A new board member questioned staff recommendations on two alcohol rulemaking petitions before members approved filing proposed product sample rules and heard public remarks.
Here are some observations from the Wednesday January 29th Washington State Liquor and Cannabis Board (WSLCB) Board Meeting.
My top 4 takeaways:
- Prior to attending his first WSLCB meeting as a board member, attorney Pete Holmes had been a prominent elected official backing cannabis legalization.
- Following his election as Seattle City Attorney in 2008, Holmes was one of the earliest elected officials to back Initiative 502 in 2012, having established a policy in the city not to pursue cannabis possession prosecutions in 2009.
- Before serving as city attorney, Holmes was a member of the Seattle Police Department (SPD) Office of Professional Accountability Review Board (OPARB), a civilian oversight group which reviewed department policies and practices. Holmes chaired the board from 2003 to 2008, during which time he called for public release of SPD records and OPARB reports.
- The group was subsequently renamed the Office of Police Accountability.
- Holmes was interviewed about his time as city attorney, including cannabis policy, by Publicola in 2017.
- Before serving as city attorney, Holmes was a member of the Seattle Police Department (SPD) Office of Professional Accountability Review Board (OPARB), a civilian oversight group which reviewed department policies and practices. Holmes chaired the board from 2003 to 2008, during which time he called for public release of SPD records and OPARB reports.
- Holmes served on the board of directors for the National Organization for the Reform of Marijuana Laws (NORML) and publicly backed a bill to legalize cannabis home grows in 2024.
- Holmes was appointed to the board briefly by former governor Bob Inslee to conclude a term from January 13th until the 15th before appointment by Governor Bob Ferguson to a full term ending in January 2031. Holmes had been reported to be on a shortlist for the board chair position following the retirement of former chair Jane Rushford in 2022.
- Following his election as Seattle City Attorney in 2008, Holmes was one of the earliest elected officials to back Initiative 502 in 2012, having established a policy in the city not to pursue cannabis possession prosecutions in 2009.
- In his first opportunities to participate in rulemaking at the WSLCB, Board Member Pete Holmes questioned the denial of two petitions for alcohol rulemaking, ending an established pattern of unanimous consent votes by the board.
- After a briefing on an alcohol-related request for rulemaking, Holmes asked why staff were not recommending accepting the petition from Good Buzz Brewing Company, a Mead manufacturer, to allow wineries, breweries, and distilleries to sample, serve, and sell bottles of their products at public and community events. He remarked, "why don't we accept the petition…it doesn't mean we're going to grant it, but if we accept the petition, doesn't it allow us to do a deeper dive to understand what legislative authority is required?” (audio - 4m, video - TVW)
- Policy and Rules Coordinator Denise Laflamme, who researched and drafted the recommendation, deferred the question to Acting Policy and Rules Manager Daniel Jacobs, who stated that part of the analysis in deciding whether to accept a petition was to determine if the agency had been granted appropriate statutory authority. In this case, while the legislature had not expressly prohibited the agency from creating new alcohol license types, permits, or allowances, staff had not previously done so on their own initiative absent explicit legislative direction. Jacobs also said that, “even if we did, it's possible that if the rules were challenged, that we would be found to have exceeded our rulemaking authority. So that's why we're recommending denying the petition.”
- Holmes then asked if there would be issues with "accepting [a] petition and simply analyz[ing] it?”
- Jacobs responded that lawmakers considering legislation regularly checked whether WSLCB had been approached to change rules before proposing a new law. He also pointed out that the agency had a 60-day deadline to respond, and that they did not want to give the "false impression that we might be able to do this in rule, because that could dissuade the legislature from taking action.”
- Despite Jacobs' explanation, Holmes did not support the motion to deny the petition (audio - 1m, video - TVW).
- After the staff recommendation on a nearly identical second petition from the owner of Cup of Swords Tavern, Holmes stipulated, “I certainly would not go against a clear prohibition on the board enacting rules in an area, we certainly shouldn't do it, where we're precluded.” His unwillingness to support the motion was motivated by wanting a better sense of “the extent of our authority in the absence of a prohibition” as he felt WSLCB was well positioned to balance public safety concerns “and the needs of the private enterprise” (audio - 1m, video - TVW).
