Policy

MCA Memos for 3-2 Special Cannabis Meeting

Linked below are MCA’s memos for tomorrow’s Special Meeting of the Board of Supervisors about Cannabis, and how you can share your support of our recommendations.


Below you will also find individual links for where you can leave a written comment on each agenda item, and at the bottom of the email the general instructions for leaving a voicemail or making a Public Comment during the meeting tomorrow.  If you don’t have time to watch the whole meeting we definitely recommend leaving a voicemail with your comments, which you can do today!


NEW PROCESS FOR WRITTEN PUBLIC COMMENT

To leave any written public comment, first you must CLICK HERE to register with Granicus. Once you have registered, you will be able to sign in and make comments on all agenda items. Moving forward, we will provide links for each agenda item to comment on, so it’s worth your time to sign up now since this is the system the County will be using moving forward for submissions.


YOU MUST MAKE AN INDIVIDUAL COMMENT FOR EACH AGENDA ITEM YOU WANT TO ADDRESS.

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Public Expression – Vegetation Modification Letters

Please CLICK HERE to review the letter and attachments from Hannah Nelson regarding the Vegetation Modification notices that went out recently.  This has also been sent to all local media. 


If you agree that the Vegetation Modification process is particularly onerous and punitive, you can CLICK HERE to support Hannah’s letter by sharing your thoughts with the Board of Supervisors to help them understand the importance of this item. 

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Item 3b – Local Jurisdiction Assistance Grant Program


As written this agenda item does not sufficiently address the need of our community in administering these grant funds, and so we can not support the proposed resolution.

CLICK HERE to read our memo.


If you agree with our memo, CLICK HERE to share your written support.  Make sure to include your personal opinions on the best uses of the grant funds and how important this Program is for our community.

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Item 4a – Fallowing


The current Notice of Application Stay and Notice of Non-Operation programs are woefully insufficient for the needs of our community.  Applicants or Permit holders should be able to pause on new production while maintaining life support systems to sell already cultivated product and keep genetics alive, without losing their local authorizations.

We support Hannah Nelson’s proposed revisions to the existing programs, and our memo outlines those considerations.

CLICK HERE to read our memo.

  
If you agree with our memo, CLICK HERE to share your written support.  Make sure to include your personal opinions on the best uses of the grant funds and how important this Program is for our community.

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Item 4b – Appeals

MCA Fully supports the Ad Hoc’s recommendation to develop an appeals process for Applicants who may be denied their Permit by MCP.

CLICK HERE to read our memo.

If you agree with this memo, CLICK HERE to share your support.  Make sure to include why you think it’s important for embossed receipt holders who are denied to have an appeal process, especially considering how many errors have been made and continue to be made in the processing of applications.
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If you would also like to make a verbal comment (we recommend it!) on any or all of these items, there are two options.

1. If you would like to leave a message for the Board of Supervisors to be played during the March 2 meeting, you can leave a voicemail comment

 – Call 707-234-6333 and leave a voice message, up to 2 minutes in length, to be played during public expression/public comment, as it relates to the agenda.

– Speak clearly, being sure to state your full name, District #, and which agenda item you are calling for. YOU MUST LEAVE ONE MESSAGE PER AGENDA ITEM.

– Anonymous phone messages will not be played back during the meeting!


2. you can CLICK HERE to sign up to make a live comment during Public Expression during the meeting. Make sure to enter ‘Vegetation Modification on March 2″ in the Public Expression field of the page. Once you sign up, you will receive a confirmation via email, and instructions on how to access the BoS meeting via Zoom on Wednesday.
Please also make sure to email your District Supervisor with your comments!

Make sure to include the items that you’re writing about in your email Subject

District 4 – Dan Gjerde gjerde@mendocinocounty.org,

District 3 – John Haschak haschakj@mendocinocounty.org,

District 1 – Glenn McGourty mcgourtyg@mendocinocounty.org,

District 2 – Mo Mulheren mulherenm@mendocinocounty.org,

District 5 – Ted Williams williamst@mendocinocounty.org 

Thanks for raising your voice about these important issues!

MCA Memo for Item 4b re Equity on Feb 8

Re: Item 4b for 02-08-2022: Discussion and Possible Action Including Adoption of a Resolution Authorizing the County of Mendocino Cannabis Program Director to Update, Amend and Implement Revisions to the Mendocino County Local Equity Program Manual to Maximize Assistance to the Extent Permitted by State Law, Regulations and Guidance (Sponsor: Cannabis)

________________________________________________________

Honorable Supervisors,

MCA is grateful that MCP has brought forward this item to enhance accessibility and flexibility of Direct Grant funds from our Local Equity Program in line with our recommendations.  We have a few minor suggestions for the language of the Resolution to ensure that the full intent of this revision is properly captured.

The Resolution currently reads:

1. Authorizes the Cannabis Program Director to update, amend and implement revisions to the Mendocino County Local Equity Program Manual to streamline the Program and maximize access to fee waivers, direct grants, and technical assistance, to the extent permitted by State law and regulations and guidance issued by Governor’s Office of Business and Economic Development. The Program Manual and any amendments thereto shall be published on the Cannabis Program’s website and filed with the Clerk of the Board of Supervisors, and shall be effective upon such publication and filing. 

We recommend the following specific revisions:

  • add the words ‘and Directs’ after ‘Authorizes;’  
  • add the word ‘immediately’ prior to the word ‘update.’ 
    • These additions would clearly identify that the Board would like to see this happen right away, and not simply be providing authorization for some potential future action.  
    • Action should be taken BEFORE the Portal reopens to ensure that these changes are made and not delayed due to the increase of MCP workload that will come with additional Portal submissions
  • change the words ‘access to’ to ‘allowable uses of.’

