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Finance Department Appeal of Business Licence Application for Northern Cross


Hearing Examiner #: HE-12-MISC-004
Planning #:
Incident #:
Filing Date:03/09/2012
City Contact:Shane Brady
Hearing Date: 07/06/2012
Description: Finance Department Appeal of Business Licence Application for Northern Cross
Decision Date: 08/03/2012
Decision Summary:Denied.

This matter came before the Bellingham Hearing Examiner for hearing on the 6th day of July 2012 on the appeal filed by Northern Cross Collective of the revocation of its business registration by the City of Bellingham Finance Director.
Testimony was received from the following individuals: See Witness List.
In addition to the Bellingham Municipal Code and Comprehensive Plan, the following documents were considered as part of the record: See Exhibit List.
The City of Bellingham was represented by Shane Brady, Assistant City Attorney. The Appellant was represented by Hilary V. Bricken, Robert McVay and Charles P. Moure, Harris & Moure, PLLC.
I. FINDINGS OF FACT
1. A business registration application was filed with the City of Bellingham Finance Department on March 8, 2011 by Martin Nickerson for a business named Northern Cross at 1306 Cornwall Avenue in Bellingham. The application states that the business is owned by Martin Nickerson as a sole proprietor. It indicates that it is a wholesaling business with estimated gross annual receipts of between $12,001.00 and $50,000.00 and that the principal products or services rendered are, "Estmation (sic) products, hemp oils, products skin care." The application is signed by the owner with the following certification: "I hereby certify, under penalty of perjury, that the information on this application and the required attachments are, to the best of my knowledge, true and complete. I am an authorized representative of this business. I agree to conduct all phases of this business in accordance with all applicable laws, ordinances and regulations established for this business/profession."
2. A business registration was issued to Mr. Nickerson for the proposed business by the City of Bellingham.
3. The business conducted by Northern Cross at the location on Cornwall Avenue in Bellingham between April 2011 and March 2012 included providing patients with cannabis products after verifying that they had documentation identifying them as qualifying patients pursuant to RCW 69.51A. The products provided to patients included various varieties of dried marijuana, edible marijuana products, starter marijuana plants, lotions and drinks.
4. The Bellingham Police Department began an investigation of the activities at Northern Cross in November 2011. The investigation included video surveillance outside the business location and visits by undercover detectives on several occasions.
5. On November 1, 2011, a camera set up outside the Northern Cross business location by the Bellingham Police Department observed 35 different people entering and exiting the business in approximately one hour. On November 30, 2011, 11 different people were observed by the camera entering the business in approximately one hour.
6. Bellingham Police Detectives Kyle Nelson and Keith Johnson purchased marijuana products at Northern Cross on multiple occasions. Each of the detectives obtained a medical marijuana authorization from a naturopath and made undercover visits to Northern Cross.
7. Detective Nelson went to Northern Cross on January 17, 2012 and provided the employee at the business the authorization he had received from the naturopath. The female employee gave him a contract listing the rules for Northern Cross. She gave him a tour of the business and showed him jars of marijuana, each labeled with the name of the variety and a price. Detective Nelson selected two types and requested six grams of each, labeled at $10.00 per gram. The marijuana was put into bags, the employee said that would be $60.00, he paid and was handed the bags and a receipt.
8. After Detective Nelson left the store the contents of the bags were weighed and field tested positive for the presence of marijuana.
9. On January 20, 2012 and January 27, 2012, Detective Keith Johnson purchased marijuana from the store.
10. On February 14, 2012, Detective Nelson purchased four grams of marijuana from the same female employee of Northern Cross for $40.00. He was not told that the amount he paid was a suggested amount or a donation. The marijuana he purchased was field tested positive for marijuana. Detective Johnson also purchased marijuana from Northern Cross that day.
