WSLCB - Board Caucus
(May 4, 2021)

Here are some observations from the Tuesday May 4th Washington State Liquor and Cannabis Board (WSLCB) caucus.

My top 3 takeaways:

• Policy and Rules Manager Kathy Hoffman delivered an update on the agency’s policy on delta-8-tetrahydrocannabinol (delta-8-THC) in legal cannabis products, describing the development of an agency position.
  • Hoffman first brought up the agency announcement of its policy statement on delta-8-THC released on April 28th, stating that she wanted to clarify what work the agency had done on the statement and “speak a bit more broadly concerning where we’ve been, where we are, and where we’re going” (audio - 6m).
    • The statement addressed compounds other than delta-9-THC “and the conversion of CBD, hemp, or both to delta- 8 THC, delta-9 THC, or any other cannabis compound that is not currently identified or defined in” state law or administrative rule.
    • Hoffman described how agency staff interest was piqued “in June of 2020, so that’s almost a year ago” which led to “exploring the dimensions of the issue around THC compounds other than delta-9 since that time.” The analysis, she said, “included a lot of research, many, many meetings, internally and externally with our national colleagues who are part of CANNRA [the Cannabis Regulators Association]. But when we started this work we were still the regulators roundtable.”
      • On February 10th, WSLCB contracted with Gillian Schauer, a research scientist at the University of Washington Addictions, Drug & Alcohol Institute (ADAI), formerly the Alcohol & Drug Abuse Institute. Schauer would work “at the direction of the Public Health Education Liaison [Sara Cooley-Broschart] and interdependently with respective program leads as called upon.”
        • The operating budget passed by the Washington State Legislature provided half a million dollars to the Washington State Health Care Authority (WA HCA) Community Behavioral Health Program to contract with ADAI “to develop policy solutions in response to the public health challenges of high tetrahydrocannabinol potency cannabis. The institute must use this funding to: Conduct individual interviews with stakeholders and experts representing different perspectives, facilitate joint meetings with stakeholders to identify areas of common ground and consensus, and develop recommendations for state policies related to cannabis potency and mitigating detrimental health impacts.” WA HCA and ADAI must produce a preliminary report by December 2021 and a final report by the end of 2022 for the Legislature and the Washington State Office of Financial Management (WA OFM).
      • A Personal Services Contract Exemption Request Form reveals Schauer would “Provide information about and analysis of specific issues to better inform decision-making and policy development. Areas of focus will include emerging issues around cannabis such as delta-8 THC, marijuana product potency, impacts on youth consumption, vapor products, consumer safety education, taxes, environmental health and other issues that may arise. This information will be provided to agency staff and the Board, especially regarding the development of legislative, rules, and/or policies.
        • Explore and analyze available research on specific issues and topics identified by agency leadership as important to the development of sound decision-making and policy development.
        • Prepare and provide reports, presentations, and briefings to convey results of research and analysis in a clear and concise manner.
        • Convene other agencies or subject matter experts as needed to accomplish above.
        • Participate/coordinate state and/or national efforts on cannabis policy, including the Cannabis Regulators Association (CANNRA).
        • Work interdependently with respective program leads on projects as assigned.
        • Provide a public health perspective and promote the public safety mission of the agency in internal and external meetings.
        • Maintain research repository pertinent to the work of the agency.
        • Leverage communication channels with fellow researchers whose expertise relates to the work of the agency.
        • Stay abreast of emerging public health issues related to alcohol, cannabis, vapor and tobacco policy and regulation.”
      • Schauer has been mentioned during WSLCB public meetings in the past several years.
        • She was first mentioned by Director Rick Garza in February 2019, suggesting she could become employed by the State of Vermont to combine that state’s medical and legal roundtable groups.
        • Garza mentioned her again in December 2019, saying she was presenting to CANNRA’s precursor organization, informally called the Regulators Roundtable, due to her expertise working with the U.S. Centers for Disease Control and Prevention (CDC) and the National Institute on Drug Abuse (NIDA).
        • During the first public acknowledgment WSLCB was looking at cannabinoid regulation beyond delta-9-THC in November 2020, Hoffman noted that Schauer was already representing public health issues within CANNRA.
        • On March 16th, Garza announced the agency had contracted with Schauer and she had “brought the states together” through CANNRA to learn “what are they doing in response to this issue around delta-8.”
        • It’s unclear to Cannabis Observer how CANNRA is funded and Washington state public records law does not apply to the private Oregon-based association. There has been no evidence of CANNRA contracting or employing research or subject matter experts directly. This example indicates at least one public member organization is using State funds to contract with individuals or organizations to “coordinate state and/or national efforts on cannabis policy” through CANNRA.
      • On March 25th, Schauer offered testimony and a presentation on delta-8-THC to the Oregon State House General Government Committee during a public hearing on HB 3000, legislation to further regulate cannabinoids. Days prior, the Oregon Liquor Control Commission (OLCC) noted an “Effort to Limit Unchecked Use of Delta-8-THC, Other Artificially-Derived Cannabinoids” following a meeting attended by Garza and WSLCB staff.
    • Hoffman said WSLCB representatives had also reached out to sister agencies on the subject of delta-8-THC:
      • Washington State Department of Agriculture (WSDA)
      • Washington State Department of Health (DOH)
      • Washington State Pharmacy Quality Assurance Commission (WA Pharmacy Commission)
      • Washington State Board of Health (SBOH)
    • “We heard from licensees as well who offer[ed] both verifiable and some less verifiable information,” which Hoffman said led staff to “focus on the definition of tetrahydrocannabinol and what the term ‘synthetic’ means in this context.” The policy statement recently put out by the agency “began to take shape last November,” she explained, and was a topic staff had been “closely monitoring for quite some time.” When the team started finalizing a position in January, Hoffman reported they’d been “focused only on delta-8.” After a draft statement was sent out to stakeholders in “early February,” she said they learned the “issue had expanded beyond just delta-8 derived from hemp.” This encouraged a revision of the statement to “include compounds other than delta-9 derived from marijuana and also began to explore statutory authority regarding rulemaking in this space. And I think we know that that’s extremely limited,” Hoffman remarked. By late March, a revised statement was “in final form” and was circulated among “agency partners,” she stated, leading to “minor adjustments based on WSDA feedback” that had been “largely related to hemp.”
      • WSDA manages the State hemp program and State law declares “All rules relating to hemp, including any testing of hemp, are outside of the control and authority of the liquor and cannabis board.” Within this constraint, WSLCB regulates hemp extracts or compounds added to legal cannabis products, particularly cannabidiol (CBD).
      • In addition, WSLCB was recently granted additional statutory authority over licensees “engaged in producing or processing hemp at the same location for which they are licensed to produce or process marijuana” to “test samples represented as hemp that are obtained from a location licensed for marijuana production or marijuana processing for the sole purpose of validating THC content of products represented as hemp.” The ambiguous definition of THC in the statute would appear to encompass testing for delta-8-THC.
      • Synthetic cannabinoids have an existing definition in state law inclusive of substances “identified in RCW 69.50.204(c)(30) or by the pharmacy quality assurance commission under RCW 69.50.201.”
  • On April 14th, board members heard from concerned cannabis producers and other stakeholders opposed to using delta-8-THC derived from hemp in legal cannabis products.
  • On April 23rd, the WA Pharmacy Commission was asked for “Clarification of Tetrahydrocannabinol (THC) Compounds other than Delta-9 under Chapter 69.50 RCW” as the Commission was assigned authority to enforce and change the schedule of controlled substances in Washington state. WSLCB staff requested clarification of the “commission’s current interpretation” of the definition of THC in the controlled substances act (audio - 2m) and members ultimately voted to agree “with the plain language interpretation of [the THC definition] as written” (audio - 1m).
  • During the April 27th board caucus, Board Member Russ Hauge talked about the different stakeholders invested in the issue, and Garza indicated that consensus was building in the agency that rulemaking and legislation would be required (audio - 8m).

