Struggling legacy farmers need tax breaks, promotion to move into future, local leaders say
For the last year, Humboldt County’s cannabis farmers have struggled to make ends meet as the price per pound of cannabis continues to fall as a result of massive overproduction across the state.
Many agree that decreasing the costs of production and eliminating the state cultivation tax would be the quickest path to immediate relief for cannabis farmers. Some say the key is branding and developing a marketing strategy that will help secure Humboldt County’s name as a world-renowned producer of high-quality sun-grown cannabis. Further integrating the cannabis industry into the local tourism industry is yet another strategy that could uplift small farmers.
While there is no silver bullet to saving the industry, one thing is clear: The legacy must be preserved.
Leveling the playing field
The Humboldt County Growers Alliance, a trade association that represents 275 licensed cannabis businesses in Humboldt County, recently joined the Origins Council as a regional partner for state and federal cannabis advocacy. The Origins Council, which also represents the Mendocino Cannabis Alliance and the Trinity County Agriculture Alliance, is the largest membership-based cannabis advocacy organization in the state representing nearly 900 licensed cannabis businesses across California.
By unifying the three Emerald Triangle counties with other major cannabis producers across the state, Natalynne DeLapp, executive director for the HCGA, said Humboldt County will be in a better position to advocate at the state and, ultimately, federal level.
Budtenders show patients different strains of marijuana in jars at a local dispensary. (Shaun Walker/ Times-Standard)
“One of the biggest costs of production is the state cultivation tax, which is a set fixed rate that recently went up which only added insult to injury,” DeLapp said. The cultivation tax for flower per dry-weight pound will increase from $154.40 per pound to $161.28 beginning Jan. 1, 2022, according to the state Department of Tax and Fee Administration. “Sun-grown farmers that are only getting $300 a pound are being disproportionately impacted whereas indoor operators are getting a much higher rate per pound. We need to deal with that discrepancy.”
Julie Benbow, executive director of the Humboldt County Visitors Bureau, echoed DeLapp’s call for immediate tax relief. “The difficult situation right now is that the legal cannabis farmers in Humboldt County, not only have their prices tanked but they are taxed a huge amount of money per pound,” she said.
Ken Hamik, operating partner of the Ganjery cannabis dispensary in McKinleyville, chair of the Arcata Chamber of Commerce and chair of the Humboldt County Visitors Bureau’s marketing committee, agreed that “tax relief should be at the top of the agenda.”
“Just write them off, give the farmers a pass this year. Prices have been historically low and it’s no fault of theirs, it’s a big fault of the regulations,” he said. “We are who we are because of our small farmers. If we do not give small farmers the proper pathway to viable business, then Humboldt County is in trouble. Legacy farmers need to be protected immediately.”
Keeping the legacy alive
As the 1960s drew to a close, hippies looking to start anew headed to Humboldt County in what would later become the back-to-the-land movement. Once there, they erected little houses in the hills and many began growing cannabis. These are the people who would lay the foundation for Humboldt County’s cannabis legacy.
“Is Southern Humboldt the birthplace of American cannabis culture? I would say so,” said Rio Anderson, owner and operator of Lady Sativa Farms in Southern Humboldt. “The intellectuals that left San Francisco in the 1960s decided to create a land-based living that was anti-industrial and communal and took care of its citizens. I actually don’t think they’re really viewed as our legacy farmers. The legacy farmers that we talk about are the sons and daughters of those back-to-the-landers.”
As legacy farmers, Anderson said it is critical to keep local history intact.
“We’ve got to evolve, but we also can’t lose sight of who we are and who we were,” he said. “But we have to be real about our history and how it was in the 70s and through the 90s when it was very anti-cannabis here. That’s got to be a part of the story, too.”
To keep the legacy alive, legacy operators must be protected, DeLapp said.
“My mission is to preserve, protect and enhance Humboldt County’s world-renowned cannabis industry. Right now, we need to preserve as many of our legacy operators as possible,” she said. “We have not lost them, there are still thousands of them that have held on through this crisis, but we don’t know how many we might lose in this next year. We need to preserve as many of our legacy operators as possible because we’re not creating a new batch of them.”
