City of Seattle - City Council - Committee - Finance and Housing - Committee Meeting
(July 20, 2022)

Here are some observations from the Wednesday July 20th Seattle City Council Finance and Housing Committee (City of Seattle - City Council - Committee - Finance and Housing) Committee Meeting.

My top 4 takeaways:

• Public commenters implored the council to not only address the drug war while evaluating cannabis equity, but also more recent city policies which had displaced African American medical dispensary owners.
  • Equity in the cannabis sector first came to the attention of the committee in December 2021 during a presentation by City of Seattle Department of Finance and Administrative Services (FAS) staff on their Race and Social Justice Initiative (RSJI). Members had been learning more about the situation since.
    • They heard from a panel of cannabis retail employees and stakeholders on February 16th.
    • Members delved into other municipal equity programs and heard a briefing from FAS representatives on March 2nd. That briefing featured possible goals and benchmarks for equity in the Seattle cannabis sector.
    • The committee heard from representatives of a Sacramento cannabis delivery company licensed through that city’s equity program, a Seattle cannabis staff training company, as well as representatives of the Washington State Liquor and Cannabis Board (WSLCB) on April 6th.
  • Peter Manning, Black Excellence in Cannabis (BEC) member (audio - 3m, video)
    • Manning had been part of a Bella Sole, a Seattle medical cannabis dispensary "forced to close as a result of David Mendoza and [former Seattle Mayor] Ed Murray's enforcement” which he characterized as “an attack on all Black-owned dispensaries.” He had been aware of “20 known dispensaries that were owned by Blacks” in Seattle which had been “beautiful.” Manning insisted “there was no hassle” with the city until Murray used “draconian-type measures” and “cracked down on us,” which he felt led to “zero” cannabis retailers in the city owned by African Americans. "Seattle has to take some type of responsibility for that," he asserted, as media coverage at that time showed there was “no way Black people could’ve survived that.”
    • Manning stated that he’d been fighting since 2014 “to get inclusion here,” and that his struggle had been documented by the Washington Post and KIRO7. He wanted city officials to “touch those people that were affected, that had legitimate dispensaries, and bring them back to the table.”
      • Mendoza had been criticized for his work on Seattle’s program to shut down medical cannabis delivery services and dispensaries in 2014 and again in 2016 following passage of a 2015 law that required the merging of the unlicensed medical and licensed recreational markets. Cannabis shop Have a Heart, the first state retailer to unionize, previously employed Mendoza as a lobbyist.
      • Mendoza was a Washington State Legislative Task Force on Social Equity in Cannabis (WA SECTF) appointee. The task force was established in 2020 and made recommendations to increase equity in license ownership and assist the WSLCB in the implementation of a retail social equity program. Their most recent meeting was on June 28th.
  • Mike Asai, Emerald City Collective Gardens (ECCG) Co-Founder (audio - 2m, video)
    • Identifying ECCG as the "first downtown" medical dispensary, and the “second Black-owned in Washington state,” Asai addressed the “mayor's social equity in cannabis, which is great, but it’s late,” and considered himself “one of the victims” of Murray and city policies. Asai pointed to former Seattle Mayor Michael McGuinn signing Ordinance 123661 in 2011, which “solidified medical cannabis” and he thought “should’ve gave us a grandfather clause.” But Murray and “his people” had “eradicated” many of the African American dispensaries in the city, argued Asai.
    • He and his family had been hurt as a result of ECCG closing, and there was “barely one percent” ownership of cannabis licenses by African Americans in the state. Asai believed he and others were owed "reparations” and “reconciliations" for the treatment they’d endured after their business was forced to close despite “never [having] had an issue with local enforcement” or “any enforcement whatsoever.”
  • Committee Chair and City Councilmember Teresa Mosqueda observed that elected officials sometimes “talk about reparations from the harmful effects of the War on Drugs,” but not much about reparations “from the harmful effects of policies that were just ten, 12 years ago.” She appreciated that perspective as they prepared to hear what city officials were considering doing on the matter (audio - 1m, video).

