- Author: Michael Hsu
Wilcher to leverage economic development resources, foster connections in Inyo and Mono counties
Tawni Thomson has a big job – literally. She is responsible for attracting visitors and activating business activity in Bishop, arguably California's most isolated city and the heart of vast Inyo County, the state's second-largest county by area.
“I know everybody says their place is unique, but we're almost an island,” said Thomson, who has served as executive director of the Bishop Chamber of Commerce and Visitors Bureau for the past 17 years. “We're a four-hour drive to the ‘mainland' in any direction – it's four hours to Reno, four hours to L.A., four hours to Las Vegas. And instead of water we have open landscape.”
While those majestic Sierra Nevada views across the Owens Valley make the region appealing to outdoors enthusiasts, diversifying the economy and supporting tourism during the offseason (generally November to May) remain formidable challenges. Thomson said devoting focused attention and resources to economic development is difficult, with only 3,700 people within Bishop's city limits and 18,000 in all of Inyo County.
“We're a very small community and we have very few people working on economic prosperity; we're spread really thin,” she said. “So if there's a way we can create some efficiencies or even get some outside help – that would be really welcome.”
In October 2023, some help arrived in the form of Aaron Wilcher, University of California Cooperative Extension community and economic development advisor for Inyo, Mono and eastern Kern counties (subscribe to his blog and e-newsletter; he will also provide updates on Facebook, Instagram and LinkedIn).
New Cooperative Extension advisor brings open ears, open mind
A self-described “city slicker,” Wilcher grew up in San Jose and has spent much of his career as a program manager and technical assistance provider in the higher education space. Most recently, he was consulting in the northern San Joaquin Valley on the California Jobs First initiative, aimed at creating jobs and accelerating economic projects across the state.
And although Wilcher certainly will bring his experience on the workforce development front, he soon discovered he will be called upon to do much more in this region.
“There's so much to learn; one of the surprising things I've learned coming here is that the complexity of my work is almost greater because you're able to be engaged in so many more things,” he said. “Because we have so few resources, you really have to pay attention to all the ones you do have. So that means you better make friends with everybody – because everybody is important.”
Wilcher is part of an emerging Community and Economic Development team of more than 20 UCCE advisors and specialists supported by UC Agriculture and Natural Resources. Like his counterparts embedded in communities across California, Wilcher first sought to get a better understanding of the most pressing issues facing the region he serves. He spent the first few months on the job talking with elected officials and a host of community managers, planners, directors and leaders.
“I really appreciate Aaron's approach in that he's come into our community and already made a significant effort to understand the different sectors in our economy and meet with people one-on-one,” Thomson said. “He's just been listening – and asking a lot of questions.”
Wrapping up his needs assessment late last year, Wilcher said he heard many priorities that are shared by communities across the state – such as devising regional economic strategy and creating entrepreneurial support systems – and a few concerns that are truly unique to this particular “frontier economy.”
For example, more than 98% of the land in Inyo County is public land, managed by the U.S. Forest Service, Bureau of Land Management and, predominantly, Los Angeles Department of Water and Power – a legacy of the Los Angeles Aqueduct project dating to the early 20th century.
“Less than 2% of the total land mass in the region is private property,” Wilcher said. “So how do you do economic development where there is no private property? For this area, it will be more about improving job quality, helping local business grow and start new operations and recruit local talent, and improving quality of life – rather than attracting large companies for relocation.”
Building partnerships, coordinating efforts can benefit all
Short of untangling that long-standing issue of land tenure, Wilcher also can tangibly serve the region in another crucial way – bringing the expertise and skill set that he's honed during a career of fostering cross-sector partnerships.
In Inyo County, Thomson said, there remains a disconnect between the agricultural interests that have been the historical lifeblood of the region and the tourism and hospitality industry that is now its primary economic engine. She noted that Wilcher has already made progress in building bridges and opening conversations.
“What I'm hoping for is that the tourism folks will have a better appreciation for the ag folks, and the ag folks will have a better appreciation for the tourism side of things – and realize that we can all work together and we really do all want the same thing: a healthy, vibrant economy,” Thomson said.
And while the region's diverse sectors and myriad organizations are working independently on economic and workforce development, Wilcher said better coordination among the entities through an overarching convening agency would be a boon for all.
“You have a lot of small organizations that are effective and interesting in what they do and they have great people,” Wilcher explained, “but they need a lot more attention and resources to be able to: one, boost their own capacity and two, get together to force multiply their impact.”
Whether through the regional joint powers authority (Eastern Sierra Council of Governments) or some yet-to-be-defined new organization, Wilcher stressed that the best approach for better governance of economic activity comes from the community itself. The only way such an endeavor will be successful is if there is local grassroots buy-in, from the start and at every step.
