Marijuana growers who plan on growing cannabis on private land next season will encounter new state requirements to address the crop’s impact on California’s creeks and streams. The success of the policy will be tested by the state’s ability to bring growers into the legal cannabis sector. Currently, an estimated 80% of the state’s cannabis crop is grown for the black market.

The CalCannabis cultivation licensing system is a new program by the California Department of Food and Agriculture (CDFA) for permitting the crop to be grown legally on private land. The State Water Board recently adopted interim policies that will affect the license, including checks on a grower’s water rights, restrictions on the diversion of water for irrigating cannabis crops, and site-specific requirements to control runoff into local streams from growing operations. Many elements of the new statewide requirements are based on pioneering regional efforts to regulate cannabis cultivation in the North Coast.

As a prerequisite for the cultivation license, growers relying on water from local tributaries must have valid water rights or apply for a new surface water right that allows them to divert and store water. This requirement is critical to the State Water Board’s new policies that compel growers to divert surface water to storage in winter for irrigating cannabis during the dry months when streams are low. Diversions are allowed to resume in winter once a stream’s minimum flow target is met. Many growers will need to obtain necessary permits and capital for constructing water storage on site. Water measuring and recording requirements will also compel growers to install devices to track their stream diversions and usage.

The new statewide requirements also seek to reduce the risk of contamination to tributaries from cannabis farm runoff. For example, licensed growers across the state will be required to provide adequate distance between cultivation operations and streams and wetlands. The requirements also establish rules for reducing erosion from access roads, increasing irrigation efficiency, minimizing runoff, and handling fertilizers, pesticides, and herbicides safely.

These new requirements will result in additional costs to many growers looking to enter the legal market, on top of new compliance costs, taxes, and reduced revenues that legalization could bring. Some experts suggest that the high cost of “going legal” could jeopardize the state’s ability to enroll enough growers to make the policies effective.

Van Butsic, an assistant cooperative extension specialist at UC Berkeley and a member of the PPIC Water Policy Center research network, conducts research on cannabis cultivation in the state. “The State Water Board’s interim policy may have a better chance of achieving desired environmental outcomes if compliance can be obtained at a reasonable price,” Butsic says. He suggests that small growers—the majority of cannabis operations in the state—will especially find it difficult to absorb the costs of compliance.

This raises difficult public policy questions on how to reduce the cost of compliance while continuing to protect water quality and the environment, how to encourage small farmers to join the legal sector, and how to effectively enforce the new rules in a sector dominated by very small farms. Resolving these issues will be vital to meeting water quality objectives in the emerging legal cannabis sector.