Legal high sellers have hit back at efforts to push them out of Hamilton neighbourhoods saying "draconian" restrictions could drive drug users into the hands of gangs.
The warning from three Hamilton legal high retailers came as the city council wrapped up its public hearing into its draft psychoactive substances policy.
Council will meet this week to discuss the public feedback before adopting its policy on Thursday.
Much of the three-day hearing was dominated by submissions from Hamilton residents alarmed at escalating incidents of intimidation, theft and verbal abuse involving legal high users.
The hearing also pitted advocates for the city's central business district against Te Rapa businesses and residents, with each side urging councillors to keep legal high sellers out of their area.
But lawyer Shelley Eden, representing three synthetic high retailers, said antisocial behaviour linked to legal highs was caused by an imbalance between supply and demand for the drug.
"There is a failure to understand in the public that actually these social problems are being caused by scarcity," Ms Eden said.
The council's draft policy identifies Te Rapa and the central city as the options for where synthetic high dealers may be located.
Ms Eden said if the council adopted either option, retailers outside the permitted zones, such as Hamilton East's U njoY, would be forced to close.
Currently, licensed legal high sellers can't move to a new address or apply for a new licence.
"Because there is no ability to make new applications at the moment we end up with this quite draconian and difficult situation," she said.
"People in New Zealand will smoke drugs and they will either smoke the lawful ones or the illegal ones. So you end up with people going into the hands of gangs."
In contrast, DV Bryant Trust chairman Doug Arcus told councillors the sale of psychoactive substances was the "very antithesis of enhancing human welfare".
Mr Arcus said communities were concerned with the antisocial behaviour outside legal high retailers and urged the council to seek strict controls over sellers.
One option would be to require legal high sellers to obtain resource consent under the Resource Management Act.
"That has the benefit of allowing the council to impose conditions to mitigate the off-site effects, with the consent holder legally and financially responsible for that mitigation," Mr Arcus said.
Long-time Hamilton East resident Cushla Mawston said the Grey St puff shop had caused residents to feel unsafe in their neighbourhood.
Similarly, Lodge City Rentals general manager David Kneebone said he witnessed begging, intimidation and urinating outside his Hamilton East office on a daily basis.
"Frankly this is a Maori problem as well," he said.
"They're just being exploited. It reminds me of the 1900s and alcohol being introduced to New Zealand. It's a disgrace what's happening."
In one of the few light-hearted moments of the hearing, Mayor Julie Hardaker said a local authority in Canada held a license to operate a synthetic high outlet and used the profits to assisting drug addicts.
"Toronto was it?" councillor Ewan Wilson asked.
Meanwhile, the Government has asked for feedback on regulations to the Psychoactive Substances Act 2013. Associate Health Minister Peter Dunne said once the final regulations were in place the "lay of the land will be markedly different to the wild west situation" that existed prior to the act.
February 26: Council to deliberate on public submissions.
February 27: Council to adopt psychoactive substances policy.
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