WSLCB - Board Caucus
(April 26, 2022) - Future Rulemaking

Staff offered a vision of future agency rulemaking including projects on cannabinoid regulation; packaging and labeling; and advertising - as well as outreach on national legalization.

Here are some observations from the Tuesday April 26th Washington State Liquor and Cannabis Board (WSLCB) Board Caucus.

My top 4 takeaways:

• Policy and Rules Manager Kathy Hoffman introduced the subject of future rulemaking projects, starting with cannabinoid regulation.
  • On cannabinoid regulation, Hoffman said a series of deliberative dialogues had been scheduled to look at delta-8-tetrahydrocannabinol (delta-8-THC) “and associated concerns with THC compounds” on April 27th, May 31st, and a third “if needed,” on June 11th (audio - 2m, TVW video, WSLCB video).
    • Hoffman said Nephi Stella, a University of Washington (UW) pharmacology professor, had confirmed he’d also participate on the first expert panel on cannabis impairment.
      • Stella also spoke at the deliberative dialogues on cannabis plant chemistry in June and July 2021.
    • These efforts were intended to inform new rulemaking “that’s coming up on May 11th” Hoffman remarked, “exploring additional definitions that we might need around THC compounds.” The project would be led by Robert DeSpain, a limited duration staffer previously focused on alcohol rulemaking whom Hoffman indicated was moving to handling cannabis issues full time.
    • Hoffman mentioned, “earlier this year we promulgated rules around THC compound evaluation” to indicate some of the definitions would be reviewed to “expand or repeal” - possibly in light of the demise of multiple bills on the matter.

• Another approaching rulemaking effort would focus on cannabis packaging and labeling (PAL, audio - <1m, TVW video, WSLCB video).
  • Hoffman commented that PAL rules would be reopened with a focus on “THC compounds” so that consumers “know what they’re getting.” She relayed the project would look at disclosure requirements and labeling with Policy and Rules Coordinator Jeff Kildahl taking point “as soon as his other projects conclude.”
    • Policy and Outreach Director Justin Nordhorn suggested PAL rulemaking would occur in “the near future” in October 2021. In November 2021, he told lawmakers that novel cannabinoids like delta-8-THC created a regulatory gap which could be addressed in part through PAL rules.
    • Hoffman said PAL would be an upcoming rulemaking project in December 2021.

• After promising to return to the matter for several years prior, Hoffman said staff were ready to open a cannabis advertising rulemaking project (audio - 1m, TVW video, WSLCB video).
  • Noting the rules had last been updated in 2018, Hoffman confirmed they’d be reopened as there’s “a lot for us to update there.” The “big project” would involve updates reflective of her team’s view that “the landscape of advertising has expanded significantly since 2018,” she added.
    • Hoffman had discussed her desire to change advertising rules for several years, first mentioning it to the board in November 2019, and again in February 2020. She talked about the possibility at greater length in November 2020. It was also part of Hoffman’s rulemaking forecasts in February 2021 and again in December of that year.

• The last prospective area for “stakeholder engagement” involved gathering comments on federal legalization through a “world café” event format, leading to some talk about the 2023 legislative session and the incoming board member.
  • Hoffman described upcoming outreach on federal cannabis reform, something she knew the board had an interest in, telling them that agency officials would host “world café sessions” which were “broader” than deliberative dialogues or listen and learn forums. She anticipated sessions being announced “late May/early June” once staff settled on “where we hold these” as they contemplated a return to in-person events. She suggested three cafés would be scheduled to learn what the public was “excited” about, what “might concern them,” as well as what “Washington can do to get ready for federal legalization” (audio - 2m, TVW video, WSLCB video).
  • Noting the large number of new rulemaking projects planned, Board Chair David Postman reminded staff they would soon have to “start thinking about the 2023 legislative session.” Hoffman responded that the recently approved THC compounds rulemaking had been intended to “move us towards the legislative session” and that they only had “three or four months” to engage in “meaningful” outreach on the topic. “There’s a…lot of work to be done in a very short period of time,” she admitted (audio - 1m, TVW video, WSLCB video).
  • Postman then commented on the reasoning for holding world café events based on licensee feedback “at board meetings around” the subject of national legalization (audio - 3m, TVW video, WSLCB video).
    • He asserted that “parts of” the closed state system established through Initiative 502 were popular among licensees who wanted some elements to be “protect[ed] in a national marketplace.”
    • Still, other “old school” aspects of Washington’s legal cannabis system might need to evolve with federal changes, so Postman wanted agency leaders to hear input on that. He hoped Congress would take advice from “recreational adult-use” states, particularly “those that are the most experienced” like Washington, confident that “the regulatory body will not be the only voice there, you all licensees have your own ways of communicating that.”
      • The Cannabis Regulators Association (CANNRA), which WSLCB leadership helped organize, was one group lobbying congress on cannabis. At publication time, WSLCB Director Rick Garza served as First Vice President of the non-profit advocacy organization and members regularly convened a Special Committee on Federal Policy and Engagement.
    • They would look for “mutual goals” through the world café events, Postman promised, though the new format could be “challenging” as it wasn’t “what we normally do.” With the first event centered around what “we would want” from positive national reform, he felt it could be difficult since “we all live in an overly and needlessly negative framework.” Postman said “we’re really going to encourage licensees to join us” for the conversation to see what results.
  • Executive Assistant Dustin Dickson mentioned that recently-appointed Board Member Jim Vollendroff would be joining the agency the following Tuesday, and would be coming in later in the day to get his “state issued devices and setting up his calendar” (audio - <1m, TVW video, WSLCB video).
    • Board members last discussed Vollendroff’s appointment on March 15th.

Information Set