Contamination fears drive push to remake state cannabis agency

Criticism that California is failing to fully address contamination in its weed crop has prompted a push for the governor and lawmakers to step in and remove that authority from the state agency in charge.

The Santa Cruz County Board of Supervisors last week asked the governor and Legislature to shift responsibility for pesticides in cannabis products from the Department of Cannabis Control to the state Department of Pesticide Regulation, which regulates pesticides on food crops. It requested that accreditation of cannabis testing labs be moved to the State Water Resources Control Board, which already certifies private labs to test food, water, soil and hazardous waste. And it asked that the state add 24 pesticides to the list of 66 chemicals for which cannabis products must now be screened prior to sale.

The resolution cited an investigation by The Times that found widespread contamination in California cannabis products, particularly vapes. Chemicals inhaled through smoking travel from the lungs into the blood and to the brain and other internal organs.

“I can’t think of a much worse way to consume pesticides than to smoke them,” Santa Cruz County Supervisor Manu Koenig said in urging passage of the resolution. Its co-sponsor was Supervisor Justin Cummings, who also chairs the California Coastal Commission.

California

Full Coverage: California’s problem with contaminated weed

A Los Angeles Times investigation, in conjunction with WeedWeek, finds alarming levels of pesticides in cannabis products at dispensaries across the state.

June 29, 2024

Protection of the public is the top legal mandate of the Department of Cannabis Control in its oversight of the state’s $5-billion regulated cannabis market. But seven years into legalization, Koenig said, the state “has clearly failed.”

The resolution drew criticism from the Department of Cannabis Control, whose director immediately called county lobbyists. The state agency said Santa Cruz County’s resolution was “passed without meaningful engagement with the DCC” and “calls into question its due diligence and grasp of the complexities and progress on these issues.”

The agency said in a written statement, “the DCC shares the County’s commitment to product safety and stands ready to support informed policymaking.”

There was no immediate reaction from Gov. Gavin Newsom’s office. Historically, Newsom has expressed confidence in the agency’s actions.

“Cannabis in California was a decades-old, multibillion-dollar industry by the time voters legalized adult-use cannabis in 2016,” agency spokesman David Hafner told The Times in 2023. “Legalizing and regulating such an entrenched, massive industry requires patience, dedication and time.”

A joint hearing by Senate and Assembly committees is scheduled March 11 for the Department of Cannabis Control to report on the “condition and health” of the industry it regulates. Pesticide contamination was not on the specified agenda.

The Santa Cruz County resolution echoes a growing body of complaints of lax oversight by the Department of Cannabis Control, but which have yet to draw legislative intervention. The umbrella agency was created in 2021 at Newsom’s request — consolidating duties overseen by agencies with expertise in areas of public health, agriculture and consumer protection — and was exempted from sunset review, a process the Legislature uses to correct or refocus state programs and identify government duplication and waste. To oversee the new agency, Newsom appointed his cannabis advisor, Nicole Elliott, who has long ties to the governor.

Complaints about Elliott’s management include a whistleblower lawsuit filed by a state lab regulator who claims she was fired after pressing agency officials to respond to allegations of pesticide-contaminated cannabis products. Such complaints also underlie current civil litigation filed by two private laboratories against 13 competitors alleging widespread cannabis testing fraud. And a previously undisclosed state Department of Justice investigation in 2022 looked into claims the Department of Cannabis Control had a political motive to protect illegal operators.

“I leave this role questioning whether the compliance program was or is meant to be a functional regulatory body that ensures the safety and legitimacy of the licensed cannabis market in California, or if the accusations that we are a ‘pay to play’ system are accurate,” a cannabis control special investigator told Elliott in a November 2021 resignation letter, a copy of which was obtained by The Times under California’s public records law.

“Field staff face an impossible task attempting to protect consumer health and safety ...”

The investigator oversaw cannabis control cases in Mendocino County. The exit memo cited stalled criminal investigations, “rampant unfair competition” in the legal market including money laundering and shell companies, and an amnesty program for license applicants that by late 2021 had brought $90 million of illegally grown cannabis into the state sales system. The investigator alleged the infusion of illegally grown weed was poorly governed and so large as to hurt legal growers, but was justified “with the oft-repeated excuse ‘at least we get the tax dollars.’”

The investigator alleged that field staff were told the amnesty program benefited Newsom, who in September that year faced a recall vote, and said field staff were told by supervisors that it “could be expanded even further during the recall election.”

An investigator’s 2021 resignation letter prompted a Department of Justice investigation.

