WSLCB - Listen and Learn Forum - Cannabinoid Regulation
(July 28, 2022)

Here are some observations from the Thursday July 28th Washington State Liquor and Cannabis Board (WSLCB) Listen and Learn Forum on the Cannabinoid Regulation rulemaking project.

My top 3 takeaways:

• Definitions and scope pertaining to cannabinoid regulation had been under development across two rulemaking projects for more than a year as synthesized cannabinoid products proliferated both inside and outside of the licensed cannabis market - and agency leaders attempted to expand their authority to control them.
  • Agency officials had begun looking into cannabinoid regulations by November 2020, starting with delta-8-tetrahydrocannabinol (delta-8-THC).
  • In February 2021, WSLCB contracted with Gillian Schauer, a research scientist at the University of Washington Addictions, Drug & Alcohol Institute (UW ADAI). That March, Director Rick Garza announced they had contracted with Schauer, who had “brought the states together” to learn “what are they doing in response to this issue around delta-8.”
    • In April, staff announced a policy statement on delta-8-THC and other cannabinoids, but were motivated to send a ”clarifying” bulletin about the policy statement days later.
    • In June and July, staff hosted deliberative dialogues centered on cannabis plant chemistry with some discussion involving questions of impairment as a way to develop rules and potential legislation to regulate cannabis compounds beyond delta-9-THC. 
    • A rulemaking project on THC Compounds other than Delta-9 was approved by board members in May 2021, following a presentation by Hoffman. A public hearing was held on proposed changes in December 2021 and the final rules were adopted by the board on January 5th.
    • After the conclusion of her contract with WSLCB in June 2021, Schauer went on to become the first Executive Director of the Cannabis Regulators Association (CANNRA). She addressed delta-8-THC policy at a conference in September 2021, and spoke in support of legislation expanding WSLCB powers on January 20th.
  • During the 2022 legislative session, an agency request bill seeking additional authority over cannabinoid products—including those available through businesses not licensed by WSLCB—became controversial, and certain cannabis industry members helped thwart multiple legislative attempts to expand WSLCB powers. The bills failed amidst rancor and accusations of “misinformation” around their impacts.
  • A renewed rulemaking project was initiated by the board on May 11th, with draft conceptual rule text released prior to the listen and learn.
    • WSLCB staff hosted dialogues dealing with cannabis impairment on April 27th, May 31st, and June 21st.
  • Director of Policy and External Affairs Justin Nordhorn deemed the conceptual rules a "very scaled back version" of their 2022 request legislation, which he said was “constructed with a lot of definitions” and evoked “a lot of confusion around a number of different points.” Indicating that cannabis sector stakeholders had conversations on “utilization of different terms and terminology,” he noted this prompted WSLCB officials to look at developing greater “consistency.” Welcoming input regarding the rule’s feasibility, Nordhorn made clear that “not everything we had” in prior legislation could be achieved in the scope of WSLCB rulemaking (audio - 2m, video).
  • Policy and Rules Coordinator Robert DeSpain brought up the “five internal meetings” and deliberative dialogues already undertaken by WSLCB representatives on the “evaluation of THC compounds.” Based on the feedback received, he said they would consider revising the conceptual draft “and/or file a CR-102 rule proposal” (audio - 2m, video, rulemaking project, presentation).
    • Take a look at a comparison between existing rules and proposed changes generated by Cannabis Observer.
    • This project was DeSpain’s first cannabis rulemaking effort at WSLCB.

