,” said Brown.

Flora Gibbs owns the The Happy Hippy Shop in Ontario with her husband Chuck. The Happy Hippy Shop is a smoke shop that sells clothes, glass jars for tobacco, water pipes, hookahs and rolling papers.

Gibbs said she understands a few marijuana dispensaries will not solve all of the city’s financial problems.

But Gibbs said some revenue from a dispensary is better than none and such a store would be a popular place.

“It would do very well because I see the traffic that goes from here to Huntington and back,” said Gibbs.

Reporter Pat Caldwell: [email protected] or 541-473-3377.