11. On February 21, 2012, Detectives Nelson and Johnson both entered the Northern Cross store and spoke with the same female employee. Two other customers were in the store, each with a different employee. The Detectives asked the employee about the process for donation of marijuana. They were told that Northern Cross sends samples to Seattle to test for THC levels. The amount Northern Cross pays the providers depends on the quality of the marijuana, but is approximately $2,400.00 to $2,800.00 per pound. On that date, the detectives purchased five grams for $50.00. The substance tested positive for marijuana.
12. On March 9, 2012, Detective Johnson went to Northern Cross and gave them a letter which stated that the business was illegal and that action would be taken if it was not closed.
13. On March 13, 2012, Detective Nelson went to Northern Cross and was helped by a male employee. He purchased 13 grams of marijuana for $130.00. The substance tested positive for marijuana.
14. Detective Nelson stated that each time he entered the store there were about five to seven employees in the store, each helping other patients.
15. On March 15, 2012, the Bellingham Police Department served a search warrant on the business of Northern Cross. The officers seized evidence and property, including over 15 pounds of dried marijuana plus edible products and rolled joints. Detective Nelson spoke with the female employee who had served him on his undercover visits. She stated that she was a volunteer who was compensated in marijuana, approximately one gram per hour, and she said that the listed prices were donation amounts. Detective Nelson was told by other employees that the business model of Northern Cross was a collective garden. Seized at the time were several receipts from vendors of marijuana. The receipts listed the name of the vendor, the product, how much was paid, and the intended selling price. Records seized included agreements with members and vendors.
16. On February 15, 2012, the City of Bellingham Finance Director sent a letter to Martin Nickerson stating that his business, Northern Cross Collective, was engaged in the dispensing, delivery and distribution of marijuana. The letter states that the application for business registration did not indicate that business activity and that the business activity in which Northern Cross was engaged is unlawful under state law and federal law, and pursuant to state and federal law it is also contrary to the health, safety and welfare of the community. The letter advises that the business registration is revoked and informs Mr. Nickerson of the right to appeal the decision to the Bellingham Hearing Examiner. The letter indicates that the City is returning the $40.00 application fee and business and occupation taxes paid on February 14, 2012.
17. Mr. Nickerson, the female employee who provided marijuana to Detective Nelson, and a male employee of Northern Cross were charged in Superior Court with crimes including delivery of a controlled substance and possession with intent to deliver a controlled substance as a result of the investigation conducted by the Bellingham Police Department. The criminal charges are still pending.
18. Northern Cross appealed the business registration revocation by a letter dated March 9, 2012. The appeal states that Northern Cross is a non-profit cooperative staffed and run by qualifying patients who create and participate in collective gardens in order to distribute medical cannabis to other qualifying patients for medical use. It claims that Northern Cross is a lawful access point for qualifying patient collective gardens pursuant to RCW 69.51A.085.
19. Gus Guenther testified that he has been a volunteer at Northern Cross, working approximately 18 to 27 hours per week since April 2011. He dealt with patients, verifying that they had the proper authorization to use medical cannabis and providing them with cannabis products. He stated that he is a qualifying patient. He indicated that all of the patients served by Northern Cross are members of collective gardens and that Northern Cross encompassed maybe five or six collective gardens. He stated that Northern Cross takes donations and gives patients what they need. He says that the marijuana is labeled with suggested donation amounts. He also said that Northern Cross had a small number of cannabis plants at the store, with plants available for members to take home to grow their own. He indicated that he was compensated mostly in cannabis. Mr. Guenther also stated that Mr. Nickerson is no longer associated with Northern Cross.
20. Tim Kerlin testified that he is a qualifying patient who receives medical cannabis at Northern Cross. He stated that he took his authorization and identification to Northern Cross and waited about 30 to 35 minutes for them to verify that he was authorized to use medical cannabis. He states that he never felt unsafe at Northern Cross and that it was a safe place to obtain cannabis, and safer than having to purchase it on the street.