• Hoffman discussed the substance of the recent policy statement and a supplemental clarification.
  • Referring to the April 28th policy statement, Hoffman said it had “not substantively changed from late March.” She commented that staff had been hearing from “many stakeholders with very different interests and topics” and assured board members “LCB hasn’t banned anything.”
  • Hoffman claimed the WA Pharmacy Commission was “equally clear that all compounds of THC are recognized as schedule one substances, such as delta-8 and delta-9, and our agency has regulatory authority over delta-9” which RCW 69.50.204(c)(30)(i) defines as including “Tetrahydrocannabinols, meaning tetrahydrocannabinols naturally contained in a plant of the genera Cannabis, as well as synthetic equivalents of the substances contained in the plant, or in the resinous extractives of the genera Cannabis, and/or synthetic substances, derivatives, and their isomers with similar chemical structure and pharmacological activity such as the following:
    • (A) 1 - cis - or trans tetrahydrocannabinol, and their optical isomers, excluding tetrahydrocannabinol in sesame oil and encapsulated in a soft gelatin capsule in a drug product approved by the United States Food and Drug Administration;
    • (B) 6 - cis - or trans tetrahydrocannabinol, and their optical isomers;
    • (C) 3,4 - cis - or trans tetrahydrocannabinol, and its optical isomers; or
    • (D) That is chemically synthesized and either:
      • (I) Has been demonstrated to have binding activity at one or more cannabinoid receptors; or
      • (II) Is a chemical analog or isomer of a compound that has been demonstrated to have binding activity at one or more cannabinoid receptors; (Since nomenclature of these substances is not internationally standardized, compounds of these structures, regardless of numerical designation of atomic positions covered.)
    • RCW 69.50.204(c)(30)(ii)---which was not cited in the WSLCB policy statement---notes: “Hemp and industrial hemp, as defined in RCW 15.140.020, are excepted from the categories of controlled substances identified under this section.”
  • Hoffman clarified that the “intent of a policy or interpretive statement is advisory.” She said that until the agency had “reached a conclusion, through the public rulemaking process, whether to adopt rules to create enforceable requirements regarding products that contain delta-8” the released policy statement would remain “advisory” only. The agency would “continue to enforce existing rules pertaining to packaging and labeling,” she said, including ensuring there wasn’t too much of “any type of THC in edible products.”
    • Board Chair David Postman asked whether the State Administrative Procedures Act (APA) considered such statements to be advisory in nature. Hoffman confirmed his understanding. Postman found the statement captured “current thinking and perspective of the agency right now” though the issue was “still fast changing” (audio - 1m).

