WSLCB - Board Caucus
(April 28, 2020) - Summary

Plans for renewed rulemaking were becoming more clear as board members prepared for roles on legislatively directed task forces on social equity and cannabis “odor.”

Here are some observations from the Tuesday April 28th Washington State Liquor and Cannabis Board (WSLCB) Board Caucus.

My top 3 takeaways:

  • Policy and Rules Manager Kathy Hoffman provided a glimpse of renewed progress on stalled rulemaking projects, expiring emergency rules, and newer legislatively-directed projects.
    • The meeting was held by phone in accordance with temporary public meeting restrictions due to the coronavirus outbreak. Board members and staff connected from remote locations via WebEx similar to Special Board Meetings on March 27th and April 6th. The last rulemaking update was provided during the April 14th Board Caucus, the most recent WSLCB public meeting.
    • Quality Control (QC) Testing and Product Requirements (audio - 1m). Hoffman said she intended to ask for approval to re-file the QC rulemaking project’s CR-102 at a regular board meeting planned for May 27th. The public hearing would be rescheduled to the subsequent board meeting on July 8th. She stressed the only difference between the original CR-102 and the new one would be “rescheduling the hearing date” and “updating the timelines appropriately.”
    • True Party of Interest (TPI, WSR 18-22-054) and Voluntary Compliance Program (VCP, WSR 19-15-074, audio - 1m). While the agency had cancelled earlier listen and learn forums arranged to gather feedback on proposed changes, Hoffman said "a WebEx environment" would be made available to host remote sessions “in mid-May.” She was confident the format would allow participants to engage “in a similar way” to prior in-person events. Looking ahead, she forecast being ready to file CR-102s on June 24th with CR-103s to adopt changes in July.
    • Incremental Expansion of Tier 1 Canopy (WSR 20-01-171, audio - 1m). Hoffman continued “putting together” two remote listen and learn sessions on the topic with plenty of time for the agency to weigh feedback. She felt the proposed rules for a CR-102 wouldn’t be completed until later in July, followed by a CR-103 to adopt changes in mid-September.
    • Cannabis Retail Title Certificates (WSR 18-09-117, audio - <1m). Hoffman spoke of a plan to “fold in [SB] 6206” establishing certificates of compliance for retail locations as part of this long idle rulemaking project. The bill was signed into law on March 25th.
    • Emergency Rulemaking - Vitamin E Acetate Prohibition (audio - 2m). Four emergency rules around the ban on usage of vitamin E acetate in vapor products were revised and extended by the Board on February 5th. Hoffman reported that the agency would re-file the emergency rules to extend their effective period at the board meeting scheduled for May 27th. Rather than predicate the rule on State Board of Health (SBOH) emergency rules, the next prohibition would exercise the agency’s new authorities granted in HB 2826, which was signed into law on March 25th. Hoffman added that HB 2826 gave the framework needed for the ban to be “held in place” should SBOH rules lapse before WSLCB’s permanent rulemaking on the matter was finalized.
      • SBOH last extended their vitamin E acetate ban on March 11th. While the SBOH motion as adopted called for the agency to open formal rulemaking to more permanently institute the prohibition, at publication time Cannabis Observer was not aware of any filings to that effect.
    • Emergency Rulemaking - Enforcement of Governor's Proclamations (audio - 1m). Looking at several emergency rules passed due to the Governor's proclamations around COVID-19, Hoffman told the Board that staff continued to monitor their impacts, and were “working with industry to see what other kinds of assistance we can provide.”
    • Legislative Rulemaking - HB 2826 (audio - 1m). Hoffman said there had been “a few internal meetings" to develop a project management plan for the cannabis vapor product regulatory law which the agency requested in consultation with the Governor’s office.
    • Legislative Rulemaking - HB 2870 (audio - <1m). Hoffman said that she was conducting “additional analysis” around HB 2870, WSLCB social equity request legislation which was signed into law after significant engagement and changes.
    • Policy and Rules Personnel Hiring (audio - 1m). Following the resignation of Janette Benham as Policy and Rules Coordinator for alcohol in March and the promotion of Kathy Hoffman to Policy and Rules Manager, the agency posted two Policy and Rules Coordinator career opportunities. Application reviews were listed as having started on March 18th. Hoffman explained that WSLCB was "completing that process" and expected new staff would be “coming on board” in May.
  • Board members discussed their roles on legislatively directed task forces on cannabis odor and social equity.
