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Santa Maria Sun / Cover Story

The following article was posted on April 19th, 2017, in the Santa Maria Sun - Volume 18, Issue 7 [ Submit a Story ]
The following articles were printed from Santa Maria Sun [santamariasun.com] - Volume 18, Issue 7

Waiting for weed: Local marijuana cultivators and entrepreneurs anticipate county and city legislation drafted to catch up with legalization

By SUN STAFF

While the passage of Proposition 64 in November made it legal for adults ages 21 and older to possess, use, and personally cultivate recreational marijuana, the matter of taxing growers and purveyors of legal cannabis is an issue local government bodies are scrambling to address.

The state will begin issuing business licenses for growers and distributors of marijuana and weed-related products in 2018, but for now, local growers and collectives are stuck distributing in exactly the same way they have been under Proposition 215, or the Compassionate Use Act.

Plant It Earth Collective receives several phone calls a day for marijuana deliveries, according to co-owner John Schniebs, but when he asks the caller for a copy of their medical card he’s often met with surprise.


GROWING INDUSTRY
Local marijuana growers are currently caught in legal limbo while awaiting the county and city regulations on recreational cannabis cultivation, but they are still able to grow and distribute under the umbrella of the Compassionate Use Act.
FILE PHOTO

The prospective customers assume that the collective can deliver because recreational marijuana is legal, Schniebs explained, but the sale of it isn’t allowed yet.

“I get two or three calls a day that say, ‘Ah, that’s stupid, well I’m going to try someone else,’” he said. “I’ve had people tell me there’s some shady ways around it … but I’m not going to do that.

“If you don’t have a license, it’s a basic drug deal to the cops, even though it’s still legal,” he added. “I can’t go to jail when it’s so close to being legal, catch a 15-year sentence and six months later it’s completely legal for everyone to smoke.”

Growers like Schniebs are currently in a legal limbo while awaiting regulations from county supervisors and city councils, and they’re not alone, as entrepreneurs of several strains wonder what the rules will look like. The necessary tax codes and regulations are currently being hashed out, and prospective cannabis retailers are still unable to move forward to meet the coming demand for recreational weed.

There’s not even a clear picture of how the industry and market will work next year. The price of a pound of marijuana could plummet if the market becomes saturated, Schniebs explained, so it’s difficult to anticipate local laws along with the demand of consumers.

“That’s what I’m thinking about right now is, is it more economically feasible in the long run to just get more stuff growing now, just start, and have no plan with what we’re going to do with it, and just hope that there will be a need,” he said. “But it’s hard to do. Right now it’s a little bit of a catch-22.” 

Rules and regs

Growers in Santa Barbara County looking to cultivate commercial weed have a way to go before legal options become available, but the process is underway—on the county level, at least.

As of April 4, the county prohibited all recreational cannabis cultivation, with the exception of medical weed and the state-protected right to consume marijuana and grow up to six plants in an indoor residence. The urgency ordinance banning outdoor cultivation will last until mid-May, at which point the Santa Barbara County Board of Supervisors will likely extend it to 22 months, according to County Planner Jessica Metzger.

“This urgency ordinance will give us time to analyze all the issues associated with [the Adult Use of Marijuana Act] and create sound regulations for the multiple facets associated with the legislation,” Metzger said at the supervisors’ April 4 meeting.

Supervisors Das Williams and Steve Lavagnino, who represent the 1st and 5th districts respectively, will take charge of creating those “sound regulations” on the county level, through an ad hoc subcommittee.

Williams said the ad hoc committee’s discussions are going well so far: They’ve discussed the possibilities of fingerprinting and banning former felons from taking part in the marijuana industry, as well as how to limit commercial weed cultivation so it helps the agriculture industry, rather than hindering it.

“Frankly, the ad hoc committee’s intention is not to try to help increase marijuana production,” Williams told the Sun. “Our main goal is to differentiate good players who are trying to do it in accordance with the law from people who are being loosey-goosey with the law, and to be able to enforce it.”

Lavagnino added that the county has contracted with an economic consultant to do a study to determine how much revenue might be generated by the cannabis industry in Santa Barbara County, and how the county might be able to tax growers.

“I can’t wait to see the economic report, because I’ve never seen anything else in the county that people want to raise taxes on,” Lavagnino told the Sun. “My counterparts on the board don’t like the oil industry, which would create revenue. There’s really nothing else I’ve seen with such a limited scope that could generate this type of tax revenue.”

Though California is set to begin issuing commercial cultivation permits in January 2018, growers won’t qualify for state permits unless they can present proof that they’re in compliance with local laws—meaning local laws have to exist.

For this reason, the county is racing to come up with cultivation regulations by the end of 2017.

“This cannabis thing is all-time consuming. This thing is so huge,” Lavagnino said. “I probably spend two days out of the week now doing nothing but research, visiting facilities, having meetings about it—we’re trying to start something from scratch. It’s not easy to do.”

