Nearly all of Sacramento's medical marijuana dispensaries have applied to keep operating legally under new city regulations.

City revenue staff have begun processing documents from 35 dispensaries that submitted applications under the city's first ordinance regulating the not-for-profit shops. Dispensaries with pending applications can continue operating until Jan. 9, 2012, under the regulations.

Four of the city's 39 registered medical marijuana dispensaries didn't turn in applications by a Monday deadline, said city Revenue Division Manager Brad Wasson.

"We're going to regulate this pretty extensively and be proactive," he said.

In November, the Sacramento City Council created the city's first regulations for the shops since California voters legalized smoking pot for medical reasons in 1996. Like their counterparts in other California cities, Sacramento officials saw a need for local regulation as the number of dispensaries grew.

The city Community Development Department’s Code Compliance Division is responsible for following up on the four dispensaries that didn’t submit applications. Late applications aren’t accepted.

Under Sacramento's new rules, only the 39 dispensaries that had been registered as operating within the city by August 2009 could apply to continue operating.

The dispensaries submitted applications under the first phase of an extensive, two-phase application process. The application of at least one, The Healing Center at 3257 Folsom Blvd., is being challenged by neighboring businesses.

The applications are now being reviewed by the city. The process includes criminal background checks with the Sacramento Police Department and the California Department of Justice.

Dispensaries must operate as collectives or cooperatives of individuals who come together to share marijuana as medicine. The applications must include the dispensaries' plans to operate as not-for-profit entities and to avoid dispensing marijuana to non-patients. Those plans will be reviewed by the city's Revenue Division and city attorney's office, Wasson said.

Dispensaries that meet all the city's requirements for Phase One will get letters inviting them to continue the process. The dispensaries must get special permits from the city Planning Commission or zoning administrator. City Council members can weigh in on any of the permits by requesting they be placed on a council agenda for discussion.

In the second phase, dispensaries apply for special operating permits from the city Finance Department's revenue division. Dispensary operating permits must be renewed each year, just like other specially permitted business activities such as massage businesses and card rooms, he said.

Dispensaries will pay $33,000 or $39,600 during the application process for the first year of operation. Renewing permits will cost about $12,000 annually.

In November, voters approved taxing dispensaries up to 4 percent, which goes into effect July 1. 

Suzanne Hurt is a staff reporter for The Sacramento Press. Follow her on Twitter @SuzanneHurt.