A beachside city became California’s legal cannabis capital. Not everyone is stoked

Anyone driving north along the 101 freeway from Los Angeles will know they’ve arrived in Carpinteria by the smell. The salty breeze caressing California’s scenic coastline is gone in a flash. In its place, a dank aroma more reminiscent of a Grateful Dead concert.

In this beachside enclave, cannabis greenhouses stretch from the mountains to the beach. Thanks to the most lenient policies in California for recreational marijuana, Santa Barbara county is now the state’s undisputed capital of legal cannabis, boasting more acres than each of the the storied Emerald Triangle counties of Humboldt, Trinity and Mendocino.

Santa Barbara voters overwhelmingly backed California’s legalisation of recreational marijuana in 2016, with hopes that the cannabis boom would bring tax revenue and new jobs to the county. The transformation has been fast and furious. Santa Barbara county is now home to around a third of all cultivation licenses issued in California, despite making up only 1.8% of the state’s land, with some megafarms stretching over dozens of acres.

A worker waters baby marijuana plants in a nursery inside Ever-Bloom, one of many cannabis farms in Carpinteria, during a tour of the facilities.

But the sudden influx of growers has inspired a broad coalition of frustration that spans local high schools, uber-wealthy homeowners and the region’s influential wine industry, who argue the pungent industry threatens to ruin their cherished lifestyle in a region dubbed the “American Riviera”.

“Santa Barbara has always been known for its elegant and sporty lifestyle,” complained John Heaton, an artist and resident French-American dual citizen. “The idea that it is now the cannabis capital of the US is not only absurd but also a threat to the century-old community that has crafted its image as a world-class destination.”

The author and journalist Ann Louise Bardach who lives near Heaton, described the smell as “like a few dozen skunks letting loose at the same time”. She continued: “And it just hangs in the air 24/7 on some days.” The smell is even worse, Bardach said, when certain growers are processing their crops into highly concentrated cannabis oil. “Some residents have respiratory ills now, asthma and weepy eyes,” she added. “It’s a bummer, as they say.”

The tensions underscore a wider drama playing out in California over the promises of legal weed. Despite broad public support for bringing the industry out of the shadows, seven years on the illicit market is thriving, businesses are struggling to turn a profit, and many on the frontlines of the transition say they have yet to enjoy the returns.

In fact, for the first time, officials in Santa Barbara are acknowledging that if market trends continue, the cost of the program both to public finances and to quality of life may outweigh any actual benefits.

‘None of us are happy’

Ground zero for the fight is Carpinteria. The enclave is home to the densest concentration of growers, many of them operating in ageing greenhouses that, decades ago, were set up by the city’s Dutch-American flower-growing industry. Now, neat lines of gabled glass and aluminium compete for space with beachside mansions, modest tract homes, mobile home parks and public schools.

Top: High schoolers, during their summer break, train for baseball at Carpinteria high school adjacent to a row of cannabis greenhouses. Bottom: Marijuana plants being farmed at a cannabis farm in Carpinteria.

Frustrations here centre on the overpowering smell that seeps out of some greenhouses that sit directly across the street from homes and schools, turning a trippy aroma into a daily reality – some would say a permanent nightmare.

Local residents concerned about the continuous stench afflicting Carpinteria high school, the city’s only public high school, appealed for help in a 2020 letter to the US attorney’s office in Los Angeles, arguing that the impact on the mostly working-class, Latino students was a violation of their civil rights. Among other demands, the letter requested an investigation of possibly illegal activity, such as cannabis oil processing by commercial cultivators that are operating within 1,000ft of schools and other protected facilities.

Although many residents are blue-collar immigrants, Carpinteria is also home to the ultra-wealthy. The eucalyptus-lined beachfront Padaro Lane boasts some of Santa Barbara’s priciest properties, with owners that include George Lucas, Ellen DeGeneres and Kevin Costner. Residents argue their high property taxes far outweigh any economic benefits brought by cannabis, and that the constant stench is ruining their health, home values and the area’s brand.

Also angered: the wine industry. Today, the rolling hills of Santa Barbara wine country are filled with specialty grape vineyards jostling for space with some of the largest outdoor cannabis operations in the state.

Officials have set a cap of 1,575 acres dedicated to cannabis in rural areas; an allotment that’s already maxed out with a long waiting list of growers. Given the nature of the county’s mountainous geography, it makes for a crowded countryside.

