WA House COG - Committee Meeting
(October 21, 2021) - Organic-Comparable Cannabis and Appellations

Staff reviewed stalled rulemaking for a certified cannabis program in Washington before turning to two California programs: an organic-comparable certification and appellations of origin.

Here are some observations from the Thursday October 21st Washington State House Commerce and Gaming Committee (WA House COG) Committee Meeting.

My top 3 takeaways:

• Committee Counsel Peter Clodfelter provided a Washington State House Office of Program Research (WA House OPR) presentation on “organic comparable certification programs” and the committee chair confirmed efforts were underway to secure a 2022 budget proviso to complete rulemaking in Washington state.
  • 2017 legislation advised the Washington State Department of Agriculture (WSDA) to create a program which defined a state organic-equivalent standard for cannabis, as ‘organic’ is a federal labeling term. But the rulemaking project remained at the CR-101 stage allegedly due to budget limitations at the department. At publication time, the project was being overseen by WSDA Organic Program Director Brenda Book.
    • Washington State Liquor and Cannabis Board (WSLCB) staff talked about the hold up in February 2020.
    • Book commented on the project during a webinar on March 24th.
    • On April 7th, Washington SunGrowers Industry Association (WSIA)  Executive Director Crystal Oliver advocated for the state to finish the rulemaking as the absence of a standard hindered “organic and regenerative farmers from being able to effectively differentiate themselves on the shelves of our stores.”
      • WSIA was subsequently recast as the Washington Sun and Craft Growers Association (WSCA) in July 2021.
  • Clodfelter told the committee that organic-comparable certification “came up at a March 2021 work session” on the cannabis sector and he’d been asked by WA House COG Chair Shelley Kloba to “provide an update and summary...to the committee.” He mentioned that the programs he’d identified were voluntary and “generally relate to providing additional information to consumers about cannabis products as well as serving the purpose of enabling cannabis businesses to differentiate their products in the market” (audio - 1m, video, presentation). 
  • Noting a 2017 law, SB 5131, Clodfelter described how legislators had intended for cannabis to be voluntarily certified by the state “comparable to the national organic program” which led to “initial rulemaking activity” (audio - 1m, video).
    • Clodfelter said the rulemaking project for organic-comparable certification at WSDA was necessary as the term “‘organic’ is controlled by the federal government,” which continued a prohibition of cannabis.
    • He outlined relevant laws and organizations governing the federal organic program:
      • The Organic Foods Production Act - The 1990 law “Established uniform national standards for the production and handling of foods labeled as ‘organic.’”
      • The National Organic Program - “A program within the U.S. Department of Agriculture implementing the Organic Foods Production Act, setting standards for the production, handling, and processing of organically grown agricultural products, and overseeing mandatory certification of organic production.”
      • Organic Certification - “Verifies a farm or handling facility complies with the U.S. Department of Agriculture’s organic regulations and allows the farm or facility to sell, label, and represent their products as organic.”
  • Until federal cannabis reform included updates to these laws and programs, Clodfelter reported that the plant remained “ineligible to have an organic designation and businesses cannot get an organic certification through the national program.” He explained that Washington was one of several states passing “comparable types of programs” to allow for “a similar type of structure for cannabis” using the federal program as a “framework” (audio - 4m, video). 
    • Clodfelter said SB 5131 included an “authorizing framework for a comparable to organic cannabis program” within WSDA. He relayed that department staff were given rulemaking authority “to establish:
      • a) Standards for cannabis and cannabis products produced and processed in a manner consistent, to the extent practicable, with the National Organic Program; and
      • b) A self-sustaining program for certifying cannabis producers and processors as meeting the applicable standards.”
      • Rules could include a fee schedule “to provide for recovery of program costs,” Clodfelter noted, as well as provisions for “inspections, enforcement, and administrative penalties.”
    • The rulemaking project initiated by WSDA officials in October 2017 indicated their intent to file proposed rules, said Clodfelter, with staff confirming to the committee in December 2018 “that ‘Certified Cannabis’ was the term that was being discussed as a possible term.” He said WSDA representatives had also mentioned having fees “aligned with the fees that state department of agriculture charges for certifying organic producers under the national program.”
    • Clodfelter confirmed that no draft rule language had been prepared, but conceded “the legislature did not require the rules, it simply authorized them.” Moreover, the program hadn’t been “specifically appropriated funds in the state operating budget.”
  • Pointing to the timeline for the project, Kloba observed that the certification was “something that the industry has wanted for a while and I’m certain consumers have as well.” She noted the lack of a dedicated budget for completion of the project, stating she had “a budget proviso in the works to fund that,” predicting “about a $200,000 budget item” (audio - 1m, video).
    • At the Washington State Cannabis Summit on September 24th, Kloba mentioned potential dedicated funding to finish the project.

