Humboldt County may begin the process of revoking permits for legal cannabis growers with unpaid taxes late next month.
Voters passed the Measure S Cannabis Excise Tax in 2016 which charges commercial cultivators between $1 to $3 per square foot. The revenue from that tax funds county services including repairing environmental damage from abandoned marijuana farms.
But since that measure passed, the county has had trouble collecting cannabis taxes due to financially struggling growers dealing with oversupply and low prices for their product. Due to that poor market, the tax was suspended in 2022 and 2023. Last year, the tax was reduced by 90%. This year鈥檚 crops have again been exempted.
But many cultivators still have unpaid tax obligations for past years. The county has set a March 31 deadline for growers to pay off what they owe or risk losing their permit.
Natalynne DeLapp with the Humboldt County Growers Alliance, a cannabis trade group, said that deadline was made over a year ago to give farmers enough time to settle their tax debt.
鈥淏ut that has roughly not happened. The market conditions remain the same,鈥� said DeLapp, who noted growers are still scraping by.
鈥淎 farmer's ability to have paid off what could be a鈥� $30,000 dollar tax debt has been nearly impossible,鈥� said DeLapp.
She said around 75% of growers are at risk of losing their permit due to unpaid taxes. She wants the county鈥檚 Board of Supervisors to find a path forward for those farmers without decimating the legal industry.
Humboldt County planning director John Ford said there are over 400 people who have entered into tax payment agreements with the government. But only around two dozen have paid off their overdue taxes. If the county keeps the March 31 deadline, the permits of growers with unpaid taxes will be suspended before a revocation hearing is scheduled.
He said the county could choose to grant an extension for growers. That will be discussed at a board meeting on March 11.
