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Widespread Water Detection

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Small Area Water Detection

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Wireless Water Detection Monitor

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Widespread Water Detection in Data Centers

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For more details, visit Sensaphone’s remote monitoring sensors and accessories information page.

Five years after California voters approved Prop. 64’s adult-use cannabis framework, the legal market is still struggling to catch fire, in part, because of a complicated regulatory structure, licensing hurdles and a heavy tax burden.

The Legislative Analyst’s Office—a nonpartisan fiscal and policy research institute for California’s Legislature—estimates that adult-use cannabis businesses operate in less than one-third of jurisdictions statewide.

Los Angeles County Sheriff's Department

Meanwhile, the illicit market continues to bloom. On July 7, the Los Angeles County Sheriff’s Department announced the results of a 10-day sting operation that involved more than 400 law enforcement personnel, who seized $1.2 billion of illegal harvested cannabis and plants last month in Southern California, and arrested 131 Mexican, Chinese and Armenian cartel members.

Investigators said that the operation accounted for only 40% of the illegal outdoor grows in the county, where up to four harvests per year can materialize. If those illicit grows went uninterrupted by law enforcement, Los Angeles County alone would shadow the state-legal market, which brought in $4.4 billion of retail sales in 2020.

California state Assemblyman Tom Lackey, whose 36th District encompasses the bulk of identified illegal operations in the Antelope Valley, said the people who passed Prop. 64 had no intention of creating the “toxic environment,” happening in his backyard.

“But here’s the reality that a lot of people don’t realize is that in California, and we’re very unique to the rest of the country on this whole cannabis issues, is that we allowed the illicit market to flourish for almost two decades, and they became very, very skilled in their delivery models and in their business operations,” he said. “And now we have international cartels that are here and they’re invading our desert for heaven’s sake. Who would have ever thought that they would go to the desert?”

In February, state Sen. Nancy Skinner introduced legislation to loosen some of the licensing and regulation constraints by expanding resources to help city and county governments that don’t have the wherewithal to oversee legal cannabis operations access a state program that would manage certain bureaucratic functions for them. That legislation passed the Senate Appropriations Committee May 3.

Last month, the California Legislature approved a plan to funnel $100 million toward its cannabis industry in an attempt to boost the legal market by helping businesses transition to more permanent licenses. According to Gov. Gavin Newsom’s May budget summary, approximately 82% of California’s cannabis licensees held provisional, or temporary, licenses as of April 2021.

The $100 million in grant funding aims to help cities and counties assist cannabis businesses in completing time-consuming and complicated environmental studies around the impacts of their operations and how they can reduce potential harms—a required step toward securing a more formal annual license, which is mandated in the California Environmental Quality Act (CEQA).

The mandate to move all businesses from temporary licenses to formal ones was meant to occur in 2019, but the deadline has since been bumped (twice) to Jan. 1, 2022. Newsom is now pushing for that deadline to be extended another six months.

Although the proposed extension has drawn opposition from various environmental groups, the absence of an extension could result in several licensees falling out of the legal cannabis system, curtailing the state’s efforts to eradicate the illicit market.

As revealed by the 10-day sting operation in Los Angeles County, the environmental impacts associated with unregulated growers using banned pesticides, banned fertilizers and stolen water for their illegal crops can be far worse.

Below are comments from various stakeholders in the California cannabis industry regarding the $100-million grant program.

Schwass

“The approval of the $100-million grant program to local governments is an attempt to reconcile one major flaw in the rollout of California’s regulated cannabis market. California required local governments to carry a huge burden in the adoption and licensing of regulated cannabis businesses without providing additional funding. The local governments were left to recoup those extra costs on their own, which in turn, increased the cost for the individuals seeking licenses. Many of the rural counties that are eligible to receive a relatively large portion of the $100-million grant program were already struggling for cash before having to take on the heavy lifting for cannabis licensing, such as Mendocino and Humboldt; which are eligible to receive $18 million and $18.6 million, respectively. I believe that the extra funding if used properly, will help those counties assist their legacy operators to comply with CEQA requirements and transition into annual licenses. However, the counties are running out of time to act regardless of how much money they receive, and approval of the trailer bill to extend the provisional licenses an additional six months would have a greater impact than the infusion of cash will have alone.” –Jared Schwass, Founder, Schwass Law Firm

