Spokane County air pollution regulators approve new rules, fees to battle smelly marijuana farms

Spokane County pollution regulators have approved a new set of fees and rules for marijuana growers in what they described as an attempt to curb the costs of dealing with mounting odor complaints.

The Spokane County Regional Clean Air Agency’s board of directors voted unanimously Thursday to require a registration fee for marijuana producers and processors that will cover some of the costs of enforcing state regulations on nuisance smells. Those regulations include a requirement for outdoor farms to inform the agency when they’re harvesting and a mandate that air pollution control equipment be used for indoor grows.

A handful of marijuana growers spoke against the new rules, saying they add an unfair fee structure on top of an already over-regulated industry. That industry was thrown further into disarray Thursday by the announcement at the federal level of a policy change that has allowed marijuana business in the state and county to continue to grow without intervention, they said.

Al French, chairman of the board, said the new fees were necessary because of continued complaints and what he said was inaction by some businesses to lessen the smell.

“When we started down this road, I made the comment, when the county was adopting its land use regulations, that it’s going to be a whole lot better if the industry regulates itself, than it is if we end up regulating it,” said French, who also serves as a Spokane County commissioner. “Over the last several years, that hasn’t been possible.”

Growers say its unfair to impose registration fees on all businesses when only a few farms draw most of the complaints. The agency reported there were 16 odor complaints related to marijuana in November, the most recent month for which data was available. Thirteen of those targeted one specific facility.

As a result of Thursday’s vote, businesses that grow, package and manufacture secondary products, such as oils and edibles, will be required to pay one-time registration fees totaling between $525 and $2,230 for the first year, based on their size and whether their production occurs in a controlled, indoor environment or outside.

Kim Hoff, owner of the mid-range production facility Flying High in Otis Orchards, said the additional fees would continue to hamstring her business, which is struggling to pay rent and break even.

“We have an indoor/outdoor facility, but with prices so low, we can’t even afford to turn on our lights,” Hoff said. “So now we are an outdoor facility.”

Hoff will have to pay a $980 fee to apply for an exemption, as an existing business operating both indoors and outdoors, from the agency rules, in addition to the one-time registration fee that is based on the size of her operation.

Aaron Juhl, owner of Funky Farms in Deer Park, asked board members to change the registration fees to scale to the size of his operation. As a lower-tier producer, Juhl is limited to 2,000 feet of plant canopy space, while mid-range businesses can grow up to five times that, and the largest businesses up to 30,000 square feet, or more than 10 times as much. The largest producers will pay less than double the registration fees of their smaller competitors, according to the regulatory scheme announced Thursday.

“I think the fee structure is completely unfair to the smallest farmers that really can’t afford these fees,” Juhl told the board members.

Crystal Oliver, co-owner of Washington’s Finest Cannabis in Deer Park and a member of the industry group the Cannabis Farmers Council, said she was most concerned about the need to report harvesting schedules to the agency, which could fall into the hands of the public and imperil the safety of crops and farmers.

“The dry cleaners, the coffee roasters, the other companies that they have to regulate, those companies don’t have to report to them when they roast coffee or clean clothes,” Oliver said.

While board members French, Spokane Valley Mayor Rod Higgins, Millwood Mayor Kevin Freeman and Tom Brattebo voted to put the rules in place and assess initial registration fees, they delayed a decision on how much businesses will pay next year and the years following to support enforcement over some confusion about what farms that begin growing indoors then move flowering plants outside will have to pay.

French said he believed any revisions made to the fee schedule would likely mean farmers would pay less, not more, by potentially changing the category that existing businesses fall into. In addition to the initial registration fee, farmers will be charged an annual assessment that will cost smaller, indoor growers $528 annually, while the largest firms growing both indoors and in the open air will pay nearly $5,000.

“I’m pretty comfortable that the fee structure for the annual renewals is not going to increase,” French said. “It might decrease.”

Oliver was dubious.

“I have never heard of a regulatory agency lowering fees. They don’t have a reputation for lowering fees,” she said. “I think they’ll figure out a way to spend the money.”

The agency expects to collect close to $172,050 from existing marijuana businesses in the county to cover enforcement expenses next year, based on a presentation made to board members Thursday. The cost of enforcing the nuisance odor ordinance, including site visits, data management and other outreach, is expected to add up to between $145,600 and $263,900.