8-2-20 Policy Update

8-2-20 Policy Update

August 2nd, 2020

 

Mendocino County Board of Supervisors

501 Low Gap Road

Ukiah, CA 95482

 

Re: Agenda Item 5b)

 

Honorable Supervisors,

I. THE STATE ANNUAL LICENSING DEADLINE IS PARAMOUNT AND IS THE LENS THROUGH WHICH ALL ISSUES MUST BE EVALUATED

The Staff Memo of the Mendocino County Board of Supervisors’ August 4, 2020 meeting agenda advocates for abandonment of the current ordinance and adoption of a land use-based permitting system, with a proposed “transition” timeframe for all current applicants and permit holders. MCA strongly believes that none of the recommendations put forth within the Staff Memo can be considered outside of the context of the urgent State Annual License deadline facing current cannabis permittees and applicants. This deadline MUST be the lens through which all other issues are considered.

Whether under the current Cannabis Permitting Program or under a new land use-based program, TWO items to fulfill CEQA requirements must be performed before a State Annual License will be issued: The Sensitive Species and Habitat Review (“SSHR”) and the site-specific review. Under both the current ordinance and the suggested land use program, the Staff Memo offers no assurance that the existing cohort of applicants and permit holders will have both of those processes completed prior to the deadline to obtain State Annual Licenses (January 1, 2022). While the Staff Memo focuses on that Department’s clear preference for switching to a land use-based system, it fails to address the paramount question of whether the County will be able to conduct those tasks for all applicants in time.

While specific issues regarding how to troubleshoot the mechanics of processing all of the applicants and permit holders is important, principal consideration must be given to the State Deadline issue. Applicants and permit holders MUST be able to know, with certainty, if the County is unable to conduct the necessary reviews before the deadline for State Annual Licenses. These applicants have poured their life savings, blood, sweat and tears into wrangling the complex and expensive regulatory process on the basis of believing that if they did everything required, they would be eligible for a State Annual License.

At this time, we cannot simply blame state regulatory agencies. We must act. We also cannot simply look to the California Legislature to rescue us. The legislative session for this year is ending in 5 weeks and, due to the Covid-19 pandemic, many of the current bills have inadequate time to proceed. Even if the matter is introduced next year, unless the County does everything in its power to try to resolve these problems before turning to the Legislature, the request is likely to fall on deaf ears. We cannot operate on the assumption that a bill extending provisional licenses will be introduced next year, and we cannot be certain whether such a bill would pass until at least 13 months from now. That is a gamble that is far too risky, and will most assuredly negatively impact licensed, tax-paying businesses. We must push forward with solutions at the local level.

II. THE SPECIFIC ISSUES ARE COMPLEX AND REQUIRE MUCH MORE DETAILED INFORMATION THAT WOULD BE BEST MANAGED BY AN AD HOC COMMITTEE WORKING WITH STAFF AND OUTSIDE AGENCIES

At this time, due to insufficient information surrounding key issues, there is no clear direction to take. Additionally, many of the issues to resolve are complex and interrelated. Individual decision points taken in isolation, before gathering missing information, could prevent many from obtaining State Annual Licenses and would likely result in additional unintended consequences.

Specific Issues for Resolution:

  1. With respect to the SSHR:
    • If the CDFW Pilot Program is approved and implemented, how much time would each screening take and how would that impact the ability to get through all of the files in the current cohort?
    • The threshold for referral appears to be quite low. Would CDFW have the capacity to process referrals?
    • What happens if four months down the road, CDFW decides the Pilot Program is not working well enough to continue to have the County do the initial SSHR screening?
    • The Staff Memo stated “there will be cultivation sites that will not demonstrate a ‘less than significant impact’ to Sensitive Species.” How do they know this and how many of the sites
    • How will the County and CDFW work out issues related to County Staff training, more articulable criteria to determine whether a review must be kicked back to CDFW, and clear criteria regarding when CDFW can require further studies?
    • There are many detailed issues that arose in the Pilot Project materials which are too technical to detail in this memo.
  1. With respect to the Site-specific review provided by Appendix G:
    • The Staff memo makes the case for switching to a land use-based system, in part due to planners being practiced in reviewing project descriptions in the normal course of their work. If this is true, why did the time estimate to complete Appendix G increase from 2 hours to 11-40 hours when the only additional information requested by CDFA was related to the project description narratives? The March 2019 CDFA Guidelines were issued before the negotiated Checklist was drafted. Even still, the CDFA Guidelines (Attachment C), provide a very straightforward project description for a rural project. A professional who prepares much more complex and technical Project Descriptions for LSA and Water Board Site Management Plans have indicated that the likely number of hours is more in the 2-8 hour range.
    • The Staff Memo lists only three possible options for completing the Appendix G Checklist. Are those options the most efficient and cost effective, and are they the only options? And will they result in completion of the Checklists in the timeframe required for all pending applicants and permit holders?
  1. With respect to the transition of current applicants to a new land use-based system in some period of time:
    • Presuming no changes in the applicant’s site or activities from the time the SSHR and Appendix G site-specific review is conducted under the current system, would the SSHR and site-specific review be usable when they apply for a discretionary permit later?
    • If a current applicant or permit holder did want to take advantage of the 10-year discretionary permit by switching to a land use-based system, wouldn’t it create an unintended incentive for them to expand cultivation or non-cultivation structures to further develop their business to include on-site processing facilities, or other development?
    • Staff has referred previously to creating a streamlined system to transition current applicants. What are the details of that streamlined system?
    • If an applicant opted to switch to a land use-based system right away, can they be guaranteed to make it through that process before the State Annual License deadline? If so, how would that be guaranteed at the same time that those who opt to remain in the current system are not guaranteed to be processed in time according to the Staff Memo?

III. A LAND USE-BASED SYSTEM IS APPROPRIATE FOR BRAND NEW CULTIVATION OR EXPANSION BUT NOT FOR LEGACY CULTIVATORS

MCA believes that a land use-based system for brand new cultivation sites and for any expansion above 10,000 square feet for current or future permit holders could be appropriate. In fact, MCA submitted a memo in February of this year, outlining its recommendations regarding Phase 3 (new cultivation) and expansion beyond 10,000 square feet, which stated MCA’s support for limited expansion and accommodating new cultivation. In a more recent memo, MCA presented the current concerns regarding the delays in conducting the SSHR and site-specific reviews and refined its position, in light of those concerns, to address new and expanded cultivation once the crisis facing legacy cultivators is addressed.

We continue to support the limited expansion and new cultivation under those recommendations once the crisis concerning legacy cultivators is addressed. However, switching the current system for legacy cultivators at this point in time will compound the crisis they face with the State Annual License deadline.

The current cohort of applicants and remaining legacy cultivators who qualify under the existing system must have a certainty that all resources are directed to processing their files before the State Annual License deadline. This must occur before a land use-based system is considered.

    • A land use-based system will need to address zoning, size adjustments, articulate reasonable conditions, and requires other changes to address concerns regarding brand new cultivation sites or expanded cultivation on existing sites.
    • A land use-based system will take time to develop and enact into law. Additionally, the site specific review and SSHR that must be done to satisfy CDFA, will still have to be done in a land use-based system, so there would be no time savings. The Staff claim that this work would be faster in a land use-based system is erroneous and must be verified.
    • Reimbursable costs cannot be the basis for any decision made to switch legacy cultivators to a land use-based system when the failure of the current ordinance process was not theirs, and given the looming State deadline.
    • PBS was already given the budget to hire 8 Planners, in part based on the need to continue to process Cultivation files. Both the site-specific review (Appendix G) and bringing the SSHR review in-house were being negotiated for more than a year. Therefore, the budget approval for 8 Planners must have included that scope of work.

IV. RE-OPEN PHASE 1 IN LIGHT OF EQUITY FUNDING

Staff recommends against re-opening Phase 1, and also recommends closing Phase 2. MCA strongly disagrees. The Equity Grant funding awarded by the State was intended in part to allow insufficiently-resourced cultivators impacted by the War on Drugs to participate in the regulated market. If Phase 1 is not reopened now, while this grant funding is available, those cultivators will likely be shut out of the process. The Board has indicated a willingness to re-open Phase 1 for this reason. Additionally, Equity Funding should not be used to correct failures in program administration, but should be reserved to fulfill the intent of the grant. As stated in the Mendocino County Cannabis Local Equity Program Manual approved of by the State:

The Mendocino County Cannabis Equity Assessment (2020) established that Mendocino has been hit hard by the criminalization of cannabis, and a targeted, data-driven and well-funded equity program can help certain populations and neighborhoods, particularly small growers and those impacted from past policies that may be left behind, into a legal sustainable economic future.

A failure to embrace those legacy cultivators, who only now have an opportunity to receive financial and technical assistance to participate, would be tragic. To rob the Equity Grant funding in order to correct the failure to process applicants in a timely manner would be reprehensible. It would be preferable to use the mandatory Cannabis Taxes that have been levied against people who believed they would be eligible for a State Annual License.

V. FAILURE TO PRIORITIZE AND PROCESS THE LAST TWO STEPS NEEDED FOR ANNUAL STATE LICENSES BEFORE THE DEADLINE COULD BE WORSE FOR THE ENVIRONMENT AND LAW ENFORCEMENT RESOURCES

Cultivators who participate in a regulated system, which imposes rigorous local and State requirements and environmental controls, must not be discarded or dis-incentivized. To do so would only strengthen the underground market option and diminish the prospects of bringing more people into the legal marketplace.