• Committee Chair and City Councilmember Teresa Mosqueda introduced two representatives of Mayor Bruce Harrell’s office to talk about a draft city-level social equity program centered on the cannabis sector.
  • Mosqueda “welcome[d] the mayor’s team,” Policy Director Dan Eder and Brianna Thomas, Harrell’s Labor Liaison, indicating that the committee was grateful for the prior work of Devon Alisa Abdallah, “the director of Legislative Affairs,” and Harrell’s external affairs liaison, Gerald Hankerson (audio - 3m, video).
    • Mosqueda explained that after their earlier meetings, the group was “very interested in moving forward some of the good research that’s been done” by staff from FAS, other city departments, and “community partners to help really be living our commitment to undoing the harms caused by the war on drugs." This included remedying “recent public policies that may have caused harm, especially to Black and Brown community members who’ve been trying to be part of this industry," she relayed.
    • Mosqueda closed by highlighting that the presentation would be about policy “concepts" rather than proposed legislation or rules, but the mayor’s representatives would have “a set of recommendations that I think the council will be very interested in hearing about…pillars of what could be legislation.” The council would continue to accept outside comments, she added.
  • Eder said he was “thrilled for the opportunity” to present to the committee (audio - <1m, video).
  • Thomas had worked on the topic for the preceding three months, and voiced appreciation for Mosequda’s remarks. She considered social equity in cannabis to be "about the deep impacts of policy that's been set here at the city level on members, particularly of the Black community, attempting to…reclaim their space as part of the cannabis industry here in Seattle." She echoed praise for FAS officials and their use of a Cannabis Racial Equity Toolkit (RET) which was “building a bridge from the policies we set before to where it is we’re going to go.” Thomas then thanked officials from other levels of Washington government, including “any help in this space from our federal delegation” (audio - 1m, video).
    • Thomas, a former city council staffer, ran for a citywide seat on the council in 2021 but lost in the primary.

• The mayor’s team envisioned separate ordinances on worker retention, a social equity category for Seattle cannabis licensees in the city, and next steps for areas like conviction expungement, future license types, and an advisory group.
  • Describing how the RET "concluded that there are significant inequities for BIPOC communities that were caused, primarily by the War on Drugs,” Eder said that they were there to offer “the first steps that the mayor is proposing to take to address some of those inequities” (audio - 3m, video, presentation).
    • He stated that a "suite of legislation" to be "transmitt[ed] on the 27th of this month" would cover:
      • “A job retention bill”
      • “A series of licensing changes”
      • “A step that memorializes the future actions that we intend to take as a city”
    • Thomas felt the negative impacts of the federal drug war “on Black communities” couldn’t “be overstated,” like families “torn apart,” loss of “intergenerational wealth,” and “deep rifts in the fabric of our community.” Other societal trends at play were displacement, gentrification, and “inequitable practices for workers across many industries,” but “particularly” for cannabis workers, she said.
    • Recognizing the limits of city authority in the space, Thomas reported that something local officials could do “is work towards equity in licensing.” Acknowledging the social equity retail licensing program to be administered by WSLCB, she said that as city authorities had “a hand in licensing,” officials could employ “a social equity approach to that licensure.” Thomas reported that existing cannabis retail licenses in Seattle were “primarily held by White men who are currently benefiting from the wealth-building opportunities in this industry." She attributed part of this to “the transition from medical…to recreational cannabis and the folks that were left behind in that transition.”
  • Worker Retention and Transparency Ordinance (audio - 2m, video)
    • Thomas commented that this proposal had been drafted by Office of Labor Standards (OLS) staff along with “Central Staff,” and FAS representatives to address “social equity licenses issued by the city.” She stressed the importance of partnering with other county, state, and federal officials on “next steps for the city of Seattle.”
    • “One of the big challenges in this industry is knowing who exactly the boss is, and who to hold accountable for labor standards” of a cannabis business, Thomas remarked. Using language “we’ve seen before,” she mentioned a plan to make public “who exactly holds the Seattle business license” in a store to increase accountability.
    • “We’ll also be looking at a retention policy” based on a “suite of legislation to protect hotel workers around retention,” Thomas told committee members. She described how during the sale of a cannabis license, “the stability of the workforce” at the business was “meaningfully disrupted, and there’s quite a bit of turnover.” The bill would attempt to require stability through “a 90-day retention with exceptions for cause,” explained Thomas, so that if “the boss changes, the workers don’t have to.” This mechanism could be enforced by OLS and “private right of action.”
  • Licensing Ordinance (audio - 3m, video)
    • Eder indicated a proposed “new social equity applicant category of Seattle cannabis licenses" would be consistent with RET recommendations, and that the definition would require either:
      • “Majority ownership by owners living" in areas “disproportionately impacted by the federal war on drugs.”
      • “One, or more, persons who have been convicted of a drug offense.”
      • “Other considerations to be fleshed out in future director’s rules informed by” WSLCB “deliberations about a state-level social equity applicant procedure.”
    • Those qualifying under the proposed category would “have a no-cost city license” while others applying or renewing licenses “would pay $4,000 in lieu of the current $3,500 fee,” Eder mentioned.
    • New cannabis license types, referred to as “ancillary businesses” that were “approved by” WSLCB—which the board could only do once a law was enacted—would be eligible for a city license, he said. Details on what licensing would be available had yet to be determined, Eder continued, “and then we would…have a lot more discussion about siting and other considerations,” particularly on regulations and locations for "consumption lounges."
      • The WA SECTF Licensing Work Group learned about cannabis clubs in Denver and other social use policies on March 17th.
  • Next Steps Ordinance (audio - 2m, video)
    • "Acknowledging that this is the beginning steps,” Eder conveyed that city leaders wanted to "memorialize" future steps which they “know that we want to take in the nearer-term,” such as:
      • Partnering with King County officials “and other jurisdictions to allow expunging prior cannabis convictions” as municipal authorities couldn’t expunge offenses outside of their boundaries, but “we can advocate for, and partner with, other jurisdictions”
      • Working with “BIPOC and other impacted communities, on approaches to build wealth through management jobs” and owning cannabis businesses
      • “In the coming months,” stand up “an advisory committee of workers, industry members, and community members who have been impacted by the federal war on drugs" to help officials “scope, and receive, and…give advice about next steps on a needs assessment” for cannabis workers and “recommendations for addressing those needs”
  • Thomas assured the committee that if “everything goes well,” proposed legislation would be transmitted by Harrell’s staff “on Wednesday July 27th” and appear on the “introduction and referral calendar” at the Seattle Legislative Information Center “the following Monday,” August 1st. They pledged to be “available to answer any of your questions” and planned to schedule individual meetings with committee members so that “everybody’s got the information that they need to make good decisions on this suite of bills” (audio - 1m, video).

