WSLCB - Board Meeting
(June 7, 2023)

Here are some observations from the Wednesday June 7th Washington State Liquor and Cannabis Board (WSLCB) Board Meeting.

My top 3 takeaways:

• Board members received a legacy environmental pesticide action update from Director of Enforcement and Education Chandra Wax addressing additional product test results and recalls (audio - 8m, Video - WSLCB, Video - TVW).
  • Wax had been on point in a WSLCB investigation which came to light with an April 6th announcement to all licensees titled “Notice of Pesticide Contamination in Region of Okanogan County” announcing administrative holds on licensees and prompting product recalls over testing done by staff of the Washington State Department of Agriculture (WSDA) indicating dichlorodiphenyldichloroethylene (DDE)---a remnant compound of the banned pesticide Dichlorodiphenyltrichloroethane (DDT)---above default action levels in rule of 0.1 parts per million (ppm).
    • Wax first addressed the situation publicly on April 12th—when the board declined to pursue emergency rules on the topic—promising more testing results were on the way. She updated the board members again on April 18th, announcing some test results and discussing stakeholder responses.
    • Staff pointed out providing information to impacted licensees wanting to relocate, on May 10th.
    • May 17th, WSLCB posted four more voluntary recalls due to “Pesticide action levels above WSLCB requirements,” impacting producer/processors in Snohomish, Skagit, and Whatcom Counties, potentially because they’d bought from impacted licensees, raising the possibility that distribution of extracts which concentrate DDx contaminants was more widespread.
    • Cannabis Observer Founder called out the decline in public updates, including around previously conducted testing, in public remarks on May 24th.
  • At the board meeting, Wax provided a presentation on “DDE contaminants found in cannabis and soil from several licensee locations in Eastern Washington” above 0.1ppm. She spoke to the history of pesticide testing in WAC 314-55-108 which was designed “through consultation with [the Washington State] Department of Health, Department of Agriculture, and Oregon Health Authority.”
    • A December 2015 Oregon Health Authority technical report covering their “Process to Determine Which Types of Contaminants to Test for in Cannabis Products, and Levels for Action” indicated the Oregon Department of Agriculture along with “analytical laboratory representatives recommended not including any organochlorine insecticides on the list,” which included DDE.
  • Random cannabis testing conducted by WSDA “between January and March of 2023” showed seven samples collected by Wax’s team containing DDE levels at “an average of 0.19 parts per million, and five of those results were positive but below action limits” with an “average of 0.053[ppm].” She noted two other September 2022 tests found DDE “above action limit [of] 0.14,” and that all of these “traced back to this area in Okanogan County,” near the City of Brewster, “defined as a five-mile stretch of land along the south end of the Okanogan River and north of Lake [Pateros].”
  • 18 licensees in the areas designated by the agency were placed under administrative holds, including five whose products had DDE above action levels. Businesses were notified, additional records requested, and licensees with DDE above action levels conducted voluntary recalls, she told board members. Wax noted April 14th stakeholder meetings between State regulators and affected licensees, testing laboratories, legislators, and trade associations. She said the same day “a detailed message was shared with licensees, legislat[ors] from the Okanogan area, local public officials, and stakeholders” to keep them apprised of what WSLCB was doing. Wax said WSLCB representatives “sought out the advice of our partners at Department of Ecology [DOE, and WSDA] and developed a plan to ensure there were not contaminants in the products available to the public,” while being aware of the capacity of WSDA testing facilities.
  • Wax indicated soil samples were collected by DOE personnel, and although the “report is not complete yet…according to the Department of Ecology, the levels of DDE and DDT and lead and arsenic in the soil samples are above State standards. Licensees will be notified and provided copies of those results when they're received.” WSLCB staff collected “124 water and product samples from January to May 2023 from the impacted area,” and she highlighted several findings:
    • “66 of the 97 samples we've received have DDE detections; 28 of those were foliage, 38 of those are cannabis oil and rosin. 44 of those samples failed for DDE concentrations above action limit; 36 of the cannabis oil in rosin samples failed, and eight of the foliage samples failed.”
    • “24 of the foliage samples that did not fail have a moderate concern action limit result, which if concentrated, would likely rise above action limits.”
    • In cannabis flower samples, “other than DDE, ten other types of pesticides were detected… below action levels. And in the cannabis and oil samples, 17 other pesticides” were present. “23 of these samples had above action limits of the additional pesticides.”
    • “The highest concentration of DDE [was] 1.7 parts per million in cannabis…oil and rosin sample. The lowest concentration of DDE in a positive sample [was] 0.018 parts per million, and the average overall DD[E] concentration” was 0.278ppm.
    • According to her presentation, no water samples had been shown to have “detectable levels of DDE/DDT.”
  • Wax went over the additional actions agency staff were taking:
    • For any “cannabis tested above action limit, the admin hold was retained, and we will pursue destruction of that product.”
    • All cannabis flower with DDE “below the action limit, the admin hold is listed on that product, but they cannot concentrate or extract the product without testing it again before it goes to the market.”
    • “If the cannabis did not reveal detectable levels of DDE, the admin hold on the specific product was lifted.”
    • “Of the five licenses with admin holds, one hold has been lifted with four holds currently still in place, and the holds have been lifted on the specific products with no detectable limit of DDE.”
    • “The LCB has been working with the Department of Agriculture and the Department of Ecology to support their processes for funding that was awarded by the legislature for grants [for] farmers and a study to consider soil remediation.”
      • With DOE authorities heading up the soil remediation effort, the project may follow an established process on cleanup of hazardous or toxic sites, described at length in this document and defined in statute in RCW 70A.305.190, which specified: “(4) Moneys in the model toxics control capital account may be used only for capital projects and activities that carry out the purposes of this chapter and for financial assistance to local governments or other persons to carry out those projects or activities.”
  • “We are acting responsibly, swiftly, and intentionally,” Wax concluded. She state, “our goal is to ensure that the cannabis products are safe,” that licensees, stakeholders, and the public were “informed as updates are available, and we also continue pesticide investigations statewide.”
  • Following the meeting, a bulletin was sent out by WSLCB staff with a transcript of Wax's remarks, and an interactive heat map of cannabis pesticide results.