Full and robust support of existing permitted cultivators and applicants must be strengthened, regardless of which pot of money the County draws from to process the current files; admit Equity Grant-eligible legacy cultivators; and subsequently create a different system for new cultivation and expansion beyond 10,000 square feet.

Negative impacts to the environment are made more possible when cultivators are not regulated. Now, in these times of Covid-19, we can ill afford to further strain law enforcement resources to implement enforcement against an expanded group of illegal grows. Should the County not take responsibility for, and control of, the current looming State deadline crisis, cultivators will abandon the regulated system. These are high stakes requiring that the County do the right thing.

VI. SUMMARY

MCA strongly supports the immediate creation of an Ad Hoc that can dig deeper into the issues that still need to be resolved, and obtain the information necessary for the Board to make wise decisions in this precarious moment in time.

The urgency of the situation must not be diminished, and the County must not wait to see if the State will rescue us. The County must rise to the occasion and fulfill its desire to provide local regulation in exchange for the ability of cultivators to secure Annual State Licenses, thus continuing their contributions to the economic health of our County through their considerable taxes.

MCA supports re-opening Phase 1 so that equity-eligible applicants can utilize the long-awaited grant funding that has been awarded to become compliant and participate in the legal industry.

MCA will be submitting additional memos addressing more technical issues concerning the proposals. However, before those issues can be fully analyzed, the preliminary question of whether the County can and will fulfill its commitments to locally regulate commercial cannabis cultivation in exchange for taxes and adherence to County-desired rules must be answered.

We look forward to working with the Board and Staff to find sensible solutions to difficult problems.

Thank you for your consideration.

Mendocino Cannabis Alliance

08.04.20 MCA Memo

 

 

MCA LAUNCHES SUMMER MEMBERSHIP DRIVE

MCA LAUNCHES SUMMER MEMBERSHIP DRIVE

Working toward a shared vision of a thriving cannabis community in Mendocino County.

(Ukiah, CA – Thursday July 23, 2020) Today the Mendocino Cannabis Alliance (MCA) is launching its summer membership drive.  Having emerged as THE cannabis trade association in Mendocino County, MCA invites the entire Mendocino cannabis community to join in the effort of creating a sustainable future where all local cannabis businesses can thrive.

A trade association is a voluntary association of businesses organized on a geographic or industrial basis to promote and develop commercial and industrial opportunities within its sphere of operation; to voice publicly the views of members on matters of common interest. MCA is already working directly with the county on the many issues that plague our cannabis program. The more local voices that are involved in the conversation, the more effective MCA will be at fully understanding and advocating on behalf of the full spectrum of cannabis business needs.

In addition to representation at the local level, members of MCA get access to a suite of benefits, including a Vendor Discount program, inclusion in our Member Directory, the ability to be elected and run for leadership positions in the organization and more. At the state level, MCA, along with 4 other regional trade associations, is partnered with Origins Council to advance cannabis policy advocacy.

In the face of current challenges, especially at the County level, MCA’s board and committee members have put enormous effort into advocating for reforms to local cannabis policy and development initiatives, such as the cannabis equity program. At present the local cannabis program presents significant challenges for existing licensees and barriers to entry for those interested in entering into licensing. Now, more than ever, we must come together and build a stronger membership base to help craft policies that will serve the best interests of every sector of our industry.

Businesses or individuals interested in getting involved with MCA can get more information at https://mendocannabis.com/join/

If you would like more information on this release, please email Theresa Anderson at info@mendocannabis.com.

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The Mendocino Cannabis Alliance serves and promotes Mendocino County’s world-renowned cannabis cultivators and businesses through sustainable economic development, education and public policy initiatives.

MCA’s Policy Progress Report

MCA’s Policy Progress Report

What We’ve Done For YOU

How MCA amplifies our policy voice and increases our power where it counts!

Beginning with most recent activities and looking back on the last eight months:

    1. First week of June, 2020.  In response to Supervisors reaching out to us, MCA drafts memos with recommendations regarding two alternative proposals to either move to a land use-based system or to revise the existing cultivation ordinance.  The memos were the result of a monumental effort by MCA, involving direct in-depth communication with state regulatory staff, conversations with individual Supervisors and County staff, and extensive internal discussions on the matter. 
    2. MCA pivots on a dime:  In the process of extensive communication with regulators regarding the feasibility of the two alternative approaches, MCA researches and reveals the status of the critical issue pertaining to the status of Mendocino County applicants in relation to State Annual licenses and suggests specific, concrete steps to resolve the issues in a timely manner. MCA then generates a memo advocating an “explore all approaches simultaneously” strategy  and broadcasts the urgency of completing the processing of Phase 1 (legacy) cultivators’ final permits because of the time-limit for them to obtain annual State licenses.  
    3. Direct Impact: From individual elected Supervisors to County staff, there is now consensus to prioritize our legacy cultivators’ ability to obtain state licenses and operate in the legal market.  Additionally, MCA has continually urged the County to streamline the process, allow for transfer of permits, and for acceptance of less expensive building permits than initially required. As a result, the County has reduced the paperwork required for initial and renewal permits, instituted a mechanism to allow legacy farmers to transfer their permits, and adopted an Ag Exempt Hoop House building permit.  
    4. Successfully advocates for the Board of Supervisors and the County to join the state in designating cannabis as an “essential” industry in the time of COVID.
    5. State Advocacy: In the Spring of 2020 MCA became a regional partner of Origins Council, a statewide cannabis policy advocacy, research and education organization devoted to the sustainable economic development of legacy cannabis producing regions. MCA, along with the Trinity County Agricultural Alliance, Sonoma County Growers Alliance, Nevada County Cannabis Alliance and the Big Sur Farmers Association comprise the Regional Council, which is the voting body on all public policy matters for Origins Council.  Please see  www.originscouncil.org for more information. 
    6. In February of this year, in response to  a survey MCA conducted with  the cannabis community, MCA suggested expansion to one acre for outdoor cultivation and different levels of expansion for other styles of cultivation. 
    7. MCA played a central role in helping to secure a $2.2m Equity Grant from the state, and stands ready to collaborate with the County in implementing it.  These funds are earmarked to assist members of the cannabis community impacted by the War on Drugs to help overcome environmental and building compliance issues, licensing, technical support, and other costs preventing our small cannabis businesses from fully participating in the legal commercial marketplace. 
    8. In January, MCA held three candidates’ forums that spotlighted all those competing for supervisorial seats in the 1st, 2nd and 4th districts.  The forums were well-attended and questions required the candidates to respond to specific issues important to the cannabis community.  It is accurate to say that the individuals on the panels revealed just how familiar and unfamiliar they were with our concerns. 
    9. Successfully advocated for the County to pass a Local Coastal Amendment to be presented to the Coastal Commission for approval.  This LCA includes every suggested amendment made by MCA, including allowance of multiple uses in a shared facility; striking the 100 ft setback from access easements; non-cultivation commercial uses in commercial zones with a use permit; allowing consumption at retail facilities as is consistent with state regulations; and providing more equitable fee schedules.
    10. Participated as an invited stakeholder in meetings convened by the Mendocino County Board of Supervisors Cultivation Ad Hoc Committee to explore possible cooperative business models, to streamline the current ordinance, to troubleshoot the state CEQA issues and to help advance the issues important to small operators.
    11. Participated as invited stakeholder in meetings convened by the County regarding Cannabis Economic Development.
    12. Advocated with County leaders for expanding the tourism board beyond representation by only the lodging sector to include cannabis business representation, with funding to market other sectors of tourism.
    13. Offered a suggested policy toward Phase 3 operators (new cultivators), that would allow cultivation in  Rangeland zoning with an Administrative or full Use Permit, depending on size. 
    14. Consistently advocated that cannabis be considered an agricultural crop thereby relieving it of the unfair restrictions imposed on it because it is currently considered a “cannabis product” and not an agricultural crop like grapes and hemp.
MCA = YOUR Trade Association. What IS a trade association?

MCA = YOUR Trade Association. What IS a trade association?

A trade association is a voluntary association of businesses organized on a geographic or industrial basis to promote and develop commercial and industrial opportunities within its sphere of operation; to voice publicly the views of members on matters of common interest.

Compare it with a grassroots advocacy organization. Grassroots advocacy groups are entirely run by volunteer members.  A trade association is a professional organization that effectively executes its mission and reaches its goals by engaging trained professionals in its work. – professionalism is how we build a strong and thriving industry!  

How Does MCA as a Trade Association Support Our Community?

  • Rapid growth in today’s competitive cannabis market favors practices that directly threaten our  high-quality processes and products.  By advocating for new regulations and supports like meaningful appellations, sustainable expansion and equity grants for small operators, we lessen this threat.
  • MCA supports our legacy community in its effort to survive and thrive in this new marketplace.  MCA helped secure an equity grant for the County to administer to those negatively impacted  by Prohibition and the War on Drugs.  
  • Locally-based cultivators, processors, distributors and retailers must work together to advocate for our values and culture that make our region unique.  Our strength lies in our unity.
  • Medium-sized businesses in our region have managed to scale up to compete statewide. Their success is laudable and MCA supports their efforts to compete statewide while supporting the survival of our producer region.