LaPine city manager weighs in on pot tax flap

A legal battle is brewing between a La Pine medical marijuana dispensary and the city after the state Legislature’s attorneys found it’s illegal for local governments to impose such a tax.

The Office of Legislative Counsel issued a letter on Nov. 13 at a Eugene lawmaker’s request, concluding a law lawmakers adopted earlier this year prohibits local governments from taxing medical marijuana.

La Pine enacted the tax earlier this year on the two medical pot dispensaries in town.

Randy Huff, the co-owner of Green Knottz, said Sunday he pays about $500 dollars a month in receipts on the medical pot tax.

But Huff said city administrators hasn’t given him or his attorney a clear answer on why they would impose a tax on medicine, so a lawsuit is in the works.

“We’ve tried to resolve this with the city prior” to a lawsuit, Huff said. “We’ve been speaking with our attorney that’s been speaking with (City Attorney) Jeremy Green and we haven’t really heard any legitimate response.”

He said he feels the city attorney hasn’t done his homework when it comes to marijuana issues.

“He obviously doesn’t know what he’s doing, since he hasn’t told his client about the illegal tax,” he said.

City Manager Rick Allen told NewsChannel 21 on Monday the city has collected the 5 percent tax on medical marijuana sales for the past several months. He said the rules surrounding marijuana taxation are uncertain, and the city moved to implement the tax to stay on top of the evolving regulations.

“It’s frustrating for the cities when legislation passes and these things are kind left to interpret,” Allen said. “All that means is everyone spends time and money and causes a lot of heart burn when if fact, if someone had offered clarity, we wouldn’t be here.”

Allen said the city council will take up the issue at an upcoming meeting. They also have asked the Legislature to address the confusion in its upcoming session in February.

Allen also said the city hasn’t spent any of the medical marijuana tax revenue until the issue can be resolved.

But Huff said the people who are really at a disadvantage are his patients, who will drive 35 miles from La Pine to Bend to get their medication.

He said his patients aren’t spending their dollars in La Pine because of this tax on medical marijuana.

“So it hurts every business here in La Pine,” Huff said.

Huff said he’ll move forward with filing a lawsuit against the city in the upcoming weeks. He said he will speak to city councilors on the issue at a Dec. 9 council meeting.