Did Humboldt County Kill Its Golden Goose?

Lady Sativa Farms in Garberville

Humboldt County, California, first became part of the public’s collective consciousness in the mid- to late-70s, when major media began reporting on the area’s prolific cultivation of marijuana. Not just any marijuana, but high potency sinsemilla (Spanish for “without seed”).

(Federal labs at the time called Humboldt homegrown among the three highest potency cannabis specimens it had tested, along with top-of-the-line Hawaiian and Thai).

Highway 101 runs inland from the county seat, Eureka, as it moves southward and it was particularly the hills around Garberville (11 miles north of the Humboldt-Mendocino County line) that drew most of the notoriety and the attention of law-enforcement.

Southern Humboldt County (affectionately called “SoHum” by locals) didn’t suffer from coastal fog and cold, as did the north county. Here the summer days were long and hot, and the cold nights in the fall contributed to the buds’ potency.

Law enforcement dubbed the region “The Emerald Triangle,” along with the contiguous cannabis-producing counties of Trinity and Mendocino. At that time federal, state, and local law-enforcement agencies began spending billions of dollars over a few decades trying to eradicate the “noxious weed.”

Time Magazine in June, 1978 ran an article called “Where the Grass Is Greener,” featuring lurid descriptions of the riches made by intrepid farmers, and the alleged violence incumbent in their activities. This writer, as a long-haired owner of a Garberville business, was quoted as saying “Dope money underwrites all of the businesses in town.” (I actually said “All the businesses in town benefit from pot money, not just mine).

Another quote in the article came from the then managing editor of the regional daily newspaper, The Times-Standard. Said Rick Nelson: “If pot is ever legalized, it will be a great industry for this county.”

Most of us had the same notion.

With California’s Proposition 64 (2016), legalizing cannabis consumption for adults, now in the rear view mirror, the question can be asked: “Has legalization benefited the county or has it’s Golden Goose effectively been killed?”

While the jury is still out on the overall affect of California’s new law, it appears the status of the boutique-grade pot produced by Humboldt’s back-to-the-land denizens is moribund if not dead. When money is involved bigger always seems better, so the permits being issued cater to large grows, not the “mom and pops.” Farming has replaced cultivation, and with it higher fees, taxes, and more hoops to jump through.

To be fair, farming had already displaced cultivation in Humboldt County. When Proposition 215 passed in 1996, California’s medical use law, many correctly read the national sentiment as changing from strict police enforcement to a more benign approach to Americans’ pot habit. With it came a “Green Rush,” with many people moving to Humboldt to grow big and make big bucks.

Counties can make their own post-legalization regulations, secondary of course to the State’s, with the federal government the ultimate arbiter of cannabis regulation. Thus far, the feds are entirely a non-player, even to the degree of lifting cannabis from the Class I narcotics category. Meanwhile, California’s 58 counties and the state government are not on the same page (“They keep changing the goalposts on us,” says one professional consultant to permit applicants).

To begin with, cannabis is an agricultural product, subject to land-use requirements. In Humboldt County, the Planning and Building Dept. oversees cannabis licensing. It would be hard to find government agencies with more regulations than those. And a cannabis permit applicant is subject to all of them.

Aside from the licensing fees, the excise taxes levied by the county on assumed profits, everything from zoning, to water use, soil types, grading, construction of any type of out-buildings, consideration of Indian burial grounds, adequate roads, etc. all require compliance with existing regulations.

Garberville merchant Rio Anderson has spent almost $400k complying with county and state regulations to make his Lady Sativa Farm legal

Rio Anderson, a Garberville businessman, owner of Lady Sativa Farms, was an early applicant for a permit, as a member of the Humboldt Grower’s Association. Not a fan of the process, he has already spent approaching $400,000, in attempting to get a 20,000 square foot grow permit.

“There seems to be an endless amount of documentation needed to satisfy the agencies involved,” he says. “It’s difficult to know what to do. Third party consultants have taken a bunch of my money. And even the consultants are often deficient. If engineering is needed, it’s even worse.”

Indeed, a coterie of consultants have made the scene, allegedly to help the applicant through the process. For a fee, of course. And some speak Spanish.

One such consultant is Joshua Allen, who worked for planning departments in Alaska, Trinity County, and briefly in Humboldt County. “They’ve made it very difficult for small businesses,” he says. “It’s about big industry and big money. They are setting people up to fail.”

Estelle Fennell, the Supervisor from Humboldt’s Second District, which encompasses the south county (where she has lived for decades) has come under criticism for not representing the small grower in the process. She would disagree.

“Some of the problem is that many small growers had a misconception about what it took to be compliant. We have a permit for 3000 square feet, if the grower lives on the property with no employees,” she said. “ We issue big permits—10,000 sq. ft., 20,000, and beyond—because we surmised other counties would grant permits to big corporation types. We wanted our people to have a chance to compete.”

One measure taken by the county, in that regard, is its abatement program. Using the Global Information System—more updated than Google Earth—the county has been locating large grows, not in the permit process, and sending land owners notices which give 10 days to “abate the nuisance,” or be subject to $6,000-$10,000 a day fines. Planning director John Ford says over $7 million has been collected through the abatement process.

Supervisor Fennell, would argue, with validity, that removing the large “black market

Humboldt County Second District Supervisor Estelle Fennell feels implementing legalization is "terribly challenging." But she feels her county is doing a good job in representing local growers
Humboldt County Second District Supervisor Estelle Fennell feels implementing legalization is “terribly challenging.” But she feels her county is doing a good job in representing local growers

grows” would remove huge amounts of product from the market place, thereby enabling legal growers a chance to compete price-wise. And many of those illegal enterprises are indeed ecological disasters, with the use of pesticides, refuse created on the property, and pirated water from streams and even the Eel River.

