MONTEREY COUNTY — Monterey County Board of Supervisors narrowly voted Jan. 9 to make changes to its outdoor cannabis cultivation pilot program, allowing growers to double their canopy size and eliminate a requirement that made permit applicants prove cannabis was cultivated on the property prior to legalization in 2016.
The board has been trying to breathe life into the sputtering local industry, which has seen a contraction amid falling prices that peaked in 2021 and competition from unregulated sales, which the heavily regulated legal industry has failed to replace.
In the second quarter of 2021, Monterey County recorded $20.4 million in taxable cannabis sales. By the third quarter of 2023, the last period reported by the state, the number had fallen to about $16.5 million.
The state eliminated a cultivation tax in 2022 and the county reduced its own cultivation tax in 2023 as the industry struggled. The county also slashed its cannabis program budget last year by 30% after its costs began to outpace its revenue, which was about $3 million in 2023.
The final ordinance will still need to be crafted by county staff after supervisors made changes to the original recommendation presented last Tuesday by cannabis program manager Joann Iwamoto. It proposed allowing an aggregate of 300,000 square feet of outdoor cannabis canopy in unincorporated areas of the county and would include a limit of 20,000 square feet per permit.
The current limit is 10,000 square feet of outdoor canopy, a number that was already increased twice as supervisors tried to prop up the receding local industry. While there is no current aggregate cap, there is a requirement that outdoor growers provide proof that that they were permitted to grow under the Compassionate Use Act of 1996, which set up a legal framework for medical marijuana.
Supervisors Chris Lopez and Luis Alejo, who opposed the motion, said that requirement made an aggregate cap unnecessary, since the number of properties was limited.
Both supervisors expressed concerns about the impact new outdoor cultivation locations would have on neighbors of the properties. Alejo said eliminating the requirement to prove prior cultivation occurred on the property would create a “free for all.”
Supervisor Mary Adams, who, along with Lopez is a member of the county’s cannabis committee, was the only supervisor to support the changes proposed by county staff. She said the county’s current zoning process was sufficient to prevent the ungoverned rush on new permits that Alejo predicted.
“Our outdoor program really remains so challenging because of the limitation and the red tape that we put people through in order to become permitted in the county,” Adams said.
But after Supervisor Glenn Church expressed reluctance, Adams amended the proposal to allow an aggregate of 140,000 square feet of canopy in the county, with an individual cap of 20,000 square feet. She offered another amendment to include residences in the list of properties that cannot be within 1,000 feet of an outdoor cultivation operation.
The proposal was approved 3-2, with Lopez and Alejo voting no.
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