Horner

“The California regulatory schema has proven complicated and burdensome to an industry struggling to find its footing. The problem with grants is they often benefit larger companies who know how to get them; I can see very little of this money getting into the hands of small family farms. It’s these small family farms that struggle most with the more complicated compliance issues such as CEQA. I believe a lot of the environmental language in AUMA was there to preempt the environmental argument against legalization of an industry that had developed a reputation for environmental damage. In Northern California we have a group of farmers doing their best to come out of the shadows and comply with the law. If our goal is to prevent environmental damage, we should be supporting these farmers first.” –Michael Horner, CEO/Founder, Cannavia

Farrar

“I think it’s great that the CA Legislature recognizes that there is work to be done. In this case I think they could have accomplished a lot more for the industry overall by lowering the CA state cannabis taxes. They are treating the symptoms rather than the underlying cause. Lowering taxes would help legal operators make ground against the illicit market which helps the whole industry progress. Lowering taxes would generate MORE tax revenue, not less, by allowing the state to levy the tax against a bigger piece of the market.” –Graham Farrar, President, Glass House

Zagzebski

“Personally, I’m encouraged by this legislation since it has several promising features intended to ease the regulatory backlog, and because it shows a willingness on the part of policymakers to take proactive rather than merely reactive steps to move the industry forward. Regulatory uncertainty is a cloud that hangs over the head of many California operators, so anything that can help clear this air is welcome. That said, there are other regulatory and tax burdens on legal cannabis operators in California that go unaddressed by this legislation and that would arguably do more to move the industry forward.” -Sander C. Zagzebski, Member, Clark Hill Law Firm

Los Angeles County Sheriff's Department

More than 400 law enforcement personnel from city, county, state and federal agencies seized $1.2 billion of illegal cannabis harvests and plants in Southern California during a 10-day eradication operation resulting in 131 arrests last month.

Despite exhausting human and financial resources during the operation, Los Angeles County Sheriff Alex Villanueva is still calling the largest operation in his department’s history part of an ongoing whack-a-mole game because more than half of the illicit cultivation practices on his team’s radar remain operational in the Antelope Valley of the High Desert, he said.

“The beauty of it is, they can’t hide,” he said in a press conference held July 7. “We see them. We’re going to come after them. It’s hard work. But with the resources, we’re going to get to all 100 percent of them. We got about 40 percent of them we addressed. We’ve got 60 percent to go.”

Operation personnel served search warrants at 205 locations. In the weeks leading up to the operation, investigators conducted reconnaissance flights and surveyed approximately 70% of all the available lands in the Antelope Valley—a region in northern LA County and the southeastern portion of Kern County, which constitutes the western tip of the Mojave Desert. During their flights, the investigators identified more than 500 illegal cannabis grows in LA County, Villanueva said.

Cannabis Business Times

In addition to the arrests—22 of which include felony charges—the sting operation seized and destroyed approximately 372,000 plants, 33,480 pounds of harvested cannabis, 65 vehicles, including two water trucks, 33 firearms and $28,000 in cash that was for one day’s payroll, Villanueva said. The eradication operation ran from June 8-18.

The majority of those arrested were undocumented persons, Villanueva said. Many of the illegal grows have been directly tied to Mexican drug trafficking organizations as well as Asian and Armenian organized crime groups, he said.

Los Angeles County Sheriff's Department

“What we want to do is send a clear and loud message to the cartels and anyone doing an illegal operation in the high desert,” Villanueva said. “Your days are over and we’re coming for you.”

While investigators said they identified more than 500 illegal outdoor cannabis grows in LA County, Villanueva said there are as many as 860 illegal grows in neighboring San Bernardino County to the east, while Kern County to the north, Riverside County to the southeast and Ventura County to the west are also experiencing illegal operations.

“Well, this is a whack-a-mole game,” the sheriff said. “[San Bernardino County has] a lot less resources in terms of personnel than we do, so this is at least, on the grow side, this is a five-county problem that we need to resolve, and it’s going to take manpower. We have the ability, the willingness, the technical know-how, the expertise—what we’re always short on is the resources to get the people employed.”

Sheriffs’ department members from Kern, Riverside, San Bernardino and Ventura counties were among the 400-plus personnel involved in the LA County operation. Also collaborating on the operation were deputies from the Community Partnerships Bureau; Safe Street and Special Victims Bureau detectives; cities of Lancaster and Palmdale station deputies; Drug Enforcement Administration (DEA) agents; the California National Guard; and California Department of Fish and Wildlife agents. Water theft enforcement teams made 19 additional arrests.

Environmental Impacts

Los Angeles County Sheriff's Department

Water theft continues to threaten the water supply for residents in the eastern portion of the Antelope Valley, leaving many of the region’s potato, alfalfa and carrot farmers without a necessary resource, Villanueva said. The theft occurs from fire hydrants and unpermitted water wells that were being drilled on the grow sites.

