WA SECTF - Work Group - Disproportionately Impacted Communities - Public Meeting
(March 24, 2021) - WA OAG Presentation

The attorney general’s office described the “strict scrutiny” standard federal courts applied to laws utilizing race-based criteria and how that related to the work group’s development of social equity program applicant criteria.

Here are some observations from the Wednesday March 24th Washington State Legislative Task Force on Social Equity in Cannabis Disproportionately Impacted Communities Work Group (WA SECTF - Work Group - Disproportionately Impacted Communities) meeting.

My top 2 takeaways:

• A briefing from the Washington State Office of the Attorney General (WA OAG) gave work group members a “crash course” on the use of race-based criteria as it related to the State’s social equity program.
  • Among many responsibilities, the Washington State Legislative Task Force on Social Equity in Cannabis (WA SECTF) was asked to offer guidance around what constituted a disproportionately impacted area for social equity applicant criteria as well as who would be awarded money from the social equity technical assistance grant program. The degree to which an individual’s race or ethnicity can be considered in prioritizing these systems had been an open question for the task force generally, and for the work group specifically. 
  • Yasmin Trudeau, the WA OAG appointee to the Washington State Legislative Task Force on Social Equity in Cannabis (WA SECTF), opened the topic up by framing some “legal jargon” the group would hear (audio - 3m, video).
    • The presentation would be led by a member of "affirmative litigation" teams working “under the independent authority of the AG,” she said. The Office also included lawyers who advised state agencies like the Washington State Liquor and Cannabis Board (WSLCB) in addition to Solicitor Generals “who argue[d] in the courts on behalf of the State.”
    • Since WA SECTF was “not funded to have legal advice given” she emphasized that “nothing we can offer in this conversation...is legal advice.” She stressed a need for mindfulness that WA OAG staff could end up “arguing in the courts on behalf of the State” around the task force’s recommendations and so delineation of the presentation as wholly separate from any eventual testimony needed “to be very, very clear.” Trudeau added that “learning the, the language of the law is really difficult. It can be dry at best and condescending at worst” and encouraged participants to ask questions.
  • Lane Polozola, Assistant Attorney General, WA OAG Wing Luke Civil Rights Division (audio - 12m, video, presentation)
    • Polozola said his division’s work involved bringing “cases to try and protect the rights of folks in Washington." He had experience “working in the anti-discrimination space” in addition to “constitutional standards that come into play when you’re talking about race-based approaches in legislation.” However, he didn’t “defend civil rights cases” but rather worked at “investigating and litigating cases in the name of the State.” Polozola commended the task force’s work as “really useful, and this is, you know, how things should happen.”
    • Polozola’s presentation would offer a “crash course on the state of the law when you’re talking about using any race-conscious classification under the federal constitution.” Moreover, he planned to give the work group a “conceptual framework as you dive in and tackle the issues.”
    • On the subject of “who would possibly challenge a social equity program” that was attempting to “do really important, good work,” Polozola indicated that any “organization or entity that might have an interest in a license who’s denied a license might want to mount a challenge...whatever the structure of the program ultimately looks like.” He noted that other states had undergone successful challenges to their cannabis licensing programs so “you’re not speculating when you start to ask these questions and think about this framework.” 
    • Polozola focused on challenges to race-based criteria at the federal level, as the Constitution’s 14th Amendment assured “equal protection under the law,” noting “when it comes to analyzing laws” passed by states the analysis considered how they “allocate burdens or benefits.” When racial classifications were applied, he stated courts tended to prescribe “strict scrutiny” standards, but when race wasn’t considered “you’re not in strict scrutiny land necessarily." Polozola continued, saying that courts had been clear “it applies even where a piece of legislation seeks to benefit members of minority groups that have historically been subject to discrimination.”
    • Suggesting that courts applied a “simple test,” to strict scrutiny considerations, Polozola identified two questions central to any evaluation. “And the first is whether there is a compelling government interest to justify the use” of a racial classification, he told the work group. The second was “whether the means that the law chooses are narrowly tailored to achieve that goal.” In describing a “compelling government interest,” Polozola said a government better have a “really good reason if it's going to start making distinctions based on race.” 
    • He noted “trying to remedy the harms from past discrimination can be a compelling government interest” and the work group’s mission met those criteria. In evaluation, courts looked for “what they call a strong basis in evidence...they look for statistics and they look for other anecdotal evidence such as testimony from impacted individuals” as well as surveys and other data sets. Judges were interested in what proof of discrimination existed, and why the law being litigated was the answer to that discrimination, he remarked.
    • Polozola mentioned disparity studies “that experts will put together” for specific programs or government contracts that evaluated “who’s actually getting government contracts at what rates and why is there a need to take any further action.” Disparity studies conducted in Washington state include:
      • Washington State Department of Social and Health Services (DSHS) - Racial Disproportionality and Disparity in Washington State (2017)
      • Washington State Department of Health (DOH) - Washington Environmental Health Disparities Map
      • Washington State Office of Minority and Women’s Business Enterprise (OMWBE) - 2019 Disparity Study
      • Colette Holt & Associates - State of Washington 2019 Disparity Study
    • Polozola then addressed the issue of a law being “narrowly tailored” to address the compelling government interest. He said courts have asked “whether you really need to use a racial classification or if there’s a race-neutral way that you can solve the problem.” Polozola commented that the existence of non-race methods to achieve the same goal had been “elevated to a really important factor” by courts though it was “dependent on circumstances and the law.” He indicated the rigidity of racial quotas in laws had been another aspect courts had scrutinized in evaluating the legitimacy of a government’s interest.
    • Polozola identified two court cases in Ohio where judges had rejected a provision of the Ohio Medical Marijuana Control Program requiring 15% of that state’s medical cannabis licenses to go to “economically disadvantaged groups” which the law identified in part by race. He argued the case showed the difficulties of using race-based criteria since an “unhappy license applicant did file a lawsuit challenging Ohio’s program for then-medical license.” Polozola said the courts applied “the two steps that we just talked about...and ultimately found” that law did not meet the strict scrutiny burden. He reported that the judges found “Ohio’s legislature didn’t have enough data ahead of time, hadn’t done the legwork up front and ultimately was too broad in their approach.”
      • Learn more about Ohio medical cannabis program rules and resources.
    • Polozola said discrimination was “a space where there is a long history of case law”---some of which supported government actions---and he cautioned “it's a tricky space now as well.”

