Northern California

Humboldt County contests lawsuit challenging marijuana tax

Humboldt County is contesting a lawsuit filed last month that alleges the county Board of Supervisors made illegal changes to its cannabis cultivation tax.

Filed last month by local attorneys Eugene Denson and Frederic Fletcher, the lawsuit calls for the Humboldt County Superior Court to order the county to refund potentially millions of dollars of tax revenue the county collected from permitted cannabis farms.

Alderpoint-based marijuana defense attorney Eugene Denson holds a stamped copy of the lawsuit that he and Eureka-based attorney Frederic Fletcher filed against Humboldt County in May challenging changes made to the county’s cannabis cultivation tax. (José Quezada — For the Times-Standard)

The lawsuit was filed on behalf of the Humboldt-Mendocino Marijuana Advocacy Project, the Humboldt Cannabis Taxpayer’s Association, the Humboldt Voters’ Association and two Bridgeville property owners, Karen and Dennis Silva.

In a court filing earlier this month, the county’s hired attorneys from the Porter Scott law firm in Sacramento stated Fletcher’s and Denson’s complaint “in its entirety and through each separately stated cause of action fails to state facts sufficient” for the court to grant their demands.

The lawsuit was filed May 14 before a crowd of supporters and a Netflix documentary film crew at the Humboldt County Superior Courthouse. The litigation seeks to have the county do away with what it claimed to be illegal changes to the cannabis tax in 2017 and revert the tax back to its original version passed by voters in 2016.

After the changes made by the board last year, property owners with marijuana cultivation permits for their land are taxed between $1 to $3 for every square foot of cannabis they are licensed to grow. The rate varies depending on whether the grow is outdoor, indoor or mixed-light. The tax is collected twice a year.

The lawsuit claims these changes were required to go before the voters for approval.

The original version of the tax passed by voters through Measure S in November 2016 taxed the farmers and not the property owners. The original measure also had the tax being collected every two years, which county staff said was an error. The tax also only taxed farmers based on how much they grew that year, not based on how much they are permitted to grow.

Denson also claims the original tax used to be pro-rated based on the when the farmer began cultivating, but was changed by the board to paying the tax regardless of whether the cannabis was grown or not.

No court dates have yet been set in the case, according to court records.

Will Houston can be reached at 707-441-0504.