WSLCB - Executive Management Team
(August 8, 2018)

Here are some observations from the Wednesday August 8th Washington State Liquor and Cannabis Board (WSLCB) Executive Management Team meeting.

My top 3 takeaways:

• The Board discussed rule changes for CBD additives to I-502 products (transcript, audio).
  • CBD additives will have to pass QA tests, including for presence of CBD.
  • Proposed sampling and testing requirements are borrowed heavily from the Department of Health, including for pesticides, heavy metals, residual solvents, and microbials.
  • DOH and Enforcement have done some testing of existing unregulated additives and found that “there are many products that will test hot at pretty alarming levels for pesticides” as well as heavy metals.
  • Retesting and remediation, pending technological feasibility, will be allowed.
  • The Board noted Medicine Creek Analytics input around heavy metals in vapor product delivery devices, and are interested in discussing heavy metals testing requirements for those.
  • WSLCB Board Member Russ Hauge recommended that the rules allow QA testing disciplinary action based on prima facie “at first appearance” evidence, rather than allowing products to continue to be sold while due process investigation plays out.
• WSLCB Policy and Rules Coordinator Joanna Eide reviewed the “rather large” Supplemental CR 102 for the 2017 cannabis legislation rule changes (transcript, audio). Here are some of the more notable changes:
  • Lozenge has been specifically defined as “a marijuana infused product, such as a hard candy, mint, pastel, tablet, or similar type of edible product, that is generally swallowed whole, chewed and swallowed, or dissolved in the mouth.”
  • “Licensees were added to the list of people that must be 21+ to work in a licensed establishment.”
  • The “proposal to allow for volume discounts, similar to in the liquor realm has been removed …”
  • A change was made “to detail requirements of when Licensing will place certain licensing change requests on hold, pending an adjudicative proceeding.”
  • Instead of redefining true party of interest to exclude financial control at a specific percentage of profits, clarifying language was added to indicate a “certain level of management or control, over a licensed business that indicates a true party of interest relationship.” Eide noted that this was what they had already been doing, and the changes are meant to clarify the existing true party of interest language.
  • The license fee and renewal rate have been aggregated so that the total annual fee of $1381 is more clearly “spelled out in statute.”
  • Processor-to-processor language has been simplified to allow processing service relationships rather than requiring sales between inventory transfers.
  • Payments language has been clarified to further prevent consignment arrangements rather than cash payments (“cash” refers to electronic transfers and check payments).
  • Sampling requirements have been made “a bit more flexible.”
  • Ownership change language has been clarified, especially with respect to receiverships.
• WSLCB Director Rick Garza initiated a substantive discussion about the pace at which the WSLCB processes license changes for licensees under investigation (transcript, audio).