In the meantime, prospective cannabis growers can use an online registry system to notify the county that they plan to pursue a state permit next year, and provide information on their planned operations.

Williams said hopeful growers who use the registry will get priority for county approval come 2018, which incentivizes current growers to “come out of the darkness, into the light,” and gives preference to local cultivators as opposed to out-of-towners.

Lavagnino said it would help to know a baseline of how many grows currently exist in the county, for enforcement reasons. At this point, he said the board is aware of at least a couple hundred grows, but he suspects the number could be as high as 1,000.

“Some might be legal because they’re under the medical marijuana laws,” Lavagnino said. “Some are a gray area. Some are completely illegal.”

He added that in his experience, most current growers want their operations to become legal, so the registry should provide a good first step in doing so.

“That’s the big carrot,” Lavagnino said. “People who are doing it illegally right now, a vast majority of those want to get into the system and become legal. And so they will fill out our registry. They will start going through the process.”

Growers like Schniebs, and his partner at Plant It Earth Collective, Kenny Dutton, say that even with legal and taxed cultivation, there will still be growers operating underground.

Operating by the book comes with costs, Dutton explained, and black market cultivators will always be able to provide a cheaper product.

“Sales tax, city tax, county tax … we end up just eating that. We don’t charge our customers sales tax, so that comes out of our take,” Dutton said. “So now, they’re going to charge you to grow, they’re going to charge to come out and inspect the grow just like building inspectors, so you’re charged for everything.”

But those looking to cultivate commercially will at least get a chance to make suggestions to county officials.

Supervisor Williams said the ad hoc committee will wait to solidify any regulations until it hears from the public. Its first public hearing is scheduled for April 25 at 12:45 p.m., in the Board of Supervisors’ hearing room in Santa Barbara. Another meeting will take place in Santa Maria, but the date hadn’t been set as of press time.

But there’s one more catch—local municipalities have first say in regulation, so hopeful growers who plan to cultivate in Santa Barbara County’s incorporated areas have to comply with local city laws, as well. Here’s what growers should look for in North County’s municipalities:

Guadalupe permits medical marijuana dispensaries, and has not yet implemented city laws pertaining to recreational cultivation.

Santa Maria’s urgency ordinance banning most cannabis-related activities is in place until Aug. 14, 2017. The only exception to the ban is delivery of medical marijuana into the city.

Lompoc’s City Council voted against an ordinance that would have aligned city law with state law, so marijuana cultivation in Lompoc is still illegal under a previously existing ban.

Buellton does not permit medical marijuana dispensaries or the use or possession of “drug paraphernalia.”

Solvang bans most cannabis-related activity, with the exception of delivery of medical marijuana into the city. Solvang’s urgency ordinance banning commercial recreational cannabis is in place until Sept. 12, 2017. 

Legal to have, but not to make

Proposition 64 allows state residents to possess up to an ounce of dried marijuana and to grow six plants inside a home, so anyone can legally start an indoor garden, smoke up, and get high, even now.

The new law also allows possession of up to 8 grams of concentrated cannabis. Often referred to as dabs, wax, shatter, BHO, hash oil, and honey oil, concentrates are a form of pure THC (tetrahydrocannabinol, or the chemical in marijuana that makes you high) extracted from the plant material of marijuana. They are smoked, vaped, or otherwise consumed.


COMBUSTIBLE CONCENTRATION
While marijuana concentrates are legal under Proposition 64, most methods to make them aren’t legal. One popular way involves butane, which is highly flammable and potentially dangerous, explained Santa Barbara County Sheriff’s Office Lt. Brian Olmstead. Pictured is a butane oil operation busted by the Sheriff’s Office in October of last year.
PHOTO COURTESY OF SANTA BARBARA COUNTY SHERIFF’S OFFICE

But there’s one problem: While Proposition 64 legalizes concentrates, it doesn’t specifically address the question of making them.

Whether or not the process is legal was posed in the People v. Bergen case in 2008. In this case, which was appealed to California’s Second Appellate District, the court affirmed the process to be illegal.

The court’s opinion was further reinforced by a 1991 California attorney general opinion that considered “chemical extraction” of marijuana to be prohibited under California Health and Safety Code 11379.6(a).

Not only that, but the process of making hash oil is considered highly dangerous among law enforcement due to some of the chemicals used to make extracts.

There are several ways to extract concentrated cannabis products, but butane is a common method. The butane is used as a solvent to strip the oils from the plant, which are then boiled together in a container to evaporate the butane, and then the residual butane is vacuum-purged with a machine.

The problem with this method, according to Santa Barbara County Sheriff’s Office Lt. Brian Olmstead, is the flammability of butane. Explosions can happen in a number of ways, he said, particularly if vapor leaks from the system, making it that much easier to spark combustion.

