LAKEPORT, Calif. – A proposed update to the county’s master fee schedule was the main item of business at Tuesday’s Board of Supervisors meeting, with a cannabis program fee totaling more than $5,000 being the key item of discussion.
County Administrative Officer Carol Huchingson and her staff presented a resolution amending the master fee schedule with regard to 14 different fees for the Administrative Office, Water Resources and the county’s new cannabis program.
Regarding the fiscal impact of those fees, Huchingson’s report said, “There will be a modest increase in revenue that will offset the cost of doing business for the County departments.”
The significant changes included a proposed new $5,073 cannabis program fee that is to be paid prior to any permit being issued; the striking of the $65-per-month boat slip rental fee the Administrative Office charged for Holiday Harbor, which the county has sold; the striking of a $10 flood zone check and the implementation of a new base flood elevation determination from Water Resources; a new $30 hunting permit and a new $50 permit fee for group activity/gathering at Highland Springs; a $60 permit and a $20 annual fee for regulatory buoys; and a $10 lake use fee per registered boat in for-profit fishing tournaments and boating events.
Deputy Administrative Office Steve Carter said Water Resources had wanted to adjust fees and create new fees, including the hunting permit at Highland Springs and annual fees on regulatory buoys.
However, Carter said interim Water Resources Director David Cowan wanted to take off the $10 lake use fee for boats in for-profit events and bring back updated department fees in July.
Supervisor Tina Scott said she also was concerned about the $50 fee for group events at Highland Springs.
Cowan said Scott had a good point. He said he had talked to staff about the fees and they didn’t know much about the boat fee, so he wanted to reevaluate it.
He agreed with Scott’s concerns about Highland Springs. Cowan said he believed the previous director, Phil Moy, was looking at a way to generate income from Highland Springs. “But perhaps there are other ways to get that.”
Board Chair Jim Steele said there also are cleanup costs for the park, and Cowan agreed, noting they have a new caretaker.
Supervisor Rob Brown suggested having a $100 deposit which would be returned if groups cleaned up after using the park.
“I know this may sound odd and come as a shock to some, but I question the hunting,” continued Brown, explaining that with equestrian activities, bicyclists and other outdoor activities going on, “it doesn’t necessarily mix” to have hunting taking place at Highland Springs.
“I share those same sentiments,” said Cowan, adding he would like to explore it.
Cowan said that when he found out they had hunting with hiking and equestrian activities he was concerned, and added that the department’s map that shows where hunting is allowed “is sorely lacking.”
Brown said he wanted to review it at some point, adding that the allowed activities should be consistent with what is done at Mount Konocti County Park.
As for the setting of the permit amounts, County Counsel Anita Grant explained, “The permit costs are supposed to represent the county’s out-of-pocket costs,” and can’t simply copy another county.
Huchingson told the board that the Water Resources fees were sourced by staff from the prior director, Moy, and she suggested the board have staff pull them and work with Cowan.
New cannabis fee intended to cover county costs; growers concerned
The item that proved to be the biggest concern for community members who spoke to the board related to the $5,073 cannabis fee.
Huchingson said that at the board’s March cannabis workshop, county finance staff gave the board a report on cannabis revenue projections, and at that time the proposal was to loan money from the general fund to frontload the cost of cannabis operations. She said the board gave staff direction to come back with a fee to frontload those costs.
Her written report said the fee would cover county expenses other than Community Development Department fees.
“The cannabis program services fee is to be collected prior to CDD issuing the minor or major use permit except early activation,” Huchingson’s written report explained, adding that the proposed fee does not include CDD staff since the current fee structure of $95 per hour covers all staff time.
However, the new cannabis fee does cover the additional accountant position, deputy sheriff position, services and supplies, and fixed asset needed to support county cannabis activities, according to Huchingson’s report.
Carter explained that the fee was built by taking that staffing into account for the rest of fiscal year 2017-18 and all of 2018-19, along with those services and supplies – including a fixed asset like a truck – and dividing it by the number of applicants to the state water board, which staff said totaled 88.
Huchingson said the fee would work if all 88 applicants come forward and get permitted. She said that number had increased by 22 since last month and could have increased more by Thursday, when the county’s cannabis ordinance went into effect.