We also recommend including language to provide complete clarity that any grantees who are currently in process with their existing budgets, but who may want to adjust their uses based on the expansion of allowable uses, may receive funding right away based on their existing budgets, and revise their budgets to align with these expanded allowances AFTER funds have been received. Applicants can not afford to wait for another time consuming round of changes and approval.

Finally, we suggest that direction be included to MCP to make revisions to the program in line with any State level adjustments that are made in the future without requiring additional Board approval, and that MCP provide any recommended additions for allowances to the State as suggested by Applicants.

The complete text of the suggested revision would read (additions in bold):

1. Authorizes and Directs the Cannabis Program Director to update, amend and implement revisions to the Mendocino County Local Equity Program Manual to streamline the Program and maximize allowable uses of fee waivers, direct grants, and technical assistance, to the extent permitted by State law and regulations and guidance issued by Governor’s Office of Business and Economic Development. The Program Manual and any amendments thereto shall be published on the Cannabis Program’s website and filed with the Clerk of the Board of Supervisors, and shall be effective upon such publication and filing. 

2.  Authorizes applicants already in process of having grant funds approved for disbursement to revise their budgets after receiving funds to incorporate updated allowances.

3.  Directs that the MCP Director Continue to Update the LEP to Include Any Newly Approved Categories or Eligible Expenses as Identified By the State, and That They Request of the State New Items or Categories as Requested by Equity Applicants As Needs Are Discovered.

With these minor adjustments, we feel this language will fully address the needs of MCP to have clear direction on how to move forward, and provide Applicants with the flexibility they need to truly take advantage of the Equity Program.

 

If you agree with our recommendations please share your support to the Board of Supervisors! Send all communications to your district supervisor directly as well as to bos@mendocinocounty.org, info@mendocannabis.com  

Make sure to include Email Subject: Comment for Agenda Item 4b on Feb 8, 2022

 

District 4 – Dan Gjerde gjerde@mendocinocounty.org,

District 3 – John Haschak haschakj@mendocinocounty.org,

District 1 – Glenn McGourty mcgourtyg@mendocinocounty.org,

District 2 – Mo Mulheren mulherenm@mendocinocounty.org,

District 5 – Ted Williams williamst@mendocinocounty.org 

 

If you do not want to send an email, but would like to leave a message for the Board of Supervisors instead, you can leave a voicemail comment to be played during Item 4b:

 

 – Call 707-234-6333 and leave a voice message, up to 2 minutes in length, to be played during public expression/public comment, as it relates to the agenda.

– Speak clearly, being sure to state your full name, District #, and Agenda Item 4b at the beginning of the message

– Anonymous phone messages will not be played back during the meeting

MCA Memos For Feb 1 BoS Meeting

CLICK HERE to see MCA’s memos and attachments that were submitted to the Board of Supervisors for the following items being discussed tomorrow Feb 1, 2022:

  • Item 4d – Crop Report
  • Item 4e – Phase 3
  • Item 4f – MCP Update + Local Jurisdiction Assistance Grant Program
    • 4f Attachment 1 – Op Ed from Hannah Nelson & MCA
    • 4f Attachment 2 – Addendum to Op Ed

We urge you to pay special attention to the Memo for Item 4f which includes our specific proposals for priority items that we look forward to seeing addressed in a Special Meeting of the Board.

We also urge you to send in your own letters regarding your challenges with either MCP or the Equity Program for consideration during Agenda Item 4f.
Please CLICK HERE to see our Urgent Call To Action and let your District Supervisor know about your experience. Now is the time to raise your voice!

Please send all communications to your district supervisor directly as well as to bos@mendocinocounty.org, cobsupport@mendocinocounty.org and info@mendocannabis.com  

Make sure to include Email Subject: Comment for Agenda Item 4f on Feb 1, 2022

District 4 – Dan Gjerde gjerde@mendocinocounty.org,

District 3 – John Haschak haschakj@mendocinocounty.org,

District 1 – Glenn McGourty mcgourtyg@mendocinocounty.org,

District 2 – Mo Mulheren mulherenm@mendocinocounty.org,

District 5 – Ted Williams williamst@mendocinocounty.org 

If you do not want to send an email, but would like to leave a message for the Board of Supervisors instead, you can leave a voicemail comment to be played during Item 4f:

 – Call 707-234-6333 and leave a voice message, up to 2 minutes in length, to be played during public expression/public comment, as it relates to the agenda.

– Speak clearly, being sure to state your full name, District #, and Agenda Item 4f at the beginning of the message

– Anonymous phone messages will not be played back during the meeting

Urgent Call to Action for the Licensed Mendocino Cannabis Community

This Tuesday the Mendocino County Board of Supervisors will be considering Consent Calendar agenda item Item 4f – Discussion and Possible Action Including Acceptance of an Update from the County of Mendocino Cannabis Program.

It is our understanding that some Supervisors are not fully aware of the various challenges being faced by operators in the program, and we believe it is essential that we as a community provide this critical insight for consideration so they can better understand the continued challenges that applicants and permit holders face. This is especially needed since most reporting by Staff concentrates on the program’s achievements and does not accurately present the continued difficulties from the applicant’s perspective. A good example is how the Equity report does not list the fact that ZERO money has actually been distributed to grantees. Another example is that MCP keeps reporting how many “incompletes” applicants had without explaining how many of them were due to staff errors or confusing instructions or portal technology limitations.

The more direct outreach each supervisor receives on these important issues from their constituents, the more they will hopefully understand the need to take immediate corrective measures, such as the ones outlined by Hannah Nelson and MCA in our Op Ed of January 12 and Hannah’s subsequent Local Fallowing Program proposal. She is also submitting a legal memo regarding the stalled processing of Contiguous Expansion Affidavits and the potential requirement that even those applications now go through a full SSHR referral to CDFW. We are so grateful to Hannah for her superhuman pro bono efforts on behalf of the entire Mendocino cannabis community, often at the expense of her personal life. But she can not do all of this alone.

