Tuesday, the Humboldt County Board of Supervisors hashed out how locally distributed cannabis grants, which aimed to address inequities from criminalization or to meet environmental standards, are playing out.

One supervisor said one part of the county’s implementation of Project Trellis and Department of Cannabis Control grants to businesses was unfair and called for the system in place to be tweaked. Supervisor Steve Madrone said that, faced with the crashing price of cannabis alongside new state and local requirements and taxes, growers had to pick and choose which bill to pay. He said this led many to prioritize Measure S taxes, a voter approved cultivation tax owed to Humboldt County, in order to keep their local permit active.

Madrone said because the board previously decided to prioritize applicants for grants who had not paid their Measure S taxes, it led to people getting bypassed in the queue over those who were waiting longer. He suggested the process be reworked to be more fair.

“In the process, I think we created a very unfair system for others in the queue,” he said, calling for staff take a close look to see about levelling the playing field.

Project Trellis, which granted funds to cannabis growers negatively impacted by the war on drugs, has given millions in state funds to cannabis businesses in Humboldt County since 2021. Humboldt County similarly dispersed grants to cannabis farmers with $18 million from the state’s Department of Cannabis Control for renewable energy and water storage projects.

The board had asked for a report Tuesday on how many recipients of these grants still owed taxes for Measure S. During a presentation, Planning and Building Director John Ford said that 44 DCC awardees owed Measure S taxes, while 58 Project Trellis awardees owed these taxes. He said in total, there is about $1.4 million owed in Measure S taxes from those who received either a Trellis or a DCC grant.

Later, after Supervisor Michelle Bushnell asked how many of these recipients’ permits are suspended or coming up for revocation, Ford said all of them that owe the tax are currently suspended.

“So they’re not cultivating, and they’re not utilizing their farms because they’re suspended,” she said, pointing to a need to make sure the money is getting utilized and put to productive use in the future.

She asked whether or not they can use the grant if their permit is suspended.

“We’re working through that right now; we are having conversations with the permit holders to determine what their plans are. Some of them have not installed the improvements yet, and the time to do so is rapidly — the end of this period is coming to a close. So if they haven’t done that, they really need to give that grant money back,” said Ford.

Supervisor Mike Wilson said, in some cases, people spent public money to increase value of land they promptly sold. He pointed to a past suggestion the grants be zero interest loans that are repaid, upon performance, that are tied to the property in question.

“So that even if stuff gets installed and then the property is sold without a license, then at least the program recoups the value,” he said. In these cases “the property owner has just invested with public money to increase their value — I know that’s not the intention. I don’t believe people are trying to do that, but… stuff happens,” he said.

Ford said they pitched the loan idea, but the Department of Cannabis Control didn’t like it. He noted the planning department is able to check if the sites have the improvements promised installed in annual inspections.

Ryan Heitz, county economic development coordinator, said while they did go a bit out of order in the queue for those up for permit revocations, “The plan is to continue funding down the list in the queue,” he said, with application review moving forward in July.

The Supervisors unanimously voted to accept the report.

Sage Alexander can be reached at 707-441-0504