Olmstead, who’s in charge of the Sheriff’s Office’s Special Investigations Unit, and his deputies approach hash oil labs like they do meth labs—with extreme caution. To dismantle a lab, officers must receive hazmat certification.

“We are still concerned about the manufacturing process because there has been documented instances in the county of people getting injured and catching on fire,” Olmstead said.

Not all concentrates are extracted with solvents like butane. Some use carbon dioxide or other methods.

“AJ,” a medical marijuana patient in San Luis Obispo who didn’t want to be identified for this story, makes his concentrates with old-fashioned heat and pressure. He told the Sun that he began making his own concentrates after learning that other manufacturers used solvents, which could contaminate the product.

“I never felt comfortable with what was going into it,” AJ said. “Most people don’t have the money or have access to proper hardware to do the process correctly.”

Concentrates don’t necessarily mean those with only THC, but also products made with CBD (cannabidiol, a non-psychoactive chemical said to have powerful health applications). Nevertheless, The Drug Enforcement Agency formally classified marijuana concentrates among drugs like heroin and ecstasy (and marijuana) in December 2016.

Although manufacturing concentrates may technically be against the law, Olmstead said that the state is currently working on a licensing framework that allows manufacturers to operate legally, which won’t be available until at least January 2018. 

Got the munchies?

The “finally, it’s about time” mood is sinking in with many Californians, as the implementation of legalized weed inches ever closer. Many are eager to get the ball rolling and move beyond ad hoc subcommittees and city council meetings to actually being able to purchase it freely.

But if the idea of smoking anything or putting your mouth on some ridiculous bong shaped like the pope is off-putting, there are still plenty of other ways to enjoy legal weed. And vendors are getting creative in how they package the formerly taboo product, especially in edible forms.


SWEET TREATS
Local baker Carol Draeger began experimenting with cannabis oils to make both delicious and medicated treats for her business, Shuggies. She said she’s waiting on local legislation before considering selling her edibles to recreational users.
PHOTO BY JAYSON MELLOM

Edibles are a mainstay for the customers of the medical marijuana delivery services that operate along the Central Coast. Danielle Savidge of Canna Coast Cooperative boiled down edibles’ appeal to patients to the practicality and ease of using them. Users may also prefer the discretion of an edible to lighting up a joint or packing a pipe.

“For delivery patients, the candy varieties are more popular because they have a longer shelf life,” Savidge stated in an email. “For patients attending events, edibles can range from drinks to ice cream to nachos to cakes and any other popular food you can think of.”

Sales of edibles have been especially lucrative in states such as Colorado, which legalized marijuana for recreational use in 2012. According to statistics compiled by Marijuana Business Daily, edibles made up a huge chunk of the state’s financial boon. Sales of edible products in the state jumped 53 percent from the first quarter of 2015 to the first quarter of 2016, generating more than $28.7 million in sales.

One local baker in Santa Maria hopes the increasing demand for edibles will help grow her budding bakery. Carol Draeger is more like a grandmother in a Pepperidge Farms commercial than a sinister drug dealer.

Draeger, who began baking when she was 9, said she was driven to elevate the taste of her medicated treats for customers of her Mi-Care Meds medical delivery service.

“Everything had a real strong taste of weed,” she said. “One of the biggest things about what you eat is taste and visuals.”

Draeger experimented with various ways to get the perfect balance of flavor and potency, eventually turning to a non-alcohol-based oil. Now, she turns out potent products that look more like the kind you’d find at a Parisian pâtisserie than in a stoner’s backpack.

“I try to make gourmet things, something that’s different,” Draeger said. “Like cranberry oatmeal dipped in white chocolate, or chocolate chunk cookies with pecans and a chocolate ganache or frosting.”

But as delicious as some of the treats look, customers need to avoid binge eating. Draeger said a lot of available edible products push the THC content up to 25 to 35 percent, packing a powerful dose. Newbies need to be aware that edibles impact an individual in a more distinct way than smoking, and also take much longer to hit your system.

Savidge echoed this warning, advising anyone who takes too much to drink citrus juice as a remedy.

“For patients first trying edibles, it is important to start with a very small dose and wait a minimum of two hours to feel its initial effects,” Savidge explained. “Everybody’s bodies are different and react to medicine in different ways.”

As for plans to alter her business to cater to recreational users once new regulations—whatever they may be—kick in, Draeger said she just plans to keep baking, for everyone.

“I also sell non-weed infused products,” she said. “So maybe you come with your friend who wants to try the edibles and you just enjoy something for the regular munchies.”

No matter how legislators end up doling out sales licenses, the benefits of normalization are already apparent. Draeger said edibles have opened doors in ways that traditional medical marijuana never could.

“I think that what it’s done for people medicinally is now they’re not afraid,” she said. “We have a lot of elderly people. It’s made people aware of what it can help them with.”

The Sun staff can be reached at mail@santamariasun.com.




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