Brett M. Kelman and Dave Nyczepir

USA TODAY

DESERT HOT SPRINGS, Calif. -- A desperate, crime-ridden desert town, reeling from a recent brush with bankruptcy, has turned to an unlikely savior to pay for its embattled police force — marijuana.

Desert Hot Springs, a city of about 28,000 people in the desert two hours east of Los Angeles, is considering legalizing medical marijuana dispensaries as a last-ditch effort to bolster the city budget so it can maintain its local police department.

The City Council will decide in August whether it will ask city voters to approve hefty taxes on medical marijuana. The council will also lift a ban on dispensaries, allowing the businesses to blossom in city limits for the first time in seven years. Council members have considered a 10% sales tax, a $50,000 permitting fee and a 5% cultivation tax — or a combination of all three.

Desert Hot Springs enacted its dispensary ban in 2007 as a swift reaction to Organic Solutions of the Desert, a small dispensary that opened near the city's center. The ban pushed Organic Solutions out of the city, but it re-opened in the nearby city of Palm Springs, where it thrives today.

The dispensary owner, Jim Camper, said he would likely return to Desert Hot Springs if the ban is lifted, but he believes it is ironic that the city would now welcome him back. Only a few years ago, officials in Desert Hot Springs viewed his customers as criminals, not a revenue source.

"It's just hilarious," Camper said. "It just shows you that more and more society is going this way. Middle America is turning to pot. You see it every day."

Although Organic Solutions could return to Desert Hot Springs, not everyone wants them back.

Judy Shea, a longtime city resident who works for a local 12-step recovery program, has urged the City Council to pursue an across-the-board sales tax increase instead of lifting the dispensary ban.

Shea insists that medical marijuana will do more to boost crime than bolster police, but she concedes that, considering the city's dire finances, the return of dispensaries is inevitable.

"Yeah, the city will get millions of dollars in revenue, but it's going to hurt the overall population," Shea said. "We've worked so hard to clean up this town, and now we're going to cause more drug addiction."

One of the biggest proponents of permitting dispensaries is Jan Pye, a city councilwoman who said this past week that she sees no irony in using marijuana money to fund the police department. It's all just tax dollars in the end, she said, and at the moment that money is being spent elsewhere.

"It's the same reason we're trying to attract more retail. The same reason Wal-Mart is on the table," Pye said.

The dispensary debate is just the latest chapter in the downtrodden tale of Desert Hot Springs. Decades ago, tourists flocked to the city to bathe in its namesake springs, but today the tourists are mostly gone, and residents struggle with a stagnating economy and a crime rate that is twice the national average.

The city went bankrupt in 2001 and slashed city services last year to avoid a second bankruptcy. Currently, more than 40% of the city's budget goes to its police department, about 25 officers with an annual cost of about $6.4 million.

Desert Hot Springs has considered hiring the Riverside County Sheriff's Department to watch over the city, but a majority of City Council members would prefer to keep the local police department. Hefty marijuana taxes were proposed as an alternative.

Kelman and Nyczepir also report for The (Palm Springs, Calif.) Desert Sun