As of Tuesday, only 32 of the 88 applicants to the state had stepped forward and asked for a preapplication conference, nine or 10 had been approved and others were working through the pipeline, she said.
Supervisor Jeff Smith asked if the program would have enough work for the county staff assigned to it. Huchingson said that it would at the start.
Steele asked about the black market, and Huchingson said there is an enforcement assumption for the deputy sheriff.
During public comment, Eric Sklar of Avalon Hot Springs asked if it was a one-time fee or if it was required annually. Huchingson said it would be one-time, upfront, but added that it would have to be looked at for fiscal year 2019-2020.
“There will be some fee in the future but we’re just not there yet,” she said.
Sklar said he supported the fee as it was stated.
Michael Green raised the issue of the item being more transparent on the agenda, and said he was concerned about lumping in enforcement against the black market with compliant growers. He said the county can’t ask compliant growers to pay for enforcement on illegal growers.
He also raised the issues of there being no differentiation in cost between small grows and big ones. “We’ve already lost most of our small growers,” he said, noting they’re getting hammered on planning and air quality fees, and now the $5,000 fee, which is putting a giant burden on small growers that larger growers don’t have.
Other growers at the meeting raised issue about the fee proposal in light of still other fees the county is charging, like $3,000 for self-certification and $150 for fingerprints, and with all of that they said they can’t even grow this year.
Some small growers said they were OK with paying the fees but questioned having more burdens added to them and whether the fee would help keep them safe. They said the barriers for them are being made so high that the black market in Lake County will continue.
Outgoing Community Development Director Bob Massarelli, who joined the discussion about midway through, said that the county had so far not issued any cannabis growing permits.
He said the first step in getting the permits is a preapplication process, and his staff had been having those meetings this week. Once those are complete, the applications have to go through a 180-day process that includes environmental reviews and approvals.
Massarelli asked if the fee would be refunded if a permit was denied, and Grant said yes, it would be, as the county is not supposed to be “unjustly enriched” in the issuing of a permit.
Middletown resident Tony Perkins said he wasn’t opposed to a fee, but suggested it should be on more of a sliding scale.
Scott asked if it had been proven that county staff would spend as much time with a small growers as a large grower.
Huchingson said she didn’t know how to the answer the question. They had the costs for the staff positions and 32 people in the process and “There are just so many moving parts to this.”
After taking a brief break, the board came back and resumed public comment, hearing more concerns about the fee from people who questioned whether it would cost that much to service the growers and who accused the county government of driving people out with its policies.
Returning to the podium, Green was one of those who questioned the staff time and the costs the county estimated it will incur.
“I don’t think staff has demonstrated a clear and convincing nexus that links the fees being requested with the actual services being provided,” said Green.
However, he added, “Let’s assume they did,” and suggested that collecting the fee is appropriate at the time the permit is issued, because the county isn’t incurring costs until then.
Huchingson suggested that the alternative was to collect the fee in two increments – the first half on April 19 or shortly thereafter and the rest at the time of permit issuance.
Steele said government is expensive. “We’re doing the best we can based on a brand new program.”
Supervisor Moke Simon said the county needed to do a tiered permit system. “Hopefully we can get it right in the future,” he said, promising growers they would improve it.
Brown said he had wanted to have a pilot program rather than opening up the permit program countywide. He said the result is the big growers are coming in and the small growers will pay the price, and it’s not fair. A pilot program, he suggested, would have made it more fair to small growers.
With regard to cannabis, “It’s a brave new world,” said Huchingson, explaining that other counties trying to establish regulations are all over the map cost-wise. Some have much higher fees; she said Sonoma County has conditional use permits that range between $15,000 and $17,000.
Ultimately, Huchingson said staff stood with what they proposed, and were not recommending a sliding scale or tiered approach.
Grant suggested the county require half of the cannabis fee be paid upon application with the remainder of any outstanding costs that are due, up to the maximum of the $5,073 fee, be paid upon the permit’s issuance.
Simon took that proposal and moved to approve the master fee schedule which Scott seconded. The board approved it 4-1, with Brown voting not.
Staff said the fee schedule adjustments went into effect on Tuesday following the board’s vote.
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Supervisors approve updated master fee schedule, including cannabis program charge
- Elizabeth Larson
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