We strongly feel that at this time the most effective way to educate the Supervisors is for individual operators in the program (YOU!) to be very clear about your personal experiences with the program, and the challenges you are facing. 

Specifically, we are recommending that you write directly to your District Supervisor and the full Board, copying MCA, for Agenda Item 4f on Tuesday with your answers to some or all of the following questions (details below), or by using the linked form ( https://bit.ly/MCP_Update_Form ) provided for your convenience. We have separated these questions into three categories. Ultimately the goal is to let the supervisors know about the effectiveness and clarity, or lack thereof, of communications between you and MCP.

We invite you to either send an email addressing some or all of the items suggested below, or to use a form we have created that enables you to say YES or NO to the items that apply to you with space for additional comments.  Whichever method you choose, it’s essential that we as a community make our voices heard on these issues.

1. Portal Questions

  • Have you been told in an email or other method of communication what standards must be met for an application to be deemed ‘complete’?
  • Have you been told in writing what the standards of proof are if you have to disprove a wrong assumption made by staff that could be the basis of a denial?
    • Do you feel an error or incorrect assumption made by Staff has led to you being deemed incomplete’?
    • ​​Do you know what the policies and procedures of MCP are for the Portal? 
    • Do you know how to locate them?
    • Did you understand the portal questions and instructions?
    • Were you able to upload the documents you needed/wanted to in the portal system based on the questions you were asked??
  • Do you feel that you have been provided clear directions on how to address any incomplete items?
    • Are all the forms and instructions clear and without errors by the MCP? 
    • Does the Portal allow you to attach the documents you thought you needed to attach? 
    • Did the instructions cause you confusion as to what items to attach in what location of the portal? 
    • Did you find that if you checked the box you thought was applicable, that you were not able to upload documents that you thought you would be able to upload because there was no place to do it unless you changed your answer?
  • Have you been marked incomplete?
  • Have you been marked incomplete more than once?
    • Were any of those times due to MCP error or Portal Limitations?
  • If you received multiple incompletes were the reviews consistent?
  • How effective has MCP been in answering your questions about the Portal?

2. Equity Questions

  • Do you feel that MCP & Elevate Impact have clearly informed you of policies, procedures and standards of success versus failure for your application?
  • If you are unclear on those policies, procedures and standards of success from MCP & Elevate Impact, how effective are they at providing clarity when you present them with questions?
  • Do you find it difficult to get timely responses from MCP & Elevate Impact?
  • Do the webinars offered by MCP & Elevate Impact provide you with useful, clear information?
  • If you have been required to make revisions to your specific grant application or budget, were you given all the corrections at one time or did they happen in small successive installments? 
  • If in successive installments, do you believe that the information could have been presented to you more efficiently?
  • Do you feel like the goal posts have changed during your grant application process?

3. General Program questions

  • Do you feel that you have a clear understanding of MCP policies, procedures and standards of success versus failure for your permit or application?
  • If you are unclear on those policies, procedures or standards for success in the program, how effective is MCP at providing clarity when you present them with questions?
  • Do you find it difficult to get timely responses from MCP?
  • Do the webinars offered by MCP provide you with useful, and meaningful way to obtain clear information?
  • Do you feel like you can participate effectively in MCP webinars?
  • Do you know what the policies and procedures of MCP are? 
    • Do you know how to locate them?
    • Are all forms you need on the website? 
    • Are they in the location they should be for the task you must perform?

In addition to these suggested items, we recommend including any challenges or frustrations that you have experienced related to communications with MCP to provide the Board with your personal experience.

If you would like to provide this feedback to the Board, but do not want to be identified for whatever reason, you can send your email, including your District #, to MCA’s Executive Director Michael Katz at michael@mendocannabis.com and he will remove identifying information (except for District #) before forwarding on to the Board.

This is a critical time to speak up about our collective experience and MCA is here to help in any way we can.

Please send all communications to your district supervisor directly as well as to bos@mendocinocounty.org, cobsupport@mendocinocounty.org and info@mendocannabis.com  

Make sure to include Email Subject: Comment for Agenda Item 4f on Feb 1, 2022

District 4 – Dan Gjerde gjerde@mendocinocounty.org,

District 3 – John Haschak haschakj@mendocinocounty.org,

District 1 – Glenn McGourty mcgourtyg@mendocinocounty.org,

District 2 – Mo Mulheren mulherenm@mendocinocounty.org,

District 5 – Ted Williams williamst@mendocinocounty.org

If you do not want to send an email, but would like to leave a message for the Board of Supervisors instead, you can leave a voicemail comment to be played during public comment:

 – Call 707-234-6333 and leave a voice message, up to 2 minutes in length, to be played during public expression/public comment, as it relates to the agenda.

– Speak clearly, being sure to state your full name and Agenda Item 4f at the beginning of the message

– Anonymous phone messages will not be played back during the meeting

Please feel free to reach out to Michael Katz at michael@mendocannabis.com with any questions about this Call to Action.

And be on the lookout for more communications from us in the next few days as we get closer to the Board meeting! The more engagement we can bring as a community the more likely we are to truly being heard.

#wearecaliforniacannabis #weareMCA #strongertogether #joinmca #mendocinocannabisalliance #community #sustainableagriculture #marketaccess #economicdevelopment #personalcultivation #cannatourism #mendogrown #craftcannabis #boutiquecannabis #knowyourfarmer #mendo #medicalcannabis #mendocino #emeraldtriangle #legacyrising #originscouncil #mendocinocounty 

Local License Fallowing Proposal from Hannah Nelson

While we are all working our hardest to create a solid foundation from which to start the coming season, it is possible that some folks would benefit from taking some time out from the licensed market without losing their current status and their investments by leaving the program completely.

