The black market is cutting into California’s recreational cannabis market—and will probably keep doing so
Two men are in jail after local authorities traced their unpaid utility bills to large illegal marijuana-growing operations hidden inside their homes last month.
Together, Sacramento County sheriff’s deputies seized nearly 300 mature marijuana plants from the two south-county houses, conservatively estimated to be worth nearly $75,000 on the street, sheriff’s records show. At one home, near the unincorporated town of Herald, deputies also retrieved 360 marijuana clones, which are genetic copies of the cannabis plants from which their cuttings were taken and grown.
The raids on the two houses happened days apart and occurred after the Sacramento Municipal Utility District flagged the properties for suspected energy theft that had racked up six-figure losses for the public utility.
SMUD only requests law enforcement assistance if it suspects power is being stolen, though it will cooperate with authorities upon request, explained SMUD spokesman Christopher Capra.
“We never supply customer information to the police,” he said. “The only time we cooperate with the police is if they request it.”
That friendly arrangement may get tapped more regularly in the future. With the first haul of legal cannabis tax revenues coming in way lower than the state’s rosy projections, officials are looking at ways to cut into a black market that’s cutting into their profit margins.
At the Herald home on Clay Station Road, SMUD informed authorities that the wires on one of its electrical meters had been tampered with, siphoning $328,613.88 worth of unpaid power since May 2006. That was two months after 51-year-old Jimmie Garrett became owner of the house, SMUD told the Sheriff’s Department, according to records.
On May 29, deputies served a search warrant at the home, where Garrett was arrested and an indoor marijuana grow was found, department records state. Along with 56 mature plants and the hundreds of cloned ones, authorities also seized three pounds of processed marijuana, reports state.
Garrett is currently incarcerated at the Rio Cosumnes Correctional Center in Elk Grove on misdemeanor charges of harvesting more than six marijuana plants and possessing marijuana for sale, as well as one felony count of obtaining unauthorized utility services. A jury convicted Garrett in 2015 on felony counts of marijuana cultivation and possession-for-sale, as well as illegal possession of firearms and ammunition, online court records show. He was sentenced to four years in state prison, but obviously got out before then.
Garrett, who works for Divinity Transportation, according to booking logs, was scheduled for a June 25 preliminary hearing at press time.
Capra stressed that SMUD doesn’t narc on its customers. It was the homeowners’ nonpayment that brought the fuzz down on them, he said, not their energy usage.
“We do not flag our usage counts,” he told SN&R. “If they pay their bill, everything is good.”
That’s not to say energy theft doesn’t factor into illegal grow operations, said William Ruzzamenti, director of the Central Valley High-Intensity Drug Trafficking Area, which operates out of the Sacramento County Sheriff’s Department.
“The theft of power over the last five, six, seven years has been going on a pretty regular basis,” he said. “The bad guys do bypass the meter.”
That can be dangerous, Ruzzamenti, a former Drug Enforcement Administration agent, added.
“Many a fire has resulted exactly from that,” he said. “We often find illegal grows because of the fire.”
That didn’t happen in either of last month’s cases. Two days after Garrett’s arrest, suspected power theft at a home on Victory Avenue brought SMUD revenue protection representatives and deputies to the door of 30-year-old Celso Rodriquez Madrid, sheriff’s records state. The SMUD reps confirmed the existence of a bypass device, which they attributed for the loss of $143,684.12 in utility revenues.
An unidentified witness on the property told deputies three of the rooms inside the house had been converted into indoor marijuana grow rooms. Records state that Madrid allowed deputies to enter his home. Big mistake. After confirming the existence of an illicit operation, deputies “froze” the residence and obtained an official search warrant, records state. Once deputies had the warrant, they came back and removed 243 mature cannabis plants worth more than $60,000, as well as seizing another $1,240 in cash.
Madrid was arrested while the two other people on his property were “released into the field,” records state. Madrid, who has no previous convictions in Sacramento County, was arraigned June 4 on the same crimes as Garrett.
