DCC’s ‘Inadequate Oversight’ of $100M Undermined California Licensing Program for Cannabis Growers | Where to order marijuana online

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According to a report by the state auditor, the California Department of Cannabis Control did not properly oversee a grant of $100 million intended to assist 17 jurisdictions in assisting cannabis cultivators with their transition from temporary to permanent annual licenses.

The Local Jurisdiction Assistance Grant Program (LJAG) of the state. You can also check out our website for more information. The California Legislature, in June 2021 provided a one-time funding source for thousands of small cannabis businesses, both legacy and equity, to comply with a state mandate on environmental protection.

Local jurisdictions are required to conduct site-specific environmental assessments for each cannabis operator in order to ensure compliance with state law. California Environmental Quality Act (CEQA). The law is designed to minimize the impact of development projects. These reviews, which can help protect sensitive animals, natural waterways, and air quality are often time-consuming.

Even if a cannabis-cultivation site does not pose a threat, a licensee cannot automatically transition to a permit that is valid for an entire year without completing a site-specific assessment, which involves biological surveys and other studies. Origins Council Executive Director Genine Coleman told Cannabis Business Times.

Origins Council is an organization that advocates for approximately 900 small, independently-owned cannabis businesses and homestead farming communities, primarily located in rural areas of Northern California.

“The way CEQA works, there is a baseline which is a snapshot of the moment you are going to submit a license application for a The new way to buy? Coleman said. Coleman said. The new way to buy? activity. We represent a majority of legacy cultivators. Some of these sites have been producing marijuana for decades. They’re all treated as if they were brand new projects. This is what has caused this problem, and this bottleneck with significant costs for these very small businesses. [operations].”

The state mandate that all cannabis businesses move from temporary provisional licensing to more permanent annual licensing was originally supposed to occur in 2019. However, the deadline has been extended multiple times due to the underfunded expectations placed on local jurisdictions for the CEQA reviews.

According to the current statutory timeline the DCC is not allowed to renew provisional licenses beyond Jan. 1, 2020. License holders must convert their licenses into annual ones by Jan.1, 2026 or they will be forced out of the market.

The $100 million funding for the LJAG Program was given to counties and municipalities to support this conversion process. The state auditor’s office questioned recently whether the program’s objectives were being met.

“We determined that DCC’s inadequate oversight and local jurisdictions’ inappropriate expenditures during first year of grant program have weakened program’s capability to achieve its goal, which is to help certain local jurisdictions that need assistance in transitioning cannabis business that hold provisional licences to obtaining annual state licenses,” wrote State Auditor Grant Parks in a report dated Aug. 29 to Gov. Gavin Newsom, and state legislators.

Newsom, the person who proposed funding in his 2021-2022 Budget SummaryIn his proposal, he said that the grant program would, in part, help transition a larger population of legacy operators onto the regulated market, and those who live in areas rich in resources and need additional capital to comply with environmental standards.

State law requires that the DCC administer the grant program. The DCC improved its administration after the state auditor raised concerns with the department leadership in July 2023. However, Parks says that some of the department’s management shortcomings were still unresolved by May 2024.

The state auditor provided two example:

• The DCC is unable to accurately measure if the 17 grantees have achieved the goal of the grant program, because the officials at the department did not ensure they included clear goals or measurable metrics in their grant agreements.
• The DCC did not also obtain documents from grantees which would have revealed problems in their expenditures including unallowable or underreported costs.

According to the state auditor, the DCC also did not establish an initial spending plan for its administration funds.

Parks wrote that “DCC has spent only $350,000 out of the $5 million available to administer the program. It has understaffed it with staff who are not qualified to manage a complex program and has failed to respond to grantees’ amendment requests in a timely fashion.” This $5 million was part of the total $100 million LJAG Program.

The state auditor found that some grantees had not managed their funds correctly. Parks questioned the $26,000 spent by two grantees who could not prove that their expenditure was appropriate.

Although it is unclear how much money remains uncommitted, the 17 counties or cities must spend or encumber the grant money by June 30, 2025 or forfeit the funds back to the State.

Moorea Warren, spokesperson for DCC CBT The department issued a statement expressing its appreciation for the California State Auditor’s (CSA) team’s evaluation and examination of the DCC’s performance in managing the LJAG Program.

The statement states that “Throughout the grant program operations, the Department has actively worked to implement change to address CSA concerns as well as address opportunities for improvement.” Before the audit report was published, many of the issues raised in the report were addressed, such as hiring dedicated grant management personnel, consolidating licensing system, and adopting CSA recommended best practices for administering grant programs. DCC is looking forward to continuing to implement recommendations and improve existing improvements.”

Some California industry stakeholders continue to question the competence of those in charge of overseeing California’s regulated marijuana market, which has continued to face hardships for nearly eight years after Proposition 64 (to legalize cannabis for adult use) went into effect.

