The City Council will resume talks Tuesday on a proposed medical marijuana ordinance that would let dispensaries sell pot to qualified patients -- even though the city attorney and district attorney insist such transactions would be illegal.

The City Council will consider amending the fifth draft of the proposed ordinance submitted by the city attorney. Among the three dozen amendments proposed to the measure are:

-- only 70 collectives would be allowed citywide, or one medical marijuana facility per 57,000 residents, each chosen via a blind random drawing;

-- proceeds from pot sales can only be used for reasonable employee compensation, reimbursement for the actual cost of cultivating marijuana and its derivative products, rent, utility bills, insurance, etc.;

-- audits and inspections would be conducted on a regular basis to ensure the medical marijuana facilities are not for-profit ventures;

-- medical marijuana facilities would have to be 1,000 feet away from each other; and 500 feet away from any school, public park, public library, religious institution, child care center and rehab facility;

-- a search warrant or other court order would have to be presented before medical marijuana facilities could be forced to disclose records of its operators and patients; and

-- to deter robberies, medical marijuana facilities would have to deposit revenue in a bank daily, or even twice daily, so that no more than a few hundred dollars are at a dispensary at any


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given time.

Councilman Ed Reyes and Councilwoman Janice Hahn also suggested the possibility of taxing medical marijuana transactions, replicating what Oakland did in July.

Councilman Jose Huizar recommended deleting a proposed "grandfather clause" for the 186 medical marijuana collectives that opened before the city imposed a moratorium in late 2007.

Currently, the proposed ordinance would give those collectives an extra six months to comply with its provisions while requiring about 800 other collectives that opened during the moratorium to comply immediately.

If approved, the proposed amendments would be merged with provisions that require medical marijuana collectives to register with the city; install stringent security measures, including bars on the windows and closed-circuit cameras; be open only about 14 hours a day; and require a valid doctor's permit or prescription before the drug can be dispensed.

Last week, Los Angeles County District Attorney Steve Cooley vowed to continue prosecuting dispensaries that sell medical marijuana, even if the City Council permits such sales.

Cooley insisted the proposed model for distributing medical marijuana would violate federal and state law. He called the City Council "clueless" and said its actions were "meaningless and irrelevant."