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October 2019, Volume 25, Number 4

California: H-2A, Cannabis

Santa Maria continues to struggle with housing for H-2A workers and local residents. An estimated 2,400 farm workers are housed in residential areas of the city. Some City Council members want a tenant displacement program that compensates renters who are forced to move when landlords agree to house H-2A workers. One proposal would require landlords who displace tenants in order to house H-2A workers to pay the displaced renters three months rent.

Duff Bevill spent $1 million or $28,000 a bed to build 10 rooms with bunk beds to house H-2A workers in Healdsburg. About 30 percent of Sonoma county growers provide some housing for their employees. The county's farm workforce peaks at 10,000 in September.

Crown Nursery in Red Bluff paid $95,000 to the Tehama District Fairground to house 200 H-2A workers in Fall 2019 who help to harvest strawberry plants. Crown uses a Fresno-area contractor to bring 400 US workers to the area, and in 2019 began to use H-2A workers at a reported cost of $1,200 per worker for recruitment, processing and transportation. Fair districts in Tulelake and Susanville rent housing for H-2A workers.

Gerawan Farming and Wawona Packing agreed to merge in September 2019 to create the largest US stone fruit producer, with Dan Gerawan as CEO. Tulare county based Wawona packs fruit from 9,000 acres of stone fruit trees.

Cannabis. California is expected to have legal marijuana sales of $3.1 billion in 2019, up from $2.5 billion in 2018. Illegal sales are expected to be $8.7 billion, almost three times legal sales, and are expected to exceed legal sales until at least 2022. State and local fees and taxes add 50 to 75 percent to the farm-level price of legal cannabis. Legal cannabis sales are expected to be $1.4 billion in Colorado and $1.1 billion in Canada in 2019.

In summer 2019, there were 583 licensed retailers in California and 263 licensed home-delivery firms. Three-fourths of the state's cities and 70 percent of the state's counties have banned legal cannabis retailers.

Santa Barbara county, with a third of the state's cannabis cultivation licenses issued in 2019, has some of the state's largest cannabis growing operations, with planned 83- and 147-acre plastic-covered hoop farms that would be among the largest in North America. Many residents complain about the skunk odor of cannabis-growing operations.

The largest Santa Barbara farms were able to combine or stack hundreds of applications for 10,000-square-foot licenses because they grew cannabis in the county before January 19, 2016. At the end of 2018, Santa Barbara county had licensed 630 acres; by June 2019, there were applications to grow over 1,400 acres of cannabis. The county collects four percent of gross revenue, which can be $300,000 to $500,000 an acre, in taxes.

Cannabis is produced outdoors and in greenhouses. Outdoor production peaks in October, when cannabis prices are lowest. Cannabis prices rise in the spring and summer.

Los Angeles county led the US in farm sales from 1909 to 1949, with oranges the leading crop. At the peak in the 1939, there were 15,000 acres of citrus in the county. The 14-acre Bothwell Ranch near Tarzana and Woodland Hills, is the only remaining commercial citrus operation, and its owners want to sell the orchard for $14 million to developers. The Los Angeles City Council may designate the ranch as a Historic-Cultural Monument, which could limit development.