21. Northern Cross argues that its activities are lawful and in accordance with RCW 69.51A.085, the provisions authorizing collective gardens for the distribution of marijuana to qualifying patient members, that it is not relevant that the operation is in violation of federal law because the City is not authorized to enforce federal law, and that the operation is not contrary to the public health, safety and welfare.
22. The City argues that it may revoke or deny a business license/registration if the business is contrary to law, that the possession, distribution, manufacture and delivery of marijuana is still a crime in Washington despite the availability of an affirmative defense pursuant to RCW 69.51A, that Northern Cross is not compliant with RCW 69.51A, the business is contrary to the health, safety and welfare of the citizens as a matter of law, and the City appropriately relied on federal law in revoking the business registration.
23. BMC 6.05.230 provides as follows:
      6.05.230 - SUSPENSION OR REVOCATION OF BUSINESS REGISTRATION

      A. The Director, or designee, shall have the power and authority to suspend or revoke any registration issued under the provisions of Title 6 of this Code. The Director, or designee, shall notify such taxpayer in writing by certified mail of the suspension or revocation of his or her registration and the grounds therefor. Any registration issued under Title 6 of this Code may be suspended or revoked based on one or more of the following grounds:

          1. The registration was procured by fraud or false representation of fact.
          2. The taxpayer failed to comply with any provisions of this Title 6 of the BMC.
          3. The taxpayer failed to comply with any provisions of this Code.
          4. The taxpayer is in default in any payment of any fee or tax under this Code.
      B. Any taxpayer may, within 10 days from the date that the suspension or revocation notice was mailed to the taxpayer, appeal from such suspension or revocation by filing a written notice of appeal ("petition") setting forth the grounds therefor with the Hearing Examiner. A copy of the petition must be provided by the taxpayer to the Director and the City Attorney on or before the date the petition is filed with the Hearing Examiner. The hearing shall be conducted in accordance with the procedures for hearing contested cases set out in BMC 2.56 as currently enacted or hereafter modified. After the hearing thereon the Hearing Examiner shall, after appropriate findings of fact and conclusions of law, affirm, modify, or overrule the suspension or revocation and reinstate the registration, and may impose any terms upon the continuance of the registration.
      C. No suspension or revocation of a registration issued pursuant to the provisions of this subchapter shall take effect until 10 days after the mailing of the notice thereof by the Department and if appeal is taken as herein prescribed the suspension or revocation shall be stayed pending final action by the Hearing Examiner. All registrations that are suspended or revoked shall be surrendered to the City on the effective date of such suspension or revocation.
      D. The decision of the Hearing Examiner shall be final. The taxpayer and/or the Department may seek review of the decision by the Superior Court of Washington in and for Whatcom County within 21 days from the date of the decision. If review is sought as herein prescribed the suspension or revocation shall be stayed pending final action by the Superior Court.
      E. Upon revocation of any registration as provided in this subchapter no portion of the registration fee shall be returned to the taxpayer.
24. BMC 1.04.010A(5) defines "Law" when used in the ordinances of the City, unless otherwise specifically defined or from the context a different meaning is intended, as denoting applicable federal law, the constitution and statutes of the state of Washington, the ordinances of the City of Bellingham, and when appropriate, any and all rules and regulations which may be promulgated thereunder.
25. BMC 6.08.020C provides that the City Finance Director may deny a business license application if presented with sufficient evidence that issuance of the license would be contrary to the health, safety or welfare of the citizens of the City, or contrary to law.
26. The Appellant does not dispute that the possession, use and distribution of marijuana is illegal under federal law.
27. In 1998, the State of Washington approved, by initiative, legislation providing an affirmative defense to criminal charges for qualifying patients using or possessing medical marijuana in conformance with the legislation. In 2011, the legislature passed a bill, Engrossed Second Substitute Senate Bill 5073 (E2SSB 5073) that would amend this statute to provide greater protection for medical marijuana users and to allow limited methods of providing medical marijuana to qualifying patients. Governor Gregoire vetoed portions of ESSB 5073, leaving other portions intact.