• Participants offered relatively few comments or questions on potential rule changes in ​​WAC 314-55-560 covering “Evaluation of additives, solvents, ingredients or compounds used in the production of cannabis products.”
  • WAC 314-55-560(1) - Title and Scope (audio - 2m, video)
    • The conceptual rules add “concentrates” and “processing” to both the title and scope of the section.
      • The extension of prohibitory power over processing would bring the WAC into parity with the authorizing statute for the agency, RCW 69.50.342(1)(m), which covers a “prohibition of any type of device used in conjunction with a cannabis vapor product and the prohibition of the use of any type of additive, solvent, ingredient, or compound in the production and processing of cannabis products, including cannabis 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.”
    • Micah Sherman, Raven Co-Owner and Washington Sun and Craft Growers Association (WSCA) Board Member, sought a better understanding of why “concentrates” were added to the list of substances the board could prohibit from inclusion in cannabis products (audio - 4m, video).
      • DeSpain asked if Sherman had an alternative suggestion or just felt the term should be removed. Sherman replied that he wanted to know how that wording “would be implemented or used.” DeSpain said the first stage of rulemaking was about “exploring” what they could add, so hearing the use of concentrates in the text was “vague” was “really helpful.” Sherman added that the wording could be duplicative of the board’s regulatory powers over cannabis concentrates, wondering if it represented an attempt “to regulate those external concentrates.”
      • DeSpain promised to “take that back” so staff ensured they were clear on the point of including “concentrates” in the change.
    • Mark Ambler, Breeze Trees Owner, shared his view that regulators wanted “to regulate terpenes and [cannabidiol] CBD additives, in addition to solvents” and ingredients (audio - 2m, video).
  • WAC 314-55-560(2) - Definitions (audio - 4m, video) 
    • With “the most changes,” according to DeSpain, definitions were added for "catalyst", "extract", and "extraction".
      • The definition for catalyst was identical to the definition in the 2022 request legislation while the other terms had some distinctions.
        • Extract
          • Request bill: “(w) "Extract" means a solid, viscid, or liquid substance extracted from a plant, or the like, containing its essence in concentrated or isolated form.”
          • Draft rule: “(d) ‘Extract’ means a solid, viscid, or liquid substance extracted from ‘Cannabis’, as defined in RCW 69.50.101, which may result in, but is not limited to, isolates, distillates, and/or concentrates”
        • Extraction
          • Request bill: “(x) "Extraction" means the process to separate or obtain a solid, viscid, or liquid substance from a plant or parts of a plant, by pressure, distillation, treatment with solvents, or the like.”
          • Draft rule: “(e) “Extraction” means the process to separate or obtain a solid, viscid, or liquid substance from “Cannabis”, as defined in RCW 69.50.101, by pressure, distillation, treatment with solvents, or the like;”
    • Annie Rothrock, ATREG, Inc. Vice President, voiced a concern over the spelling of “viscid,” feeling they likely meant “viscous.” DeSpain was confident that the term “was intentional” but promised to check with staff to ensure it was the appropriate phrasing (audio - 3m, video).
      • Rothrock gave input during the April 27th dialogue, as well.
    • Shawn DeNae Wagenseller, Washington Bud Company CEO and WSCA Board Member, offered written comments after the event which addressed definitions.
  • WAC 314-55-560(3) - Procedure (audio - 2m, video) 
    • The sole notable change to this section was the inclusion of “processing” within the scope of the board’s authority to prohibit compounds in cannabis items.
    • Ambler asked "who would be doing the verifying" at WSLCB with regards to "case report data" and the “Other local, state and federal agency findings” before the board prohibited a compound or process (audio - 7m, video). 
      • DeSpain’s understanding was that power to restrict substances or practices rested with the board, and that verification of the items Ambler mentioned were the purview of agency staff briefing board members.
      • Ambler hoped to get a sense of how often the board might review and enact restrictions under this subsection, or the potential for “a backlog.” He expressed concern about "the lag" between the board receiving a case study about a compound or practice and when the board might act, and how this could impact the “American cannabis” products made in the state. DeSpain told Ambler that as most of this section was already in rule, there hadn’t “been any additional meat and potatoes” and no “backlog” had emerged to date, officials would “consider” Amber’s point further.
      • Nordhorn responded that Ambler’s input was “well taken” and that WSLCB staff could “revisit” the subsection of rule. Using vitamin E acetate as an example—a vapor product ingredient widely blamed for a series of vaping-associated lung illnesses in Washington and elsewhere in 2019—he remarked that the intent was for the board to be able to react to “emerging public health issues.” Happy to add clarity, Nordhorn expected “public health entities” at the state or federal level like the Washington State Department of Health (DOH) would be where the board would seek verification around case reports or other findings.
  • WAC 314-55-560 - General Feedback (audio - 1m, video)
    • DeSpain invited “additional suggested revisions” to the rule section,
    • Ambler suggested that "any place we have the authority written into the WAC that you can regulate" could instead state “regulate or approve" so that individuals could “submit a list of additives or concentrates” as a way of “proving that they’re OK, that they’re healthy.” Publishing a list of approved additives, solvents, and concentrates would be useful for licensees seeking acceptable processes, he argued (audio - 4m, video).

• Given no further comments, Policy and Rules Coordinator Robert DeSpain concluded the forum early, telling attendees their input “could be incorporated into this next phase of the rule proposal process” (audio - 3m, video).
  • He explained that while the remarks they’d heard weren’t “considered formal” public comments, participant feedback would be added to the “CR-102 packages” which would outline public engagement by agency representatives. DeSpain then shared some general rulemaking resources at WSLCB:
    • Current Rulemaking Activity
    • Rulemaking Process—Phases 
    • Rulemaking FAQs
  • DeSpain thanked attendees for their involvement and promised that work on the project would continue.