WSLCB - Board Caucus
(November 7, 2023) - Summary

Staff shared rulemaking progress including upcoming outreach events, a new petition on cannabis testing results, and a timeline for implementing social equity legislation.

Here are some observations from the Tuesday November 7th Washington State Liquor and Cannabis Board (WSLCB) Board Caucus.

My top 3 takeaways:

• Policy and Rules Manager Cassidy West talked about drafting conceptual rules and integrating feedback for three rulemaking projects.
  • SB 5367 Implementation (audio - 1m, Video - TVW, Rulemaking Project)
    • Approved by board members on June 21st, West explained she was “working on developing conceptual draft rule language with the internal project team as well as” the Cannabis Lab Accreditation Standards Program (CLASP) which included staff from WSLCB, the Washington State Department of Agriculture (WSDA), and the Washington State Department of Health (DOH). Her intent was to “make sure that rules are consistent as lab standards and accreditation standards are transitioned to the WSDA and Department of Ecology, respectively.”
      • A separate WSDA rulemaking project to define lab accreditation standards for DOE staff to use in assessing the capability of labs had a dedicated webinar on June 28th.
      • Find out more about revisions to cannabis laboratory policies from an August 2nd DOE webinar on lab accreditation.
    • “I will also be working with [Operational Research Specialist Sarah] Okey and the Cannabinoid Science Work Group to develop and refine proposed language,” said West. She added that a stakeholder engagement session on conceptual draft rules would be scheduled “sometime after Thanksgiving, [in] early December.”
      • Staff had indicated work group recommendations finalized on October 5th would be part of their rule development.
  • Product Samples (audio - <1m, Video - TVW, Rulemaking Project)
    • With plans to use feedback from focus group discussions on October 6th and 11th, West anticipated draft rule language for a CR-102 would be "publicly disseminated in the coming weeks.” She affirmed organizing was underway for “holding stakeholder engagement sessions on proposed draft rule language in early December.”
  • Retail Medical Cannabis Endorsements (audio - <1m, Video - TVW, Rulemaking Project)
    • Opened by the board on October 25th, West mentioned that Policy and Rule Coordinator Daniel Jacobs “tentatively plan[ned] to request the board's approval for the [CR-]102 in January.”

• West mentioned a petition she’d received on extending the expiration dates for certificates of analysis (COA) for cannabis products (audio - 1m, Video - TVW, Rulemaking Project).
  • Submitted to the agency on October 30th, West stated the unnamed petitioner wanted the board to “consider rulemaking to extend the expiration date for the certificate of analysis for cannabis products not yet…transferred to a retail store from 12 months to 18 months.” She said staff would have a “response to the board in December that will include a recommendation to either approve or deny the petitioner’s request.”
    • 12 month expiration dates for COAs were created in the Quality Control Testing and Product Requirements Rulemaking Project adopted in March 2022.
  • Board Chair David Postman wondered when the recommendation might be presented. West replied that 60 days after the petition was received would be “December 29th, so it'll be the board meeting before that,” potentially on December 20th. Encouraging public participation, Postman observed “there's no public hearing prior to a petition coming to the board, but it doesn't stop people from sending their thoughts to, to any of us, or you” (audio - 1m, Video - TVW).

• Preparations to start SB 5080 Implementation to expand and amend the social equity licensing program at WSLCB were outlined by West (audio - 3m, Video - TVW).
  • Passed into law on May 1st, West said the CR-101 to begin the rulemaking process “related to expanding and…improving the social equity in cannabis program” would be offered for approval during the Wednesday November 8th Board Meeting.
    • WSLCB staff most recently discussed the status of retail equity applicants on October 31st, acknowledging that a grant program for equity applicants to be administered through the Washington State Department of Commerce (WA Commerce) had only begun to be set up as officials announced the search for a vendor for the grant program on October 27th. This came in response to an advocate raising the issue of WA Commerce staff’s lack of preparedness with board members on October 25th.
    • Separately, a 2022 budget allotment for a $200 million dollar community reinvestment project also administered by the Department set aside money that could be used for cannabis business development. One aspect of this project, titled “Increasing Assets and Income: Financial Assistance/Payments,” included a three million dollar cannabis business grant program “aimed at supporting social equity-qualified license holders to provide early-stage financial support and technical training to cannabis licensees who meet the social equity definition.” 
      • After the budget passed into law, a public meeting and survey input by a social equity in cannabis task force Community Reinvestment Work Group was among the feedback considered by WA Commerce officials when developing the reinvestment project.
  • “In recognizing that cannabis prohibition laws were disproportionately enforced for decades, and that…cumulative harms from the enforcement remain today, in 2020 LCB developed agency request legislation that created the State social equity program, social equity task force, an opportunity to provide a limited number of licenses to individuals disproportionately…impacted by the enforcement of prohibition laws.” Following task force recommendations completed at the end of 2022, she noted that officials initiated SB 5080 as WSLCB request legislation. “The legislation enacted expand[ed] the scale of the current social equity program and makes it more effective by allowing additional retail stores over time,” she remarked, as well as allowing issuance of “up to 100 processor licenses immediately.” West mentioned a cap of ten producer licenses which could “also be issued in conjunction with the processor licenses. Additionally, social equity licenses are provided more flexibility to locate a store while also [maintaining] local control over zoning and outlet density.”
    • While processor licenses could be issued immediately once the agency establishes rule, according to section 3 of the bill text, “January 1, 2025, up to 10 cannabis producer licenses, which must be issued in conjunction with a cannabis processor license.”
  • West felt needed rules included “updating definitions such as ‘disproportionately impacted area,’ ‘social equity plan,’ ‘social equity applicant,’” and more “within the scope of the social equity in cannabis program.” Additionally, she commented how the project would incorporate “a framework and process for local jurisdiction input on outlet density; expanding a social equity…license issuance and reissuance; providing for license mobility and county threshold establishment; and other revisions as necessary…to align the current rules with the scope of the legislation.”
    • In a Research Program briefing on October 3rd, staff reviewed preparing two analyses of cannabis license density in accordance with a legislative mandate to consider how many stores could be added to the social equity licensing program in light of population changes. Former Policy and Rules Manager Kathy Hoffman had planned to take on some of this work when moving over to become the Research Program Manager, but she left the agency shortly thereafter to become a Senior Policy Advisor for the Washington State Department of Labor and Industries (WA LNI), and her replacement was not hired at time of publication.
  • Following board approval of the CR-101, West relayed “stakeholder engagement sessions [were] tentatively planned to be held early next year, and the CR-102 is tentatively planned to be presented to the board in early April.”
  • Postman wanted a better understanding of when the project would be completed. West described her intention for “evaluating” the existing rule, followed by stakeholder input sessions in December 2023, or January 2024. From there, she expected a CR-102 with proposed rule language could be presented April 10th, followed by a public hearing on May 22nd. Under this timeline, final rules would be offered for board adoption “on June 5th, which would mean that the rules would be effective July 21st,” 2024 (audio - 1m, Video - TVW).

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