The Mendocino Cannabis Alliance called it the “most significant policy day in Mendocino County, hands down,” in recent history. At its meeting on March 14, the Board of Supervisors voted unanimously to accept an offer from the State Department of Cannabis Control to help streamline applicants’ permits. On February 8, the Alliance sent a lengthy letter to the Department and Governor Gavin Newsom, documenting what it calls “a pattern of failure,” and pleading for state intervention to prevent a collapse in the county’s licensing system.
Last Monday, after hours of testimony at a Senate Committee hearing on small businesses including cannabis, Nicole Elliott, the director of the State Department of Cannabis Control, sent a letter to the Mendocino County Board of Supervisors, reading in part, “If the Board chooses to pursue such streamlining, the Department is prepared to collaboratively engage with the County to address longstanding challenges confronting the County’s legacy operators and California’s legal market. This includes assessing inefficiencies under existing procedures for compliance with the California Environmental Quality Act (CEQA), and identifying a way by which the Department could (with the County’s assistance) lead revitalized efforts to ensure timely compliance with CEQA for provisional license holders. Likewise, streamlining local permit decisions will provide greater clarity, sooner, to support enforcement of state and local law.”
Elliott also requested that the County “refrain from disbursing additional funds under the Local Jurisdiction Assistance Grant (LJAG) Program.” CEO Darcie Antle told the Board the grant program funds were the subject of an audit, after learning that Cannabis Program Director Kristin Nevedal said she had made a reporting error that led the state to mistakenly believe over $3 million of the grant money had already been spent.
Supervisor John Haschak asked Nevedal if the requested freeze in spending the grant funds applies to money the Board approved to hire planners under a contract with a company called 4Leaf to process applications. The grant is intended to help local jurisdictions bring cannabis applicants into compliance with environmental regulations.
“We just approved a contract, last meeting, for $1.6 million for 4Leaf to do this additional consulting,” Haschak reflected; “and it seems like that’s necessary work to be done. But if they’re saying, don’t spend any more money, does that mean that we’re not supposed to continue with that contract? It’s kind of a Catch-22, because we need to keep working on the applications, and we can't get behind if this doesn’t work out with the state.”
Nevedal responded that, “Based on my conversations with the DCC yesterday, it does not include the 4Leaf contract. So they're not asking us to not move forward with the 4Leaf contract. They’re asking us to not move forward with issuing grant monies.”
It’s not clear yet exactly what the licensing process would look like in a collaborative effort with the state. But supervisors and Michael Katz, Executive Director of the Mendocino Cannabis Alliance, are hoping for an extension to the July 1 deadline for processing state permits.
County Counsel Christian Curtis told the Board, “We would need to do a CEQA addendum…If you keep essentially all of the substantive environmental protections that are there now, you could likely do a pretty significant overhaul. The big change is that this would mean the Appendix G process would not happen at the county level anymore. Because a lot of the steps that are being taken during the permit application review process are documenting what the state wants before they issue their permit.” He speculated that the state could convert its process to a ministerial permit or choose another way to document site-specific environmental compliance. “I’m very heartened to see that they’re willing to work with us on this,” he added.
Curtis also pointed out that, while much of the work of processing applications is likely to be performed by the 4Leaf contractors, civil servants do have protections, and he does not want them to panic.
During public comment, a caller named Kaylie Perkins, who said she is an attorney with clients who are trying to get their permits with the county, told the Board she thinks it’s time for a change. “I think the Mendocino Cannabis Department should be omitted, and instead, only a state license should be required,” she stated. “The DCC has proven that they are competent in processing licensing documents, and Mendocino Cannabis Department has proven that they are not…There are countless reports of the department losing documents, requiring multiple submissions, sending erroneous correction requirements, and it’s been a constant drain on our clients. We should have an exemplary permitting process. We started it off, after all, with 9.31. But ever since then, it’s gone downhill. Everyone in Northern California that’s in the cannabis industry knows Mendocino County is not the place to go to get permitted. So I urge the Board to strip the cannabis department of their authority and hand responsibility over to the state.”
Supervisors defended the department and Nevedal. In a call after the meeting, Supervisor Maureen Mulheren said she does not think it would be realistic to eliminate the local cannabis department, and she does not believe anyone at the department is acting nefariously. She said an extension of the timeline would be the most helpful thing, but she is concerned that the state will not be as compassionate as the county. She views the application portals as examples of the county giving applicants as many chances as possible to submit their documents.
Supervisor Ted Williams has long complained that the cannabis program is rightfully the state’s responsibility. He said that, while Nevedal is “kind of in the hot seat right now,” multiple ag commissioners and cannabis program managers and heads of Planning and Building before her have also been accused of botching everything. “It’s the same result, no matter who you put there,” he said. “It’s a structural problem.”