Currently, there is a process to Stay an Application and an opportunity to not cultivate for up to one year (out of every five years) built into 10A.17, but these options are overly restrictive and arbitrarily limited in ways that are not optimal for licensees.  The incomparable Hannah Nelson has volunteered her time to provide a redlined version of the existing language in the ordinance and corresponding form.  She provided this proposal to the Cannabis Ad Hoc, and authorized us to share it with the community, for which we are sincerely grateful!

Here is the email that Hannah shared with the Ad Hoc along with the revised documents (linked below):

“On a pro bono basis, I reviewed the current cultivation ordinance and MCP form (there used to be another form for Permit holder Stay, but it was removed from the website and only this APPLICATION Stay form was present). I decided that the best chance that we have for getting this necessary reform done quickly was to conduct the bulk of the proposed ordinance redlining work myself. Attached are two documents: One that contains redline of existing ordinance provisions that would be implicated in both types of fallowing (for applicants and for annual permit holders). That document also has some comments in the edits that were tracked (in the column on the right side of the page) as well as some points relating to the need for specific components of any fallowing program, and an alternative to the simple ordinance strikethrough and additions if it is believed to be a better option (a new type F (for fallowing) permit).

I genuinely hope that the Ad Hoc can immediately bring this to staff, including MCP and County Counsel. As you know, time is of the essence. With the further delays in the Equity Grant Program, CEQA and Permit Application Processing, the increase in the state cultivation tax effective this year, the drought, and other extreme conditions, there is an URGENT need for a fallowing program that is reasonable and considers the current realities of the situation. Every applicant has VOLUNTEERED to be regulated and stepped forward into the abyss. No one thought it would be as torturous of a process (neither the County nor the applicants) as it has been and continues to be. Every one of these tax-paying businesses is tracked and traced at the state level. Accountability of state license holders is no longer the issue, it is now the County. At a minimum, the County needs to provide a reasonable fallowing program immediately. The tax year has begun, and decisions regarding spring planting must be made soon.

Thank you for your attention to this issue and any effort to EXPEDITE it would be greatly appreciated.”


She further indicated that from the beginning of the current Stay of Application process, it was envisioned in part as a tool to prevent denial of an application and to give the applicant a way to correct things, resolve issues instead of being denied.  It appears that the Board of Supervisors may be discussing this item on March 1, and we will let you know as soon as we have confirmation.

CLICK HERE to review the redlined County Documents

If you agree with these recommendations to support our licensed operators during this challenging time, please email bos@mendocinocounty.org to let them know you support Hannah Nelson’s Fallowing proposal.

The messages that have the most impact will include a few sentences about how these issues impact YOU directly.  Feel free to share your story with the Supervisors!

In the meantime, if someone gets denied, they may want to consider the existing Notice of Application Stay but would be required to follow the more restrictive requirements, including not having any cannabis inventory, until the changes proposed by Hannah are adopted.

Potential Extinction of Tax-paying Legal Mendocino Cultivators Must Be Addressed By Mendocino County – Hannah Nelson & MCA Op Ed – 01-12-2022

Recently, Mendocino County cannabis cultivation permit applicants were given a short window to resubmit their application and all supporting materials. The “portal” had been delayed from its intended opening multiple times, but finally opened on August 2nd and closed on November 2nd. It was intended to streamline the process and finally straighten out the County’s records for each applicant after many years of program management under different leadership losing files and long delays in processing applications.

Unfortunately, the monumental efforts of the new Mendocino Cannabis Program (MCP) have once again failed to streamline the process and it has once again stalled out. Chronic understaffing and poorly thought through actions have not resulted in positive outcomes. While MCP works tirelessly to rectify problems (some self-inflicted and some due to outside forces), there has been NO clear or consistent communication or guidance to the applicants. Instead, they have been sent notices that their applications are incomplete and that there is no current way to correct the deficiencies or errors—some of which are simply incorrect determinations by staff reviewers—and are told that they may be denied as a result. This is despite the fact that reviews are not conducted pursuant to consistent or clear guidelines, there were insufficient instructions given, the limitations of the portal technology, and other challenges. 

While there is no question that MCP needs and deserves full staffing, legitimate questions remain: 

  • Why hasn’t MCP staffed up since being directed and funded by the Board of Supervisors? 
  • Why did MCP not establish and publish clear standards, guidelines and educational materials that would give applicants and staff clear and consistent basis for the portal submission requirements? 
  • Why have the applicants not been told when they will be able to correct any noticed deficiencies and, more than that, what is the process of clearing up mistakes by staff or any unclear comments by staff regarding items they deemed deficient? 
  • Why do different reviewers review the same files and come to different determinations? 
  • What will the appeal process be if applicants are wrongly denied? 

We have asked these questions in various ways over the past several months, and have not received any clear answers. 

Will the County answer these questions and address these issues now, in public, or will the answers and solutions only come from and be forced through existing and future litigation?

This is not the same old gripe about the inefficiencies of County government, which is quite common here in Mendocino. The sad fact is that concurrent factors combine with these local problems to create what amounts to an existential crisis for most of these small local tax-paying cannabis businesses. The recent cannabis market crash, exorbitant local and state cultivation taxes, the looming deadline for state Provisional licenses, the shifted CEQA burden, drought, fire and Covid all are contributing to make this an EXTINCTION-LEVEL EVENT. 

On top of this, the County has failed to properly supervise the outside contractor that is responsible for rolling out the Equity Grant funds to the qualified grantees and has not insisted that other County departments that are necessarily involved in that process were coordinated with from the beginning.  As a result, time-limited approved funding from the state is in very real jeopardy of having to be returned, and intended recipients that might have been saved from shuttering may not receive this desperately needed relief in time to save their businesses. 

The County was also granted $17.5 million dollars in a local jurisdiction grant, which will likely also suffer from the same bureaucratic entropy as the Local Equity Program and as a result, may not get to the intended beneficiaries in the form of real services or grants in time to be meaningful in addressing the huge challenges they face TODAY. 