DeLapp likened it to environmental conservation.
“We need to protect and ensure that our county and state policies are not detrimental to their health and habitat — I think of this like endangered species,” she said. “… We need to make sure that the habitat is conducive and not actually detrimental to their health, which is questionable at both the state and local levels. Then we need to enhance them, which means helping promote their stories, promoting their brands and it’s not just the people who are still part of the industry.”
If legacy cultivators are able to hang on, Humboldt County’s cannabis industry might have a fighting chance. “The legacy is important for the future, not the past,” Hamik said.
Integrating cannabis into local tourism
Matt Kurth, owner of Humboldt Cannabis Tours, said the best way to protect the county’s legacy is to bring people here.
“We all know that this magical place truly has to be experienced,” he said. “How do you take a photo of the Redwoods or a video of a cannabis farm just before harvest? People must be present to experience these things. Cannabis tourism is the only option for Humboldt County if we are to remain economically and culturally relevant into the future. I say this after much thought and soul searching about my motivations.”
Matt Kurth (Times-Standard file)
Kurth started Humboldt Cannabis Tours, California’s first cannabis tour company, ahead of statewide legalization in 2015. He offers tours to legal cannabis businesses across Humboldt County. To date, he’s conducted more than 400 tours with more than 1,000 guests.
“Everyone is really worried about the consequences to our community of the market continuing to collapse. They are leaning more into tourism as it provides a diverse income stream and more stability,” he said. “… We need to move away from selling pounds and shift towards selling experiences.”
Kurth envisions Humboldt County becoming the France or Napa Valley of cannabis.
“Napa and France wine economies are heavily reliant on tourism. Wine tourism is a $5 billion industry in France and accounts for 25% of wine’s economic impact. In Napa, wine tourism contributes about $2.23 billion to their economy, that is about 30% of wine production’s impact,” he said. “A large part of what makes France France is tourism.”
Benbow agreed that cannabis tourism “has the potential to be a really strong player” in the future of the cannabis industry.
“There is quite a bit of cannabis tourism already. Humboldt Cannabis Tours, the owners of the Scotia Lodge and Humboldt Bay Social Club offer consumption at their hotels, Papa & Barkley Social is a new cannabis lounge in Eureka, there’s really a lot going on already,” she said. “…I’d say that as a major player in tourism it’s a nascent industry, but so was craft beer 10 years ago.”
Benbow also underscored the importance of Humboldt County boosting marketing efforts.
“Humboldt cannabis was a brand long before Humboldt cannabis was legal and we need to push that message forward. We’re running on fumes right now,” she said. “There some amazing farmers throughout the county and they all have incredible stories to tell. That’s what the tourists want to buy, the history and the story of it.”
Laura Lasseter, director of operations for the Southern Humboldt Business and Visitors Bureau, said her main mission “has always been tourism marketing and destination development inclusive of the cannabis industry.”
“For us, integrating cannabis and tourism is nothing new but everchanging,” she said. “We have embraced the cannabis industry with open arms and do our best to help showcase what we can with our events, external marketing and networking to help advance the integration of cannabis and tourism through our partnerships in the hospitality and tourism industry. We’re making a concerted effort to work towards destigmatizing, normalizing cannabis with education.”
Lasseter emphasized the need to preserve the cannabis culture, heritage and legacy craft farmers that made Humboldt County world-renowned.
In addition to being an economic driver, cannabis tourism also has the potential to build bridges between industries, DeLapp added.
“There is an incredible opportunity to partner between the cannabis trade associations, the various tourism organizations, chambers of commerce and pool resources together where we’re building each other up and not tearing each other down,” she said. “It’s time for us to put some of the past behind us and to openly acknowledge that cannabis is part of the future. If we all understand that and accept that as reality, then we can really come up with different plans and strategies for how we can work together.”