State Cannabis Tax Cut a Mixed Bag for Humboldt (Also more Info from the Board of Supes)

The state has reduced its cannabis tax rate, which helps farmers but has a downside unique to Humboldt County.

During a review of recent state legislative activity at the Sept. 23 county Board of Supervisors meeting, Karen Lange, the county’s legislative consultant, highlighted the passage of Assembly Bill 564, which rolls back the state’s cannabis tax rate from 19 percent to 15 percent.

The bill was signed into law the day before the supervisors meeting and the new rate will be in effect Oct. 1 through June 30, 2028.

“Its a big deal for communities like yours,” said Lange. “It’s not a statewide problem but it’s definitely a thing for your growers and hopefully it provides some relief to folks that are trying to follow all the rules.”

But revenue from the state tax contributes to the county’s Project Trellis cannabis business assistance program and grants for environmental restoration, water storage systems and renewable energy systems to replace generators.

Supervisor Mike Wilson noted that less cannabis tax revenue will affect state funding for those things, which Humboldt uniquely benefits from.

“I did hear from constituents within this community around AB 564 and the loss of funding,” he said. “So I know that while there are concerns about cannabis retail tax and the impact it can have on maybe the illegal market, we also have to acknowledge that Humboldt County is a huge recipient of the funding that comes from those taxes.”

Wilson added that “we get probably more money per capita for our programs, especially environmental programs and cleanup than probably almost any county in the state of California relative to that taxation.”

He’s hoping there can be “a little bit more nuanced conversation about that in the future if something like that comes up again.”

Several wins for the North Coast region were largely credited to the efforts of State Senator Mike McGuire, who will be termed out at the end of 2026. Lange said he’s “going out swinging.”

Part of that is approval of $50,000 for an initial financial feasibility study on a proposal that’s been discussed for decades – turning McKinleyville into an incorporated city.

McKinleyville is in Supervisor Steve Madrone’s district and he said studying incorporation is “something the community is very much looking forward to, having the data on the potential for incorporation.”

Calling McKinleyville “the third if not the second largest non-city in Humboldt County,” Madrone said having the financial data “is going to allow our community to actually have an informed discussion about the pros and cons of incorporation – it’s not saying we’re gonna incorporate but it’s the next step forward to looking at it and exploring it.”

Lange outlined several other state legislative pluses for the North Coast, including a bill that was passed and sent to the governor’s desk allowing for the composting of deceased livestock, addressing a longstanding challenge for local ranchers and farmers.

Legislation to create a regional energy grid allowing transfer of renewable energy to and from other states was also passed. Lange said “there’s going to be funding tied to that that should be used to help update the grid and increase the infrastructure” in Humboldt County.

Pushback on AB 470, a bill would have allowed AT&T to stop providing old school landline telephone service in about a decade, was successful and the bill was voted down.

Supervisors have argued that in a county with high power outages, losing landlines – which are often the only reliable communication during an outage – would prevent some residents from calling 911.

Another action, replenishment of the state’s nearly depleted Wildfire Recovery Fund, is a mixed outcome.

The state approved a final deal generating $18 billion. The bad news for residents is that $9 billion of that will come from an increase on utility bills for customers of investor-owned utilities like PG&E.

Also during the meeting, supervisors fielded an update on the County Public Health Division’s harm reduction program, which includes syringe exchanges and disposals.

After a pandemic-influenced drop in the number of syringes exchanged, it’s “back in full swing,” said Public Health Officer Candy Stockton, with 259,000 syringes exchanged in 2024.

The program also includes education, distribution of overdose reversal kits, and HIV and Hepatitis testing and treatment.

Overdose death rates have been dropping over the last three years, with 50 last year and fentanyl making up the majority.

“The numbers for this year look on track to be at that same level or slightly higher this year so this overdose prevention work remains critically important in our community,” said Stockton.

The syringe exchange encounters allow county public health staff to make referrals to further help but Stockton said more than 85 percent of drug use is through pills and other non-injection methods.

Supervisor Rex Bohn questioned the program’s effectiveness and highlighted the role of law enforcement.
“As we move forward with the fentanyl use, a lot of that is going to be law enforcement and with the Drug Task Force and everything else,” he said. “Instead of accommodating, having less on the streets also helps people if they’re down – if they can’t get the product, maybe they’re going to think about coming in and getting help with that.”

He added, “So I hope that’s a big part of it rather than aiding these people – your stats say it’s the greatest thing in the world and I don’t know if the streets show that.”
Other supervisors were more supportive of the program, with supervisor Natalie Arroyo praising its “data-driven approach.”