WSLCB - Board Meeting
(October 31, 2018)

Here are some observations from the October 31st Washington State Liquor and Cannabis Board (WSLCB) Board Meeting.

My top 2 takeaways:

• During Wednesday’s Board Meeting, action was taken on several cannabis items.
  • The Board adopted a revision of their interim policy which enables licensees to phase-in the packaging and labeling (PAL) rule requirements adopted in May. The deadline for compliance with the new PAL rules was pushed out six months from January 1st, 2019 to June 1st, 2019 (audio - 2m).
  • The Board adopted final language for both the 2017 and 2018 Cannabis Legislation Implementations. The 2017 Cannabis Legislation has been in development for over a year and covers a wide array of technical/descriptive changes (audio - 2m). The 2018 Cannabis Legislation focuses on testing of cannabidiol produced outside the 502 system used in 502 products (audio - 2m).

• The agency opened rulemaking on two significant cannabis topics: enhanced traceability penalties and true parties of interest (TPI).
  • The Cannabis Penalties rules package will offer “guidance on when to escalate a [traceability] violation which may be viewed as aggravated.”  The current penalty matrix for traceability violations has been under review in response to recent Enforcement actions.  Proposed rules may also address consistency in settlement offers (audio - 2m).
  • A TPI rules package has been pulled out of the 2017 Cannabis Legislation rulemaking (audio - 2m).

Here are some observations from the Wednesday October 31st Washington State Liquor and Cannabis Board (WSLCB) Board Meeting.

My top 3 takeaways:

• Implementation of HB 2334 (“Regulating the use of cannabinoid additives in marijuana products”) by WSLCB officials began before the law had taken effect, but took months longer than the original forecast for the project.
  • Signed into law on March 21st following an unevenly paced route to the governor’s desk, the law would take effect on July 1st as RCW 69.50.326.
  • On April 4th, the CR-101 to begin rulemaking was approved.
  • On August 8th, agency leadership reviewed the rulemaking project during an executive management team (EMT) meeting and learned progress had been delayed in part due to challenges encountered when attempting to add functionality to the traceability system. The board approved proposed rules on August 22nd.
  • On October 3rd, a public hearing was held during which three comments were received on the project.

• Policy and Rules Coordinator Karen McCall presented the CR-103 on the project, which was approved by board members and took effect on December 1st, 2018 (audio - 2m, Rulemaking Project).
  • McCall stated that the enacting law “allows a producer or processor to import [cannabidiol] CBD products to enhance the CBD in the products that they are making.” In addition to the remarks offered in the public hearing, she told the board she’d received three written comments.
  • Following board adoption, McCall said, the rules would take effect “December 1st.” Board members approved the new rules.
  • Board Chair Jane Rushford thanked McCall “for being part of the interim support” following Policy and Rules Coordinator Joanna Eide’s departure from the agency shortly after introducing the proposed rules which were not subsequently modified. Rushford introduced McCall’s successor, Policy and Rules Coordinator Kathy Hoffman, who was “diving deeply into where we’ve been and where we’re headed.”
    • Hoffman was later promoted to Policy and Rules Manager.
    • Rushford’s term ended in early 2021, and David Postman was appointed to succeed her.

• Months after the new rules took effect, the board approved an exemption to tracking imported CBD products in the seed-to-sale traceability system.
  • During a June 2019 board caucus, Hoffman reported that the adopted rules “superseded what we were able to do in traceability” due to alleged limitations in MJ Freeway Leaf Data Systems. She admitted “we don’t have a workaround for this yet” while noting the system could handle cannabinoid additives sourced from within the legal marketplace.
  • At the following board meeting, members adopted BIP 12-2019 pertaining to WAC 314-55-109(3) regarding entry of testing lab results into the traceability system for CBD products obtained from an unlicensed source. Board members gave their approval without question.
    • During the May 2019 Traceability Advisory Committee meeting, the vendor and agency staff discussed a workaround, but Project Manager Clare Olson asserted any new development work would have to wait until a subsequent subscription services release. Following the tumult of release 1.37.5 in July, all additional development was halted.
    • At publication time, cannabis traceability and board interim policies were both undergoing significant changes. Leaf Data Systems was scheduled to be replaced by a Cannabis Central Reporting System (CCRS) in December 2021. And the board began rescinding interim policies on September 15th in favor of releasing policy statements instead, though BIP 12-2019 had not yet been addressed.