Members of the Arcata City Council on Wednesday adopted rules for the Medical Marijuana Regulatory Program, but they delayed approving an inventory tracking system contract over concerns about compatibility with Humboldt County’s track and trace plans.

The council’s action creates the city’s Medical Marijuana Innovation Zone, where entrepreneurs eventually will be able to cultivate, manufacture, test and warehouse their products. That zone is in the West End Road neighborhood, in the area at the southeast corner of the U.S. Highway 101 and State Route 299 intersection.

The council voted 4-1, with Councilman Mark Wheetley opposed, to back the ordinance, land use and permit regulation changes to create the program and innovation zone.

The Medical Marijuana Regulation and Safety Act signed by Gov. Jerry Brown in October has prompted new statewide regulations and licensing programs to be developed for full implementation by 2018. The statewide rules will interact with regulations passed by local jurisdictions, such as Arcata’s or the program approved in January by the county Board of Supervisors.

Licenses in Arcata could start to be issued as early as next month, city Community Development Director Larry Oetker said, but according to the rules adopted Wednesday, an inventory tracking software system must be in place before cannabis businesses can begin operating.

Oetker and his staff had recommended the city enter into a contract with Fort Lauderdale, Florida-based BioTrackTHC, which has a system that allows for the tracking, regulation and enforcement of all marijuana or marijuana products grown, produced or sold within the zone.

BioTrackTHC CEO Patrick Vo gave a presentation, explaining to the council and the more than 50 people at the meeting how the company’s software can index and monitor cannabis from the plants grown by licensed farmers to ensure the product is accounted for from the plot to sales point.

The council opted against accepting BioTrackTHC’s contract even though the company would have been providing the software to the city and cannabis businesses with no upfront costs.

The permittees would pay an invoice on a monthly basis on total unique identification numbers used in the month prior. If a small cultivation permittee obtained 100 unique identification numbers from the creation of 100 plants in the month, then that permittee would be invoiced for $1 for that month, the company’s proposal said.

The council heard from several speakers who wanted to make sure any track and trace system would be compatible with the county’s, would be easy to use and would preserve the unique Humboldt County name — a brand synonymous with the highest quality marijuana.

“We need to look at ways of bringing out farmers in compliance, which already is going to be tough,” said Steven Gieder, executive director of Humboldt Green.

On Tuesday, the Humboldt County Board of Supervisors authorized county Agriculture Commissioner Jeff Dolf to start working with the Swiss company SICPA Security LLC to develop a pilot project to track and trace medical marijuana before the harvest season. County officials on Friday began accepting applications for commercial medical marijuana cultivation, manufacturing or distribution permits.

Oetker said the delay on approving a contract for a tracking system might delay the start of the cannabis industry in Arcata. Community development and building department staff already have been contacted by entrepreneurs ready to apply for a permit.

“People are ready to move forward,” he said.

Mayor Paul Pitino said he would be open to having a special meeting to expedite the process of having an inventory tracking system in place.

Steven Moore can be reached at 707-441-0510.