These businesses are going to be lost PERMANENTLY if something is not done. 

Where is the ACCOUNTABILITY of the County? 

It is time to stop blaming the Applicants and instead work in partnership with them and other stakeholders to save this necessary component of our community and local economy.

Every applicant has VOLUNTEERED to be regulated and stepped forward into the abyss. No one thought it would be as torturous of a process (neither the County nor the applicants) as it has been and continues to be. Every one of these tax-paying businesses is tracked and traced at the state level. Accountability of state license holders is no longer the issue, it is now the County.

CLICK HERE for a more thorough and detailed explanation of the issues touched on above. 

Sincerely,

Hannah L. Nelson

e: hannahnelson@hannahnelson.net

Mendocino Cannabis Alliance

e: info@mendocannabis.com

Hannah L. Nelson is a local attorney with extensive experience in cannabis issues, policy, and compliance at the local and state level. 

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

Together they have consistently offered free, pragmatic assistance to the County to help resolve these and a myriad of other issues. Their requests to  provide “fixes” to proposed regulations in the County by vetting them for practical implications prior to implementation have consistently been rejected.

Hannah L. Nelson and Mendocino Cannabis Alliance Statement of Issues Related to The Crisis Facing Mendocino County Cannabis Businesses – Op Ed Addendum 01-12-2022

As you may have seen recently in regional (1)(2) and national media (3)(4), the community of small licensed cannabis farmers and businesses in Mendocino County are in a crisis of epic proportions.  Small farmers in California face a combination of excessive taxation at the local, state and federal levels as well as a deadline to have their state licenses converted from Provisional to Annual. Those factors combined with massive overproduction and severely limited market access have created a perfect storm of existential threats. The additional circumstances that small farms in Mendocino County face compound those destabilizing forces in a way that will ensure the shuttering of even more small family farms and businesses in Mendocino County.

Our local farmers were already facing extreme conditions from years of poor administration of the local permitting process and the state Provisional licensing crisis. The lack of communication or effort by the Mendocino Cannabis Program or the Board to publicly address these and more recent “portal” re-application process difficulties, the failure to adequately supervise the administration of the Equity Grant Program, and the failure to provide a process that is fair, reasonable, and consistently administered without simply blaming inadequacies on applicants has led to an environment of fear and confusion for applicants and permit-holders alike. 

Mendocino County advocacy groups like the Mendocino Cannabis Alliance and the Covelo Cannabis Advocacy Group, and attorney and advocate Hannah Nelson, have worked hard to provide solutions and on the ground input to the Board of Supervisors and the Mendocino Cannabis Program (MCP).  Recently, the County formed a new Cannabis Ad Hoc Committee to address both the Portal Application Resubmission Process and Local Equity Grant Program.  Despite this engagement and repeated calls from many program participants, clear standards and guidelines for permit processing and approval have yet to be provided. Inconsistencies in review of the same materials – and mistakes by staff and applicants – due to the lack of standards and proper instructions have plagued the process. Actionable, clear communications from the MCP are virtually non-existent.

In order to assist the necessary dialogue that must occur if the County is to rectify the situation and maintain some level of accountability of the program, we offer a summation of history of the most pressing issues:

  1. Portal Process

From August 2, 2021 to November 2, 2021, local cannabis permit applicants were required to re-submit their entire County Cannabis Permit application and all supporting materials to create a clean slate of compliance paperwork after years of lost files and program changes by the County.  Applicants were told that to begin with, the portal submission review was for completeness of the application, not substantive review of their ultimate approval or denial. However, what appear to be matters relating to substantive review have been included in the initial portal review for completeness, and applicants were later told that if the application packet was not “complete”, which now meant substantively approvable within the narrow portal timeframe, they would be rejected.

Applicants were also led to believe that they would have an opportunity to cure portal issues after the Portal closed, but were instead sent letters that did not state that and gave the impression that they would be denied. Some of those notices were incorrect and had to be changed by the County, but the County never changed the date on the notice— rendering it legally deficient for its intended purpose. Some applicants received 2 to 3 sets of Notices for the same application without any explanation of the differences between the notices or any changes to the checklist of deficiencies that were sent with the Notices. The County sent applicants what amounted to a fear and anxiety producing letter just before the holidays, stating that they might be denied a permit due to an ‘incomplete’ submission, and emphasizing that since the Portal was already closed, there was no way to change their status to “complete”. These multiple and sometimes incorrect Notices were sent to tax paying businesses most of which have been operating for 4 & 1/2 years and in many instances had submitted files to the county 2-4 times in the past, in order to replenish files which were in many cases lost by the various iterations of the County Cannabis Program.

Applicants have been receiving these deficiency notices regarding their application, but have not been provided with the corresponding information promised by MCP that would include guidelines and timelines for successful completion. Furthermore, incorrect assumptions and errors by MCP staff have often formed the basis of an alleged deficiency. Multiple, successive reviewers on any one submission have come to completely different conclusions about whether a category was complete or deficient. Some of the deficiencies result from mistakes made on form templates issued immediately before the portal opening without advanced warning.

There have been no clear communications regarding any of the following from MCP:

A) standards by which portal submissions for completeness are judged;

B) standards by which approvals and denials will be determined (either up front after portal submission in lieu of an incomplete notice, or later when substantive review is conducted);

C) when educational materials with those standards and any clarifying information will be released;

D) what steps will be taken to perform educational efforts to support successful completion by applicants;

E) when the Portal will be reopened and how much time people will have to resubmit through it to correct “deficiencies” listed in the Incomplete determinations;

F) how errors by applicants or staff can be addressed so that denials based on errors by staff or by applicants are avoided, and/or can be cleared up outside of any arbitrary tight timeframe of resubmission or appeal;

G) what kind of appeal process and timeframe for appeal will be afforded for Denials:

  1. Based on initial portal submission, or resubmission;
  2. Denials based on substantive review of application after portal submission or resubmission or of those in “good standing” or renewals.