“Ultimately it will be up to the community and empowering the community to support such an effort,” he said. “It will probably look like an entity – or set of entities – that will be the go-to place where people share ideas, develop projects and track progress.”
UCCE to offer trainings, connections to resources
Given the importance of “mom and pop” shops and eateries in the local economy, Wilcher – with the support of UCCE Inyo-Mono Director Dustin Blakey – is planning to provide training opportunities in the coming months for existing and emerging leaders across sectors to understand the local economy and empower them to drive and support new programs. Wilcher and Blakey have proposed a “community economic development academy” to offer curriculum in strategic planning, local economic data and program management.
The Eastern Sierra has made strides in recent years to lay the groundwork for development activities, Wilcher noted. Regional stakeholders led by the Eastern Sierra Council of Governments created a Comprehensive Economic Development Strategy that outlines opportunities and goals for the region. These stakeholders have also been actively engaged in the Sierra Jobs First initiative, which devised a strategic plan for community and economic development investments. Wilcher also praised the work of the Mammoth Lakes Chamber of Commerce and other chambers.
The Bishop Chamber of Commerce and the recently opened Eastern Sierra Business Resource Center – a partnership with the Sierra Business Council – provide some essential learning resources, but Thomson acknowledged her community would greatly benefit from additional offerings.
“It's great having more people make more educational opportunities available,” she said. “And it can be incremental – we're so small that even if we can help five people, that's a huge impact.”
Wilcher said he also seeks to bring to the region subject-matter experts like Keith Taylor, associate professor of Cooperative Extension and community economic development at UC Davis, and Anne Visser, professor of community and regional development in the UC Davis Department of Human Ecology.
Taylor has been helping to organize UC ANR's team of Community and Economic Development advisors. Across the state, Taylor said he aims to create greater awareness of underused resources from invaluable networks such as the National Association of Community Development Extension Professionals (NACDEP) and the regional rural development centers under the U.S. Department of Agriculture's National Institute of Food and Agriculture.
“We're looking at how we can leverage existing assets in what I call the ‘hidden economy' – things like the California State Association of Counties (CSAC) and Rural County Representatives of California (RCRC), major associations that provide immediate capacity for counties that often go underutilized,” he said. “The hidden economy refers to legal entities and business practices that enable local communities to capture more economic activity, making them less beholden to external forces and shocks.”
Like Taylor, Wilcher seeks to expand the toolbox for economic development in the Eastern Sierra region and thus empower people to drive their own sustainable growth and prosperity. He will share resources and insights on a newly launched blog; he urges interested community members to subscribe to the blog and sign up for his e-newsletter.
“I'm passionate about this; I'm excited to be here,” Wilcher said. “I love being at this intersection between technical aspects – like policies and data and all the things we do at the university – and working with the community and hearing what people are interested in, what they're working on and what they need.”
- Author: Emily Caldwell, The Ohio State University
- Author: Pamela Kan-Rice
Study analyzes tension between legal cannabis, financial industry
Legalization of marijuana in California has helped some financial institutions in the state increase their assets. At the same time, many banks, feeling stifled by federal regulations, deny services to licensed growers, manufacturers and retailers, a new study shows.
“Licensed cannabis businesses need to bank their cash and take out loans to build their businesses, but many banks worry that by doing business with the cannabis industry, they'll be flouting federal laws,” said co-author Keith Taylor, University of California Cooperative Extension community development specialist. “Banks that won't accept legal cannabis cash deposits and don't provide loans, aren't monetizing their deposits. Marginalized cannabis communities are missing out on capital.”
Of the banks and credit unions contacted by researchers at The Ohio State University and University of California for the study, most were not knowingly involved in the cannabis industry.
Combining data on bank holdings and interviews with growers and bankers, the research –published online in the journal Agricultural Finance Review – paints an initial picture of how the marijuana and financial industries co-exist in California now, and suggests regulatory changes could create new opportunities for both.
The data analysis did make one thing clear: Legalization of the estimated $16 billion marijuana industry in California has been a boon to financial institutions. But restricted access to banking, from checking accounts to loans, perpetuates inequities for those participating in the legal production of cannabis – while unlicensed, illegal growing and exporting continues as an enormous cash-based sector of the industry.
“We need a better understanding of the economics of this industry and all of the questions and implications related to it so the impacts of policy choices are intentional,” said lead study author Zoë Plakias, assistant professor of agricultural, environmental and development economics at The Ohio State University.
“If we want to have a more equitable society and allow communities to keep more of the value of this crop, how do we do that? We first need to characterize what happens in communities when you legalize cannabis.”
