WSLCB – Executive Management Team
(July 24, 2019)

Updates on hemp, traceability, agency request legislation, and the legislatively-directed interim study on taxation of cannabis by potency.

Here are some observations from the Wednesday July 24th Washington State Liquor and Cannabis Board (WSLCB) Executive Management Team public meeting.

My top 3 takeaways:

  • Director Rick Garza provided new information on the agency’s participation in the development of the Washington State Department of Agriculture (WSDA) hemp program (audio – 8m).
    • Garza last briefed on the state’s hemp efforts on June 4th.
    • WSLCB had been fielding questions from marijuana licensees interested in cultivating hemp as well. The agency met with WSDA Director Derek Sandison and Policy Advisor Kelly McLain to get a “better understanding of how the [hemp] program is going to work.”
    • Garza indicated the agency then helped convene Governor Jay Inslee’s policy staff to consider oversight of cannabidiol (CBD) products. “Most of the states are struggling with this,” he noted, adding that WSDA intended to license hemp growers, but not processing. Eventually, the Washington State Department of Health (DOH) will be encouraged to weigh in on the regulation of CBD in the state. 
    • WSDA’s plans for regulations and reporting were not finalized, but “it’s not like they’re just going to issue a permit and [growers are] on their own,” Garza stated. WSLCB staff were being prepared to help answer hemp questions from marijuana licensees.
    • Garza hoped a recent Regulator’s Roundtable in Alaska which agency staff attended could shed light on other state’s efforts to control hemp or CBD products.
    • At publication time, WSDA had issued 120 hemp licenses around the state.
  • Director of Legislative Relations Chris Thompson briefed on WSLCB’s legislatively-directed interim study on taxation of cannabis by potency and the development of agency request legislation (audio – 6m).
    • The agency was asked to perform the cannabis tax study by the legislature through an appropriation in the budget which Thompson last discussed on July 10th. He reviewed legislative priorities and a timeline for agency requests for next year’s session most recently during the Cannabis Advisory Council (CAC).
    • Thompson said his office was “working fast and furious on getting [the taxation study] project organized and launched” and had invited “approximately 15” people from “a wide range of perspectives and organizations, external and other state agencies.” Tribal Liaison Brett Cain was following up with those individuals to establish the study’s workgroup.
      • Cannabis Observer founder Gregory Foster was invited and planned to participate in the workgroup.
    • The study will involve at least three workgroup meetings with facilitator Debbie Rough-Mack, who helped Policy and Rules Coordinator Kathy Hoffman organize a listen and learn session this past spring.
    • Thompson reported an “apparent successful bidder” on the agency’s request for proposal (RFP) for “technical research and analysis” to inform the workgroup on “feasibility issues.” This includes “analysis of impacts on the medical market – production and consumer behavior within the medical space” due to the high cannabinoid concentration in many medically-compliant products. The final contract budget was still being negotiated.
    • In preparation for the legislative session, Thompson said he was almost ready to offer “descriptions of potential agency request legislation,” possibly inclusive of draft bill language. He planned to solicit feedback from stakeholders “in the early part of August” to allow time to “share areas of support and interest and concern” before the agency’s September 13th deadline to submit proposals to the governor’s office.
    • Thompson promised “further discussion” before any bill drafts were sent to the Code Reviser’s office for formatting into legislation.
  • Agency leadership conferred on upcoming meetings and efforts to stabilize the traceability system.
    • Board Chair Jane Rushford confirmed the Board’s second ‘on-the-road’ meeting of the year would occur at Cascadia College on August 21st in Bothell. The agenda for that meeting was said to be coming together “beautifully” and other meetings associated with the trip remained in development. “A prevention gathering” was planned for the afternoon of August 20th. The agency Public Health Education Liaison, Sara Cooley Broschart, planned to have more information on the prevention community meetup the following week, which Rushford said would “mimic what we did in Spokane.” She added that Hoffman was considering a listen and learn session in the area (audio – 3m).
    • Regarding Cannabis 2.0 (C2.0), Rushford and Garza were scheduling meetings with contacts at five agencies which had not participated in the project’s initial interagency conference. The effort, which involved coordination of request legislation on cannabis across several state institutions, was likely to see its first public meeting in late October after potential legislation was more developed (audio – 2m).
    • Deputy Director Megan Duffy spoke of “constant working with MJ Freeway to move the tickets along, identify root causes, get fixes in place” for the troubled traceability software. She said the agency continued to study new data and review workarounds in light of the new board interim policy (BIP) on a “24-hour path of trying to get stability to the release and the system” (audio – 1m). Communication Director Brian Smith confirmed the agency would host an internal webinar on Monday July 29th at 2:30pm with Enforcement officers and agency staff to brief them on the new BIP. Director Rick Garza, Cannabis Examiner Manager Kendra Hogdson, and Enforcement Chief Justin Nordhorn were expected to speak. Smith noted they would take no questions (audio – 2m).
    • Executive Assistant Dustin Dickson shared a preliminary agenda for the following week’s EMT which included reviews of traceability; request legislation; tribal relations and compacts; the recent Washington SunGrowers Industry Association (WSIA) meeting in Omak; plus a quarterly rules update (audio – 3m).
Here are shared documents for your review:

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