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With Marijuana Legalized, Farmers Worry Over State Regulations

A+marijuana+farmer+in+Humboldt+County%2C+California%2C+weighs+his+product.+While+Proposition+64+will+allow+farmers+to+grow+the+plant+legally%2C+its+new+regulations+and+taxes+threaten+the+livelihood+of+the+small+farmers+who+previously+dominated+the+industry.+Photo+courtesy+H+Lee.
A marijuana farmer in Humboldt County, California, weighs his product. While Proposition 64 will allow farmers to grow the plant legally, its new regulations and taxes threaten the livelihood of the small farmers who previously dominated the industry. Photo courtesy H Lee.

A marijuana farmer in Humboldt County, California, weighs his product. While Proposition 64 will allow farmers to grow the plant legally, its new regulations and taxes threaten the livelihood of the small farmers who previously dominated the industry. Photo courtesy H Lee.

A marijuana farmer in Humboldt County, California, weighs his product. While Proposition 64 will allow farmers to grow the plant legally, its new regulations and taxes threaten the livelihood of the small farmers who previously dominated the industry. Photo courtesy H Lee.

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Five hours north of San Francisco lies the Emerald Triangle, a trio of agriculture-focused counties that comprises the largest cannabis-producing region in the United States. In these three counties — Humboldt, Mendocino and Trinity, marijuana growers have become increasingly concerned that California’s recent legalization of recreational marijuana under Proposition 64 will destroy their livelihood.

One member of the marijuana industry, who goes by Copall, has enjoyed the legitimacy that legalization granted. But as a middleman that buys marijuana from growers and sells to dispensaries, he fears that Proposition 64’s regulations and taxes could put him and many local growers out of business and pave the way for larger corporate farms to take over. Proposition 64 helps erase a stigma around the marijuana industry, but at a cost to the growers that have spent their lives advocating for the industry.

“It will end traditional marijuana farming like this,” Copall said. “The one-acre farm won’t be in existence for much longer. You’ll start to see guys with millions come in and beat out their small farm counterparts… It will end our way of life.”

That way of life has become a culture throughout much of the Emerald Triangle. Residents of the Triangle look as if they walked out of a Grateful Dead concert, and college students from Humboldt State University frequently work on farms trimming marijuana. In Eureka, the marijuana industry has transformed abandoned warehouses and buildings into marijuana grow centers.

The threat to growers’ culture comes largely from the increase in state oversight that Proposition 64 brings. Starting 2018, growers will have to go through the new Bureau of Marijuana Control to obtain a license to continue their operation, a process that they may not have the monetary resources to go through. For now, growers have stopped expanding their farms to make sure they can afford the license necessary to match the size of their operation, as the process for obtaining a license hasn’t been established by the state.

Many growers agree that Proposition 64 was the next big step for an industry seeking to shake off the negative stereotypes that surround marijuana use, but the cons to this proposition have left the community divided. As a result, the California Growers Association, which represents 450 farmers and 350 supporting businesses, voted not to take a stance on Proposition 64 and remain neutral.

“Nobody, not even the supporters, think the passing of Proposition 64 was a home run,” lawyer Anthony Curiale said. “A lot of people think California can do better.”

Curiale — who focuses his practice around the marijuana industry — says many of the people he represents are worried by the fact that the state plans to issue Type 5 or “Large” cultivation licenses in 2023. Currently, the only licenses offered by the state range from Type 1 for small farms to Type 4 for medium-sized farms, a range which creates a size limit that prevents larger cultivation centers. However, the state plans on offering Type 5 licenses, which would allow large corporations to upend a community that has predominantly done business on its own terms.

One Humboldt grower, Kelly Rhoades, has now hired an accountant and a lawyer because she has become worried over the licenses and taxes that she will have to pay. She says smaller growers won’t be as lucky.

“I’m privileged enough to be an established grower here, [so] I’ll be able to pay my bills and hire people to make sure I’m doing [everything] right,” Rhoades said. “What I’m sad about is that it’s probably going to cost new growers $50,000 to $100,000 to just break in because of the regulations.”

These regulations concern aspiring marijuana cultivators. In addition to purchasing the plant and its upkeep, potential growers will have to pay regulation prices that will become official in 2018. The regulations further establish the notion that big corporations will control the marijuana industry, although Curiale says the smaller farms will put up a fight.

“Proposition 64 brings a lot of good things to the industry, but the main thing that detracts from it is the absurd regulation on this industry, from random inspections… to high-priced environmental taxes,” Curiale said. “This wasn’t a perfect proposition, and those [small growers in] Arcadia and Eureka will [try to] make sure the industry remains in their control.”

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With Marijuana Legalized, Farmers Worry Over State Regulations