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Grand jury criticizes California town over pot farm

By Leidhra Johnson

SACRAMENTO (Reuters) - Officials in a northern California town who approved a plan to create a medical marijuana farm have drawn a rebuke from a grand jury that accused them of ignoring federal law.

The Sacramento County grand jury report points to the conflict between federal and state law in California, where possession and cultivation of small amounts of marijuana for medical purposes is legal.

The grand jury report carries only recommendations, not criminal penalties, and prosecutors have not filed any charges relating to the project.

Cannabis is considered an illegal narcotic under U.S. law, and federal authorities have raided pot dispensaries and greenhouses in California and other states in a crackdown aimed at supposed medical marijuana suppliers engaged in large-scale drug trafficking.

The cash-strapped municipality of Isleton, a town of 850 people less than 40 miles from Sacramento, was promised $600,000 in annual revenue from a company that was developing the pot farm, according to the county grand jury report, which was released on Monday.

Isleton officials planned to use the money to upgrade their two-person police department and maintain security over the marijuana operation, which would measure more than a football field and potentially employ 50 people, the report said.

The report said the project, which would have supplied pot to medical marijuana dispensaries in southern California, was approved by Isleton on the "promise of money and jobs."

"They forgot the old saying, 'If it sounds too good to be true, it probably is,'" the report states.

Isleton is not the first California city to approve a marijuana growing operation. Oakland last year gave the green light to a medical marijuana pot farm, but later pulled back from the project due to the threat of federal prosecution.

The grand jury report said Delta Allied Growers, the company behind the proposal, has "reportedly buried more than 1,000 marijuana plants and apparently abandoned the project."

Isleton city manager Bruce Pope, who helped shepherd the project through its city council approval in November, told Reuters on Tuesday the project remains up in the air now that Delta Allied has suspended operations.

"If it comes down that they can't do this without being indicted, then I imagine they'll close the shop," he said.

The Sacramento district attorney sent a letter to Isleton officials raising questions about the legality of the project, and U.S. Attorney Benjamin Wagner also warned in writing that the project would violate federal law.

A spokeswoman for Sacramento District Attorney Jan Scully declined to comment.

Pope said the grand jury report was "fair," but he faulted prosecutor for their handling of the matter.

"I think the district attorney was over the top in this, she acted like she was dealing with the Mafia, like she wasn't dealing with a fellow government agency," he said.

California voters approved medical marijuana in a 1996 initiative. Fifteen states and the District of Columbia allow medical marijuana.

(Writing by Alex Dobuzinskis: Editing by Dan Whitcomb)

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