WSLCB Proposed Changes Based on Comments

The Washington State Liquor and Cannabis Board (“WSLCB”) has released new information about proposed rule changes. These changes are meant to accommodate testimony gathered from the public through a series of public hearings across Washington State. A final public hearing on the proposed rules will take place February 10, 2016 and, if adopted, the rules will become effective on March 24, 2016.

There are a number of proposed changes but the following will list the highlights that are likely to make the biggest impact:

  1. WAC 314-55-020: “Marijuana license qualifications and application process.”
    1. Applicants will need to be up to date on Employment Security and Labor and Industries taxes.
    2. Six month residency requirement for financiers will be removed allowing for out-of-state financiers.
    3. The residency requirement for all applicants, partnerships, corporations, LLC, Managers/Agents who manage a licensed premises will be increased from three months to six months. (This change is already covered in the emergency rules published September 23, 2015)
  2. WAC 314-55-035: “What persons or entities have to qualify for a marijuana license?”
    1. Financial institutions will be removed from the true party of interest matrix.
  3. WAC 314-55-077: “What is a marijuana processor license and what are the requirements and fees related to a marijuana processor license?”
    1. The language prohibiting the use of terpenes and cannabinoids will be removed.
    2. The language prohibiting the characterizations of flavors for inhalants will be removed.
    3. Language will be added to prohibit marijuana infused products that require baking or cooking.
    4. A requirement will be added to require “Mr. Yuk” stickers to be on all labels for marijuana infused edible solid and liquid products.
  4. WAC 314-55-096: “Samples.”
    1. A section will be added for “Education Samples.”
  5. WAC 314-55-102: “Quality Assurance Testing.”
    1. Retesting after 30 days requirement will be removed.
  6. WAC 314-55-310: “Transportation license.”
    1. Changed allotted delivery time from 24 hours to 48 hours.
  7. WAC 314-55-430: “Qualifying patient or designated provider extraction requirements.”
    1. Added CO2 as a solvent that can be used for extraction under certain conditions by qualifying patients or designated providers.

 

Of these changes, one of the most important is the reclassification of a financier and the removal of the associated residency requirement. If adopted, this change will allow out-of-state investors to enter the marijuana market in Washington, greatly increasing the possible sources of funding.

The other important change is the increase in the residency requirement for all applicants, partnerships, corporations, LLCs, etc. Previously a three month residency requirement, it will be extended to six months making it a longer commitment for those looking to enter the marketplace. This increase in residency has already been included in the Emergency Rules released on September 23, 2015 but after adopting this proposed rulemaking the increase will be finalized in the regulations.

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