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San Jose Collects Nearly $300,000 From Pot Tax

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A vial of medical marijuana

Marijuana is poured from a jar at at medical marijuana dispensary. (David McNew/Getty Images)

CBS SF Bay (con't)

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SAN JOSE (CBS SF) — In a strange twist, the number of police officer layoffs in San Jose may be reduced because of revenue generated by medical marijuana dispensaries.

Out of the 115 medical marijuana collectives believed to be operating here, 73 paid the new seven percent tax on the collectives mandated by Measure U. This has brought in around $290,000 in the first month the tax was imposed.

KCBS’ Mike Colgan Reports:

Councilman Pierluigi Oliverio, who led the effort to tax the businesses, said with the city facing a $115 million shortfall, any source of revenue is welcome.

“When you aggregate that to a year, that’s about $3 million,” he said. “That’s enough for three libraries or six times a senior nutrition program or 18 police officers.”

Dave Hodges with All-American Cannabis Club, one of two dozen collectives who didn’t pay the tax, said he was advised not to because paying the tax would violate state and federal law.

“The way Measure U is structured it defines the activities we are doing as a sale and sales of cannabis are federally illegal and illegal in the state,” he said. “What the city has done is create a measure that goes around state law.”

Adding to the confusing situation, all medical marijuana collectives are illegal here, whether or not a tax is paid.

(Copyright 2011 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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