• Clodfelter went over the OCal Program, a recent California organic comparable certification for cannabis produced in the state (audio - 6m, video).
  • The OCal program was enacted with a “July 2021 rulemaking deadline for the creation of two different programs,” Clodfelter remarked, one “for cannabis and non-manufactured cannabis producers that’s under the jurisdiction of the state Department of Food and Agriculture” (CDFA), and a second for “manufactured cannabis products” within the California Department of Public Health (CDPH). His presentation centered on the CDFA program, “because that’s the only one where final rules have been adopted and the program is live.”
  • Clodfelter commented that the CDFA program pertained to “cannabis flower, pre-rolled cannabis, and certain other limited cannabis products that don’t have any other ingredients in them besides cannabis.” He indicated that Califorina law included a “contingent nullification” so that if “federal law changes, cannabis becomes eligible for a[n] organic certification and designation.” 
    • OCal Program final rules were adopted July 14th, “creating the ‘OCal’ program for cannabis and non-manufactured cannabis products.”
      • OCal Program - Final Regulation Text 
      • OCal Program - Final Guidance Documents 
      • Food and Drug Administration regulation 21 CFR section 179.26 (Apr 1, 2020) incorporated by reference
    • Voluntary Certification. “Cultivators and distributors may apply to certifying agents to have their operation (or portion of their operation) inspected, evaluated, and certified as OCal compliant.”
    • Labeling Terminology. “‘OCal’ is labeling term to identify cannabis and non-manufactured cannabis products produced according to OCal rules, which are designed to be comparable to National Organic Program rules.”
      • Clodfelter indicated the OCal seal could be used on “product packaging and labels and marketing” while the term OCal could be used in “individual product names.”
  • The system allowed “third-party certifying agents to play a role,” Clodfelter said, either “private entities or local governments” that registered under the program and were accredited by either the CDFA or the national organic program. Participating cannabis businesses had to have “a comprehensive system plan that is agreed to with the certifying agent” covering all “aspects of how their business is conducted,” including “where the cannabis inputs” and materials used came from. He added that this plan needed to be updated annually. The program allowed for yearly “site inspections” including “unannounced” inspections as well as “recordkeeping requirements.”
  • The program featured “provisions on testing and sampling” plants, soil, and water, Clodfelter said, occurring “at the expense of the certifying agent or” CDFA. He went on to describe prohibited substances and methods under the OCal program:
    • “Synthetic substances and ingredients except as provided in the National List of Allowed and Prohibited Substances,” which was part of the national organic program.
    • “Non-synthetic substances and ingredients prohibited in The National List of Allowed and Prohibited Substances 
    • Substances prohibited by the Department of Cannabis Control for use on cannabis 
    • Excluded methods involving genetic modifications 
    • Ionizing radiation 
    • Sewage sludge”
    • None of the substances “could be applied to the land in the three years immediately preceding harvest of cannabis,” he noted.
  • Fees for OCal had to be “reasonable and filed in advance” with CDFA, remarked Clodfelter. He indicated there were also mechanisms like compliance notices, suspension, or revocation of certification in addition to fines. Violations included labeling products as “organic,” and fines could be levied “up to $20,000 for other intentional violations,” but most amounts were based on “the severity of the violation.”
  • Clodfelter reported that CDFA staff were accepting “applications from prospective certifying agents” who would be able to “start accepting applications from the individual cannabis businesses who seek certification” of their products and facilities.

• Clodfelter described how cannabis “appellations of origin,” similar to federal appellation laws for viticultural areas in winemaking, had been enacted in California “to promote regional products and local businesses, prevent misrepresentation of a product, and support consumer confidence about a product’s origin and characteristics” (audio - 6m, video).
  • Clodfelter explained that the California Appellations Program (CAP) set up the state as the first legal cannabis jurisdiction to enable the definition of appellations of origin, and committee members might be “familiar with this concept from the wine industry.” The proposition legalizing cannabis in California which voters approved in 2016 had required labeling of products to indicate “a county, city, or city and county origin,” he said, before a 2019 law created the CAP with “specific standards, practices, and cultivars applicable to cannabis produced in a certain geographical area.” Clodfelter added that there were penalties for businesses misrepresenting their product in either locality or appellation labeling. He clarified that state regulators had only produced “draft rules” and had “gone through...four different revisions.” Clodfelter reported that final CAP rules were scheduled to be adopted by January 1st, 2022.
    • Take a look at CAP documents from the fourth additional comment period:
      • Modified Text of the Proposed Regulations
      • Notice of Modifications to the Text of the Proposed Regulations
      • Addendum to the Initial Statement of Reasons
    • The U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) within the U.S. Department of the Treasury maintained a list of established American Viticultural Areas (AVA), including AVAs in Washington state.
  • For a CAP applicant to be approved, they had to “include the practice of planting in the ground in the canopy area,” Clodfelter stated. He made clear this excluded cannabis grown using “greenhouses and artificial light in the canopy area,” indoor product facilities, “as well as, potentially, hydroponic operations.”
  • Clodfelter described how “three or more unique cultivators within an area of a proposed appellation of origin can petition” to “establish or amend an appellation of origin.” He told the committee there were petition submission fees and petition proposal fees based on whether a petition was establishing or amending an appellation. Petitions could cover “a specific strain” being cultivated or a requirement for OCal certification, Clodfelter said, as there was “flexibility in what requirements could be associated” with an appellation determined by the petitioning businesses.
  • According to Clodfelter, CAP petitions also had to have “evidence of a legacy, history, and reputation, and economic importance of cannabis production in the area.” Overlap among appellations was possible but would entail “an explanation of differences,” he stated. CDFA staff would “issue a proposed notice of action” for completed applications, and list approved appellations of origin on their website along with associated mapping and appellation requirements, Clodfelter added.
    • Find out more from the Origins Council, a California nonprofit organization “dedicated to sustainable rural economic development within cannabis producing regions, and establishing nationally and internationally recognized, legally defensible, standards-based, geographic indication systems for cannabis.” The group had been a sponsor of the Mendocino Appellation Project (MAP), a 2016 cannabis appellation of origin effort in the region, along with the Mendocino Cannabis Alliance.
  • Representative Eric Robertson inquired as to states “behind” California in setting up organic comparable programs that could still be a “resource” for Washington regulators. Clodfelter replied that he hadn’t encountered other states setting up similar programs. Kloba remarked this was part of an endeavor by legislators to “order some tools that we can use to make sure that our industry...is ready to go if and when there is a change in the federal law against cannabis” (audio - 1m, video).

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