A large cannabis operation with 22 buildings spanning over 11 acres must temporarily cease operations as hundreds of employees are fighting for their jobs, culminating in a chaotic Sacramento City Council meeting.

Law enforcement officials ordered Natura to close on Oct. 2, a farm located on Elder Creek Road near Power Inn Road, citing fire code violations that make the Morrison Creek district buildings unsafe for its 450 employees.

Nautra now must work with the city to bring its 22 buildings on its 11.5-acre site into code compliance.

The decision to close down the operation led to about 40 employees attending a Sacramento City Council meeting the next day to fight for their jobs. The Sacramento Bee reports that the city council meeting “delved into chaos.”

“I believe my company is wrongfully under assault,” Michael Hicks, an employee, told the city council on Tuesday. “My job and the job of hundreds of others are in jeopardy right now.”

Sacramento Mayor Darrell Steinberg urged Natura CEO and co-founder Ori Bytton to urgently spend money for construction. The Mayor got personal and pointed out that Bytton listed his home recently for $35 million, according to a Wall Street Journal article, and believes he should be able to handle the cost.

“I don’t begrudge anybody’s wealth,” Steinberg said. “But I would suggest to you that you hire people to do double, triple, quadruple overtime to get this work done in collaboration with the building inspector and fire inspector and get these folks back to work as quickly as possible and/or pay you employees while this work gets done.

That comment, however, led Bytton to jump from his seat and raise his voice, causing the council to adjourn the meeting early, and dozens of employees of the operation left the room. “You may be asked to leave,” an official told Bytton as he was speaking. KCRA 3 posted a video of the city council disruptions.

A temporary closure could result in the facility closing for good, said Craig Powell, a co-founder of the firm and its senior vice president. “There are tens of millions of dollars of plant and product that will rot and decay, to the demise of our company,” Powell said.

The case was taken by Judge Christopher J. Kruger, then reassigned to Judge Richard K. Sueyoshi, per Natura’s request. The city is currently evaluating the details of the lawsuit, city spokesman Tim Swanson told the Bee.

Chants of “Go home Nazis!” could be heard from people in the meeting. Some shoving around can be seen in the video, but it did not escalate much further. No one was injured, however, and no one was detained, according to the Sacramento Police Department. 

Tom Pace, the city’s development director who spoke before the council, said that Natura has been extending the compliance time limits since the COVID pandemic.

The city’s interim chief building official, Bob Latz,and city Fire Marshal Jason Lee, made the decision to stop granting extensions, Pace said. The compliance shortcomings are reportedly fire suppression and protection equipment that was missing in multiple buildings on the campus. This usually involves things like sprinkler systems.

A Lawsuit Emerges

On Thursday, the company sued the city in Sacramento Superior Court claiming the city violated the company’s constitutional rights. The lawsuit asks for a judge to order the city to allow the business to stay open.

“Loss of employment resulting from the city’s outrageous misconduct will be devastating to these Natura employees and could potentially render many of them homeless in a city that already has a significant homelessness problem,”

An unrelated lawsuit was filed in 2021 by workers associated with the operation. Several contractors said they were awaiting payment from a Nautra campus they each provided services for, according to liens filed with the Sacramento County Clerk and Recorder’s Office.

Sacramento is Ground Zero for Cannabis Business Representation

As the capital city of California, heated meetings are not uncommon.

A group of licensed cannabis business owners rallied on the steps of the California capitol in June 2022 to bring attention to the impact high cannabis taxes have on independent entrepreneurs. The demonstration, which was held in response to the proposed state budget released by Governor Gavin Newsom, was organized by Supernova Women, an Oakland nonprofit that works to create opportunities for Black and Brown people in the cannabis industry.

The rally featured more than fifty cannabis business owners, patients, and policymakers who are Black, Indigenous, or people of color (BIPOC) and gathered to call for several changes to the state’s cannabis regulations, including eliminating the cannabis excise tax for licensed social equity businesses.

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Cannabis gifting storefronts and delivery services in Washington, DC are bracing themselves today for a DC City Council emergency vote scheduled for tomorrow, April 5, 2022, that could drive them back underground.

Initiative 71 legalized cannabis for recreational use in DC in 2014, with 64.87% of voters approving the measure. However, DC’s lack of statehood means that the city budget has to be approved by Congress — and immediately following the passage of the initiative, Maryland Republican Rep. Andy Harris introduced an amendment to the bill known as the Harris Rider that has effectively allowed Congress to block the city government from legalizing commercial adult-use sales.

Residents of DC are currently allowed to possess up to two ounces of cannabis, grow up to six plants, and gift up to an ounce to other adults, but commercial sales remain banned due to the Harris Rider. Over the last several years, this has led to a “gifting economy,” a creative workaround in which customers purchase an item such as a T-shirt, digital artwork, gym membership or other product and receive a cannabis gift in exchange.

This has led to some tension between medical cannabis dispensary owners and the folks running gifting services. It’s also attracted the ire of DC City Council Chairman Phil Mendelson, who has attempted to take action against I-71 gifting shops several times.

Last year, Mendelson introduced an emergency bill to empower city agencies to engage in “revocation of licenses, sealing of premises, and fines for businesses purchasing, selling or exchanging marijuana.” The language in the bill that would have increased enforcement on gifting businesses, including a fine of up to $30,000, was removed one day ahead of the vote.

Now Mendelson has revived the fight, calling for an emergency vote tomorrow that would allow the city to close down gifting businesses starting in mid-May, while also eliminating the need for a doctor’s recommendation for anyone procuring medical cannabis from DC dispensaries by self-certifying their medical use. This move is supported by many medical cannabis dispensary owners, who complain that they’re losing business to gifting stores, which operate in a gray area of the law due to the Harris Rider.

A resolution from Mendelson’s office, reported by DCist.com, declares that “Several dozen illegal cannabis businesses are currently operating in the District. These businesses … do not pay the fees and taxes licensed facilities must pay, putting licensed cannabis businesses at a competitive disadvantage.”

Under I-71, DC residents can grow up to six plants for personal use and gifting — but home growers accused of running an illegal service could be fined $30,000 and locked out of their residence for 96 hours.

DC residents can contact council members to let them know they don’t want their taxes being used to shut down cannabis gifting stores. The vote is scheduled for tomorrow’s legislative session.

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