Both raids occurred in the unincorporated areas of Sacramento County, where elected representatives on the Board of Supervisors have resisted allowing medicinal or recreational cannabis uses. But the county has been unable to stop underground enterprises. Along with costing the state and city of Sacramento money, the marijuana black market is blamed for degrading the environment, funding cartel wars and trafficking human beings.
Ruzzamenti cited the usage of toxic pesticides and foreign chemicals on public lands, in particular, “which are literally causing the Pacific fisher and spotted owls to become extinct.”
Conflicting statements from the White House haven’t helped California zero in on its problem.
Since recreational use became legal in California at the beginning of this year, the Trump administration has sown confusion with conflicting statements about whether federal marijuana prohibitions will or will not be enforced. Attorney General Jeff Sessions, a virulent marijuana opponent, caused the most turmoil, rescinding Obama-era guidelines to let alone states that have legalized marijuana, which Congress enacted prohibitions on in 1970.
In January, speaking before a community oversight commission, Sacramento County Sheriff Scott Jones said he didn’t know whether federal drug agents would begin raiding state-sanctioned marijuana businesses. Jones, who has criticized California’s adoption of sanctuary protections for undocumented immigrants, said he was a states-rights supporter when it came to weed.
“It’s a little different than like immigration, where federal law trumps state law on immigration because it’s a federal issue. Marijuana’s not that way,” he told the commission. “There can be conflicting laws from the feds and state law on marijuana, and it’s not a constitutional issue, because it’s not solely a federal or a state issue.
“We’re going to comply with the state law,” Jones continued. “So it’s not like we’re going to be joining the feds and doing operations now. The exception might be going after drug trafficking organizations or international trafficking things, like we’ve always done.”
The department did partner with federal, state and local agencies in a long-term investigation that this month uncovered a massive illegal grow spanning two properties in the southern county. Surrounded by parched yellow fields, the operation loomed in plain sight on the rural outskirts, with tens of thousands of healthy marijuana plants staked in rows under three hangar-sized, torn white canopies.
According to a video from sheriff’s spokesman Sgt. Shaun Hampton, individuals fled as approaching narcotic investigators raided the properties on the 12000 block of East Stockton Boulevard and the 10000 block of Arno Road in the early morning hours of June 13. Ground officers, canine units and air support helped corral approximately 30 individuals, resulting in 17 arrests on firearm possession and marijuana cultivation charges.
Hampton said authorities found approximately 17,000 to 19,000 marijuana plants on the properties, with an estimated street value of $4 million. Authorities also recovered 13 firearms from both locations, some of which they say were placed strategically throughout the locations. At least two of the guns had been reported stolen.
There were signs that people tending the grows were staying on the disheveled properties, where a cooking pan sat on a Home Depot box and empty water jugs and bottles littered the ground around blue lawn chairs. The Sheriff’s Department video also showed a toilet planted in front of a shed near some plywood boards, partly surrounded by a drooping privacy curtain. It was unclear if the toilet was hooked up to any plumbing.
Ruzzamenti said it’s rare to apprehend middle or upper management during these raids.
“Any criminal organization tries to insulate the major players,” he observed.
That means mostly arresting the help, some of whom are there under duress, Ruzzamenti acknowledged, though he believes that’s the exception.
“In some cases there is a human trafficking component,” he said.
Whether they’re there consensually or not, the bud tenders are typically pawns.
“And they’re not connected to diddly, for the most part. So it is difficult to climb the ladder,” Ruzzamenti said. “Just rounding up the field workers, I’m not sure how productive that is. … But that is sometimes where the investigation starts.”
Those arrested this month could also face felony environmental crimes, Hampton’s video indicated. The spokesman told SN&R on Friday that he didn’t yet have all the names and birth dates of those arrested to provide upon request.
In his meeting with the oversight panel earlier this year, Jones suggested Sacramento was luckier than other counties when it came to black-market operators.
“A lot of other counties have it far worse than us,” he said, noting the absence of nearby federal forest land. “And we don’t have much rural, open space that can conceal a large grow.”