28. RCW 69.51A.085 provides for collective gardens for the provision of medical marijuana to qualifying patients. This section provides that qualifying patients may create and participate in collective gardens for the purpose of producing, processing, transporting, and delivering cannabis for medical use subject to the following conditions:
      (a) No more than ten qualifying patients may participate in a single collective garden at a time;
      (b) A collective garden may contain no more than fifteen plants per patient up to a total of forty-five plants;
      (c) A collective garden may contain no more than twenty-four ounces of useable cannabis per patient up to a total of seventy-two ounces of useable cannabis;
      (d) A copy of each qualifying patient's valid documentation or proof of registration with the registry established in section 901 of this act, including a copy of the patient's proof of identity, must be available at all times on the premises of the collective garden; and
      (e) No useable cannabis from the collective garden is delivered to anyone other than one of the qualifying patients participating in the collective garden.
29. RCW 69.51A.085(2) provides that the creation of a collective garden means qualifying patients sharing responsibility for acquiring and supplying the resources required to produce and process cannabis for medical use such as, for example, a location for a collective garden; equipment, supplies, and labor necessary to plant, grow, and harvest cannabis; cannabis plants, seeds, and cuttings; and equipment, supplies, and labor necessary for proper construction, plumbing, wiring, and ventilation of a garden of cannabis plants.
30. RCW 69.51A also allows a qualifying patient to obtain medical marijuana from a provider. However, the provider may only serve one qualifying patient at a time. The patient must designate and revoke the designation of a provider in writing. A designated provider may not begin serving a different qualifying patient until 15 days have elapsed from the last qualifying patient designated him or her to serve as a provider.
31. The provisions of E2SSB 5073 relating to a registry and regulation of producers, processors and dispensers were vetoed by the Governor and are not in effect. The Governor's veto message stated that the vetoed portions of the bill that set up licensing and registration requirements for the processing and distribution of marijuana would have placed state employees charged with the responsibility for the program in jeopardy of federal prosecution. The Governor's veto also indicated that she remained open to legislation that would exempt qualifying patients and their designated providers from state criminal penalties when they join in nonprofit cooperative organizations to share responsibility for producing, processing, and dispensing cannabis for medical use, provided the exemption was conditioned on compliance with local government location and health and safety specifications.
32. At the time Bellingham Police Department officers seized property at the Northern Cross facility in March, 2012 there were 1,986 members for whom Northern Cross maintained collective garden member agreement forms.
33. Northern Cross contends that it maintains a rolling membership such that each person who is a member/qualifying patient is a member only while in the store, except for a small number of core members who maintained continuous membership. It argues that Northern Cross is a non-profit cooperative that is managed and staffed by qualifying patients who operate collective gardens to provide medical cannabis to other qualifying patients, and that absent local regulation prohibiting operation of collective gardens in the manner in which Northern Cross operates, it falls within the parameters set in RCW 69.51A.
34. The City argues that RCW 69.51A only provides an affirmative defense to charges of possession, use and distribution of marijuana for those qualifying patients and providers who are in compliance with the provisions of the law, but that the possession, use and distribution of marijuana is still contrary to law and marijuana is a Schedule I controlled substance.
35. RCW 69.50.204 does provide that marijuana is a Schedule I controlled substance. The manufacture, delivery, or possession with intent to deliver of marijuana is a class C felony pursuant to RCW 69.50.401(c).
36. BMC 6.05.030 provides that a business registration certificate is personal and non-transferable, and that a new certificate is required any time the person, business entity, ownership or form of doing business changes.
II. CONCLUSIONS OF LAW
1. The possession and distribution of marijuana and cannabis products is in violation of federal law.
2. Enforcement of federal laws regarding the possession and distribution of marijuana and cannabis products is outside the jurisdiction of the City of Bellingham.
3. Obtaining and maintaining a valid business registration or license within the City of Bellingham requires compliance with all applicable laws, which, according to BMC 1.04.010A(5), includes federal laws as well as state statutes and City ordinances.
