City of Seattle - City Council - Committee - Finance and Housing - Committee Meeting
(March 2, 2022) - FAS Cannabis Equity

Seattle City Council Finance and Housing Committee - Cannabis Social Equity - UFCW
[ Event Details ]

After public comments were heard, Finance and Administrative Services staff offered research and stakeholder recommendations on cannabis business equity before replying to questions.

Here are some observations from the Wednesday March 2nd Seattle City Council Finance and Housing Committee (City of Seattle - City Council - Committee - Finance and Housing) Committee Meeting.

My top 5 takeaways:

  • Mosqueda gave two representatives of the mayor's office an opportunity to speak prior to public comment during which several cannabis industry employees and stakeholders called for greater worker support and more diversity among cannabis licensees in the city.
    • Advisor to the Mayor Devon Abdallah conveyed the excitement of Mayor Bruce Harrell to “be partnering with Councilmember Mosqueda on, basically, increasing the cannabis equity in our city,” including “legislation to improve it” (audio - <1m, video).
    • Harrell’s “labor liaison,” Gerald Hankerson, echoed Abdallah and said the mayor’s office was looking “to make some great legislation” for Seattle (audio - <1m, video).
    • Cody Funderberk, Ponder Cannabis budtender (audio - 2m, video) 
    • Lynn Domingo, a cannabis patient and medical advocate, reported a long history of cannabis activism as she’d found the plant to be “safer than opioids” and better for her ailments. She supported a more equitable cannabis sector, arguing that policy had so far “left out the communities of color” and that city officials should undertake change to “continue the movement to justice.” Domingo added that she’d been "horrified to hear about" robberies of retailers in the area in 2022 (audio - 3m, video) 
    • Gabriel Prawl, President of the Seattle Chapter of the A. Philip Randolph Institute (Seattle APRI) and ILWU 52, spoke up to represent "workers and community" as he felt cannabis employees were “largely being left out of the…economic boom in this industry.” Moreover, he believed those “disproportionately harmed by the war on drugs are not the ones who have” profited the most under cannabis legalization in the state, as cannabis licensees in the city were “almost exclusively White” men employing “women, Black, Indigenous, and People of Color.” Prawl indicated that workers wanted better training and opportunities for advancement, as well as better pay and benefits. Improving these areas would provide individuals' a “fair shot to succeed in the industry,” he said, promising to continue engaging with the council on policies to increase “social and economic justice for workers” and to better educate the public (audio - 2m, video).
    • Dustin Lambro, at that time the recently-appointed Political and Legislative Director for UFCW 21, encouraged “swift action” on the “booming” cannabis industry. He mentioned that there had been “more than $185 million in cannabis products” sold in Seattle in 2021. Lambro remarked that UFCW 21 leaders estimated that “about half” of the “over 33,000 jobs in the industry” were in Seattle, but felt workers had not benefited from the sector’s success. Prior to adult use legalization, he indicated that medical cannabis in Seattle had been “a generator of economic opportunity for both Black and Brown communities, and a provider of medical-grade cannabis” for patients. Lambro alleged that “over 99% of the cannabis retail owners in Washington state are White” and that city officials needed to make a “targeted effort here in Seattle” to “improve working conditions for the cannabis workforce” by offering training and advancement avenues. He pledged that UFCW 21 members would continue to work with city leaders to assist their equity efforts (audio - 2m, video).
    • Paul Thomas (audio - 1m, video) 
    • TraeAnna Holiday, King County Equity Now (KCEN) Media Director and former Africatown Community Land Trust Community Organizer (audio - 2m, video) 
    • Adán Espino, Craft Cannabis Coalition (CCC) Executive Director—who also commented during the previous committee meeting—was appreciative of the “continued conversation" on cannabis issues by committee members. “We do have some initial concerns," he said, mainly around CCC members not being involved in earlier outreach by city officials. Acknowledging that Mosqueda professed an intention to be inclusive, Espino hoped existing retailers could play a larger part in the committee’s work. He stated that other jurisdictions pursuing cannabis equity programs included “a considerable amount of time studying both the cannabis market within their city, and the broader issue of how social equity in cannabis can look” including “industry participation” (audio - 1m, video).
  • FAS Consumer Protection Division Strategic Advisor for Cannabis Licensing Lachen Chernyha, and Purchasing and Contracting Division Field Enforcement Representative Rick Dimmer presented on a history and future of city cannabis equity policies (audio - 9m, video, presentation).
    • Chernyha assumed the role held by Cherie MacLeod, the former FAS Strategic Advisor and Marijuana Regulatory Program Manager. MacLeod had represented the Association of Washington Cities (AWC) on WA SECTF and had a key role setting up cannabis policies in Seattle both before and after legalization, including emphasizing business equity.