Other Cannabis Control employees interviewed by The Times, speaking anonymously because of fear of reprisal from their employer, said they had heard the same remarks.

The email chain shows Elliott thanked the investigator for the observations and asked for more details, especially the allegation the agency was protecting Newsom’s political interests.

“This alleges a potential violation of state law,” Elliott wrote. “If you have more information related to this allegation, I would like to request this information so that it is properly addressed.”

The cannabis department’s parent agency, the Business, Consumer Services and Housing Agency, subsequently requested an investigation by the attorney general’s office, spokespersons for the multiple agencies said. The review was not assigned to the DOJ’s Bureau of Investigations, which has a team that examines public corruption. The inquiry instead was sent to the Employment and Administrative Mandate Section, which defends state agencies in civil employment matters.

The case was closed in February 2022 after interviews of five people, the attorney general’s office said. None of the three state agencies involved would provide records of the investigation. Reasons given for withholding documents included the confidentiality of records involving the governor’s office. Nor would the Business, Consumer Services and Housing Agency specify which of the many allegations raised in the investigator’s resignation letter had been referred to the Justice Department. Nevertheless, it said the Justice Department “found the allegation to be unsubstantiated.”

Newsom has long championed California’s cannabis industry. As lieutenant governor, he aligned himself in 2016 behind a ballot measure to create a legal recreational weed market, arguing it was a racial justice issue as well as economic opportunity. Elliott’s history runs a parallel course. Her husband is Justin Elliott, a Newsom policy counselor and campaign loyalist who followed Newsom from San Francisco to Sacramento and until this fall was the governor’s deputy chief of staff. Nicole Elliott also worked for Newsom when he was mayor of San Francisco, and from 2017 to 2019, set up and ran San Francisco’s cannabis licensing office with a focus on social equity and decriminalization.

Shortly after Elliott left to work for Newsom in 2019, the San Francisco controller’s office reported that the city had declining cannabis sales, an over-saturated market with a long queue of applicants waiting for licenses to be processed, and the city had yet to grant its first permanent equity license.

Similar concerns about licensing were raised in an August 2024 state audit that criticized the Department of Cannabis Control for poor management of $100 million in licensing grants. A February update by the auditor noted the program appeared to be back on track in most communities, but the cannabis agency remained slow in approving project changes.

Amid reports by The Times of the Cannabis Control department’s failure to address pesticide-contaminated products, lawmakers briefly entertained legislation to mandate stepped up safety enforcement, but dropped those provisions in 2024 when the cannabis agency cited the costs.

Three individuals separately involved in the legislative process, speaking anonymously because of fear of retribution from cannabis regulators, said they were told that drawing public attention to contamination issue would hurt both the state’s cannabis industry and their own ambitions.

“Word on the street is Newsom will veto any legislation if anyone tied to any bill is critical of DCC,” said the sponsor of one cannabis bill.

In an email, Elliott’s spokesperson refuted such allegations. There was no immediate response from Newsom’s office.

“Director Elliott has not told any individual to refrain from speaking about contamination issues or discussing these issues with the Los Angeles Times,” Hafner said.

Nicole Elliott, right, speaks at a cannabis growers gathering in 2019.

(Andy Colwell)

Others said the reasons for inaction may be more mundane: Cannabis regulation is a notoriously technical subject, there is little incentive to wrestle with it, and no backlash for lawmakers who don’t.

“There’s no payoff,” said Eric Goepel, an Iraq War veteran and national lobbyist behind the Los Angeles-based Veterans Cannabis Coalition.

Elliott declined to speak for this article. In past interviews, she has framed her task at the Department of Cannabis Control as one of carving out a “thoughtfully regulated space” from a massive, deeply entrenched illicit market — with her eye on the need for “decriminalization.” She stressed the difficulty of the goal.

“To do so in a few years’ period of time might be impossible,” she told The Times in 2022.

Initiatives on Elliott’s desk at that time included a campaign to convince consumers that legal weed was safe, tested and trusted.

“ I absolutely think it’s important for consumers to know the impacts of consuming harmful substances in untested cannabis, and how the regulated framework seeks to help solve for those,” she said.

A Times investigation would disclose that as the $5-million promotional campaign rolled out, Elliott’s agency was aware that pesticide-tainted products were being sold in state-licensed stores and were certified as safe by state-licensed labs. By the end of 2023, Elliott personally had been copied on whistleblower complaints attesting to contamination in tens of thousands of cannabis products, records obtained by The Times show. Those products were allowed to remain on shelves for months. Nor was the agency’s own testing lab capable of checking for pesticides.