4. The City of Bellingham is enforcing its own ordinances by requiring compliance with all applicable laws, including federal law, in the issuance and administration of business registrations and licenses.
5. The business registration application filed by the owner of Northern Cross includes a certification by the owner that the business will be conducted in accordance with all applicable laws, ordinances and regulations established for the business.
6. The business of Northern Cross was not conducted in accordance with all applicable laws and regulations established for the business in that marijuana and cannabis products were possessed and distributed on the premises, in violation of state and federal law.
7. There is no dispute in this matter that the activities engaged in by the Appellant, the possession and distribution of marijuana and cannabis products, violates federal law.
8. RCW 69.51A.085 permits, under state law, no more than 10 individuals who are qualifying patients with a terminal or debilitating condition, as defined in RCW 69.51A.010(6), and who have been authorized by a health care professional by valid documentation to use marijuana to treat that condition, to create and participate in a collective garden for the purpose of producing, processing, transporting and delivering cannabis for medical use to participants of the collective garden. The state law provides qualifying patients who are participants of a collective garden an affirmative defense in the event they are charged with violation of RCW 69.50. which provides that possession and distribution of marijuana is a criminal offense. To avail themselves of the affirmative defense provided by RCW 69.51A qualifying patients must demonstrate that they are in compliance with the requirements of that statute.
9. RCW 69.51A.085 limits a collective garden to no more than 15 plants per patient up to a total of 45 plants, and 24 ounces of useable cannabis per patient up to a total of 72 ounces of useable cannabis. Northern Cross possessed more than the allowed total of useable cannabis. Bellingham Police officers seized more than 15 pounds of useable cannabis in March 2012.
10. No provision of state law permits the possession or distribution of marijuana to more than 10 qualifying patients or in total amounts exceeding 72 ounces. Northern Cross operated its business as a dispensary, serving nearly 2,000 patients who had signed membership agreements. The Engrossed Second Substitute Senate Bill 5073, which was passed by the legislature in 2011, included provisions for medical marijuana dispensaries, subject to regulation by the State Department of Health, however these provisions were vetoed by the Governor and did not become the law of this state. Medical marijuana dispensaries are not legal in the State of Washington.
11. Vetoed sections of E2SSB 5073 defined "dispense" to mean the selection, measuring, packaging, labeling, delivery, or retail sale of cannabis by a licensed dispenser to a qualifying patient or designated provider. Dispensers would have been required to obtain a license from the Department of Health which would have been charged with adopting rules establishing requirements for licensed dispensers, including screening of operators, inspection of facilities, safety and sanitation standards, labeling requirements, and setting limits on the number of dispensers allowed in each county.
12. The vetoed section of E2SSB 5073 also provided for registration of qualifying patients, designated providers and others. Compliance with the registration provisions would have conferred immunity from arrest and prosecution for acts in compliance with the law. As a result of the Governor's veto the immunity provisions of the Bill did not take effect.
13. RCW 69.51A.040, which would have provided immunity from criminal and civil penalties for qualifying patients and designated providers but for the Governor's veto of the registration and licensing provisions of the bill provides further clarification to the intent of the legislation. Immunity would have been limited to the possession, manufacture, delivery or possession with intent to deliver, for possession of no more than 30 plants or 48 ounces of useable cannabis and cannabis products for a person who was both a qualifying patient and a designated provider. A single, qualifying patient or provider could possess no more than one-half of those amounts. Absent the provisions for licensed processors and dispensaries, which were vetoed, the law did not provide for large-scale or retail distribution operations, whether for profit or not-for-profit.
14. The Governor's veto of licensing and registration provisions in the bill resulted from concerns that state employees would be required, by those provisions, to violate federal law in order to carry out their duties in the licensing and registration of commercial businesses that produce, process, or dispense cannabis. The Governor's veto of a section of the bill that would have required owners of housing to allow the use of medical cannabis on their properties also resulted from the concern that the provision put the property owners in potential conflict with federal laws. The City of Bellingham is in a similar position as those state employees and property owners if it is required to license or register businesses that possess and distribute marijuana in violation of federal law.
