Council members received an informational report from City Attorney Stephanie Atigh on Monday, but nobody from the group broaching the idea for a dispensary - Purple Cross Rx - spoke about it at the meeting.

The council was given three possible options: Start the rezoning process, adopt an urgency ordinance or do nothing. They chose the latter, which essentially rejects the idea at this point.

There were 2 speakers, both opposed to a pot club. One was from Gilroy and he pointed out how the dispensary there opened in defiance of the city council's decision against allowing it. Gilroy also is facing litigation over the matter, and a superior court judge recently ruled to keep the dispensary open for now.

The second speaker was opposed while contending unauthorized residents, especially minors, would be exposed to potential resale. Another resident questioned whether Purple Cross has a tax identification number.

Atigh in her report noted how there is litigation in progress in several locations and how a court case in Anaheim over a ban on cannabis dispensaries will affect all cities throughout the state. In their direction to staff, the council also requested that Atigh keep a close eye on the Anaheim case.

Atigh said whatever occurs, it likely would be appealed, possibly to the "supreme court" - though she didn't specify whether she meant state or federal. She also pointed out how the federal government is not actively enforcing the law in states with legalized medical marijuana.

Mayor Victor Gomez, however, pressed her on the legality, and she further stated that pot was still illegal under federal law.

When council members shared their thoughts before directing staff, Gomez had this to say about Purple Cross' projections for significant tax revenue: "(The law) says that the medical marijuana can be 'dispensed' but it does not say it can be sold, so how does this generate tax money as claimed?"

Councilman Doug Emerson also questioned the tax factor.

"If their tax projections are accurate, they would have to make a lot of sales - this concerns me. They claim to be an 'unincorporated nonprofit association' but no such type of organization is listed in the California tax code or at the state.

"I have added concerns because their Web site seems to indicate that they already delivering marijuana in San Benito County using 'volunteer' drivers.'"

Councilwoman Pauline Valdivia said she has reservations because it's available elsewhere.

"If people need medical marijuana, there are other locations where they can get it, like Gilroy and Santa Cruz," she said.

Councilman Ray Friend said the city does "not have enough information or input from the public at this time."

And Councilwoman Eugenia Sanchez noted how she agrees with Friend and Valdivia.