• A rulemaking petition to raise the permissible limit for an environmental pesticide from a licensee impacted by WSLCB actions found no support from board members.
  • Research Manager Kathy Hoffman first addressed the petition on May 2nd, then went over the staff recommendation with the board on June 5th.
  • Hoffman explained the petition had been submitted to the agency on April 19th by Todd Luther of Okanogan Gold, and gave some background on the issue similar to her past remarks, with references to what Wax had presented earlier (audio - 5m, Video - WSLCB, Video - TVW).
    • Hoffman said Luther had asked the board “to consider increasing the current action level or tolerance of pesticide chemical residue on cannabis products from 0.1 parts per million for pesticides not listed in rule or otherwise authorized for use in the production of cannabis, to 0.5 parts per million,” including “specifically for DDE.” The recommendation from staff included minimal input from WSLCB divisions aside from "public health and prevention” which she commented had referenced federal research conducted around pesticides in tobacco and argued “there was no compelling reason to change the threshold limits for any of these chemicals at this time.” A “brief” diversity, equity, and inclusion analysis raised concerns over “disproportionate pesticide exposures…associated with folks working near these pesticides,” which she downplayed as not germane to the petition at hand
    • Moreover, Hoffman emphasized that were the petition turned into rule, it “would not be retroactive” and wouldn’t stop preceding agency actions. To do otherwise was uncommon, “unless we had a legislative mandate.”
    • Hoffman laid out the potential options identified by staff: “deny the petition and maintain this status quo here. I would offer that we just don't have enough research to suggest that changing parts per million for this particular pesticide derivative is appropriate.” Board members could also “deny the petition and offer an alternative approach,” or “accept the petition.”
  • Board Chair David Postman wasn’t in favor of changing the allowable action level for DDE based on the lack of safety research on the subject, commenting “we just don’t know” enough to make the change. He did see “good questions about that long list" that WSDA tests for. Hoffman claimed the WSLCB Cannabinoid Science Work Group had been discussing the matter on June 1st. Postman asked Hoffman if there were any other “long term” approaches they should consider for updating pesticide action levels (audio - 2m, Video - WSLCB, Video - TVW).
    • She affirmed that among the topics the work group was delving into, they were “starting to talk about contaminants,” and that as her team began to implement SB 5367 on tetrahydrocannabinol (THC) regulations, “we may get to a point where it's appropriate to open up” pesticide rules to see “if there's anything we need to add, subtract, or adjust.”
  • Postman noted the list of 59 pesticides in rule with specific action levels was separate from the 243 WSDA staff could test for, and that both should be reviewed. Hoffman responded that they could work with WSDA representatives on that (audio - 1m,  Video - WSLCB, Video - TVW).
  • Board Member Ollie Garrett wanted to know if this would fall within the scope of the new research office Hoffman was leading, and Hoffman affirmed it would, “once we get that research unit up and running” (audio - <1m, Video - WSLCB, Video - TVW).
  • Board Member Jim Vollendroff was not in favor of adopting the petition, though he did “appreciate the petitioner’s request, and…I have even more questions as this whole DDT/DDE thing has come through.” These joined “another list of questions that I feel like we need to work through as a board” related to pesticide testing. Postman wanted agency leaders to “evolve with this" and leverage new research groups and experts, what he termed the “infrastructure of 2023, to look back at some of those other things” and update rules accordingly. Nonetheless, he considered Luther’s petition “too prescriptive” even in the face of “economic disruption.” Postman argued “the whole point was if something was high, we're going to find it. We can't now say, ‘okay now, let's lower it so we don't’” (audio - 3m, Video - WSLCB, Video - TVW).
  • The board voted unanimously against accepting the petition (audio - 1m, Video - WSLCB, Video - TVW).

