WSLCB – Executive Management Team
(February 12, 2020)

[ Event Details ]

Here are some observations from the Wednesday February 12th Washington State Liquor and Cannabis Board (WSLCB) Executive Management Team public meeting.

My top 3 takeaways:

  • WSLCB Director of Legislative Relations Chris Thompson provided a legislative update to the Executive Management Team (EMT) beginning with the status of the agency’s request legislation and a closely related bill requested by the Governor and the Department of Health (DOH).
    • Thompson’s last update on the agency’s request bills was on January 29th.
    • HB 2871“Establishing a retail privilege endorsement to a marijuana producer license.” (audio – <1m)
      • Thompson began with the agency’s ill-fated medical patient/small producer bill which he confirmed “did not make it out” of the Washington State Commerce and Gaming Committee (WA House COG), the bill’s policy committee.
    • HB 2826“Clarifying the authority of the liquor and cannabis board to regulate marijuana vapor products.” (audio – 1m)
      • Thompson initially said the bill made it through its policy and fiscal committees “unchanged.” He noted the measure achieved unanimous support from the Washington State House Appropriations Committee (WA House APP).
      • Later, Thompson said that the Department of Health (DOH) had “been asking for some changes to [HB 2826] in the event” their vapor request legislation, SB 6254, failed to move ahead. He indicated “there was a problem with the title and the scope of adding to our bill some of those other provisions.”
      • Thompson discussed another potential amendment to HB 2826 regarding “making information about product components disclosed accessible to the public.” One of HB 2826’s provisions would require licensed processors to disclose constituent substances in their cannabis vapor products to DOH. According to Thompson, a discussion about what information could be considered “proprietary and therefore exempt” from public records disclosure was underway. Participants had thus far assumed information provided to the state would not be exempt as the Department wasn’t “likely to see formulas, or quantities, or procedures for mixing.” However, Thompson felt that “the jury is maybe out, to some degree” on whether that interpretation was legally sound (audio – 3m).
        • Crystal Oliver, Washington SunGrowers Industry Association (WSIA) Executive Director, raised this issue during public comment at the February 5th Board Meeting.
    • SB 6254“Protecting public health and safety by enhancing the regulation of vapor products.” (audio – 2m)
    • HB 2870“Allowing additional marijuana retail licenses for social equity purposes.” (audio – 8m)
      • Concluding his initial briefing with the agency’s quite active social equity bill, Thompson described a “fairly positive” WA House COG hearing, followed by “good discussion and testimony” during the bill’s fiscal committee hearing (video). He noted the bill had advanced on “essentially party line” votes, with Republicans voicing concerns about “the fact that there are race explicit terms and provisions in the current draft.” Thompson said conversations with legal advisors had led to “a new approach that’s likely to get enough support that it could go forward and might address that concern” by taking mentions of race or ethnicity out of the bill. Other bill revisions had been “under consideration” as well. Those concerns aside, Thompson felt “there’s a lot of interest in moving this bill along.” Lawmakers and staff were “waiting for us to get back to them with a green light” for new language. He hoped to have that settled “if not today, then tomorrow” as the deadline to pass legislation out of its chamber of origin was Wednesday February 19th at 5pm.
      • Thompson believed there was a “pretty good chance [legislators] will be working on the floor this weekend” and support was being organized by the Washington State Commission on African American Affairs (CAA) which “has been working hard on this bill.” He reported CAA had organized “well over a dozen groups, organizations, stakeholders” to lobby for the bill which “includes association folks that we’re all very familiar with” in addition to groups representing “communities of color” impacted by the bill.
      • In the rush to amend and advance HB 2870, Thompson acknowledged “in the policy committee they didn’t have any time to really even look at the [first] substitute” while WA House APP members hadn’t seen new language which removed explicit mentions of race. He was optimistic for “some support on both sides” of the aisle for the next substitute version of the house bill.
      • Board Member Ollie Garrett spoke up to say she was working with the CAA and Commissioner Paula Sardinas to “make sure that we’re all in agreement with the language.” Thompson said he’d spoken with Sardinas and Sheri Sawyer, a senior policy advisor at the Governor’s office, before conferring with agency Director Rick Garza. Thompson’s impression was that momentum for the rewritten legislation was “going better than I expected.”
  • Thompson reviewed other cannabis-related bills which had traversed the house of origin fiscal committee cutoff “but are not coming from us.”