The state auditor’s report was particularly disappointing, given that the punitive taxation levels used to pay for the program have driven hundreds California cannabis businesses into bankruptcy. 15% of businesses Hirsh JAIN, founder of an industry consultancy, said that “taxes are in default across the state.” Ananda StrategyTell me if you can CBT.

“In the end, mismanagement of these funds hurts ordinary Californians the most, as many remain without convenient access of safe, tested cannabis product almost eight years after Prop. Jain is also the vice chair of Cannabis Chamber of Commerce and a member of the Cal NORML Board of Directors.

According to the DCC licensing database, as of September 4, 1,146 of California’s 4,973 active cultivation permits statewide (or 23%) still have provisional permits.

In the eight counties which received grant funding from the LJAG Program, 29,5% of active cultivation permits still have provisional licensing in these jurisdictions.

*San Francisco’s grants went to the city and county.

Nine cities also received grant funding from the LJAG Program, including Los Angeles (22,3 million dollars), Oakland (9,8 million dollars) and Sacramento (5,8 million). Los Angeles County had 264 cultivation licenses that were still listed as provisional.

Coleman said that Mendocino County growers continue to be in a state of existential crisis due to “unreasonable’ statutory deadlines for converting their licenses. Coleman cultivated cannabis more than 20 years prior to founding the Origins Council. She is also a founding member of the Mendocino Cannabis Alliance.

“The mandate to review every site puts an enormous burden on the local jurisdictions. This is especially true for rural jurisdictions who are less resourced than urban jurisdictions and do not normally have to deal with such a large workload of discretionary reviews,” Coleman said.

Why does Humboldt County, which is adjacent to Mendocino County, have nearly twice as many cultivation licenses yet a higher conversion rate? 949 out of 1,083 licenses have already been converted to annual permits.

Coleman said that when Humboldt County officials set up local ordinances on cannabis, they created a system which was better aligned to state mandates, in terms of discretionary reviews for each project. They had the correct infrastructure locally to match state requirements.

She said that Mendocino County officials had set up a program even before the state licensing framework in California was implemented.

Coleman said, “This is not Mendocino County’s fault because they are trying to serve the legacy farming communities by transitioning as quickly and painlessly as possible to licensing.” “They set up a system that would be the best way to go.” It was not in line with the state’s mandate for site-specific CEQA.

She said that Mendocino County had set up a ministerial permit system without discretionary review of environmental standards.

Coleman explained that Mendocino County did not have a system in place to meet the state licensing requirements. This is because the state requires an individual site-specific review for every project to qualify for a state license and CEQA compliance.

Cannabis cultivators in Mendocino have been unable to obtain a license because of the influx of three local regulatory agencies and six department heads over the past six years since the county launched its adult-use program in accordance with Proposition 64.

The Mendocino cannabis programme was so rife with obstacles that county officials eventually gave up. In an effort to streamline the process of obtaining permits, the DCC intervened and took over the sole management responsibilities of the LJAG Program..

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Coleman said, “So the DCC hired a environmental firm to conduct an environmental impact assessment for the entire program.” “And they will also conduct the site-specific CEQA reviews.” Everyone is rowing in the exact same direction. There is political will. There’s focus. “But there’s not enough of it.”

As part of the review, Environmental Impact Reports Often, they are produced to document any impacts and potential and planned mitigating measures. EIRs are also programmatic. Once site-specific reviews have been performed, they may include multiple options of environmental paperwork such as a notice for exemptions or a mitigated negative declaration.

Coleman said that Mendocino must still adopt and certify its proposed programmatic EIR. However, the draft proposal calls for seasonal biological surveys and analyses.

“We’re going to run out time,” she said. “And some hundreds, 200, 300 400, 500 small farm families who have been fighting for eight years, are about to fall from a provisional license cliff without good reason. “I think the timelines created a lot of pressure.”

California’s provisional licence holders may not be able to wait until spring to conduct some of the state-mandated biological assessments. Their permits will expire in 2024 or 2025.

The entire provisional licensing program will be “kaput” by the end of 2025. This means cannabis cultivators that haven’t switched to annual licensing will find themselves in a rut with no paddle.

“What’s really bad about this whole thing, is that you have no appeal right,” she said. “You are a provisional licencee and have no rights to due process. You have not protected your investment in the site, which is usually several hundred thousand dollars at this stage for cultivation. We’re talking a specific location, and you cannot even sell your business until you have a license. You have not protected your investment. “It’s heartbreaking to see what’s happening.”

Coleman said that while environmental controls are important for both the state and the industry, the $100 million in funding from the LJAG Program is like throwing gasoline on a flame. She said that if there is not enough time and capacity to implement the solution the grant money was intended to solve, it could unintentionally do more harm than good.

“I think this is the lesson.”