- Rather than oppose the staff’s recommendation, Holmes chose to abstain from voting on the motion to deny the petition (audio - <1m, video - TVW).
- After a briefing on an alcohol-related request for rulemaking, Holmes asked why staff were not recommending accepting the petition from Good Buzz Brewing Company, a Mead manufacturer, to allow wineries, breweries, and distilleries to sample, serve, and sell bottles of their products at public and community events. He remarked, "why don't we accept the petition…it doesn't mean we're going to grant it, but if we accept the petition, doesn't it allow us to do a deeper dive to understand what legislative authority is required?” (audio - 4m, video - TVW)
- Acting Policy and Rules Manager Daniel Jacobs presented a supplemental CR-102 on the cannabis product samples rulemaking project, which the board approved (audio - 6m, video - TVW).
- Jacobs stated that this rulemaking started as a petition from the Washington CannaBusiness Association (WACA) that the board accepted in the fall of 2022 but didn’t initiate action on until March 2023. He pointed to focus groups held with interested parties in March and October of that year, as well as a survey sent out to licensees in July 2023.
- The first iteration of the CR-102 was filed in August 2024, and Jacobs outlined several proposed changes from that version:
- Combining the categories of vendor and educational samples into a single category called ‘trade samples’
- Requiring samples to be the smallest unit currently sold at retail
- Identifying sample limits provided to retailers and employees by calendar quarter
- Identifying traceability and record keeping requirements
- Requiring physical separation of samples from products sold at retail
- Modifying sample jar requirements
- Following a public hearing in October 2024, agency staff had conversations with licensees and interested parties about changes they wanted to see, and Jacobs stated they’d received several emails describing prospective changes.
- The supplemental CR-102 included changes such as “clarifying that sample jars can be displayed by retailers physically near the retail products being sold” and increasing the quarterly limit for employees to receive samples.
- It also “distinguish[ed] trade samples from internal quality control samples…and also clarifying and distinguishing internal quality control samples from just quality control samples, which may refer to samples provided to laboratories for quality control testing.”
- Other changes to the language covered “sample limits based on THC concentration, acknowledging that sample limits for flower don't necessarily translate to sample limits for concentrates” and dropped “references to sample limits per batch and per harvest, and instead just used per calendar quarter, per employee, across the board.”
- The last revision to the CR-102 was the specification that “old samples and old sample jar labels have to be disposed of by September 1,” 2025. This was done so licensees had time to get through existing inventory before new labeling and sample size requirements took effect.
- Jacobs concluded that the changes should not cause a significant enough cost increase to require a Small Business Economic Impact Statement related to the rules and requested approval. Board members then voted to approve the CR-102 (audio - <1m, video - TVW).
- Several public commenters greeted the new addition to the board, but concerns about support for existing producers and allegations of racial bias in past licensing continued.
- Elijah Cain (audio - 1m, video - TVW) and Tracey Freeman (audio - 2m, video - TVW) wanted to know whether it was “true that LCB issued a license to White people that did not qualify for cannabis and denied Black people a license that were more qualified in 2015.”
- Paul Brice (audio - 4m, video - TVW).
- Christopher King (audio - 3m, video - TVW)
- King Welcomed Holmes to the WSLCB before complaining about treatment by former Board Chair David Postman, indicating such behavior "chills free speech.” He then described an incident where he was “accosted” by Board Chair Jim Vollendroff when he was in the building, and that Vollendroff “threatened to have me escorted out of here.” King was candid that this treatment “traumatizes me" and complained about board members interrupting speakers and reducing comment periods to three minutes. He felt this change was meant "to diminish Black and Brown voices, because we're the ones that are most vociferous," and he asserted board members would interject when they do not like what is being said.
- King warned that he was going to contact his attorney because the situation was "very serious," and he would see them in court. He then promised to leave a copy of his draft lawsuit which he planned to file “in a couple of weeks.”