The proximity has raised tensions between grape and cannabis growers on multiple fronts. Pesticides, for example, are prohibited for cannabis but often required for crops such as grapes and avocados – another staple of the area – making aerial spraying of pesticides by farmers a contentious issue.

Here too, the smell is a routine complaint, and vintners say it’s affecting tourism.

Specialty grape vineyards jostle for space with some of the largest cannabis operations in the state.

“When you think about wine tasting, about 80% of the experience is olfactory, and when you throw in the skunk odour, none of us are happy,” said Blair Pence, the owner of Pence Vineyards & Winery near Buellton. His vineyard sits across the road from one of the county’s largest outdoor cannabis growers, West Coast Farms, which includes a 46-acre outdoor cannabis farm, and has planning approval for a 4-acre nursery, and two 3,000-square-foot sq ft buildings.

“My wife gets splitting headaches. When the cannabis grows are really going in the summer, we don’t spend much time up here; it just kills us.”

Adding fuel to the ire is that much of the cannabis grown in wine country is actually owned by out-of-county investment groups or corporations who have leased the land from longtime local landowners and cattle ranchers. According to the county, there are roughly 30 fully licensed cannabis operators in the area.

For their part, cannabis growers and their advocates in county government say that the industry is putting otherwise unfarmed agricultural land to good use, creating jobs and much-needed county tax revenues in the process.

The ‘green rush’

California’s cannabis market has been operating in a quasi-legal sphere since 1996, when medical marijuana was decriminalized. In 2016, advocates for Proposition 64 successfully argued that decriminalizing all cannabis use would create lucrative tax schemes and rewrite the historic injustices of policing such a widely used drug.

But Prop 64 allowed cities to choose whether to allow cannabis businesses or not. Many refused to, banning both cultivation and dispensaries. Others, with varying degrees of success and scandal, sought to cash in on the “green rush”.

In Santa Barbara, one man took on that challenge almost single handedly: the county supervisor Das Williams, a Carpinteria resident of mixed Dutch-Indonesian heritage. His campaign to bring legal cannabis to Santa Barbara found support – and tens of thousands in donations – from Carpinteria’s Dutch-American cannabis farmers.

In 2017, Williams formed a two-person committee to create the county’s cannabis ordinance, promising tax revenues as lofty as $25m per year that would pay for a slew of benefits, including new government jobs related to marijuana, policing efforts and programs for low-income and unhoused people.

Das Williams led the campaign to bring legal cannabis to Santa Barbara.

But in crafting the regulations, critics say, Williams and his fellow supervisor Steve Lavagnino met behind closed doors and relied on input from marijuana lobbyists, resulting in the most lenient licensing and taxation system in the state. It didn’t help that Williams pushed the ordinance through in a year when Santa Barbara was busy reckoning with wildfires and deadly mudslides.

The Los Angeles Times later subjected Williams to criticism in a series of articles, and a withering 2020 Santa Barbara county grand jury report cited “numerous emails” from cannabis lobbyists that appeared to “direct specific actions” to board members.

But Williams has so far survived the controversy, and he remains unapologetic.

“To me, knocking out a power as strong as the black-market trade in marijuana was never going to be an easy task,” Williams said. “The ‘law enforcement only’ strategy has been tried for nearly a century and it’s failed. It’s important to try something else.”

Williams acknowledged the validity of odour complaints but said these have been reduced dramatically by better greenhouse ventilation technology, although he agreed the problem does continue in certain areas of wine country. “I live a few blocks from the biggest operation in the whole county,” he said. “At the beginning, I could smell it constantly; now I can go a year without smelling it.”

Aside from the odour, the chief complaint put to Williams is that cannabis tax revenue – an estimated $50.1m in total since 2018 – hasn’t come close to bringing Santa Barbara the cash that was promised.

Santa Barbara is one of the few counties that taxes farmers based on the value of the marijuana they sell, as opposed to the acreage of their farms. While that strategy works when cannabis values are high, the industry has experienced a huge decline in profitability during the past year. With the sale price of cannabis in the state at roughly a third of its value just a year or so ago, many corporate investors have pulled out of the market entirely, and the number of licensed growers in Santa Barbara county has declined by about 25%.

The vast landscape of hoophouses in Buellton in Santa Barbara county can be seen from atop a hill. Wineries and vineyards in the area have been complaining of the intense marijuana odour.