• Work group members and the public had several questions and comments on affirmative action in certain government activities, particularly related to Washington Initiative 200 (I-200).
  • Trudeau spoke up to clarify strict scrutiny was “the highest of the three standards” around discrimination law which Polozola confirmed. He said another standard, the “rational basis approach,” was a low bar for a law or policy to clear when dealing with “protected classes” (audio - 2m, video) 
    • The middle standard for constitutionality is called intermediate scrutiny.
  • Work group member and University of Washington (UW) Professor of Sociology Alexes Harris brought up I-200, asking if the law “makes it more difficult to even think to use race in criteria for this program.” Polozola responded that in a federal court “the analysis under the 14th Amendment is going to stay the same.” Trudeau said the initiative had been discussed while stakeholders drafted the original legislation creating the task force in 2020 “and it was determined that it didn’t” have an impact on the law as passed. Polozola stated that I-200 was about “preferential treatment based on certain protected classes in public employment, education, and contracting.” He continued, saying “the reason I kind of talk about the federal level is because that’s the law of the land and that’s...you can’t get rid of it” (audio - 2m, video).
    • See a 2017 WA OAG opinion on Use Of Race- Or Sex-Conscious Measures Or Preferences To Remedy Discrimination In State Contracting.
  • Darlene Conley, Co-Owner of Social and Economic Equity and Diversity (SEEDS) for African Americans in the Legal Cannabis Industry, asked if I-200 “makes it very complicated to even” ask about race, citing difficulties she’d had sourcing race-based data while doing “research in juvenile justice.” Trudeau replied that I-200 was “contemplated as an impediment on including race on last year’s legislation and we confirmed it wasn’t.” Conley clarified that the initiative was put forward as “one of the reasons the LCB gave for not even being able to have accurate data on how many African Americans or Latinx owners there were of I[nitative]-502 businesses or applicants.” Work group Co-Chair Christopher Poulos had no further information on the subject but said the group could “circle back with LCB and see” (audio - 2m, video).
    • Here is WSLCB information on minority owned retail title certificate holders and certificate holders’ self-identified race as of July 2020.
  • Harris inquired as to “what level would we have to show the disparate impact” in order to use race within social equity criteria. She wondered whether “the war on drugs” and “incarceration rates” were sufficient proof to justify race-based assessments, “or would we have to show the past several years of the lack of” minority-owned legal cannabis licenses in the state. “At what level does the disparity need to be shown?” Harris asked. Polozola responded that, for government contracting, courts had stated that “it needs to be tied to the industry at issue” and sometimes this had been done “geographically and to the industry segment.” Trudeau joined in to say “the way to think about it is as close to the problem you’re trying to solve as possible” (audio - 2m, video).
  • WSLCB Director of Legislative Relations Christopher Thompson spoke up to provide context for how I-200 was considered while agency staff drafted the original social equity in cannabis law passed in 2020 (audio - 3m, video) .
    • He said that bill, HB 2870, “didn't really have anything to do with” I-200 which was a “separate statute” that pertained to “government jobs, admissions to colleges and universities, and contracts with government in Washington.” Thompson communicated that these areas had no connection to what WSLCB staff “know or don’t know about the ethnicity of current cannabis licensees.”
    • However, Thompson said WSLCB was unable to “compel licensees to disclose race and ethnicity” though the agency did ask for the information. “What we have is imperfect,” he remarked, but had been shared with the public.
  • Work group member and UW graduate student Michele Cadigan asked about the impact of the Ohio ruling mentioned by Polozola, “does that make those licenses available to everyone or does it say ‘you guys need to go back and reorganize or reconfigure that equity program?’” Polozola didn’t know how the court’s decision would be interpreted or implemented. Trudeau concurred that “it just depends on what's argued and how the judge decides to do it” and that “anything could happen” (audio - 1m, video).
  • Poulos thanked Trudeau and Polozola before wrapping up the discussion by saying the “key takeaway is that...we’re going to talk about race in this task force and in this working group and when we make recommendations we need to keep in mind that they would be scrutinized under the strict scrutiny standard” (audio - 1m, video).

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