Plakias and Margaret Jodlowski, assistant professor of agricultural, environmental and development economics at Ohio State, conducted the study with researchers Taylor, Parisa Kavousi and Taylor Giamo at the University of California, Davis.
“The tensions we are observing in the cannabis banking space comes about in part due to the inequity felt between large cannabis and small and legacy operators,” Taylor said. “The ‘big guys' are able to absorb a great deal more than ‘Ma and Pa.'”
Legalization benefited financial institutions indirectly
Marijuana is listed as a Schedule 1 drug under the federal Controlled Substances Act. Even in states that have legalized recreational and medicinal use of cannabis, it is still a federal crime to possess, buy or sell marijuana. California legalized recreational cannabis for adults in 2016, and the industry is overseen by the Department of Cannabis Control.
Data used by the researchers for this study included bank and credit union call data for the years 2015-2020. The analysis showed that assets held by financial institutions in counties that legalized marijuana had increased in that period by almost $750 million and loan activity rose by about $500 million.
These benefits are presumed to be spillover effects of better overall economic health that followed cannabis legalization in specific counties, Jodlowski said, because the interviews with financial institutions indicated there has been little appetite among banks to associate with the marijuana industry.
“It's important to remember when talking about loans that it's not possible to identify whether they were for cannabis operations, and they're probably not based on what we heard from stakeholders,” she said. “It's more of a general relationship. The bank is doing better, and they're able to lend out more in general and earn more interest from loans.”
When they narrowed the analysis to banks that operate only in California, the researchers found that for each single new manufacturing or retail license, bank assets and loan capacity grew by tens of thousands of dollars. Cannabis cultivation licenses, on the other hand, had no impact on California banks' holdings.
“This suggests that a lot of the economic benefits of legalization come from other stages of the supply chain – and it's not a foregone conclusion that farmers benefit from legalization,” Plakias said. “There's a need to think about how farmers who are producing cannabis in the legal market, often operating in rural environments with a weaker economic base to start with, can be supported in the context of economic development.”
The team also interviewed marijuana farmers and representatives from banks and credit unions in Humboldt, Trinity and Mendocino counties – the “Emerald Triangle” region known historically in California and nationally for the quantity and quality of marijuana produced there.
Cannabis growers face obstacles, risk-adverse bankers
On the financial side, bankers reported being hamstrung by ambiguous federal guidelines that pose a real risk to financing cannabis, largely because banks are required to report suspicious transactions to the federal government. They might be seen as players in a criminal enterprise even by providing banking services to employees who work for licensed members of the cannabis industry, or they could lose big on lending if cannabis-related assets backing a loan were seized by federal agents.
“What's consistent across all financial institutions is that it's very costly, and does involve taking on some risk, to be in compliance with all of the guidelines – the risk being that even if you follow all guidelines to the letter, there's no assurance that you can't still get in trouble,” Plakias said.
Cannabis growers they interviewed reported paying fees ranging from $200 to $3,000 per month for bank accounts, which they found to be cost prohibitive. These limitations leave most licensed marijuana producers and retailers in the lurch, forcing them to rely on nontraditional financing arrangements – maybe investing in friends' endeavors – or risk running cash operations.
“There is a lot of evidence that cash can be better for a local economy because cash tends to stay local – but we are now a credit-based economy,” Jodlowski said. “In this day and age it's incredibly harmful for local economic development to have an entire sector that's denied access to credit, because so much of developing as a household, or individual, or industry requires credit and requires demonstration of credit-worthiness.
“That's a fundamental harm of these sorts of restrictions.”
This research is part of a larger project on cannabis and community economic development in California supported by a grant from the UC Davis Cannabis and Hemp Research Center. As part of this project, the California authors on this paper recently published a review of the opportunities and challenges marijuana legalization poses for localities in which the crop is cultivated and sold.
“It's clear we need policies making cannabis banking and finance more equitable,” Taylor said. “It's also clear that ‘Ma and Pa' enterprises need to associate together in formal organizations so they can achieve economies of scale and harness their political power to endure the transition to legal.”
Despite the stigma attached to marijuana, even when legal, its status as California's most valuable crop – estimated to be worth more than almonds and dairy combined – attracts outsiders who are better-equipped to come up with funding to get their operations started and compete with legacy growers who have lived and worked in California for generations.
This trend necessitates development of evidence-based policies that take all participants into consideration, the Ohio State researchers say.
“Our findings speak to confusion around existing policies and the need for streamlining, clarifying and having a more unified approach to regulating this industry,” Jodlowski said.
Related reading:
Cannabis and utilities hold potential for economic development, says UCCE specialist
Characteristics of farms applying for cannabis cultivation permits