    • Cannabis Odor Task Force (audio - 2m). Board Member Russ Hauge reported on a call he’d had with the agency’s Director of Legislative Relations, Chris Thompson, about an “odor study” WSLCB was asked to conduct through the inclusion of a $30,000 proviso in the State’s supplemental budget. Hauge noted the maneuver “codified” SB 6089, a bill on the topic which was not moved by the Legislature after its introduction. He expected a “substantial burden on the agency” from the effort, particularly staffing and the required participation of a representative from the WSLCB. Hauge volunteered to serve as he’d done “substantial work on odor issues under the theory of public nuisance” as an attorney. There was no objection to Hauge’s acting as the agency’s delegate to the task force.
    • Cannabis Social Equity Task Force (audio - 3m). Board Member Ollie Garrett shared that she continued to have “great conversations” with stakeholders and Director Rick Garza “weekly” in preparation for the legislative task force on social equity in marijuana created as part of HB 2870. Garza seconded Ollie’s observations, but noted that achieving the statutory deadline of July 1st for the task force’s initial meeting was looking doubtful to him ("I don't know that that can happen.”). Garrett was slated to serve as the agency’s delegate to the task force and noted that the deadline for agencies to declare their representatives had passed the day before. Garza anticipated “some engagement that we’d like to do out with the community even before the task force meets, if that’s possible” possibly via “virtual meetings.”
  • The Board signed cannabis compacts with two tribes, and staff offered more details on WSLCB’s operational adaptations to the “new normal.”
    • Tribal Marijuana Compact - Nisqually Indian Tribe (audio - 1m). Sovereign tribal nations have the option to enter into marijuana compacts with the State of Washington “concerning the commercial production, processing, and sale of marijuana.” The most recent compact signed by the Board was with the Nisqually Indian Tribe on December 18th. Tribal Liaison Brett Cain told board members that “a change had been made” to the compact which required resigning by the Board. The revision had been worked out by Tribal Attorney David Wolff, Assistant Attorney General (AAG) Bruce Turcott, “and the Governor’s Office.” The Board signed the updated compact which had already been signed by the Tribe’s Chairman, Ken Choke.
    • Tribal Marijuana Compact - Lower Elwha Klallam Tribe (audio - 1m). Cain brought forward a new compact with the Lower Elwha Klallam Tribe which had been designed with the Tribe’s attorney, Stephen Suagee, and signed by Tribal Chairwoman Frances G. Charles. Cain said the compact would be delivered to the Governor’s office “this week” after the Board moved to sign it.
    • Garza reviewed internal and external agency operations building on his April 14th update. Daily management team meetings had continued and agency leadership had “worked through...126 topics and issues” presented from inside and outside the agency. He was complimentary of the agency’s communications with staff, licensees, and the public; and drew attention to the WSLCB’s COVID-19 webpage. Garza remarked that he expected an extension of the Governor’s “Stay Home, Stay Healthy” order for “who knows, another two weeks or a month at least.” Considering teleworking was likely to continue after the emergency abated, Garza concluded that “we're finding that very little needs to be done in the office" (audio - 7m).
    • Garza later called attention to the agency’s cannabis retailer webinar which provided guidance on operating while observing social distancing mandates (video). WSLCB planned to host a second webinar for all cannabis licensees “soon.” Garza said he’d been talking to representatives of cannabis industry associations “by phone” to develop topics of interest to the industry (audio - 3m).
      • Cannabis Observer missed the agency’s email notification about the retailer webinar as we weren’t subscribed to the agency’s ”Cannabis Retailers” topic. You can subscribe to receive agency email and update your preferences at WSLCB’s GovDelivery service.
    • Deputy Director Megan Duffy discussed how the agency expected to migrate back to their offices based on guidance from the Governor. Teleworking would be preferred for the foreseeable future unless an employee’s in-person work supported a “core function” of WSLCB. Duffy planned to work with division directors to survey staff on their teleworking experiences. There was agreement that the State had entered a "new normal" where social distancing and working from home would become increasingly prevalent (audio - 5m).
      • Duffy mentioned the agency’s systems modernization project (SMP) had continued, with a scope of work drafted and undergoing “internal discussion” specifically around “contingencies for how that project would get done if, in fact, we are not in the office.” The “apparent successful bidder” typically arranged “job shadowing” to develop solutions, a challenge in teleworking contexts. Board Chair Jane Rushford expressed gratitude for the SMP team’s “performance despite the complications.”
    • Later in the day, the WSLCB announced the cancellation of the Wednesday Board Meeting and Executive Management Team (EMT) meeting.