• Hoffman then looked ahead to the initiation of formal rulemaking on cannabinoid regulation on May 12th.
  • Hoffman said that at the next board meeting, she would present a CR-101 for approval “that contemplates rule development that would allow you, the board, to evaluate additives, solvents, ingredients, and compounds used in the production and processing of marijuana products to determine whether such products pose a risk to public health or youth access.” Additionally, some compounds “other than delta-9-THC are not subject to mandatory testing, including potency, and the impacts of these chemicals are unknown and could be dangerous,” Hoffman added. Should the rulemaking project be approved, she expected “scheduling rule development meetings that will be framed in much the same way,” and would use a “deliberative dialogue format” that featured outreach “to scientific experts to help us advance a frame and sort the multiple interests at play in this issue.” The rulemaking project would include work on “possible legislative remedies that will expand the LCB’s authority to respond to circumstances like this.”
    • Hauge noted that he’d be meeting with Hoffman later on the subject to offer anecdotal stories he’d received from “the producer/processor ranks...about what’s going on” with delta-8-THC. Hoffman welcomed Hauge’s continued involvement (audio - 1m).
    • Cannabis Observer notes that Hoffman’s language reflects relatively new authorities granted to the Board in 2020 in the wake of the vaping associated lung injuries (VALI) health scare via HB 2826. Specifically, RCW 69.50.342(1)(m) states the Board may adopt rules for “The prohibition of any type of device used in conjunction with a marijuana vapor product and the prohibition of the use of any type of additive, solvent, ingredient, or compound in the production and processing of marijuana products, including marijuana vapor products, when the board determines, following consultation with the department of health or any other authority the board deems appropriate, that the device, additive, solvent, ingredient, or compound may pose a risk to public health or youth access.” Rules to implement that law were adopted by the board on February 17th.
    • Garza told lawmakers on March 25th that the agency was standing up a work group on delta-8-THC with representatives from the cannabis industry, the Washington State Department of Health (DOH) and the Washington State Department of Agriculture (WSDA). He said the focus would be “to address delta-8 and other psychoactive derivatives leveraged on information from CANNRA discussions” (audio - 1m, video).