15. The Governor's approval and partial veto of E2SSB 5073 which permits collective gardens was dated April 29, 2011. The portions of the bill that were not vetoed became effective July 22, 2011.
16. Northern Cross began its operations distributing marijuana and cannabis products in April 2011, prior to the effective date of the law which permitted collective gardens.
17. Northern Cross' operation at 1306 Cornwall Avenue does not fall within the definition of a collective garden which is authorized in RCW 69.51A.085. It is not an operation in which no more than 10 qualifying patients share responsibility for acquiring and supplying the resources required to produce and process cannabis for medical use, such as a location for the garden, equipment, supplies, and labor necessary to plant, grow, and harvest cannabis, cannabis plants, seeds, and cuttings, and equipment, supplies, and labor necessary for proper construction, plumbing, wiring, and ventilation of a garden of cannabis plants. The purpose of a collective garden, as defined in RCW 69.51A.085 is to produce, process, transport and deliver cannabis for medical use to the participating qualifying patients who created the garden. Northern Cross describes its operation as a cooperative which manages multiple collective gardens. It does not operate a collective garden. It receives marijuana from vendors, packages, labels and dispenses it to patients at its store in exchange for money. The role of patients who obtain marijuana from Northern Cross appears to be simply exchanging money for marijuana.
18. The operation of Northern Cross at 1306 Cornwall Avenue in Bellingham is not authorized by RCW 69.51A. The possession and distribution of marijuana to patients that is not authorized by RCW 69.51A is in violation of RCW 69.50.
19. The operation of Northern Cross is not consistent with the representations set forth by the owner on the business registration application filed by Mr. Nickerson. It describes the business as a wholesaling operation of "Estmation(sic) products, hemp oils, products skin care". It does not describe the actual business of Northern Cross, which is the distribution of marijuana and cannabis products to retail customers. It also states that all phases of the business will be conducted in accordance with all applicable laws, ordinances and regulations established for the business. This statement is not accurate as the business cannot be conducted in accordance with all applicable laws.
20. False representation of the business on the registration application is grounds for revocation pursuant to BMC 6.05.230A(1).
21. BMC 6.08.020 provides that the Finance Director may deny any license application if presented with sufficient evidence that issuance of the license would be contrary to the health, safety or welfare of the citizens of the City, or contrary to law. In this case, the registration application did not accurately describe the business of Northern Cross. The evidence that the business would be conducted contrary to law or to the health, safety or welfare of the citizens was not presented until after the registration was issued. The registration may be revoked for false representation of the business. The Finance Director has the authority to not issue a license if the business would be contrary to law. For this reason the registration application requires a certification that the business will be conducted in accordance with all applicable laws. It may be revoked if evidence is presented that the business is not conducted in accordance with all applicable laws.
22. Failure to comply with all applicable laws is also failure to comply with the provisions of Title 6 of the BMC and is grounds for revocation of the business registration pursuant to BMC 6.05.230A(2).
23. The Appellant cites United States v. Vasquez-Alzarez, 176F.3rd 1294 (1999) for the proposition that state and local law enforcement officers may not arrest for violations of federal law unless there is a state law authorizing such an arrest. In this case, however, the Bellingham Police Department did not arrest the Appellant or its agents for violations of federal law. The City is not attempting to prosecute the Appellant or its agents for violations of federal law. The Finance Director based his revocation determination on the Bellingham Municipal Code and City business registration requirements, which provide for denial and revocation of business registrations that are contrary to applicable law.