This lack of communication is causing the entire community of local permittees to experience massive confusion and anxiety. It is imperative to release information that at the very least gives clear indications of these different timelines. 

Applicants have had to completely reorganize their lives based on a constant ‘hurry up and wait’ mode of conducting business in the County. They are expected to at all times be ready with unknown documents that fulfill unknown expectations and standards. They have zero information about when or how they will be judged. Honest and human mistakes by the staff of MCP are deemed to be correctable at some unknown time and only then by the efforts and detailed request of the applicant, but honest and human error by the applicant, or submission of an incorrect document or something that an outside agency has prepared that is in some way inconsistent with the applicant’s materials, are presumed to be out of compliance and either subject to denial or subject to unknown additional efforts by the applicant at some unknown time.

These challenges would be enough to drive even the most seasoned business professional to their wits end, and yet they are only one part of the crisis our community is facing.

  1. Local Equity Grant Program & New Jurisdictional Grant Program

The overwhelmed and understaffed MCP has been unable to properly manage the contracted Equity Grant administrator and ensure smooth coordination with other County departments. The company contracted to administer the program has been ineffective and the County must have better oversight of the contracts it issues.

MCP inherited the bones of an Equity Grant Program and tried to build the ship as it sailed. However, MCP lacks the capacity to handle proper oversight of the program efficiently. A case in point is that MCP never involved the necessary other County departments prior to the rollout of the Equity Grant Program. A good example was the fact that it was not until AFTER awards were approved and grantees notified that County Counsel created a contract template for use in the program. It was not until AFTER awardees were notified that the County departments involved in financial expenditures were looped in and began the technical process of having the approved funds wind their way through the maze of required departments. As a result, QUALIFIED, APPROVED NOTIFIED AWARDEES did NOT get the funding that was promised to them in 2021.

Again, the current MCP inherited the current program, and the responsibility for pre-grant interdepartmental coordination should have been up to the prior MCP administration. However, once the current MCP took over, it should have immediately evaluated the pragmatic details to ensure the contracted administrator could effectively accomplish the purpose: to get money to the qualified grantees in a timely manner. Stakeholders had specifically forewarned the need to address these matters at length in the last 6 months, but the County did not act. It should be further noted that this was YEARS AFTER the program funds were awarded by the State to the County and more importantly, Equity Grant funding from the state to local equity programs may be RESCINDED and the funding withdrawn if state timelines are not adhered to. In this instance, more than $2 Million in FREE grant funds from the state could be rescinded.

These funds are CURRENTLY needed as a lifeboat and can’t be allowed to drift away. Additionally, the enormous $17.5 million dollar local jurisdiction grant cannot be allowed to drift into the same kind of failure of efficiency, pragmatism and lack of oversight. Planning must be done NOW to push the funding out to those that are intended to benefit from the award. Contrary to MCP and perhaps public perception, the local jurisdiction grant from the state was to directly benefit the state provisional license holders who are struggling to transition to their state annual licenses because they do not yet have their local annual permit and/or do not have the funding to finish the CEQA process and infrastructure projects required by state and local regulations as a prerequisite to state annual licensing. 

  1. Satisfaction of CEQA Requirements and Appendix G Processing

MCP informed one applicant that a determination regarding their Contiguous Expansion Affidavit proof could not be addressed because CDFW was taking issue (again) with the County’s application of that process. This information was not disclosed by the MCP to the Ad Hoc despite the fact that it directly impacts the Portal resubmission timelines. There has been no indication of when or how issues related to the Contiguous Expansion Affidavit, which, if the project is eligible to utilize it, is a necessary component of fulfilling both the primary application requirements as well as the satisfaction of CEQA with respect to Sensitive Species and Habitat.

Appendix G processing has completely been halted. The County never issued better guidance materials but instead forced the applicants and staff to engage in interminable back and forth submission, suggested edits, resubmission, and so forth (rinse and repeat). Licensed and qualified CEQA professionals were and are at a loss as to the standards and expectations mounted against each submission without relation to the Appendix G guidance documents posted by the County on its website. Repeatedly, practitioners and applicants requested updates to the templates and materials, but none have ever been issued. 

Then, suddenly, without discussion or warning, all processing of Appendix G packets stopped, apparently in September. While it would be wonderful if the reason for the abrupt discontinuance of that processing was due to preparation of updated materials, sadly, we do not believe that is the case. Rather, the program is too overwhelmed and understaffed to continue to process them. Also, any issue with respect to the Contiguous Expansion Affidavits would impact the Appendix G situation. Zero communication to the public was conducted providing an explanation of the abrupt halt until forced to answer questions by individual applicants about why their submitted package had not been responded to. At the very least, should MCP be forced to make a tough call to alter a key programmatic function like the suspension of processing applications or CEQA certifications, it has the responsibility to educate the Board and the public about it as soon as the information becomes available, and should endeavor to email the entire applicant pool with that information and the expected timelines to follow.

  1. Local Taxation

Currently farmers that have come forward to be regulated are subject to a minimum cultivation tax based on the size of their permit application and not on the amount of product actually grown or sold. Cannabis is the only crop on which the County places a minimum tax regardless of the actual sales conducted. This tax does not take into account crop failure or allow for deductions based on unsold products.

Recently, the Board of Supervisors signed a resolution that it sent to the State asking for State cannabis tax reform but declined to take action on local cannabis cultivation taxes.

We strongly believe that the best way to approach the State with a Tax Reform proposal is as a partner doing everything possible on the local level to match the challenge of the moment for our licensed cannabis businesses. To this end, we urge the County to adopt the following local Tax Reform suggestions that would both provide relief for struggling licensees and signal to the State that Mendocino County is ready to work together with them to address the existential crisis our community is facing:

1. We recommend the Board give direction that cannabis cultivation taxes only be levied based on the amount of canopy being grown (minus any potential crop loss) by a licensee, NOT based on their permit size. It is our understanding that the current Tax Initiative does not mandate that tax is based on permit size, and that it would be under the authority of the Board to adjust this aspect of the tax framework without changing the ordinance and without being in contravention of the Initiative. This can potentially be accomplished through Tax Credits, if necessary.

