WENATCHEE — Rob Colwell stands in an almost empty building looking at his dead marijuana plants.
It cost Colwell and his significant other Shari Bohart almost $300,000 to construct this building for their marijuana growing company, Green Leaf Producers. Now they’ve had to shut down their business and are working to sell their license, Colwell said.
“One of the reasons we are as bitter as we are is because we’re in our 60’s,” Bohart said. “This was a way for this family farm that is no longer economically functional (to make money). This was going to be our retirement.”
Colwell and Bohart blame Chelan County for creating regulations in 2017 that made it illegal for them to operate. They are not alone with at least 19 growers in Chelan County closing in the past three years. Despite the closures marijuana sales in Chelan County continue to grow. In 2018 sales grew close to $5.4 million in Chelan County, compared to $4 million in 2017 and a mere $1 million in 2016.
The marijuana industry statewide also is expanding by leaps and bounds, becoming a nearly $1 billion industry in retail sales last fiscal cycle. Growers in Chelan County, though, are locked in two ongoing lawsuits with the county over regulations.
Chelan County Commissioner Kevin Overbay says it wasn’t just regulations that closed businesses, but bad business sense by growers and processors also contributed. The regulations the county passed in 2017 were also needed to protect residents from the stink of marijuana growing operations, added traffic and other problems, he said.
“So, when you look at this you say, ‘Is it fair to those people that were living here and some of these people have been here 40 or 50 years and established their residence, their property, is it fair to impose this element upon them?’” Overbay asked.
Fight against regulations
Marijuana growers organized themselves to lobby for the industry when the county placed a moratorium on new marijuana growers and producers in 2015. Caitlein Ryan is the former president of the Central Washington Growers Association, which has fizzled out in the face of the new county regulations, she said.
The regulations banned outdoor marijuana grow operations anywhere except 20-acre rural residential properties, according to the Chelan County code. They also required 1,500-foot buffers from the edge of the property.
Indoor grows can occur on 10- or 20-acre rural residential parcels, commercial agricultural or rural industrial areas, according to the Chelan County code. Indoor grows require a 100-foot buffer from property lines.
“It was a two-year battle going to county meetings, public hearings. And the commissioners came up with the resolution that didn’t ban it, but it is an effective ban, making following the code impossible for growers,” Ryan said.
It’s not clear how many growers are left in Chelan County. There are still 26 active grower licenses in Chelan County and the county continues to receive applications for marijuana grow operations. But some businesses listed as active said in interviews that they are attempting to sell their licenses or move to other counties.
It is frustrating for growers and producers because they started operating before the county established its regulations, Colwell said. He and his brother Steve Colwell, a part owner, are third-generation cherry growers. They pulled out part of their family’s cherry orchards so they could lease the land to marijuana growers.
Cherry prices have been down for several years, making it a difficult for farmers to produce a profit, Rob Colwell said. The cannabis-growing industry presented a chance to turn land that had become unprofitable into a money maker.
He and others feel like they were unfairly targeted.
“We jumped through every hoop and had all the proper documentation that we needed,” he said. “We had everything in line and started to operate before the county started making all of these demands and changing the rules.”
On March 7, Rob Colwell received a letter from the county asking him to cease marijuana operations on his farm.
Colwell wrote in response, “It was with rather bemused interest that I read your letter and your demand for us to bring our cannabis production and/or processing facility… into compliance.” He hasn’t grown any marijuana since 2017, he wrote.
Private property rights
The county isn’t trying to shut down marijuana growers and producers, Commissioner Overbay said. It is attempting to protect the property rights of its other residents.
“What happened here is the county didn’t put any regulations in, in the very beginning and basically let folks do their piece,” Overbay said. “And then realized, ‘Oops, this is a lot more than we had bargained for.’”
Overbay wasn’t a Chelan County commissioner when the marijuana moratorium was first put into place. He was elected in 2017, but he did sit on the cannabis workgroup that designed the regulations and voted to pass the new regulations.
Overbay describes himself as pro-business and anti-overregulation, he said. But he’s also supportive of personal property rights.
The challenge the county faced was when marijuana growers and producers first came into the county, they opened up shop in residential areas with little supervision, he said. Neighbors encountered impacts to their property values from marijuana smell and other problems.
“And you know most people, their houses are their castle,” he said. “That’s where they go for refuge. And they want it to be as pristine as possible. “
The county isn’t trying to shutdown marijuana growers or producers, Overbay said. If it wanted to shut them down, it wouldn’t have allowed them at all.
Instead the county passed regulations that it felt were fair considering the limited amount of private property available, he said. The majority of Chelan County land is owned by the state or federal government.
The county’s decision was also not impacted by the lack of taxes it receives from the marijuana industry, Overbay said. The state receives the majority of marijuana tax revenue. In 2019 the county is estimated to get back $84,267 in taxes from the state, according to a document from the state Liquor and Cannabis board.
“I don’t like to see business leave the county,” Overbay said. “However, at the end of the day, what are we looking at? Do we want the quality of life for our residents?”