Perhaps well-reasoned, the policy has had its miscues. One large organic vegetable farm, with many greenhouses, was targeted by the enforcement posse in an early morning raid. The terrified owners were allowed to keep their vegetables. In another case, an “in the permit process” farm was hit by the raiders and only a last-minute phone call allowed the farm to persist just before deputies cut down the pot plants.

Attorney Ed Denson isn’t a fan of the abatement policy, noting that the other three categories of “nuisance” (junk cars, negligence, willful nuisance) carry much more modest fines. But he’s even less favorable about the excise tax levied by the county on both permitted farms and those in the process of getting a permit.

He’s referring to Humboldt’s Measure S, which first was to tax permit holders and applicants, but later was changed to tax the land owner, illegally says Denson since public hearings were not part of the process. He’s suing the county on behalf of growers who may have leased their property to others, or whom he feels were taxed before they even harvested, based on assumed profits.

(The county taxes outdoor grows at $1 a square foot. A 10,000 square foot permit will garner a $10,000 excise fee, annually. Backed by satellite photos, the county can show that a grow exists on a property. The big leap of assumption, however, is that the farmer was able to sell his/her wares, in the convoluted world of post-legalization. At this juncture, 75% of California’s cities and counties have banned retail sales of pot within their jurisdictions, despite Proposition 64’s passage).

“What other crop in the world is taxed before it even is harvested and brought to market?” activist Douglas Fir asks, rhetorically.

Follow the dots on my own recent case history and you can see some of the contradictions and confusion in post-legalization: I’ve owned 43 acres in the heart of Southern Humboldt’s prime growing area for over four decades. When I decided to sell, my young tenant applied for a permit, early in the going with the knowledge that associates of his would make a bid to buy, with the permit application adding value to the buyer and myself. We signed a lease agreement for his use of my property.

My tenant, applying for a 10,000 sq. ft. permit, grew a crop of CBD cannabis, uncontested because my land was in the permit process. I was subsequently contacted by the State Water Board, with photos of the grow, telling me I am in the watershed of an endangered creek, Redwood Creek, which in turn feeds the Eel River, itself endangered.

Attorney Ed Denson is not a fan of Humboldt’s excise taxes and foreclosure program. He has filed a suit trying to retrieve some of the excise taxes levied

I readily agreed to an inspection, and was subsequently visited by State and Local Water Board reps, plus one from Fish and Game. The inspectors were happy that water for the cultivation came from our rain catchment pond, but I was instructed that the water tank in between my primary spring and my house would need a float valve to turn off input when the tank was filled, so the spring would continue to feed my creek.

The overflow line from my tank was already directed to the creek. What would a float valve serve? Further, a forest pond, sitting in the creek passage, was cited for causing a lot of erosion which had to be dealt with. The creek bed is hard pan rock, which one cannot drive a shovel into. I’ve been watching the flow for over 40 years. There is no erosion. But I now must correct the “problem.”

Finally I was told that the spring referred to needed to have a use permit. I’ve been using it for over four decades, for household use and vegetable gardening. I do understand that California, in the wake of “tornado fires,” and “flash fires” has a need to supervise its water resources. Still, I joked with the inspectors that “if I were some radical property rights guy I would be running you off my property for telling me I don’t own my own spring.” They laughed.

Next, I was sent a $10,000 excise tax bill for the permit applicant’s grow on my property. I paid it, having no recourse. I’m now a plaintiff in Attorney Denson’s lawsuit. Bear in mind, I wasn’t the applicant for the permit.

All of the county officials I interviewed agreed that 10-20,000 square foot grows and above, in the hills rising east and west of the Eel River, are withholding countless of gallons of water from the river and therefore contradictory to their stated ecological goals. As Abbott and Costello asked, “Who’s on first?”

So, did Humboldt County kill it’s Golden Goose? I would say “no.” Legalization did. Even big growers find the bureaucracy and fees unreasonable to deal with. A foreclosure company in Redding told me the majority of its foreclosures are coming from Humboldt and Trinity Counties. Including mine. My buyer dropped out in the face of the obstacles, while losing a substantial deposit. Not to be heard from since.

Cannabis was made illegal in 1937, with the passage of the Marijuana Tax Act. In the decades following there has been endless vilification of the substance, its users and providers, with billions of dollars spent sustaining myths and untruths, with Drug Czars and media campaigns showing “your brain on pot” and patients trying to escape a pot-prescribing doctor’s office.

Admittedly, marijuana is not just any other crop, given its psychotropic qualities. However, there still are no recorded deaths attributed to the substance, here or anywhere. And millions have been smoking it for decades, illegally, without untoward results. So, how dangerous is it?

While Supervisor Fennell and Planning Director John Ford would agree that implementing legal marijuana policy is “incredibly challenging,” one might ask if the skewered public perception, fed by decades of propaganda and myths, makes the job any easier. The answer is clearly “no.”

The majority of officials in their capacity would probably tell you they are dealing with a dangerous drug. Some still believe it’s a “gateway drug,” no matter how many times that notion has been disproved. Old activists like myself, after years of lobbying for a sensible cannabis policy, might now ask ourselves if we took the right tact, now that legalization is here.

Personally, I think I should have lobbied for simple decriminalization.

uncle ho
Ted Kogon is a writer/businessman who has lived in Humboldt County for over 40 years. He has been an activist to change marijuana laws for the same length of time, with appearances on 60 Minutes, ABC News Nightline, and 20/20, while contributing to stories by the LA Times, San Francisco Chronicle, and other print media. It's been an up-hill battle and he's not sure it's not still an up-hill battle.