Since October, nine of San Francisco's 27 dispensaries have shut down after receiving letters from Haag citing the stores' proximity to playgrounds as grounds for punishment as harsh as seizure of the property and up to 40 years in federal prison, The Sacramento Bee reported Sunday.
The federal government is targeting marijuana dispensaries within 1,000 feet of schools and playgrounds.
Shop owners said closing down is an easier option than trying to fight potential charges and risking losing.
"We call it the 44-cent policy," said Al Shawa, who opened the Shambhala Healing Center last year. "For a postage stamp, with no raid or anything, they can get people to just close and leave."
Shawa got a letter from Haag threatening "enhanced penalties" for "operating within prohibited distance" of the Jose Coronado Playground.
He said although he worked with the city Planning Commission for 18 months and spent $250,000 to open the dispensary, he will probably shut down because "I probably don't have the guts to challenge the feds."
Others say because of San Francisco's layout, it will be difficult if they want to reopen.
"Look at San Francisco," said Raymond Gamley, who used to own the Divinity Tree marijuana dispensary. "It's so crowded. The terrain lends itself so that it's difficult not to be within 1,000 feet of anything. You can see how silly it is. I can't tell you how bad it feels, what they did to us."
Yet, Gamley was optimistic that about the fate of dispensaries, which have been legal in San Fransisco since the medical marijuana initiative was adopted in 1996.
"Even though we're within 1,000 feet of a playground, it's not like it's even in the same neighborhood as us," Gamley said. "I mean, they're trying to put the genie back into the bottle and I don't think they can."
Notable deaths of 2014 [PHOTOS]