At their Oct. 26 meeting, the Sonoma County Board of Supervisors voted to extend until Sept. 10, 2023 its previous 45-day moratorium on new multi-tenant ministerial cannabis permits instituted earlier this fall, agreeing many purported small growers were blowing smoke and abusing a flawed process.
The multi-tenant provision was established three years ago to allow small farmers the ability to lease parcels collectively in order to operate grows no larger than 10,000 square feet each via a streamlined ministerial permitting process. Cultivators operating in this way are able to avoid getting a traditional conditional use permit, so long as the shared parcel is at least 10 acres in size and the total cumulative area of cannabis grows does not exceed one acre (43,560 square feet).
The provision was intended to reduce barriers to entry into the market for small farmers, so as to reduce market control by larger corporate interests, however, Agricultural Commissioner Andrew Smith told supervisors only about 20% of the 85 multi-tenant operators are operating in line with the board’s intent. The rest, he said, are taking advantage of the ministerial process as a cheaper, faster way by operating multiple multi-tenant grows on multiple parcels, sometimes with the same co-tenants.
Smith said this allows, functionally, for a second, easier route to grow sizes, which, while dispersed through the county on multiple sites, would otherwise require a conditional use permit for the same individual operators cultivating on a single site. Not only does the secondary path to a certain cultivation goal erode the legitimacy of the permitting process, but it prevents an accurate assessment of impacts that would otherwise be determined through a conditional use permit process for grows of that size, as the ministerial permitting process is not subject to the same standards as use permitting.
“The provision as it is currently written is focused more on the identity of the applicants and the relationships between the applicants rather than on the land use intended by the projects. The current standards do not allow us to distinguish truly multi-tenant operations that would meet the board's intent on the provision,” Smith said.
“In several instances the same multi-tenant applicants have applied for ministerial permits together on three or four separate — and in some cases — contiguous parcels. As a result of this, there are many multiple acres of cannabis cultivation that have been subject to ministerial review instead of discretionary review, and thus cumulative impacts that have not been evaluated over a landscape. This has led to the perception by industry and citizens stakeholders, as well as staff, that this is an abuse of the provision and its original intent,” he said.
Smith said that the “lion’s share” of current multi-tenant operators are groups of four cultivators operating together on four separate parcels, achieving the maximum grow size of a much more rigorously obtained conditional use permit. There are also concerns that large cannabis corporations within the county are backing these grows, however, their exact involvement remains unclear
Furthermore, because the ministerial process doesn’t require the same environmental impact review (EIR) a conditional use permit process would require, Smith said the multi-tenant operations will also likely fail to comply with the state licensing authority, which will likely require higher standards for such grows. Smith said it will be cheaper and more effective for ministerial applicants and operators allowed to bypass reviews to complete them at the local level rather than at the state level.
The supervisors deliberated for hours on the topic, struggling to achieve the four-fifths supermajority vote to enact the moratorium.
Major sticking points in the debate centered around how current multi-tenant permittees in operation would advance in relation to the new rules. The board ultimately agreed with staff’s recommendation that currently permitted multi-tenant operators would be eligible to renew their permits annually for five more years, subject to two code enforcement inspections each year.
Deputy County Counsel Sita Kutiera said staff had envisioned three pathways for current operators to pursue within the next five years: they could phase out operations, apply for a use permit under the current ordinance for a different use (such as indoor) or apply for a new permit under the new ordinance, expected to be completed in 2024.
Supervisors David Rabbit and Chris Coursey were hesitant to back the five year extension for current permittees, with the board ultimately winning Coursey’s support by including an incentive requiring operators to submit and diligently pursue a conditional use permit within three years in order to continue operating as they are in years four and five.
The third-year conditional use permit application requirement would also prevent staff from being overrun by a deluge of applications upon the five-year expiration — with that requirement, proponents argued, there would be plenty of time to process legitimate applications.
The 54 multi-tenant applications in the pipelines will have to withdraw their applications.
There was also lengthy discussion over who was to blame for operators who received multi-tenant permits designed for small growers, but who were acting like larger growers.
Supervisor James Gore, perhaps the board’s strongest supporter of ministerial cannabis cultivation permits, said current multi-tenant permittees may not hold all the blame.
“I don’t assume that conforming with the ministerial permit invokes malintent from everybody. I think this is a very difficult one to generalize to that level,” Gore said.
At one point, Gore asked Smith to confirm whether staff were actually facilitating the multi-tenant applications against the board’s original intent. Smith said that his office was not encouraging ministerial grows, but that prospective applicants were merely — and understandably — intrigued by the loophole.
Still, Gore said, “We had staff members approving stacked permits. Let's just admit to that today. We’ve had discussion about all these people gaming the system ... but we know staff was issuing these permits.”
Supervisor Coursey agreed with Gore regarding the flaws in the system being the root cause behind the abuse of the multi-tenant provision. “We didn’t hone in as much as we should have. And if there’s a loophole, people are going to take advantage of it,” Coursey said.
Rabbit was the only hold out on the vote, saying that a five year extension will have allowed some cultivators who had received the first ministerial permits three years ago to operate out of the loophole for eight years total — far more than they’d need to recover their investments, he said.
Cannabis cultivation is a highly controversial subject in Sonoma County, with groups of residents — the self-proclaimed “neighbors” groups — staunchly opposing cannabis grows in rural residential and agricultural residential zones on claims of impacts such as smell, environmental impacts and, purportedly, an increased risk of crime.
On the other side, cannabis cultivators insist they are growing an agricultural product not dissimilar to wine grapes, and that the cannabis industry will be a boon to Sonoma County’s economy if only regulators would get out the way.
The county is currently in the multi-year process, begun this summer, of creating a brand new cannabis cultivation ordinance to replace the existing ordinance, which was deemed unsalvageable.