California Cracking Down on Pot Shops

Sitting on a sofa in the gymnasium-sized Quonset hut of the New Liberty Bell Temple, Daniel Reynolds puts his lips to a plastic cone and breathes in marijuana vapor.

Marijuana plants sit on a shelf at Coffeeshop Blue Sky cannabis dispensery July 22, 2009 in Oakland, California.

(Justin Sullivan/Getty Images)

The vapor contains the active substance in cannabis that Mr. Reynolds, a cancer patient, says "eases his pain."

The vast room also hosts a pool table, ping-pong table, video-game monitor, and a stage for live music.

In the back, a cubicle displays Mason jars filled with green, leafy clumps. Customers pay between $25 and $55 per one-eighth of an ounce for different strains of marijuana, marked "Humboldt Gold," "Black Africa," "Banana OG," and "NY Diesel."

Los Angeles's pot economy is booming. The number of medical-marijuana dispensaries here has skyrocketed from 183 in 2007 to about 800 now. In this period, pot shops have morphed from what Reynolds calls "hidden, remote places with no signs or addresses" into listed and public outlets. Many sport 10-foot signboards in the shape of a marijuana leaf.

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But as dispensaries have sprouted across this and other California cities, they face pushback from local residents unhappy with their new neighbors and officials concerned about inadequate oversight of a novel business. Sacramento and Santa Cruz are considering moratoriums on new dispensaries as they review regulation. In L.A., complaints about robberies and drug abuse at the clinics prompted the city council to shut down several hundred dispensaries over the past few months.

Many of them had opened in spite of a moratorium on new dispensaries because of a legal loophole that allowed them to operate pending an application for exemption. On June 16, the city council enacted a measure to eliminate this exemption.