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Monday, September 26, 2022

After legalization, the cannabis industry loses its luster

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The legalization of fate has transformed California’s landscape, both literally and figuratively.

The profit margin between cannabis cultivation and the permitting process has shrunk flatly since the 2016 passage of Proposition 64, according to long-term advocates of legalization in Nevada County.

Diana Jamzon, executive director of the Nevada County Cannabis Alliance, estimated the total permit cost for one farm she worked with last year at $50,000.



Medical cannabis lawyer for a long time laughed valley For some, he said, the price of a legal switch after farm infrastructure reaches code could approach $250,000.

“Everything should be allowed,” he said, laughing. “All buildings – the greenhouse should have a permit, the road should have a permit – everything should be OK to launch safety standards.”



Laughter, who grows CBD-dominated strains, said his advocacy never took root in profit, but that the low cost of flowers combined with bureaucratic hurdles to “getting legitimized” are not viable for the average grower.

“There are all these requirements that have nothing to do with the garden,” he said, laughing. “A cannabis farm is a business, like a gas station or Walmart.”

Laughter said it was frustrating to watch the industry grow hostile to small business owners because of the altruistic intent that fuels his profession – linking those in need with botanical medicine.

He laughed about his time linking patients with peripheral neuropathy and varying degrees of autism to cannabis through Caladrios Network. “Most of the cannabis grown on my farm was made into tinctures, edibles or suppositories and distributed free of charge. It seems to me unfair to put a price on most people who are determined enough to find me and seek my help. The medical system has already taken their money.”

Laughter has taken its invitation to Sacramento before, to speak privately with and on behalf of Forest Heard who said locally grown CBD eased symptoms of his son’s intractable epilepsy, caused by Lennox-Gistolt syndrome.

“There’s a whole range of conditions that cannabis seems to help,” he laughed. “I say it this way because I don’t like demanding things, but, over the years, I’ve seen dramatic improvements when we find the chemistry that best suits someone’s individual needs.”

Even with the exorbitant cost of the legislation, he laughed as an advocate of the plant’s medicinal benefits—particularly with terminally ill—he said he would seek a permit if his farm’s physical standards didn’t immediately disqualify his property.

Daughter said he reviewed attorneys to maintain legal status amid a rapid change in legislation — legislation and enforcement — between 2016 and 2018, while CBD strains were grown and distributed free of charge.

Even after three of the five current Nevada County Sheriffs—Heidi Hall, Ed Schofield, and Sue Hoek—visit a laughing property off the Idaho-Maryland road, gun ownership was automatically excluded from a commercial cannabis license because the land is located in Res-Ag Zoning.

“Not because (the industry) is dangerous or full of criminal activity,” he laughed. “This is because some of the neighborhoods with Res Ag zoning have emerged with strong opposition. The policy is the work of finding a compromise.”

He also said that the Laughter property is not wide enough to qualify for commercial growth, so even if Laughter lived elsewhere on a plot of similarly narrow dimensions—”my property is not exactly 200 feet wide”—it does not meet the 2-acre minimum.

Industry change

According to Martin Bolt, Nevada’s chief of public finance, the county has spent “a lot of money” over the three to five years promoting licensed farming efforts in Nevada County.

Bolt said the county has invested “significant dollars” to develop the licensing program, including dedicated staff dedicated to the planning and construction aspects of the legalization process, as well as cannabis compliance units.

Bolt said he could not determine the total amount invested to develop the program, noting the complexities between the overlapping and separate responsibilities of cannabis law enforcement and the county’s planning department.

Furthermore, Bolt said, Grass Valley and the City of Nevada are responsible for the permits and procedures for planting and distribution in their respective municipalities.

“Our Nevada City Department of Planning and Services is using up, but they make up for us,” Bolt said. “The infrastructure is somewhat different for each jurisdiction.”

Bolt said the county is providing some infrastructure support, but each state should develop its own regulations and ordinances.

Barry Anderson, a management analyst with the Nevada County Executive Office, said $1.9 million is the county’s cost to date for legal operations.

“The county general fund invested $1.9 million, starting in fiscal year 2018/19 through the current fiscal year, to operate the cannabis compliance division,” Anderson said. “This does not include any costs associated with measuring tax revenue.”

“I’m not saying we’re going to get costs back,” Bolt said. We didn’t catch up by any means…. It’s more than just a drop in a bucket.”

Bolt said identifying tangible costs for public agencies bound by local legislation is a challenge because the cannabis industry is involved in the various county resource areas that provide support and oversight to the industry.

Josh Merriman, of Cannabis County Compliance, said the county began issuing permits and collecting fees in 2019 when the program began.

Merriman said the fees attached to the permits are paid exclusively for employee time.

“There are no official fees besides time,” Merriman said. “Employees’ time is calculated on the basis of hourly wages.”

Merriman said Nevada County has one of the lowest — if not the lowest — fees for an administrative development permit for up to 10,000 square feet of cannabis. Smaller sites seeking commercial permits for cannabis have a “faster turnaround time.”

When inquired about similar operations in Yolo County, Merriman said he found the agency charged $40,000 on the permit with a $9,000 annual fee.

“Our annual fee is $900,” Merriman said.

Laughter said that a Nevada county farmer seeking legality would pay less than farmers in other counties because the latter must pay for their county permit and state license separately.

“Once you get a permit, you have to get a license from the state,” he laughed. This is a completely different level of difficulty.

Merriman said Nevada county supervisors conducted a county-wide environmental impact report in 2018, making way for a decree introducing blanket state license eligibility to allow those who were granted.

“Other jurisdictions require a conditional use permit,” Merriman said, adding that the site-specific analysis required with the permit application is usually lengthy and expensive. “We ran an EIR at the county level, so we have a simplified cookie cutter law.”

Laughter noted that a Mendocino farmer trying to legalize his business would pay thousands of dollars more than a farmer in Santa Barbara, one of the few other counties with a similar blanket law.

“Look at the Idaho-Maryland mine,” Laughter said, referring to the lengthy process required for Rise Grass Valley to reopen gold mining operations on two light-industry properties. “Imagine if every farm had to do that.”

The Nevada County grand jury report was released in May 2021 An estimated 3,500 to 4,000 “illicit plants” are in operation.

According to Merriman, officials have received 239 permit requests so far. One hundred and fifty-five have been approved so far, Merriman said, with the rest still in various stages of review.

“If you don’t have a permit and license, you can’t work,” he laughed. “That’s why Nevada County is having an explosion here — you can legally work in the cannabis market.”

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