• Public commenters brought up environmental pesticide actions, problems faced by social equity applicants, and questions about the incoming agency director.
  • Gregory Foster, Cannabis Observer Founder (audio - 4m, Video - WSLCB, Video - TVW, written comments)
    • Continuing the topic of environmental pesticides, Foster thanked Wax for the update he’d previously called for, “and I hope that y’all will continue to keep everyone informed publicly.” He then turned to the $5 million DOE soil remediation effort WSLCB staff would consult on, and asked the board to “include updates about how that is going and as that progresses.”
    • Foster acknowledged he was still learning about the environmental clean up policies in the state, but called for using “this process, this funding to advance cannabis and hemp science [and] fill in some of the data holes that we have.” He recognized limits on how the appropriated money could be spent under the Model Toxics Control Act, which “also introduces some questions about who's liable for this, who actually has to pay for it, and who actually has to do the cleanup.”
    • Foster explained the investigation and feasibility review in the process, something that “looks at potential impacts on human health and the environment, and alternative cleanup technologies,” leading him to wonder “whether cannabis and hemp could be one of those alternative cleanup technologies in this circumstance.” He urged collaboration with a land-grant institution like Washington State University (WSU) and “plant some hemp there, do some actual testing, do some actual measurements about it. Plant some cannabis there since it’s licensed premises and you can actually do that.” Foster predicted that, if successful, the pilot program “can kickstart things around using that for hempcrete, [and] getting it out of the environment.”
    • Foster further suggested that the agenda format of board meetings always placed general public comment after board actions were taken, highlighting “in this…particular rulemaking petition, there was no opportunity for public comment before the board took action.” He noted some public agencies heard public remarks before any formal actions were taken.
    • Postman replied there had been conversations late in the 2023 legislative session about the remediation pilot program, but “the wording around that is a little bit vague” and he would be following up with staff on their remediation technology options (audio - 1m, Video - WSLCB, Video - TVW).
  • Peter Manning, Black Excellence in Cannabis (BEC) Co-Founder (audio - 4m,  Video - WSLCB, Video - TVW)
    • Manning reported that in speaking to social equity program applicants, he’d heard the vendor responsible for scoring and prioritizing applicants, Ponder Diversity Group, was telling them “that they cannot use their points in the scoring rubric…as a group entity” and that scoring was being done based on only one person on an application. He’d been led to believe by WSLCB that “that you can actually take multiple people to create points in the rubric. I would like the LCB to take time to look into that matter.”
    • Manning believed WSLCB officials were working to get the “program off the ground,” but Ponder Diversity Group staff “sees it a little bit different.” He’d received confirmation from the group about how they intended to “gauge” the Disproportionately Impacted Area (DIA) maps and residency timeframes that would only cover specific years, even though in WSLCB information “they're in blocks of ten years.” Manning wanted WSLCB to help clarify those standards for Ponder Diversity Group members.
    • He stressed that “we are not here to point fingers, or to muddy up the situation at all. We truly believe that the LCB has every good intention on making this program work,” but applicants were from communities that “waited ten years to get to industry…and now it's more convoluted now that we're right close to the finish line.”
  • Damian Mims, BEC Executive Treasurer (audio - 3m,  Video - WSLCB, Video - TVW)
    • “I'm here today in a suit, missing appointments, on my birthday,” Mims stated, “because it felt like…I needed to be here” to talk about “gray area finger pointing, misinformation, not-my-job tactics that seems to happen within government agencies.” He’d seen a “real effort" to break that pattern with the WSLCB equity program, but “there’s misinformation, confusion, and a lot of extra stress with this application process.”
    • He couldn’t get a “consistent answer” about the completeness of his application between Ponder Diversity Group, agency staff, and social equity mentors organized by the Washington State Department of Commerce. Mims talked about getting conflicting emails on the status of his application, and having difficulty contacting the vendor scoring them; “why is this simple question so hard to answer?” He anticipated future delays and confusion, unsure why WSLCB leaders were “hands off at this critical moment.”
    • “I'm sure we will get you an answer for that," Postman remarked (audio - 1m,  Video - WSLCB, Video - TVW).
  • Christopher King (audio - 4m, Video - WSLCB, Video - TVW)
    • King last addressed the board on May 24th.
    • King told board members “people are complaining for valid reasons,” and his first issue was the hiring of Will Lukela as the incoming WSLCB Director. King was curious, “What's his track record about; what’s his program?” He pointed out that Colorado officials had been revising their equity program and claimed an equity delivery aspect of the program amounted to a cannabis equivalent of “Driving Miss Daisy.” King pressed the board to explain in greater detail Lukela’s “claim to fame, why did you hire him?”
    • King relayed “the story of one Margaret Belcher, who was an amazing child care provider in Columbus, Ohio” he’d represented in court because authorities weren’t giving her “Title XX money” as a daycare provider. King argued, “the government treated her like dirt” in a way that reminded him of how social equity applicants were being treated.