Cannabis growers plan to sue El Dorado County

Eric Jaramishian
Mountain Democrat

El Dorado County Growers Alliance members say they plan to sue the county and its Board of Supervisors for blocking several commercial cannabis applicants from receiving licenses.

Applicant and Shingle Springs resident Lee Tannenbaum said he has been in the application process since late 2019. The El Dorado County Sheriff’s Office has not given approval or denial for Tannenbaum’s application to the Planning Commission, which has seemingly been held up on background checks, according to Tannenbaum.

“There have been 10,000 licenses issued in the other legalized counties in this state since the time we passed the law, but El Dorado for some reason can’t seem to issue one,” Tannenbaum said.

According to the county’s ordinance code, permits are issued when background checks of all owners are completed with review and recommendation by the Sheriff’s Office.

Tannenbaum’s attorney James Brunello wrote to the Board of Supervisors Oct. 11 to address issues with the application process, which members of the Growers Alliance have also tried to do numerous times to no avail, according to the letter. Tannenbaum said he has had similar luck with Sheriff John D’Agostini.

“I have been told in writing that the sheriff will not speak to me, that if I have any questions about policy or the way that they’re running their business that I need to talk to deputy county counsel Breann Moebius, who ultimately backs everything the sheriff says, because of the code that was written, which is now in effect,” Tannenbaum said.

Brunello’s letter states that the permitting process is “broken,” disregards the will of county voters and exposes the county to potential liability due to privacy violations.

“The code was written to prevent people from actually getting through the process and once they did get through the process, there’s some poison pill language in there, which will prevent anybody from holding a cannabis license long term,” Tannenbaum said.

In El Dorado County background checks for commercial cannabis activity are required for all owners and investors of the company.

“Owners,” according to the county, are defined as any person with ownership interest, shareholders and lenders, not including a bank or financial institution. Owners are also anyone who might share any profits the business makes, which could include employees earning commission, persons who participate in management or control of the business and anyone who is a financial interest holder.

The wives or spouses of investors would need background checks as well, according to the county.

The cannabis operating permits would expire upon any change in ownership.

Examples of what could trigger permit expirations include selling stock, receiving a loan from a new private lender, hiring a commissioned sales person, providing an employee a profit sharing agreement or the death of an owner, which all constitute as a change in ownership, according to the county’s background investigation initial and review questionnaire.

“They’re super invasive and it’s a violation of U.S. privacy law and state (law),” Tannenbaum said. “That is where the grounds of the lawsuit are.”

The Sheriff’s Office declined to comment on the situation.

Grower’s Alliance members say since no favorable action has been taken after their lawyer’s letter was sent to supervisors, they will go forward with the lawsuit.

“The ballot measures require the sheriff to comment on the criminal background of commercial cannabis applicants. His refusal to do his job effectively blocks cannabis cultivation licenses in the county,” Rod Miller, director of the Growers Alliance, wrote in a news release announcing the lawsuit.

County voters in 2018 voted to legalize cannabis and its commercial use.

“It has been nearly three years since El Dorado County voters passed five cannabis initiative measures by substantial margins,” Brunello wrote in his letter to the board. “Since then (the Growers Alliance) and its members have worked in good faith to implement the policies bringing legal cannabis to El Dorado County.”

Brunello told the Mountain Democrat Nov. 2 that the Growers Alliance plans to file the lawsuit this week.

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