Grand Jury Slams California County’s Cannabis Regulations

A grand jury in Santa Barbara, California criticized the county’s cannabis regulations in a report released this week, writing that members of the Board of Supervisors allowed marijuana businesses to dictate policy and failed to serve the interests of the county’s residents. The grand jury, which serves as an oversight body for county agencies, wrote in the report that it had received several requests to investigate the actions of the board in relation to the creation of the county’s cannabis regulations.

The grand jury took issue with the establishment of an ad hoc committee that was formed by the board in 2017 to create regulations for adult-use cannabis cultivation in the county. The committee was made up of two county supervisors, Das Williams and Steve Lavagnino, and was not subject to open meeting laws as is customary for most land-use issues. The report, which did not name individuals in accordance with grand jury policy, criticized the lack of transparency and the committee’s close relationship with cannabis industry representatives.

“The Board of Supervisors granted nearly unfettered access to cannabis growers and industry lobbyists that was undisclosed to the public during the creation of the cannabis ordinances,” the county grand jury wrote. “On March 20, 2018, the most extreme example was an email sent by a Board member to a lobbyist, during a Board meeting, asking the lobbyist if they agreed with a [planning and development] staff recommendation.”

Licensing And Taxation Rules Questioned

Among other issues, the grand jury was critical of the licensing of cultivation operations in the county. The regulations did not limit the size of commercial cannabis farms and allowed anyone who filed an affidavit stating they had been growing medical marijuana on a particular property to apply for a license for the site. No system for verifying the affidavits was implemented, a weakness that is widely believed to have been taken advantage of by many of the county’s now-licensed growers.

“Without question, one of the most perplexing decisions made by the Board was the utilization of an unverified affidavit system,” the jury wrote.

The grand jury report also decried the taxation scheme put in place by the board, which was based on a firm’s gross receipts rather than on the operation’s area, a system that is more customary and easier to verify.

“I’m trying to generate what could be $20 [million] to $40 million a year for the county,” Lavagnino said at a board meeting in February 2019.

However, the board found that the county only collected $6.8 million in taxes in the 2018-2019 fiscal year for 217 acres of permitted cultivation. In comparison, nearby Monterey County collected $15.4 million from 62 acres the same year.

Grand Jury Calls For Change

Writing that the board’s actions in support of a robust cannabis industry had “altered the quality of life in Santa Barbara County, perhaps forever,” the grand jury called for the cannabis regulations to be revised.

“The Jury believes the Board of Supervisors, in their hubris, failed the people of Santa Barbara County,” the report reads. “Now they must amend the cannabis ordinances to regain the people’s trust.”

But the county supervisors who served on the ad hoc committee defended the cannabis regulations while saying the grand jury’s concerns would be addressed. Lavagnino said on Thursday that the grand jury is biased against the legalization of cannabis and Williams said that the panel only pursued “one side of the story.” 

“The demographics of the grand jury are not reflective of the county as a whole,” Lavagnino said. “It is not at all surprising to me that a group of predominantly white senior citizens is uncomfortable accepting that cannabis is now mainstream. We will review their recommendations and answer them as required.”