2. We recommend that the Board work with stakeholders to sponsor an ordinance change to the Tax Code that would base cultivation taxes on Gross Receipts with no guaranteed minimum.

3. Continue to advocate for state cannabis tax reform, including elimination of the cultivation tax, reduction of the excise tax and modification of the manner in which taxes are calculated to prevent triple taxation because sales taxes are based on totals that include both the cultivation and excise taxes.

We believe that initiating local tax reforms will substantially bolster our efforts when asking the State to provide tax relief. 

It is short-sighted to fail to address the over-taxation issue at the local level. What amounted to a $5.6 million tax income to the County will evaporate to zero if our local cannabis businesses are shuttered.

Conclusion

We understand that the MCP is understaffed, and we have supported their staffing up for over a year. However, at a certain point, the substantial impact of the inability to staff up quickly, meaningfully, and with the correct expertise and capacity must be addressed. The continued inefficiencies and errors have resulted in systemic failures that together with the other external factors noted above (market crash, over taxation, etc.) have crescendoed into an urgent situation that must be rectified.

The Board was justified in supporting the new program manager nearly a year ago as she attempted to tackle the problems that had built up over the prior 3 &½ years and it was right in authorizing the funds necessary to ensure the department had the resources it needed. However, at this point, it becomes complicit in not getting into the trenches and helping more specifically to tackle these monumental issues— especially as mistakes and errors in rollout and further delays continue. Due to understaffing and lack of history of the current version of the MCP, it is necessary to provide more direct oversight and accountability. However, even before those heroic efforts may be undertaken, the most important immediate need is for communication. Applicants, including annual permit holders that have or will be applying for renewal and that may have provided or be ready to provide Appendix G materials to the County for certification, must have more specific information pertaining to timelines, templates, standards, and ability to engage to correct errors by staff or by the applicant. MCP must be able to articulate processes and standards clearly and apply them consistently. 

Until now, offers of practical problem solving from knowledgeable experts and stakeholders have been rejected by MCP. We hope that the County will avoid perpetuating the same type of mistakes that we have repeatedly warned against in the past and will direct MCP to work directly with stakeholders to vet all new processes and programmatic implementations BEFORE they are finalized and rolled out. Additionally, it is time to tell applicants (including annual renewal applicants) exactly what the timelines are moving forward. It is unreasonable to continue to keep them in suspense about how and when they will be able to proceed, especially if there is once again going to be a very narrow (30-day) and arbitrary deadline that every single applicant that was given an incomplete must meet. The fact that this amounts to over 80% of the applicants in the portal provides a good indication that the primary problem is the underlying system and lack of consistent and clear standards, guidelines and communication. 

Every applicant has VOLUNTEERED to be regulated and stepped forward into the abyss. No one thought it would be as torturous of a process (neither the County nor the applicants) as it has been and continues to be. Every one of these tax-paying businesses is tracked and traced at the state level. Accountability of state license holders is no longer the issue, it is now the County.

Urgent attention to the Portal, Appendix G processing, the Equity Grant Program, including oversight and accountability measures for the contracted program administrator, and immediate and pragmatic planning for the rollout of the Local Jurisdiction Grant Program is imperative. Reform of local cannabis taxation policies are necessary to ensure the sustainability of that revenue stream for the County and the support of our struggling small businesses. The time for focused action is now, or we risk losing what remains of our local licensed cannabis community.

Sincerely,

Hannah L. Nelson

e: hannahnelson@hannahnelson.net

Mendocino Cannabis Alliance

e: info@mendocannabis.com

Hannah L. Nelson is a local attorney with extensive experience in cannabis issues, policy, and compliance at the local and state level. 

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 Memos for BoS Meeting 01-04-2022

We’re kicking off the New Year with a few memos (linked below) to the BoS for their meeting on January 4 regarding the following items:


– Public Expression – Portal Process & Equity Program


As you are all well aware, there are still many outstanding questions regarding the Portal resubmission process and the Equity Program. For the Portal it is essential that the MCP publish clear guidelines and timelines for when the Portal will re-open and what applicants will need to do in order to be deemed complete, as well as the criteria for application denial and an appeals process for applicants who are denied.


For the Equity Program we must urge the County to remove all barriers for the distribution of funds, and to allow grant monies to be used to cover any outstanding tax payments. We are dangerously close to the deadline for 2 Million in grant funding to be distributed, and neither our Equity Applicants nor the County can afford to lose access to these funds.


– Item 5g – the County Legislative Platform


We are grateful to the General Government Committee and MCP for incorporating many of our recommendations into the Redlined County Legislative Platform (attached) which will be advocated for at the state level by our County lobbyist. In addition to the items that were included, there were several which required further explanation and refinement, which we are now providing to the Board for consideration. Click the link below to see both the memo that was initially submitted to the GGC on December 13, and the memo for tomorrow following up on the remaining items.


Item 5k – Repeal of the Facilities Ordinance


As you may have been aware, the revised Facilities Ordinance that was adopted in May was successfully challenged in court by the Willits Environmental Center because it did not undergo a full environmental review. We recommend that a full environmental review be conducted to enable the passage of the ordinance, and that provisions supporting increased access to microbusiness activities for our local licensed operators be added to the ordinance.


Visit https://bit.ly/MCA_Memos_01-04-2022 to review the memos and supporting materials.


If you agree with our recommendations on these items, please email bos@mendocinocounty.org and cobsupport@mendocinocounty.org to let them know you support MCA’s proposals, referencing the appropriate Item # in the Subject of your email.


