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WA Pot

Last Friday, Washington Governor Jay Inslee signed into law Senate Bill 5052, also known as the Cannabis Patient Protection Act.  The governor vetoed a few sections, but most of the bill remains intact.  The law takes effect July 1, 2016, and attempts integrate Washington’s medical marijuana system with the state’s recreational marijuana market.  SB 5052 moves oversight of Washington’s medical marijuana program from the Department of Health to the newly dubbed Washington State Liquor and Cannabis Board (WSLCB).

Throughout the legislative session, the bill was criticized by the medical marijuana community for limiting patient access to medicine by significantly reducing possession and cultivation amounts, creating a government database which may violate patient privacy and expose patients to criminal liability, and potentially eliminating jobs by forcing existing medical dispensaries to close if they do not obtain a recreational license before July 1, 2016.  So what exactly is in place?

Optional Patient Database

In Washington, patients only need a doctor’s recommendation to qualify as a medical marijuana patient. No card system or registry currently exists.  SB 5052 creates an optional patient database.  Patients who voluntarily register may possess three times as much marijuana as is allowed under the recreational law.

The medical marijuana community argues that forcing patients to register in order to have sufficient access to medicine would essentially force patients to admit to committing a federal crime, and that disclosure of personal medical information is a violation of privacy laws under the Health Insurance Portability and Accountability Act (HIPAA).  Sen. Ann Rivers, the sponsor of the measure, said that part of the reason the database is so important is to find out if there are enough stores providing medical products to patients.

Patient Possession Limits

Prior to SB 5052, medical marijuana patients could possess up to 24 ounces of usable marijuana and 15 plants.  Under the new law, a patient may have the following limits:

  • three ounces of usable marijuana (flower)
  • 48 ounces of marijuana-infused product in solid form (edibles)
  • 216 ounces of marijuana-infused product in liquid form (beverages)
  • 21 grams of marijuana concentrates (oil, wax)

A patient may also grow up to four plants for personal medical use and possess up to 6 ounces of usable marijuana products from the patient’s plants.

However, if a doctor determines that the patient’s needs exceed the amounts above, the doctor may specify it is recommended that the patient be allowed to grow up to 15 plants for personal medical use and possess up to 16 ounces of usable marijuana from the patient’s plants.

Collective/Cooperative Gardens

Currently, medical marijuana patients may pool their resources and participate in collective gardens.  Each such garden is limited to 10 patients and each patient may allocate some or all of their personal 15 plant limit to the collective.  However, no collective may have more than 45 plants total.  SB 5052 essentially reduces the number of patients that may be associated with a collective garden from 10 patients to four patients.

SB 5052 now dubs collective gardens as cooperative gardens.  Each co-op is limited to four patients.  Each patient may allocate some or all of their personal plant limit (which is 6 or 15 plants depending on the patient’s medical needs) to the co-op.  However, no co-op may cultivate more than 60 plants total.

Large collective gardens have until July 1, 2016 to either reorganize into a co-op with less patients, or obtain a producer license from the WSLCB.  The state will grant priority to collectives who demonstrate their experience in the marijuana industry and who have been good proprietors.

Medical Marijuana Dispensaries

Lastly, one of the largest criticisms of the law is that medical marijuana dispensaries exclusively serving medical marijuana patients will no longer exist.  Instead, medical marijuana dispensaries must become licensed recreational stores and obtain a medical cannabis endorsement indicating that the applicant is knowledgeable in the medical use of cannabis.

Under I-502, the WSLCB has limited the number of recreational retail licenses it will issue to 334.  The number was determined using a formula that distributes the number of locations proportionate to the most populous cities within each county.  SB 5052 provides that the WSLCB must reconsider and increase the maximum number of retail outlets it established and allow for a new license application period and a greater number of retail outlets to be permitted in order to accommodate the medical needs of patients.  The WSLCB will conduct an evaluation of applications received during the application period.

The WSLCB is now tasked with developing a merit-based application process that allows applicants the opportunity to demonstrate their experience and qualifications in the marijuana industry.  The board will give first priority to applicants that have the following qualifications:

  • applied for a state retailer license prior to July 1, 2014
  • operated a collective garden before January 1, 2013
  • maintained a state business license and a municipal business license, as applicable
  • has a history of paying all applicable state taxes and fees

Medical and recreational operations should prepare themselves for transitions in 2016.

 

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As we get closer to the November election and the potential (likely?) passage of Ballot Measure 91 in Oregon, the most common question we hear asked is, “what is recreational marijuana in Oregon going to look like?”. That question is almost always closely followed by people asking if the recreational licensing and implementation process is going to be like Washington’s I-502 process.

As one of two states with recreational cannabis use, Washington should be a leader in how to implement, and build, a legal cannabis market. But, it’s not. Here’s a pretty great article about some of the big issues. http://www.inlander.com/spokane/more-money-more-problems/Content?oid=2358747 

From problems with under-production to the creation of a new black market, Washington’s I-502 has been a marginally successful program. 

We recognize that every state will have it’s growing pains, but we are very hopeful that Oregon’s legal cannabis market will look and feel different. 

The Seattle Times, in this article http://seattletimes.com/html/localnews/2024709004_oregonmarijuanameasurexml.html lays out some of the fundamental differences between the two states.

Here are a few of our predictions how Oregon will be different, and better:

1. Medical dispensaries in Oregon will be allowed to continue to operate and, if they choose, also get licensed to be recreational dispensaries.

2. Our taxes will be lower. I mean WAY lower. This will prevent the black market from regaining a foothold in Oregon.

3. Oregon will have learned from Washington and license cannabis cultivation facilities before new retail facilities.

4. We will not start from scratch for cultivation. This means that, hopefully, Oregon will allow an opportunity for cannabis cultivation facilities supplying the existing legal dispensary market to apply for a recreational license. This would ensure no lapse in cultivation.

5. We are very hopeful that the OLCC will not limit the number of licenses. Without limits a true free market cannabis economy can develop.

There has always been a rivalry between Washington and Oregon, Portland and Seattle, and, if Ballot Measure 91 passes, we are going to guess that Oregon is poised to be the leader in a sensible recreational cannabis market.

 

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