“Most Californians would be shocked and disappointed at the amount of water these unlicensed, illegal grows are using, especially as California suffers from a drought,” DEA Associate Special Agent in Charge Curt Fallin said in the LA County Sheriff’s Department press release.  “By our calculation, the illegal grows in Los Angeles, Riverside and San Bernardino counties require an astounding 5.4 million gallons of water a day, every day.”

On July 8, Gov. Gavin Newsom asked Californians to voluntarily cut back on household water consumption by 15% compared with last year, as he expanded his regional drought state of emergency to apply to 50 counties, or roughly 42% of the state’s population, Los Angeles Times reported.

The water theft by illegal cannabis growers is part of an effort to irrigate each plant up to 3 gallons of water per day in the High Desert, according to Eric Lindberg, the senior engineering geologist and chief of the South Coast Cannabis Regulatory Unit, who represented the Los Angeles Regional Water Quality Control Board during the July 7 press conference.

Los Angeles County Sheriff's Department

Unregulated cannabis cultivation operations often allow fertilizers, pesticides, petroleum fuels, sediment, irrigation tailwater, trash and human waste to be released into the environment and to pollute waters of the state, Lindberg said. And illegal diversions of surface water for cultivation drains lakes and streams, he said.

“In many cases, illegal pesticides are found at illicit cannabis cultivation sites,” Lindberg said. “Many of these pesticides are banned for use in the United States because they’re highly toxic to humans and animals. Illegal pesticides can contaminate the soil, service water and ground water, and are easily mobilized by stormwater runoff.

“Pesticides used to exterminate insects, rodents, mold and weeds can move up the food chain and can cause secondary poising and mortality of pets and other animals. These pesticides can also contaminate our drinking water supplies.”

Threat to Wildlife

Los Angeles County Sheriff's Department

During the 10-day operation, enforcement personnel also rescued 180 animals, including 84 dogs, many of which are up for adoption.

In addition, two dead bears were discovered nearby the illegal grow sites. Their deaths we directly attributed to pesticide use, according to the sheriff’s release.

Chloe Hakim, a biologist for the Department of Fish and Wildlife Region 5, as well as the lead scientist for the Los Angeles County regional department, said during the press conference that both scientific and enforcement action are needed to stop illegal grows and to mitigate their negative impacts.

Los Angeles County Sheriff's Department

Focused on protecting the diverse plant, fish and wildlife resources for their ecological value, and the habitat they depend upon, Hakim said seeing first-hand what the illegal grow sites have done to surrounding habitats has been tragic. During her field assessments, Hakim said she observed substantial alterations to streams from sediment buildups attributed to illegal cultivations through grading that can cause death and abnormalities to aquatic species, as well as stream crossing that cause fish impediment and other harms to nearby plants and wildlife.

Trash, illegal pesticides and illegal fertilizers also do harm, she said.

“Just a quarter teaspoon of carbofuran, which is an illegal pesticide that some illegal growers use, can kill a bear,” she said. “And you can only imagine what that can do to us humans when the sheriffs come across [it] and they’re picking out the weed, and biologists of our agency come across and they step by this pesticide. This is something that is important to resolve and important to get ahead and completely eradicate this kind of an issue.”

Some of the region’s critical species that need their habitats protected to thrive and survive include the Mohave ground squirrel, desert tortoise and Swainson’s hawk, as well as Joshua trees, which are protected under California state law, but illegal cultivators have cut them down to build their hoop houses.

Intimidating Local Residents

Los Angeles County Sheriff's Department

Not only are the illegal growers threatening wildlife and water supplies for local residents, but they’ve threatened and intimidated the locals themselves, U.S. Congressman Mike Garcia said during the press conference. Garcia represents California’s 25th District, which encompasses the majority of LA County’s northern region, including the cities of Lancaster and Palmdale.

“When I first heard about this problem at the beginning of this year, it was one of these things that you couldn’t believe it until you actually saw it,” he said. “I ended up going flying with the local sheriffs out in Palmdale in April. I saw it from the air at the time. There were roughly 400 to 500 of these illegal nurseries in the local area, and it was absolutely heartbreaking to see.”

After he landed, Garcia said he took a 25-minute drive to Pearblossom, an unincorporated community of roughly 2,500 people, where he held a townhall with local residents. The testimonies Garcia heard from those locals were absolutely tragic, he said. They were being threatened on a daily basis by bad actors and cartel members with weapons, he said.