24. Federal law violations may be cited to deny an application for a medical marijuana patient using marijuana in conformance with State law. In Roe v. Teletech Customer Care Management, LLC (2011) 171 Wn.2nd 736, the Washington Supreme Court determined that Washington patients have no legal right under federal law to use medical marijuana and that an employer is not required to accommodate a medical marijuana user, one reason being that it would violate federal law. In this case, the City is in a similar position to the employer in Roe v. Teletech, supra. It is being asked to license a business which violates federal law. The court's decision is authority for the Finance Director's decision to deny a registration to a business that would operate in violation of federal law.
25. The Finance Director's statement that the business is contrary to the health, safety and welfare of the citizens is a direct reference to the enabling language of the Bellingham Municipal Code, authorizing revocation of the registration. By providing that marijuana is a Schedule 1 controlled substance and that the unauthorized possession with intent to distribute and distribution of marijuana is a Class C felony the State of Washington has determined that the activity is contrary to the health, safety and welfare of the citizens. The City of Bellingham need not present additional evidence that the activity presents a risk to the health, safety and welfare of the citizens.
26. The Appellant objects to the admission of the City's Exhibit 4, which is a package of documents including the Second Amended Information, Amended Determination of Probable Cause, Warrant of Arrest on Information, Order of Arrest, Bench Warrant, and First Amended Affidavit of Probable Cause Determination for each of the three defendants in Superior Court cause numbers 12-1-00283-8, 12-1-00281-1, and 12-1-00282-0. These documents are official records of the Superior Court of Washington for Whatcom County. They are documents in the criminal proceeding resulting from the Bellingham Police Department investigation of Northern Cross between November 2011 and March 2012. As official court records they are admitted for the purpose of showing that criminal proceedings are pending in Superior Court regarding the matters at issue in this proceeding, that the defendants are charged with offenses as stated in the informations, that a determination of probable cause was made as stated in the records, and that warrants were issued. They are not admitted to establish the truth of the matters asserted in the Affidavits of Probable Cause Determination.
27. Martin Nickerson is listed as the sole proprietor of the business on the business registration application. Business registrations are not transferable. Testimony presented by the Appellant at the hearing indicates that Mr. Nickerson is no longer associated with the business. BMC 6.05.030 requires that a new business registration certificate is required any time the person, business entity, ownership or form of doing business changes. If Mr. Nickerson is no longer associated with the Northern Cross operation a new registration would be required to allow Northern Cross to operate any business in Bellingham, even if the registration had not been revoked.
28. The business known as Northern Cross was operated in violation of both Washington State and federal laws. It operated a marijuana dispensary beginning in April 2011, prior to the effective date of RCW 69.51A.085. At that time no laws authorized the distribution of marijuana to more than one qualifying patient in a 15 day period. On and after the effective date of RCW 69.51A.085, July 22, 2011, Northern Cross did not operate in conformance with the provisions of that section authorizing collective gardens. It included nearly 2,000 patients and possessed over 15 pounds of marijuana, clearly in excess of the number of patients and amounts of marijuana permitted in the collective garden provisions. It did not operate as a garden in which no more than 10 qualifying patients shared responsibility for the production, processing, transportation and delivery of medical cannabis exclusively for their own use. Irrespective of Washington State laws, the possession and distribution of marijuana which is the core business activity of Northern Cross is in violation of federal law.
29. The business registration for Northern Cross was issued based on an application which failed to accurately describe the business activities of Northern Cross. Northern Cross was operated in violation of the agreement signed by the owner of the business as part of the registration application that it would be conducted in accordance with all applicable laws, ordinances and regulations.
30. The Finance Director's revocation of the business registration of Northern Cross is clearly supported by the evidence and is in conformance with the Bellingham Municipal Code.
31. Any Finding of Fact that should be denominated a Conclusion of Law shall be deemed to be a Conclusion of Law. Any Conclusion of Law that should be deemed to be a Finding of Fact shall be deemed to be a Finding of Fact.
III. ORDER
The appeal of Northern Cross Collective is denied. The Finance Director's decision to revoke the business registration for Northern Cross is affirmed.

ENTERED this 3rd day of August 2012.
Bellingham Hearing Examiner
________________________________
Dawn Sturwold
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