The Washington State Liquor Control Board (LCB) is currently creating rules for implementing Senate Bill 5052 (SB 5052) and House Bill 2136 (HB 2136), which unify Washington’s medical and recreational cannabis markets. The LCB is holding hearings throughout the state where members of the public have the opportunity to present oral testimony to the Board. The final hearing will take place this evening, November 19, 2015, in Everett. This post will summarize the hearing that took place on November 16 in Seattle.
The hearing began with a general overview of the LCB proposed rules (the Board’s PowerPoint is available here). Notably, the new rules lifted restrictions on the amount of plant canopy space allowed to producers. “Plant canopy” is the amount of square footage dedicated to live plant production. Currently the canopy has no defined limitation, but may change based on an upcoming report from BOTEC on the size of the medical marijuana market. BOTEC is a research firm that worked with the LCB in 2013 to research the size of the initial market. The LCB also touched on rules related to financiers, restriction on locations of cannabis businesses, restriction on flavor for cannabis products, medical cannabis endorsements, security, and quality assurance. Additional information on the new rules can be found here.
Monday’s hearing was primarily reserved for members of the public to voice concerns over the new rules through oral testimony. The following are some of the major issues raised:
Deficiencies with the Tiered System. On October 12, the LCB began accepting applications for retail licenses. The LCB stated that 800 applications have been received at this point. SB 5052 requires the LCB to use a three-tiered system to determine the order which applications are granted:
- First priority: Applicants who applied for a marijuana retail license prior to July 1, 2014, operated or were employed by a medical marijuana collective garden prior to January 1, 2013, and who maintained a state and local business license (where and when required). To get this first priority, you must also have a history of paying state taxes.
- Second priority: Applicants who operated (or were employed by) a medical marijuana collective garden prior to January 1, 2013, have maintained a state and local business license, and have a history of paying state taxes and fees will be second in line for retail licenses.
- Third priority: All other applicants
Several people stated that applicants are “gaming the system” by purchasing businesses that qualify for tier one priority, purely for the benefit of the application preference. Testimony conveyed concerns that allowing such a practice misconstrued the legislator’s intent behind creating the tiered system that gives preference to applicants who operated medical marijuana dispensaries prior to the implementation of Initiative 502.
Availability of products for the medical community. Several members of the public deemed limits on the amount of THC insufficient. The LCB’s proposed rules include limits on the amount of cannabis a person may possess:
- 3 oz. of usable marijuana;
- 48 oz. of marijuana-infused product in solid form;
- 21 grams of marijuana-infused extract or marijuana concentrate for inhalation; or
- 216 oz. of marijuana-infused product in liquid form.
According to testimony, medical marijuana patients need a variety of cannabis products, based on the ailment they are treating. These limits allegedly restrict the types of cannabis products patients will be able to consume.
Also, several people testified about the need for high CBD products. One processor asked for permission to create CBD oil derived from hemp. Another person requested that canopy space be allocated to grow cannabis high in THC, because of the added cost in growing this type of plant. He alleged that there was no market incentive to grow CBD products, which is sought out by many patients. Allowing special space would allegedly provide an incentive to grow high CBD products.
Lack of Labor Regulations. Several members of the United Food and Commercial Workers made comments on the lack of protections for workers in the cannabis industry. The Board heard requests for a minimum wage higher than the state level, protected sick days, health insurance, benefits, and apprenticeship programs. Additionally, union members were concerned over the lack of worker protections. For example, if workers reports a business with an unsafe work place, they may suffer potential termination. Proponents of these regulations claimed they were required to ensure safety in the cannabis industry, claiming that if workers do not have certain protections they will not have an incentive to comply with many of the regulations intended to protect the public.
Bottom Line: Now is the time to convey your concerns to the LCB. Other issues were raised at the hearing and this is only a brief summary. I encourage attending the meeting tonight to get a full idea of the issues the LCB is facing. Alternatively, if you are interested in submitting a comment but are unable to attend the final hearing, written comments may be submitted through the LCB’s website.