“While I was at this townhall, we had a member of the cartel, an armed member of the cartel, in the front row,” Garcia said. “He was there to send a clear message, not to me, but to the residents that talking to elected officials about this problem was a bad idea. He was there to intimidate.”

Los Angeles County Sheriff's Department 

Before last month’s operation, the illegal growers in the Antelope Valley faced zero risk and a substantial reward of up to $15 billion harvested from the High Desert on an annual basis, Garcia said.

While the sting operation resulted in the seizure of harvested cannabis and plants worth roughly $1.2 billion, investigators said that the operation accounted for only 40% of the illegal outdoor grows in the county, where up to four harvests per year can materialize. If those illicit grows went uninterrupted by law enforcement, LA County alone would have shadowed the state-legal market, which brought in $4.4 billion of retail sales in 2020.

“After this operation, we were able to rebalance the risk-versus-reward matrix, and we need to continue to make sure that the risks are unlimited and the reward is absolutely zero for these cartel members,” Garcia said.

Continued efforts are all about reclaiming the county for the residents of the Antelope Valley, Villanueva said.

Founded in 1850, the LA County Sheriff’s Department was the first professional police force in the Los Angeles area and worked to tame the lawlessness of the county over 150 years ago, he said. The department shouldn’t have to try and re-tame it again to regain a sense of law and order for a civil society, he said, but that’s what it’s had to do.

Los Angeles County Sheriff's Department

When Lancaster Mayor Rex Parris took the podium during the press conference, he picked up one of the 33 confiscated firearms from a nearby display table and pointed it in the direction of media members.

“This is the cartels,” he said. “We are very, very close to driving down the freeway and seeing bodies hanging from the overpasses. That is what’s coming. And if you have any doubt, our citizens have to look at this part of the gun; not this part.”

Parris set the gun back down on the table and said the cartel members are even walking into people’s homes to intimidate them.

Later in his remarks, Parris lightened the tone when talking about Lancaster lending its tractors and construction equipment that were used to tear down the illegal cultivation sites. “I got to ride one; it was great fun,” he said.

Continuing Efforts

Los Angeles County Sheriff's Department

Although many of the 131 individuals arrested were armed, Villanueva said they showed little resistance. Before the operation, the illegal farmers’ biggest threat was actually being ripped off by other cartels stealing their harvests, he said.

“We didn’t meet any really resistance at all, because typically when we showed up at one of the grows, everyone just took off into the desert running or they surrendered,” Villanueva said. “We didn’t get a lot of resistance.

“No one got away, for the record. Every single person that we put our eyes on is in custody.”

The 22 felony and 109 misdemeanor arrests have been filed with LA County District Attorney George Gascón’s office for consideration, Villanueva said. However, the sheriff did not offer overwhelming faith in the DA’s office.

“We have been very disheartened by the district attorney not filing on our cases for human trafficking when it comes to sex crimes and prostitution,” Villanueva said. “So now we’re going to present this and see what the district attorney will do, but hopefully he’ll do the right thing.”

With the district attorney’s decision out of his hands, Villanueva said his department will focus on eradicating the other 300-some sites investigators identified during their aerial reconnaissance. Last month’s operation cost about $1 million, he said. During the second week of the operation, his department had to scrounge around to pay for the gasoline involved in the eradication efforts, he said.

Los Angeles County Sheriff's Department

To help future efforts, Supervisor Kathryn Barger, who represents the 5th District on the five-member LA County Board of Supervisors, said she’s going to provide the sheriff’s department discretionary funding through her district allocation.

Further funding from the county was blocked by the majority of the supervisors, Parris said. That’s why Lancaster’s city equipment was used 17 miles outside of its jurisdiction, he said.

Last month, Barger’s office allocated $100,000 to the operation, she said during the press conference. Beyond that, the eradication efforts need to be more than an episodic position, she said.

“I have told my colleagues it’s only a matter of time before it leaves the Antelope Valley and hits down below,” she said. “What began as water theft has exploded to become the infiltration of organized crime groups in the Antelope Valley who are operating internationally.

“This illegal activity is impacting the quality of life for residents and businesses, and if left unaddressed, will have long-lasting and devastating effects in the region.”

As the illicit market continues to thrive throughout California, the outdoor operations in the Antelope Valley are the LA County Sheriff’s Department's primarily focus because they are the most visible, Villanueva said.

Meanwhile, the cartels are gobbling up cash-only real estate transactions, sometimes buying up entire neighborhoods of residential homes, and gutting the interiors to convert them into indoor grows, he said.

“So, you can see them starting to shift their operations to indoors,” Villanueva said. “That’s the next logical step for these illegal cartels.”