A large group of marijuana industry folks showed up at today’s Board of Supervisors meeting to give their representatives an earful about a proposed excise tax measure for commercial marijuana cultivation. Almost to a person the weed folks stated that they’re totally not opposed to being taxed — just not right now, or not at the cultivation stage, or not at the proposed rate.

As hashed out in previous meetings, the proposed tax measure would, if approved by voters in November, charge growers one dollar per square foot of outdoor cultivation area, two dollars per square foot of mixed-light cultivation area or three dollars per square foot of indoor cultivation area. The language of the measure needed to be finalized at today’s meeting in order to make it onto the General Election ballot.

After some brief discussion from the board, public speakers gathered in a long queue to address the supes. Several speakers protested that the tax would effectively squeeze out small farmers, while others said it wouldn’t provide enough of an incentive for them to come out of the black market and go legit. 

“I think you need to drastically reduce the cost per square foot,” said Thomas Mulder. Otherwise, he said, “You’re going to put the smaller farmers, the more eco-friendly farmers out of business.”

“If we become too onerous in this initial phase, the taxes start to build up [and] it will make it almost impossible for a business person to do what they would normally do,” said Ken Hamik of Hummingbird Healing Center. He suggested waiting until more people are growing legally, with the Humboldt brand well established, before taxing cultivation.

“You need to consider that this industry needs to be nurtured,” said Sunshine Johnston. “It needs your help.”

Kent Sawatzky, the county’s most frequent public commenter, flashed a bit of anger as he argued that there’s no reason to tax anything that’s grown in an area less than 5,000 square feet. He suggested the proposed tax was all about money and greed. “I think you should be ashamed of yourselves,” he said to the board, adding that he will do the best he can to make sure the measure is defeated at the ballot box.

Ultimately only two public speakers voiced support for the tax measure. One was Alexander Moore, whose Honeydew Farms was recently granted permits for nearly seven acres of cultivation, and the other was John Bartholomew, the county’s treasurer and tax collector.

When the matter came back to the board for discussion, the supervisors proved unified in pushing back against the critics. Second District Supervisor Estelle Fennell noted that while the tax measure has been under consideration for months now, none of the previous meetings on the issue had the turnout of today’s meeting. 

Third District Supervisor Mark Lovelace agreed. “The time to get involved in the conversation is at the start of the conversation, not the end,” he said.

First District Supervisor Rex Bohn said he literally got his ass handed to him by dairymen after the last meeting on this issue. They were upset over the board’s decision to lower the tax rate, he explained. There’s a regulatory burden that simply comes with the territory of being in business, he said. And as for there being no incentive to go legitimate, Bohn pointed out the benefit of not being arrested: “The cost of peace of mind is hard to put a price on.”

Lovelace and Fourth District Supervisor Virginia Bass rejected the accusation that greed was behind the measure. The revenues from the tax will go toward much-needed county services, they said. “We’re not grabbing money for ourselves,” Lovelace said, reminding people of the hundreds of millions of dollars needed for deferred maintenance and Public Employee Retirement System liabilities.

Fennell and Fifth District Supervisor Ryan Sundberg pointed out that other California counties are considering rates much higher than the one being proposed here. “Other counties are vacillating between $25 and $50 per square foot,” Fennell said. “This is not huge.”

In the end, Fennell made a motion to adopt the proposed measure for the November ballot, Sundberg seconded and the motion passed unanimously.

From the staff report, which you can read in full by clicking this, here’s the proposed language for the ballot:

Humboldt County Commercial Marijuana Cultivation Measure. To maintain and improve essential services, including public safety, job creation; crime investigation/prosecution; environmental cleanup/restoration; children/family mental health; drug rehabilitation; other County services, shall Humboldt County establish a $1 - $3 per square foot, based upon type of grow, annual commercial marijuana cultivation tax generating approximately $7.3 million annually until ended by voters, with all revenue for the County, none for the State, annual audits, and public review?

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