Further independent testing commissioned by The Times showed an even larger problem: Half of cannabis vaping products contained chemicals that cannabis regulators did not even monitor.

Overall, the testing identified 79 pesticides tied to cancer, liver failure, thyroid disease and genetic and neurologic harm to users and unborn children. Most were present at low levels that pose harm from repeated use over time, but in some cases, the concentrations exceeded federal guidelines for risk from a single exposure.

The cannabis agency did not provide an update on its pesticide testing capabilities. As recently as January it was still sending samples to another state agency lab.

The Times’ contamination findings, including revelations of unheeded whistleblower reports, ultimately triggered 269 product recalls, a score of testing lab citations, suspensions or license revocations and a $3.2-million fine against one cannabis brand. Lawmakers, citing Times’ reporting, demanded an accounting on cannabis safety and the state has drafted new regulations for product testing. A December article exposing further regulatory failures, including the open use of illegal pesticides by licensed growers, propelled a push for updated regulations.

Elliott’s agency has stepped up surprise inspections and penalties against cannabis companies skirting testing requirements or dealing in unlicensed weed. In a February 2025 press release, the agency took credit for quarantining “hundreds of thousands” of cannabis products and “a significant amount” of raw cannabis materials under 481 confidential embargo orders.

The press release cited 366 license sanctions in 2024, including 21 against testing labs. Yet the crackdowns underscored the agency’s slow pace, showing license holders had been allowed to stay in operation many months if not years after investigators documented wrongdoing.

In January, the cannabis agency revoked the licenses of a Mendocino County cannabis distributor and nursery, Clone Wizards, for a March 2023 criminal traffic stop involving more than 3,000 pounds of illegal weed, and licensed crops that went missing after allegedly failing safety testing. The Cannabis Control agency in January sanctioned two Los Angeles operators more than eight months after its investigators found evidence of untracked weed or false inventory records, and it took more than five months to shut down a Van Nuys cannabis distributor whose entire taxed inventory disappeared.

Thirteen of the 14 infractions that cost the maker of popular cannabis brand Muha Meds its manufacturing license last year stemmed from a 2021 raid by the agency that confiscated $30 million in illegal cannabis products.

Santa Cruz County has been aggressive in policing its cannabis industry, seeking to even the playing field for those who hold 96 licenses in the coastal county, said county cannabis director Sam LoForti. The county ranked among the top 10 in the state for cannabis cultivation last year.

The resolution passed by the board last week seeks to recruit other counties in its call for changes in pesticide monitoring, and asks the California State Assn. of Counties and the League of California Cities to help “grow collective action.” LoForti said he also broached the campaign with counterparts in other counties during a meeting last week.

The Department of Cannabis Control, meanwhile, has said for more than a year it is working with the Department of Pesticide Regulations on new pesticide screening requirements. Those recommendations were made Dec. 18, and included a call for the addition of 13 pesticides to the screening list, based on Times’ reports, whistleblower tests, police raids, and the state’s own data on pesticides found on vegetables and fruit imported from China and Mexico.

The proposal omits 37 other chemicals found in cannabis by The Times, including propargite, tied by researchers to brain cell death; fenvalerate, a banned insecticide linked to reduced sperm counts; and a carcinogenic disinfectant, ortho-phenylphenol, the newspaper found in high levels in cannabis pre-rolls and attributed by one manufacturer to its rolling papers.

“I think the expansion of the testing list is a great idea, but I have serious doubts as to whether a rollout from [California regulators] would be well thought out enough to avoid killing businesses,” said Jason Cooley, lab director of Los Angeles-based SQRD Lab, one of the state’s large cannabis testing laboratories.

In the absence of state action, pesticide concerns have boosted private sector safety programs such as the nonprofit ECCO (Environmental and Consumer Compliance Organization) and generated a public conversation about cannabis safety and pesticide exposure. It also has fostered marketplaces for pesticide-free cannabis distillate, as brands confronted with adulterated feedstocks seek cleaner supply lines. A number of state laboratories have voluntarily expanded testing services beyond state requirements.

While such steps are good, the benefits are not universal, said Zach Eisenberg, vice president of Anresco Laboratories, one of the cannabis labs involved in ECCO.

“Not every brand is going to be able or willing to participate in such a certification program. So a regulatory intervention is still needed,” Eisenberg said. “Otherwise you may just have a bifurcated market where high quality/clean distillate goes to ECCO and the contaminated distillate still gets sold [and] consumed.”