EUREKA, Calif. — This summer, Humboldt County has shown that its commercial medical marijuana market is ready to open to operations large and small if they can play by the rules.
Two commercial medical cannabis farms — a quarter-acre mixed-light farm in Carlotta and a 7-acre outdoor farm and processing center in Honeydew — were the first to be given the county’s stamp of approval this summer, marking the beginning of a new era for the industry.
However, some cannabis advocacy organizations have aired different views on whether the county is taking the right steps.
About 100 more prospective medical marijuana business owners have submitted applications to the county. County Senior Planner Steve Lazar expects hundreds more in the coming months. Lazar described the current batch of applications as being at the “first end of big wave” that is about to crest.
“When that happens, it’s going to make the last three months look like a cakewalk,” he said.
First two Humboldt County grows OK’d
Approved in January and having taken effect in late February, Humboldt County’s commercial medical marijuana program sets land use regulations and creates a permitting system for both new and existing commercial cannabis cultivation, processing, and manufacturing operations in the longtime cannabis hotbed known as the Emerald Triangle — comprised of Humboldt, Mendocino and Trinity counties.
The county’s program complements the California’s Medical Marijuana Regulation and Safety Act, which created a statewide licensing program that is expected to start up in 2018.
In order to operate a cannabis business in California, operators must hold both a local and state license.
A regular attendee at the county’s marijuana program meetings was Ferndale resident and local restaurant owner Alex Moore, who co-owns Honeydew Farms LLC with his wife Miranda.
The couple had already had been cultivating just under an acre of medical cannabis on his Honeydew ranch when the county’s permitting system went online in February.
Moore now seeks to expand their operations by six more acres of outdoor grows — some of which will be leased to other cannabis farmers not connected to their company. They also plan to build processing facilities and eventually open up dispensaries throughout the state to become an “all-inclusive company,” Moore said.
“We decided that it was time to come out as supporters of this industry,” he said. “I’m a businessman and entrepreneur and this is just a business opportunity that we’re going to take advantage of. I have no moral issues with cannabis. I think the world is a better place because of it.”
Moore said Honeydew Farms is also the largest cannabis farm that is set to take participate in the county’s cannabis Track and Trace Program starting in August.
Because of the large size of cultivation Moore was seeking, his application had to be reviewed and approved by the county’s Planning Commission.
On July 7, Moore’s application was approved in a 4-1 vote, with several commissioners lauding his work.
Commissioner Ben Shepard was surprised Moore’s application was the first they would review due to the size and scale of the operation, but was heartened by the fact that state and local agencies supported it.
“It’s a very complete package,” Shepard said at the meeting. “… I think it’s a very good way to start what we’re entering into here in this series of conditional use permits that we’ll be hearing.”
Commissioner David Edmonds opposed the application as he thought it went against the county’s desire to have an industry made up of smaller farms — a sentiment shared by some local growers.
While Moore’s farm is one of the larger operations to have come forward, it was not the first to get the county’s approval.
That title goes to a 10,000-square-foot, mixed-light farm in the Carlotta area owned by Blessed Coast LLC’s Adram Darwish. Darwish declined an interview with the Times-Standard.
Unlike Moore’s operation, the Carlotta farm had to obtain a zoning clearance, which only requires approval from the county’s Planning and Building Department director.
Preparation and patience
Regardless of whether a cannabis operation needs to undergo a full-blown public review or just a pen stroke from a planning official, it takes a lot of work just to reach that point.
Though California voters legalized medical marijuana by passing Proposition 215 in 1996, the state failed to regulate the resulting industry until almost 20 years later.
Between August 2015 and January, California’s medical marijuana industry was suddenly confronted with new and often costly water quality regulations and licensing programs at the state and local level.
“So the idea that someone was well-positioned and ready to get their stuff in — that isn’t really true,” Lazar said. “… We expect a lot of people are going to take the maximum amount of time.”
Despite the size of Moore’s proposed cannabis farm in Honeydew, he said he was already well-positioned and familiar with land use regulations following a nearly decade-long process to subdivide his ranch. As a result of this earlier effort, his 14 existing greenhouses and ranch were already permitted and had undergone a full environmental review.
While Moore’s ranch fit the county’s mold for cannabis farming, he still chose to hire an environmental consulting firm to review their cultivation expansion, which ended up costing more than $10,000 on top of everything else.
“I think for a lot of people it’s kind of daunting, but there is definitely quite a few firms, companies, engineers that are very well-versed in this process,” Moore said. “If people are not knowing what to do, they should just hire someone to do it for them.”
While he described the county’s decision to open itself up to a commercial cannabis industry as “historic,” California Growers Association Executive Director Hezekiah Allen said the regulatory process has proven to be quite cumbersome for growers.
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Allen said this could result in fewer growers coming into the regulated market.
“The scope of this transition requires that local agencies push themselves past the business-as-usual mindset where we take a lot of time and work to get through every permit,” Allen said. “We need to transition several thousand farms. … We’re really looking to get this thing streamlined.”
Other organizations, such as the Humboldt-Mendocino Marijuana Advocacy Project, known as HUMMAP, are calling on the county to be more restrictive on the size and scale of the local cannabis industry in favor of smaller outdoor grows.
“The county is catering to the greedheads,” HUMMAP spokesman Robert Sutherland said. “… Instead, we need to focus on an industry that continues to honor its reputation for quality. People will buy based on their knowledge that it’s coming from a hands-on, very conscientious and responsible handler.”
HUMMAP had sued the county government in February, claiming that the county’s cannabis program did not address environmental impacts associated with the operations it would be permitting. The lawsuit settled earlier this month with the county agreeing to conduct full environmental reviews for future commercial medical marijuana regulations.
As of July 8, the county had received 91 applications for commercial medical marijuana businesses — a lot of them for hash manufacturing — but Lazar said there are hundreds more to come.
While the county Planning and Building Department created a new Cannabis Services Division this month to deal with the expected onslaught, Lazar said it does not completely solve the workload issues they’ve been experiencing.
“It’s been ‘all hands on deck,’ ” Lazar, one of four staff members in the Cannabis Services Division, said. “We have to continue to ramp up for this and develop more institutional division of labor and cross-training. We’ve got to hire people.”
County Planner Cliff Johnson, who normally deals with agricultural permits, said the Cannabis Services Division has helped improve the rest of the department’s workload.
“That is taking a weight off of the rest of us who are now able to get back to the non-cannabis applications we’ve historically been working on,” he said.
A growth industry
Prospective cannabis business owners have until the end of the year to submit their applications to the county. After then, applications will no longer be accepted until the county completes an environmental review with the intention of expanding the industry to even more areas.
Currently, the county only permits new cultivation to take place on prime agricultural lands and did so in order to ensure the program could be legally defensible without having conducted a full environmental review.
County Planning Commissioner Lee Ulansey criticized the program for limiting new grows to these agricultural lands, stating that it has “created a monstrous boon for a couple of landowners to the detriment of the rest of the county.”
“And I think that’s really unfair,” Ulansey continued.
Humboldt County 1st District Supervisor Rex Bohn said that the county’s ongoing environmental impact review will address Ulansey’s concerns, which he also shared.
“Most of the marijuana is not grown in the ground,” Bohn said. “That’s why we see so many truckloads of soil going up and down the road. People are bringing in their prime ag. And that may be a better approach.”