Down the dirt roads on the hills of Northern California, where small farmers have been growing marijuana and evading the authorities for decades, the anticipation before election day, when the state will vote on a recreational marijuana ballot, is high. But many of the farmers will vote "no" on Proposition 64, the statewide ballot measure that could legalize marijuana for adults over 21. The farmers want marijuana to be legal, but they think the proposed law puts big business interests ahead of the small farmer.

Ruby Steinbrecher, a lawyer and the chair of the Sonoma County Growers Alliance, an advocacy and educational group for marijuana cultivation businesses in California, says many long-time marijuana farmers from Sonoma and up to Humboldt County will vote no on 64, which will propose the passage of the Adult Use of Marijuana Act (AUMA), on Tuesday.

"There is a big fear that the big interests are about to come in and crush the small growers," says Steinbrecher. "We know consolidation is coming, we know things will change, but we don't want the small businesses that have been around for a long time to go away completely because this is the culture of who we are and what we do. We need to protect it."

The main complaint about the Adult Use of Marijuana Act (AUMA) is that it is not as friendly to the small farmers as the medical marijuana laws are. If passed, the California state government will issue unlimited growing licenses in five years time, which means big companies will be able to buy as many licenses as they want to create mega-marijuana farms.

Another issue, says Steinbrecher, is that farmers in Northern California, most of whom have been cultivating marijuana long before the laws started to change, are just learning how to deal with the new medical regulation laws passed under the Medical Marijuana Regulation and Safety Act in 2015, which gave the industry a much needed clear and robust framework to support a legal industry. The new recreational laws add confusion to that process, she says.

"We are just wrapping our heads around the new medical laws passed last year," says Steinbrecher​. "We are busy focusing on that and throwing in new regulations for a recreational market adds a thick layer of complications and issues to the huge paradigm shift of legalization."

California has long operated in a gray market. In 1996, voters passed Proposition 215, which legalized medical marijuana but did not offer a framework or regulatory body to manage the industry. As California's industry becomes legitimate, the farmers need to change the way they have done business for years.

"Many people never kept business records as a precaution [in case of a police raid]. If you were cultivating cannabis, you'd keep business records on scraps of paper and burn them after the harvest," says Steinbrecher, who is also the president of Madrone California, a collective of small marijuana farmers who have come together to help each other stay compliant under the new laws. "Legalization is overwhelming; we need more time to adapt."

According to polls, Proposition 64 is likely to pass in California. If it does, that means marijuana would be legal for recreational use in every state along the west coast of the U.S. The ArcView Group, a network of marijuana angel investors, says if California passes a law for recreational use, the national marijuana market could go from $7 billion last year to $22 billion in four years. There are similar measures in Arizona, Nevada, Maine, and Massachusetts. As for medical marijuana, Florida, North Dakota, Arkansas, and Montana are voting to legalize medical use. But as California is estimated to grow the bulk of the country's marijuana, all eyes are on the state to see what happens. If California legalizes recreational use, there is a good chance that many other states will follow in the coming years, which will in turn put more pressure on the federal government to change federal law.

Hezekiah Allen, who grew up on his family's marijuana ranch in Honey Dew, California, sold the land and started lobbying for small marijuana farmers and businesses in 2014, with his group the California Growers Association. He has fought to get many concessions for small businesses included in the medical regulation laws passed under the Medical Marijuana Regulation and Safety Act in 2015. He says if AUMA passes he will have to start working to get farmer-friendly regulations amended into the new law. The group has a neutral stance on 64, but he says he will vote no.

"Is the goal to make marijuana millionaires? Or to make all these criminals in the hills small-business owners? We want to make business owners out of the farmers who have been working in the shadows for decades," says Allen.

He is also against the rule that allows companies to buy unlimited number of licenses in five years, as he believes it will beget mega cannabis corporations that will threaten the livelihoods of small farmers.

"Small farms are good for California. Right now, the state is home to a diverse group of boutique and craft farms, but 64 will accelerate consolidation," says Allen. "It's going to be messy, it'll be a fight, but I am not discouraged. We will just work to put amendments in that will support small business."

Another aspect of AUMA that Allen believes goes against small businesses is a flat tax structure across the industry; multimillion-dollar businesses will be taxed at the same rate as a boutique grower. The taxes under AUMA will be imposed at harvest, so cultivators will have to pay before getting it inspected for quality and potency, which could end up hurting farmers if the yield doesn't turn out as planned or if mold or pests infest the flowers. This could hurt a small-business owner who lives harvest to harvest, says Allen.

Allen says AUMA does have positive aspects, including the fact that most people will not go jail for marijuana offenses. But much of the work he did to help support small businesses got undone as the campaign raised $20 million to get on the ballot and pay for ads, Allen says.

Another aspect of legalization that farmers will have to get used to, Steinbrecher says, is a shift in culture and attitudes towards the government. She grew up around marijuana cultivators and says she is excited for the industry to become a legitimate part of the economy. But the farmers, who have been persecuted by drug agents dropping out of helicopters to cut down pot crops and arrest the owners since the start of the domestic drug war, are just learning how to trust and deal with the government and regulators, she says. The isolated communities of the hills, the main producers of marijuana sold in retail shops in San Francisco and Los Angeles, want to be licensed and regulated, but in order for it to work, she says, all the farmers need to be on board. But since 64 has been divisive, she says if California doesn't move into legalization slowly, many farmers will just continue operating in the black market.

"We need to show that legalization works and that the government isn't this big, scary man," says Steinbrecher. "Once the farmers all have their licenses and know they will not be busted anymore, that's when it's time to expand to recreational. This will take time."

Published on: Nov 7, 2016