It's no longer a secret that Humboldt County's economy is contracting. Countywide, sales tax receipts in the 2017-2018 fiscal year plunged 15 percent from the year before and it's obvious, especially in Old Town Eureka, that businesses are feeling the pinch. Vacant storefronts abound.
Anecdotally, anyway, the economic decline seems directly attributable to changes in the cannabis industry, which once conservatively accounted for one of every four dollars spent in Humboldt County, according to one study. So it stands to reason that as goes cannabis, so goes Humboldt business. And right now that's a scary prospect.
The cannabis industry is getting squeezed from both sides. Those farmers who have opted to remain in the black market have watched prices continue to plummet as the market faces a glut of cannabis and the list of states that have legalized weed in some capacity continues to grow. Meanwhile, the county has ramped up crack-down efforts through a code enforcement model that imposes fines of up to $10,000 a day.
And those farmers trying to go above board in the regulated recreational market are facing an uphill climb. Compliance and licensing costs are steep. Then there are taxes, testing and distributor fees, all of which shave a farmer's bottom line. One farmer recently told the Journal he paid a total of $60,000 in 2018 in taxes, permitting, licensing and application fees.
Obviously the money bleeding from the industry has ripple effects. It hits local restaurants, car dealerships, boutiques and shops, as people working in the industry have less money to spend. And it hits local governments, which have seen the aforementioned dip in sales tax revenue.
So yeah, things are tough out there right now. But there are also some real signs for optimism, indications that the knowledge, skill and ingenuity Humboldt County's cannabis industry has cultivated over the course of decades will continue to shine, no matter how much money large corporations throw into research and development or just how big those farms get in the Central Valley.
This week's cover story focuses on one of those signs. It looks at the collaboration between Humboldt Seed Co., HendRx Farms and a host of others to plant 10,000 distinguishable strains of cannabis last year in an effort to hunt out the region's best cannabis genetics.
Not only did the project result in the identification of about 50 strains with unique qualities that those involved hope will gain a foothold in the recreational market, but it was also the kind of muscle flex that ripples through the industry. After all, it's not a stretch to say that a project of this scope and breadth would only be possible here, where there's both a cannabis gene pool built over the course of decades and the community spirit necessary to pull it off. And these are perhaps two of Humboldt County's greatest assets moving forward.
Collaboration will be a key to Humboldt County's success in this new world of legal weed, whether its seed companies and clone nurseries working together, multiple farms joining forces under a brand that's already gained a foothold or farmers working with geneticists to find breakthroughs that will push the nascent industry forward.
We don't have the deep pockets, the corporate clout or the acreage of farmland to compete with the Anheuser-Bushes and R.J Reynolds Tobacco of the world. But we do have some bright people doing some remarkable things, and the more they work together the more we like our chances of finding a lucrative and sustainable niche in what is quickly becoming a global weed industry.
Thadeus Greenson is the Journal's news editor. Reach him at 442-1400, extension 321, or email@example.com. Follow him on Twitter @thadeusgreenson.