The messages that have the most impact will include a few sentences about how these issues impact YOU directly. Feel free to share your story with the Supervisors!


If you would like to sign up to provide a verbal comment during the meeting in support of any of these items visit https://bit.ly/Mendocino_Telecomment


Or, you can pre-record a spoken comment that will be played during the Board item by calling (707) 234-6333. When leaving a voicemail please include your first and last name and the Board item you are commenting on (Item 5g, 5k or public expression, or call once for each item!). Voicemail comments are limited to 2 minutes.


#wearecaliforniacannabis #weareMCA #strongertogether #joinmca #mendocinocannabisalliance #community #sustainableagriculture #marketaccess #economicdevelopment #personalcultivation #cannatourism #mendogrown #craftcannabis #boutiquecannabis #knowyourfarmer #mendo #medicalcannabis #mendocino #emeraldtriangle #legacyrising #originscouncil #mendocinocounty

MCA Memos for 12-07-2021 BoS Meeting

In advance of the Mendocino Board of Supervisors meeting tomorrow, Tuesday December 7, MCA has prepared memos for the following items:

  • Item 5c – Fee Schedule 
  • Item 8a – State Cultivation Tax Reform
  • Item 8b – Equity Grant

On Item 5c we encourage the Board to consider the overall impact that proposed fee increases could have on the entire Mendocino County community, as well as our locally licensed cannabis businesses, and to either temporarily suspend the goal of complete cost recovery, or at least extend the timeline of the proposed increases to make them more manageable for already struggling businesses.

For Item 8a, we sincerely appreciate the interest in supporting Tax Reform at the State level, and encourage the Board to work with us and other stakeholder groups on local solutions to help support our community and bolster our efforts to create meaningful change.

Item 8b includes submission of a new application for Equity Grant funding.  In this memo we identify immediate needs for our existing Equity program which is in danger of returning grant funds to the State, as well as specific recommendations and questions related to the proposed Equity Grant Application.

CLICK HERE to read the memos.

If you agree with our recommendations on these items, please email bos@mendocinocounty.org and cobsupport@mendocinocounty.org to let them know you support MCA’s proposals, referencing the appropriate Item # in the Subject of your email.

Please also be sure to mention that inviting MCA into local policy development conversations is the most efficient way for our community to effectively work with the County on the issues that face us all.


The messages that have the most impact will include a few sentences about how these issues impact YOU directly.  Feel free to share your story with the Supervisors!


If you would like to sign up to provide a verbal comment during the meeting, CLICK HERE.


Or, you can pre-record a spoken comment that will be played during the Board item by calling (707) 234-6333. When leaving a voicemail please include your first and last name and the Board item you are commenting on (Item 5c, 8a or 8b, or call once for each item!). Voicemail comments are limited to 3 minutes. 

Thank you for your support! Please email us at info@mendocannabis.com with any questions!

MCA Policy Call Update

  1. Portal Numbers

2. Coalition Memo Seeking Standing Committee

11-09 BoS Meeting

  • BoS creates Cannabis Portal and Equity Program Ad Hoc
    • Supervisors Haschak and McGourty
    • want to see clear communications from MCP

3. Equity Program Update

  • CLICK HERE for all approved revisions
    • Enhanced Direct Grant criteria
    • Enabled full Direct Payment in one tranche
    • Removed Income Threshold – any income levels may now apply
      • will prioritize existing Equity Applicants under the previous Income Threshold from initial cohort
    • Will require all County taxes to be paid up in full

Deadline for Round 1 funding eligibility closed on Nov 7. There will be more funding.

Insurance Question still outstanding, working on getting answers.

4. Jurisdictional Assistance Grant Funding Application

CLICK HERE for draft documents from MCP

2.5M to process phase 1 and 2 applicants to 2023 CEQA completion deadline

  • assumes correction letters for 90% of applicants
  • 4064 hours of work

phase 1 & 2 application review – 14099 hours – want to finish this by dec 31 2022

  • includes renewals – 1722 hours

MCP IS recommending they do App G’s

  • App G review for phase 1 permit holders – 3166 hours
  • App G for applicants through portal – 5692
    • staffing and contractors

TW – for 18 M dollars how many applicants will get to annual license

KN – EVERYONE – what we estimated was that 90% of those incomplete in the portal will make it through corrections letters

  • still some prohibitions – tree removal

**could get to 833 folks coming through phase 1 and 2

1. Satellite Imagery and Power Score – combined almost 700K but neither contribute to Annual Licenses.


2. Direct Grant Funds to Applicants – think it’s important that amounts be roughed in for the budget to ensure we allocate specific funds for those specific uses. It is concerning that the idea is to solely itemize needs from the department and use ‘whatever is left’ for applicants without including dollar amounts.


3. There is no mention in the Grant Application yet regarding the question of adding a discretionary permitting process to 10A.17. We should definitely include this b/c it could be essential for operators who have to transition to a discretionary permit without a new ordinance.
In the grant requests should be made for:

  1. Funds to cover the costs for any environmental review, or legal determination that environmental review is not required, to amend Chapter 10a.17 
  2. Funds to amend 10.a.17 to add a discretionary permitting pathway for current applicants under the ministerial permitting provisions.

It is also essential that direct grants to applicants be made a priority and not be held up while MCP works to increase their capabilities and infrastructure in regards to hiring additional staff and consultants.  For example, while MCP is staffing up and processing applications, operators can receive Grant funds to finish all outstanding building permit work, or hire CEQA professionals to prepare biological assessments and checklist analysis, etc. If these funds were to not roll out quickly, the applicants would not be able to be at the point where the MCP can process them. This particular use of funds will also create better quality submission packages for MCP to review, ultimately saving time and resources.

5. Emerald Cup Small Farms Initiative

CLICK HERE for details!

CLICK HERE to apply by Nov. 13!

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