• Members had a couple of questions about funding and zoning implications of the bill concepts before Mosqueda concluded the meeting with a call for additional information.
  • Mosqueda thanked Eder and Thomas and looked forward to receiving a “fully baked suite of proposals.” She emphasized that the details of the discussed ordinances weren’t “finalized,” and welcomed “high-level” questions about the ideas (audio - 1m, video).
  • Councilmember Sara Nelson offered that she was "all about not reinventing the wheel" and liked that their ideas “seemed” to build on prior work by various city agency staffers. She called attention to a "2019 Cannabis Equity Survey and Analysis" from FAS, hoping the mayor’s staff would take it “into account” and was relieved to see outreach to "the existing community and the retailers themselves." She asked if the proposed ordinance would necessitate “reprogramming of the city allocation” of cannabis excise taxes currently going into the city general fund to “support any of this work” (audio - 2m, video).
    • Thomas replied that changing allocation of those funds wasn’t planned “for this suite of legislation." Although she was aware of “recommendations from our many stakeholders to repurpose those dollars, that is not our current intention.”
    • Nelson noted the heavy taxation and regulatory burdens on cannabis licensees “like, no access to capital, no normal banking, no tax deductions for federal income.” Because the industry was already in competition with an “illicit marketplace," she opposed causing “any major difficulties" for cannabis businesses.
  • Nelson was excited to learn about new license types, and wondered if allowing for them would involve any changes “around buffers that could actually increase the number of licensees available for equity ownership.” Eder considered that a “separate conversation" from legislation which "expands the code section" to "effectively anticipate" officials issuing “different types of cannabis licenses" approved by the state. But there were no further details on business types nor “where they’d be located…at this stage,” he answered (audio - 1m, video).
  • Bringing the conversation to a close, Mosqueda expected “more opportunity for discussion,” then thanked Thomas and Eder “for the work that you have done.” She said “the concept here would be to get additional feedback” and then look at draft legislation before it appeared on an introduction and referral calendar “that first week of August.” Council members would be reviewing the proposal for “possible issues” by August 11th  (audio - 1m, video).
    • The next Finance and Housing committee meeting scheduled for August 3rd was cancelled.