- Micah Sherman, Raven Co-Owner and Washington Sun and Craft Growers Association (WSCA) Board member (audio - 3m, video - TVW)
- Sherman began by saying “we're very happy to have [Holmes] here and look forward to working together.” He said that the past year had “seen an incredible amount of consolidation in the retail system,” which he found was “in contradiction to the statute on the books related to how many stores can be run by one ownership and financial interest, and so we're seeing the downstream effects of that pretty much decimate the cannabis industry.” Sherman said the result was that "most of our members are struggling to pay their bills…we're on the verge of basically a collapse of the cannabis system."
- Sherman said that he had brought up these issues with agency leadership for “close to two years now” without any action, and that "every attempt I've made to get a coherent response has been denied, has been thwarted, has been sandbagged, basically.” He explained how “folks that have [continued to operate] managed to come up with a business model that was sustainable for close to a decade. In my case in, in the last six months that has stopped being the case.” Sherman told board members he was "pretty much at the end of my rope," and that he and many of his members were about out of business.
- Sherman noted that they were working on legislation to try and halt the decline of producers, but relief wouldn’t come in time for many businesses. He also stated that only “about 50% of the legal market share is participating” in the licensed system and that was declining, and that this was "a choice that we made in not taking action for a decade to respond to the things that myself and many other people have been bringing up for 10 years.”
- He concluded by requesting “your guys' help and making sure that this thing eventually becomes successful, but at this point it is not."
- Jay Farishobah (audio - 4m, video - TVW)
- Farishobah described how he’d been denied a cannabis license in 2015, stating he was “regulated down from a priority one to a priority three,” and "yet my license was good enough for another individual, White individual, to present them same qualifications and get a license.” He relayed having been previously denied a military award, with another soldier telling him it was due to his race. Stating the purpose of the agency social equity program “spells out that one of the primary reasons that Black and Brown people would be available and open to licenses because of this situation,” Farishobah felt his circumstance should be remedied.
- "This racism has been so, it's just been too deep all my life," but at age 85, “it doesn't stop me from, from progressing, taking care of myself, my family.”
- Mike Asai, Black Excellence in Cannabis (BEC) Vice President and Emerald City Collective Garden (ECCG) Founder (audio - 3m, video - TVW)
- Asai also congratulated Pete Holmes on becoming the newest board member and acknowledged Holmes' work in cannabis reform as Seattle City Attorney, noting that he was "one of the first in the nation to stop prosecuting cannabis.”
- Asai stated that he, too, was a “pioneer” in medical cannabis through ECCG which he started in 2010 as Seattle’s first “Black owned” downtown dispensary. He insisted he’d operated with transparency and had believed that those who stepped up early in the legal cannabis system would be recognized and protected as laws evolved. He alleged that Seattle officials and WSLCB had “unjustly shut us down in 2016,” despite his compliance with a 2011 city ordinance regulating medical cannabis. Asai noted that this law had never been rescinded, and argued dispensaries like his should have been “grandfathered in by the city.” Instead, “the City of Seattle failed to defend the pioneers of medical cannabis...especially Black owned dispensaries when it mattered most, and that failure continues today."
- Claiming that city governments had since redlined social equity licenses, Asai suggested it was nearly impossible to secure locations due to restrictive buffer zones. He said that "while we fought for equity, we continue to face barriers designed to keep us out." Asai pressed Holmes on his plans to correct these previous wrongs, asserting the agency needed a continued overhaul. He stated that the WSLCB "should be pushing for a cleanup bill this 2025 session," and that BEC members were ready to offer solutions.
- Caitlein Ryan, Cannabis Alliance Executive Director (audio - 1m, video - TVW)
- Ryan joined others in welcoming Holmes to the board, explaining how her organization was "dedicated to the advancement of a vital, ethical, equitable and sustainable cannabis industry.” She noted that she and Holmes had a history together and that he’d been at the forefront of critical conversations about cannabis regulation, social justice, and market normalization. His career demonstrated a "lifelong commitment to justice, transparency, and thoughtful leadership,” observed Ryan. She expected his work collecting “perspectives among opposing stakeholders will help to address significant challenges in the cannabis industry.” She praised his "historical knowledge and nuanced understanding of the industry," hopeful it would be instrumental in navigating federal legalization and evolving regulations, to help create a “sustainable” cannabis sector. However, she cautioned, "there's a lot of work in front of us.”
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