WSLCB - Board Caucus
(March 19, 2019)

Here are some observations from the Tuesday March 19th WSLCB Board Caucus.

My top 3 takeaways:

• Board Member Ollie Garrett initiated discussion about legislation relevant to the agency and related media coverage (audio – 11m).
  • Noting the failure of the agency’s request legislation to establish a mandatory budtender permit (HB 1370 / SB 5678), Garrett asked what the agency could still do. It was agreed a mandatory licensing and training program would require legislative action. Garrett and Board Chair Jane Rushford felt an optional program would be “attractive to a lot of people.” There was agreement to follow up on the issue after talking to Director of Licensing and Regulation Becky Smith and other staff about federal requirements for licensing related to child support and the limits of the agency’s power.
    • Details on HB 1370’s policy committee executive session. The bill was not scheduled for a public hearing by its fiscal committee.
    • Details on SB 5678’s policy committee public hearing. The bill was not scheduled for an executive session by its policy committee.
  • Garrett asked about the failure of social consumption legislation to advance (HB 1945) and what the agency could do for local jurisdictions that wanted to enact local policies. Board Member Russ Hauge told Garrett that state regulations against cannabis clubs, and the state’s Smoking in Public Places laws were very clear. Garrett mentioned a recent meeting between herself and Seattle City Attorney Pete Holmes in which Holmes said the smoking in public places statutes were his biggest obstacle. Rushford and Garrett agreed to follow up on the topic next week after talking to staff.
    • See HB 1945’s bill profile by Cannabis Observer. The bill was not scheduled for a public hearing by its policy committee.
  • Garrett also brought up recent media coverage about “one of our licensees” and “a blog post.” Although the references were oblique…
    • Hauge’s jest that “It’s a terrible thing to lose your license because you forgot to tag some nine-inch plants” confirms the Board was referencing  Q13 Fox’s story about Smokey Point Productions.
    • And the blog post discussed was Tobias Coughlin-Bogue’s article at The Sesh titled “What’s Really Going On With Russ Hauge?” Garrett felt “that should have gone over to everyone that signed the letter.” Rushford promptly replied: “It did.”
    • See the February 27th Executive Management Team meeting for more details about the curious series of events leading up to lawmaker allegations of a “toxic culture” at WSLCB.
    • Cannabis Observer is proud to count Bogue as a sponsor and would like to encourage more journalists to build on the source material our citizen observers provide.
• Board Member Russ Hauge provided an update on a potential disagreement about the degree of tribal ownership of cannabis businesses (audio – 7m).
  • On March 7th, Department of Revenue Tribal Liaison Kara Briggs sent a letter to WSLCB Policy Analyst and Tribal Liaison Brett Cain regarding complete, majority, or partial tribal ownership of cannabis businesses under compact.
  • Hauge acknowledged inquiries asking if compacts necessitated “whole tribal ownership of the enterprise that we’re compacting.” Hauge’s opinion was that the answer was murky, but claimed “statute is pretty clear” and that “tribal considerations can only be given if the tribe is the whole owner of the enterprise.” He noted the Department of Revenue (DOR)’s rules regarding tribes allowed businesses to “enjoy tax benefits if they are even partially owned” by a recognized tribe.
  • The letter from Briggs challenged WSLCB policy and claimed “any tribal ownership” should be allowed under compacts.
  • Hauge said, “We’re just not going to do that.”
  • When the question was raised by cannabis-compacted tribes, Hauge said the agency had “decided not to fight about it” and that he and Cain had been authorizing “majority owned tribal enterprises.” Hauge felt currently compacted tribes were satisfied by the agency’s position and he believed WSLCB policy should be more restrictive than DOR’s request: “We’re not comfortable with saying just any tribal ownership is enough to quality for a compacting relationship with us.”
  • Briggs requested a “consultation” between compacted tribes, DOR, and WSLCB. Hauge pushed back citing federal concerns and said he didn’t see the point of “further dialog with DOR, I mean they know what our position is.” Hauge alleged Briggs’ letter did not reflect concerns of DOR leadership: “That’s one person’s opinion.”
  • Rushford agreed they shouldn’t “make work” by taking on the topic. Hauge added that allowing it could create a means for corporate funding to become available to tribal cannabis businesses in a way not allowed for non-tribal licenses. He said “taking the safety off” that type of financing might “unbalance” the market.
• Board Chair Jane Rushford mentioned a recent meeting with the Washington Healthy Youth Coalition (audio – 11m).
  • On Friday March 15th, the Washington Healthy Youth (WHY) Coalition convened at WSLCB headquarters. Rushford agreed to meet with participants to represent agency leadership.
  • She updated them on the “Board’s philosophy, our approach, and how we fit in the organization” as well as the new policy analysis framework and Cannabis 2.0 project.
    • Rushford initially described the Cannabis 2.0 project in November and provided an update at the end of February.
  • Rushford reported the planned 15 minute meeting extended to an hour as questions and engagement with the prevention community group was “fun” and “worthwhile.”