    • The LIC’s Session Documents/Materials site published lists of bills which had passed required steps in the legislative process. Tuesday February 11th was the last day for legislation to be passed by a fiscal committee in its house of origin, the second cutoff date in the session calendar.
    • HB 2359 / SB 6206“Creating a certificate of compliance for marijuana business premises that meet the statutory qualifications at the time of application.” (audio – 1m)
      • This bill was first mentioned at the December 2019 Cannabis Advisory Council (CAC) meeting by Washington CannaBusiness Association (WACA) Executive Director and Lobbyist Vicki Christophersen as one of the organization’s 2020 legislative goals.
      • Thompson said that both versions of the bill were moving and stated that if it became law, WSLCB would be required to “issue a certificate of compliance for marijuana business licensees that meet all the set back requirements at the time of application even if at a later time” a type of business opens within that buffer that would make the location non-compliant. Thompson included that “there’s a little, minor technical tweak that we’ve got on that.”
      • As the legislation’s house and senate fiscal notes indicated the measure would cost “less than $50,000 per fiscal year in the current biennium or in subsequent biennia,” both bills bypassed the need for fiscal committee hearings. At publication time, the House version of the bill sat in the Washington State House Rules Committee (WA House RUL) while the Senate version had been advanced to the second reading calendar by the Washington State Senate Rules Committee (WA Senate RULE).
    • SB 6033“Concerning the safety and security of retail marijuana outlets.” (audio – 6m)
      • Agency leadership previously discussed cannabis retail robberies and  the pre-filed version of the bill in December.
      • The initial version of SB 6033 would have required local law enforcement to report robberies of cannabis retailers to the Washington State Patrol (WSP) which in turn would have been required to report to WSLCB. Thompson said “local law enforcement testified that they didn’t want to be in this bill” and suggested a “change which was made to the bill” before it was moved out of the policy committee. As a result, “the licensee now would have to report to the LCB” any robberies in the first or second degree. Board Member Russ Hauge commented that the narrow scope of the offenses considered by the bill “makes no sense.” Enforcement Chief Justin Nordhorn was skeptical that “the licensee knows what that” legal distinction was. Thompson added the bill also featured a sentencing enhancement for individuals found guilty of robberies “and it requires Justin to report to the state patrol, too.”
      • Nordhorn told the group that SB 6033 had “no requirements on what we do with” robbery data beyond forwarding it to WSP. There was little information about what reporting was expected, nor procedures for when it “doesn’t get reported” by licensees. His initial understanding of the measure was that it would deal with “robberies, burglaries, thefts, you know, the whole gambit – and yet it just called out robberies in the first and second degree.”
      • Hauge, a former county prosecutor and chair of the state’s Sentencing Guidelines Commission, argued the required information was “incomplete” since “just asking about robbery doesn’t tell any real story about what’s going on.” Though not opposed to gathering data, he asserted, “if you put it on the license holders, they’re probably not going to do it.” Going further, Hauge’s opinion was that “an enhancement is not going to…deter anyone from committing that kind of crime because when people commit that kind of crime they think only about whether they’re going to get caught, not what’s going to happen to them if they’re caught, identified, convicted, and sentenced.”
      • Thompson said the topic came up following some “break-ins at stores up in King County.” Hauge asked if he meant “robberies” due to the fact that “there’s a real distinction between something like a break-in when nobody’s there and a robbery. A robbery takes a confrontation.” He agreed that there had been crimes in that area and robberies in particular were “extraordinarily dangerous.” At issue for Hauge was the outstanding question of what the State was “going to do about it. And I’ve not heard anything in this bill that says we’re really going to be addressing that problem.” Thompson concurred that HB 6033’s “genesis wasn’t specific to robberies, or break-ins, or burglaries” but involved a “variety of crimes at retail shops.” Thompson noted that a sentencing enhancement had been proposed in legislation during the prior year. Nordhorn observed that if the robbery was “cash-based” the agency had no way to know if it was reported, even if it was reported to local law enforcement, leaving him doubtful the bill could achieve its intent. Hauge asked if WSLCB was being approached “for our position on this bill”; when Thompson replied that they hadn’t, Hauge chuckled and responded, “good…I certainly don’t want to testify.”
      • Nordhorn said that James McMahan, Policy Director for the Washington Association of Sheriffs and Police Chiefs (WASPC) had reached out to him ahead of the bill’s first hearing, but that he hadn’t “heard from him since.” Thompson concluded that it “sounds like [McMahan] got what he wanted.”