As a result, the county is expecting to earn just $7.5m in cannabis tax revenue this year, a 54% decline from 2022 and only half the $15.2m that was expected to fund the county’s latest budget, according to a county report.

The county supervisor Laura Capps is the highest-profile politician criticising Santa Barbara’s cannabis policies, and was elected to the board last June on a campaign to reform them. In her view, the financial argument for cannabis no longer adds up. “The main purpose of this for the county was to bring in revenue,” she said. “Shortly after my term began, we got a quarterly report that indicated … the program was barely paying for itself.”

This year, said Capps, only 34 out of 69 operators paid any taxes at all; the majority declared they had netted zero sales, while an additional nine growers didn’t even bother to file returns.

A still-thriving black market adds to the problem. It’s widely known that some producers feel they have no choice but to turn to illicit sales to stay afloat in a challenging market. Last year, California officials estimated that two-thirds of the state’s cannabis crop was sold illegally, and Santa Barbara has been no exception.

“[People are] buying illegally because of either their personal history and relationships, or the fact that it’s 20% cheaper because of the taxes associated with a regulated product,” said Brittany Odermann, Santa Barbara county’s principal cannabis analyst. “The illegal market is really hindering the legal market from getting the foothold that it needs in order to be viable and sustainable.”

The future of cannabis farming

The challenges facing marijuana mega-farms of the future come into focus at Ever-Bloom Farms, Carpinteria’s largest indoor producer. Its greenhouses sit on property owned by one of the Dutch-American farming families who arrived in Carpinteria in the 1960s, operating a lucrative flower trade until South American and Canadian competitors came to dominate the industry in the 1990s.

Ever-Bloom harvests roughly 30,000 cannabis plants a week and is owned by Ed Van Wingerden, a Dutch American Carpinteria resident who began growing gerbera daisies in the 1980s before switching to cannabis a decade later. The company employs nearly 300 full-time farm workers, mainly immigrants from Mexico, some of whom have worked at the company since it opened.

Baby marijuana plants are potted by an automated potting machine and workers at Ever-Bloom, one of many cannabis farms in Carpinteria.

On a recent morning, Phil Greene, Ever-Bloom’s president, guided me through rows of greenhouses filled with more than 100,000 plants in various stages of flowering, from seedlings to fragrant buds ready for harvest.

People are realising that traditional agriculture can grow cannabis at scale well,” he said while showing me a conveyer belt system where several farm workers skilfully operated a robotic potting machine for baby plants. “This is just a new crop for this greenhouse that has been operating for 50 years.”

A walk through the hothouses is akin to strolling several football pitches, replete with tall marijuana plants gently waving in an indoor breeze. That breeze comes from an air circulation system Ever-Bloom hopes will alleviate that persistent odour issue. More than 100 separate Dutch-manufactured carbon scrubbers – each resembling a household air conditioning unit – are spaced throughout the facility. The machines suck in the circulated air and strip out both the odour and any dust particles using filters and ultraviolet light, significantly reducing the smell inside the greenhouse. Just outside the structures, there is no noticeable smell at all.

It’s a promising solution. But with each unit costing about $20,000, many of Ever-Bloom’s smaller competitors couldn’t afford such mitigation measures, much less compete in California’s cratering cannabis market. “A lot of people got in at the same time and now we are seeing the effects of oversupply,” Greene observed. “It’s just too much for the legal retail outlets to absorb.”

A greenhouse at Ever-Bloom, which harvests roughly 30,000 cannabis plants a week.

Three years ago, Greene explained, a finished batch of indoor-grown cannabis could fetch between $1,200 and $1,400 a pound. “That was almost three times what it gets now, and the cost to make it is the same,” he calculated. “So now it sells for about the same as the cost to produce it, and for some even less than the cost to produce it.”

Despite the current challenges, Greene doesn’t see Carpinteria’s greenhouses going anywhere soon. Also unlikely to disappear: the conflict between cannabis growers like Greene and local residents, who are putting pressure on politicians to further regulate and squeeze more from the industry. Capps recently convinced the rest of the board, including Williams, to unanimously vote in favour of forcing growers to file their taxes or risk losing their license.

“I am realistic enough to know that cannabis is here to stay,” Capps said. “There is some demand for it and revenue to be had, but far from what people hoped. I’m trying to reduce the negative impact as much as possible and not just live in this fantasy that we can somehow throw it out.”

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