    • Chernyha said they would cover a “brief history of FAS cannabis equity work” and the results of a Cannabis Racial Equity Toolkit (RET) created by the division. Dimmer remarked that the city originally approved siting of cannabis businesses in 2015 “without considering social equity in the licensing” and “Black business owners and community were, and continue to be harmed.” He said that the RET represented an attempt by local officials to “take accountability” for their role in licensing inequity “and also look into the blindspots on how we can right these wrongs” not only for cannabis licensing but for the “whole community being impacted.”
    • Chernyha claimed that following cannabis legalization in Washington in 2012, a “complex state licensing process” combined with “the lack of outreach to community” meant only “those with wealth or capital were able to obtain licenses.” She added that “none of Seattle’s existing Black-owned medical operators were able to obtain licenses to continue operating.” Following the establishment of WA SECTF in 2020, Chernyha said that the equity retail program at WSLCB associated with the task force was due to begin accepting applications “this year.”
      • The opening of the equity retail application window would be delayed due to the withdrawal of proposed rules by WSLCB staff on May 10th. Policy and Rules Manager Kathy Hoffman provided a general justification for the delay while assuring board members the action wouldn’t “throw us off by a lot" as the agency would still begin accepting applications “in the early fall” or “late summer.”
    • Legislation during the 2022 legislative session would have “greatly expanded the number of retail and producer/processor licenses available” statewide, she noted, but had failed to pass. Of the retail licenses available in the equity program, only two were in the city of Seattle, Chernyha told the committee, but she stressed that officials had looked to “undo harm in other ways.” This included Seattle officials leading the way on vacating local cannabis convictions in 2018, she stated, along with efforts at the state level the following year with Governor Jay Inslee’s Marijuana Justice Initiative and SB 5605 which allowed vacating of cannabis misdemeanor convictions. Though the RET initially focused on licensing, Chernyha said, the RET outcomes were revised after “community feedback” to center “Black communities through access to licenses and capital, business education and mentorship, affordable housing, healthcare, education, and reentry support, business plan support and flexibility in the process, reinvesting proceeds back into the Black community, and rebuilding generational wealth.” 
    • Pointing to “nearly two dozen stakeholder engagements”---like the Cannabis Equity in Our Community forum—Chernyha relayed the themes heard by FAS staff were “that the communities most impacted by prior marijuana laws should be the ones to receive assistance from equity efforts,” a need for “accurate data collection,” monetary support, inclusion of medical patients “since they’re often not acknowledged or counted in the data,” and that any equity program created by officials “be viable, given laws against preference based on race.”
    • Dimmer covered other specific recommendations FAS staff had heard:
      • “Dedicate $1 million for the next ten years” to fund a city equity program
      • “File a motion with King County Superior Court to vacate convictions and dismiss charges for felony convictions” for cannabis possession which Black people recieved “for the same crime that their White counterparts received misdemeanors for”
    • While a timeline for action by the city was not set, Dimmer showed one possible timeframe in the presentation:
      • “2022 - Dedicate $1M per year to Seattle Cannabis Equity Program.
      • 2023 - Launch Seattle Cannabis Equity Program.
      • 2023 - Seek additional cannabis retail licenses for Seattle.
      • 2024 - Partner with other City departments to implement a grant program for those most impacted by the War on Drugs in Seattle.”
    • Dimmer described how FAS had been working with staff from the Seattle Office of Economic Development (OED) and had identified “22+ departments” in city government with officials interested in cannabis equity. “We [don’t] want to take all the resources from [a cannabis equity] fund when there’s other city departments” engaged in “similar work” to what had been recommended already, he commented. Dimmer showed what recommendations had already been approved by FAS to be part of the equity program they pursued with Mayor Harrell’s office:
      • “Equity in business licensing, lowering licensing fees (FAS)
      • Reducing buffering and dispersion requirements (Seattle Department of Construction and Inspections)
      • Providing grants or loans and technical assistance (OED)
      • Mentorship and business planning (OED)
      • Investment in communities most impacted (OED)”
  • Questions about funding and expungements as well as the order in which policy changes should be enacted were raised while members and panelists gave additional comments.
    • Mosqueda was grateful for the additional information, saying she’d grown interested in the RET when it was briefly mentioned the previous December. She then opened the floor to questions (audio - 1m, video). 
    • Councilmember Sara Nelson was similarly appreciative of the presenters, assuring everyone she "fully support[ed] the goals" of cannabis sector equity, and acknowledging City Councilmember and committee Vice Chair Lisa Herbold’s work "helped form this team" (audio - 5m, video).
      • She considered the equity toolkit to be “extremely important” and broadly supported the recommendations described by Dimmer. Mentioning the $1.4 million in cannabis excise tax revenue the city had received for the previous year, Nelson speculated that could be adequate money to “get this off the ground.” She also liked that the proposal was consistent with the recommendations of WA SECTF which “makes our work easier.” Nelson asked whether the data collection being proposed would feature “analysis of the status of equity in our…retail stores” including employee demographics, feeling that survey topic was a “great avenue” for pursuit.
      • Nelson reported that she’d contacted WSLCB Board Member Ollie Garrett, who was also the president of African-American business development group Tabor 100. She conveyed Garrett’s reticence over an idea in the UFCW presentation for a sales tax increase to fund Seattle equity work as Garrett felt it “could really negatively impact our shops here” since product sales were a poor “indication of the cost to operate these businesses.” Nelson understood that it could more heavily impact any licensees “who lack capital, whose sales are lower” or don’t own multiple retail stores.
    • Herbold told her colleagues she had lobbied for social equity legislation at the state level but wasn’t responsible for initiating the RET by FAS staff whom she knew were “responding to…a lot of what they heard” at the city cannabis equity forum in 2020. Noting the “very large excise tax” levied on cannabis already and a “regulatory fee” on cannabis businesses imposed by the city, she said this had been a mechanism to offset some of the “cost associated with the regulation” of licensees such as local annual inspections of their premises. Herbold was committed to working with FAS representatives “to look at the areas in which” the city inspections “are duplicative of state inspections” as well as improvements to industry equity. An idea which had come in a proposal for the FAS 2021 budget included considering “once every two years inspection,” but she said that the administration of previous Mayor Jenny Durkan opposed the concept. Should the council look at changing the local sales tax on cannabis items to support an equity program, Nelson wanted them to review cannabis regulatory fees as well (audio - 8m, video).
      • Nelson did have a question about “some of the recommendations from stakeholders,” specifically expungement of cannabis felonies. She wondered whether the Seattle city government was empowered to file to dismiss those offenses. “The small amount of research I’ve done in this area is that state law prohibits expungements,” she remarked, but still expressed doubts as the acts being expunged were “no longer crimes.” Dimmer responded with his understanding that the city didn’t “have authority to do that,” but he wanted the Mayor’s office and council to back a policy change “to the folks who are needing to make that decision.” He relayed that people with these convictions had their lives “impacted gravely” when it came to housing, employment, and other opportunities and that FAS recommendations were more reflective of public sentiment than a legal analysis of city powers.
      • Dimmer was also not “sure where the funding is going to come from” but their presentation was centered on supporting community feedback. He conceded officials hadn’t made a dedicated effort to reach out to budtenders at stores, but “did reach out during…our forum” to hear from both businesses owners and cannabis staff. Dimmer considered budtender perspectives to be an important indicator of industry equity and didn’t want to see fracturing within the cannabis sector as part of "an oppression olympics" debating who was the most harmed by cannabis policy. 
    • Herbold followed up to ask about the best order in which to enact cannabis business changes, a question she’d raised with panelists from other jurisdictions earlier in the meeting (audio - 2m, video). 
      • Dimmer advocated for starting with permitting and zoning changes that could make new areas of Seattle open to cannabis retail stores. He said that Seattle “lost 450 businesses during [the coronavirus pandemic] in the downtown corridor” and with zoning changes cannabis businesses might be welcomed as one way to “revitalize” neighborhoods that lost storefronts during the pandemic.
    • Dimmer remarked that an FAS intern had been reaching out to local governments about their equity programs for cannabis and thanked municipal staff who had responded, as well as cities whose officials had offered testimony to the committee during the meeting (audio - 1m, video). 
      • Nelson inquired whether the intern’s work had been compiled “in a report form” and if she could review what they’d found. Chernyha promised they’d make that available to her (audio - 1m, video).
    • Hankerson reiterated the mayor’s support of the issue and was looking forward to collaborating on policy solutions with Mosqueda and the council (audio - 1m, video). 
  • Mosqueda concluded the discussion and promised that the committee would host further conversations on cannabis equity as “there's a huge sense of urgency."
    • Mosqueda expressed gratitude to the panelists who “shared their journey” and promised the entire council would consider the matter in hopes of taking action “relatively quickly” in order to “create a more equitable recovery” from the pandemic (audio - 1m, video).
    • She promised to follow up on stakeholder equity recommendations and panelist suggestions at their next meeting on April 6th. Though it was “early in the conversation,” Mosqueda remained committed to continuing momentum around the topic in addition to potential legislation (audio - 2m, video).

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