    • SB 6489“Concerning possession of vapor, vapor products, tobacco, and tobacco products by persons under the age of twenty-one.” (audio – 2m)
      • In 2019, HB 1074 was adopted, raising the legal purchase age for tobacco and vapor products in Washington from 18 to 21 at the beginning of the year. SB 6489 would end the authority of peace officers or WSLCB Enforcement officers to detain or seize tobacco or vapor products from individuals under 18 years old. The bill’s intent was to focus state action on prevention over punitive actions against minors possessing tobacco or vapor items illegally. 
      • Thompson told the EMT that “we’ve let the sponsor [Senator Rebecca Saldaña] know that that puts some significant limitations on the degree to which we can enforce” Tobacco 21 (T21) legislation, but “they’ve so far done this with that knowledge.” He said that “problems with the original draft” had been “fixed” when the bill was introduced, however the substitute bill moved “away from the advice that we’d provided to the Senator.” Though the agency didn’t officially oppose the legislation, Thompson was clear that the current bill would “limit how effectively we could enforce the T21 legislation.”
      • At publication time, HB 6489 had been placed on the second reading calendar by the members of WA Senate RULE which would allow representatives to call the bill up to propose amendments before a third reading and floor vote.
    • HB 2375“Concerning tableting and encapsulating machines and controlled substance imitation materials.” (audio – 1m)
      • This bill received a public hearing in the Washington State House Public Safety Committee (WA House PS) on January 20th and executive session on January 30th.
      • Thompson indicated the bill had been amended “to exclude marijuana” processors from a ban on the sale, possession, or use of tableting machines “because some of our licensees use those machines in their processes.”
        • It’s Cannabis Observer’s understanding that WSIA contract lobbyist Bryan McConaughy first identified this issue and was asked to advocate for an amendment.
      • At publication time, HB 2375 had been placed on the second reading calendar by WA House RUL.
    • SB 6057“Concerning price differentials in the sale of marijuana.” (audio – 1m)
      • This bill received a public hearing on January 23rd and was passed during executive session on January 28th. Certain reforms in the bill were related to a petition denied by WSLCB on February 11th.
      • Near the end of his briefing, Thompson recollected the bill’s bona fide business reasons” for price differentials were similar to policies for alcohol which allowed differing sales prices if “it costs you more to transport it to this purchaser than that one and that sort of thing.”
        • Thompson did not mention the bill would allow wholesale discounts based on quantity of products purchased.
      • As the bill’s fiscal note projected zero additional costs to the WSLCB, it was not required to have a fiscal committee hearing. At publication time, the bill awaited assignment to the second reading calendar by the members of WA Senate RULE.
  • The EMT then heard about several “dead bills” that didn’t make the house of origin fiscal committee cutoff. Thompson stated, “most of the big bills died; most of the bills that we had real concerns about died.”
    • HB 2279“Improving the development of the marijuana market by enacting provisions specific to craft cannabis production.” (audio – 2m)
      • This bill received a public hearing in its policy committee on February 3rd. Licensee Micah Sherman brought the bill to the agency’s attention during the January 22nd Board Meeting after which Hauge described himself as “generally supportive” of the measure during the January 28th Board Caucus.
      • Hauge asked about the “attitude” from lawmakers about bills to allow direct sales by producers. Thompson made no mention of the direct sales component of the agency’s failed request legislation, HB 2871, instead pointing to “a very lively hearing on” HB 2279 which he described as “the so-called craft cannabis bill.” His view was that there was “a lot of support and a lot of opposition” to the bill both from within and outside the cannabis industry. “It died with a whimper,” Thompson said, “there really wasn’t much legislative support for that that I perceived.” Rather, he claimed the “Chairman wanted to give a colleague the courtesy of a hearing.”
    • HB 2263 / SB 6085“Expanding opportunities for marijuana businesses by removing residency barriers and providing access to capital for minority and women-owned businesses through a fee on certain investments.” (audio – <1m)
    • HB 2361 / SB 6393“Concerning cannabis industry workplace standards.” (audio – <1m)
      • HB 2361 received a public hearing in its house policy committee on January 16th but was not subsequently moved. SB 6393 was heard by its senate policy committee on January 23rd before being passed during executive session on February 6th. The measure was referred to WA Senate WM but never received a hearing.
      • Thompson confirmed the legislation “died.”
Here are event details and shared documents for your review: