Transcript Legalized Marijuana Update

Legalized Marijuana Update:
Washington
CWAG Annual Conference
July 22, 2014
Bruce L. Turcott
Assistant Attorney General
Washington Attorney General’s Office
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Legalized Possession
• Limited possession 21 & over
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1 oz “useable” marijuana +
1 lb marijuana-infused product in solid form +
72 oz marijuana-infused product in liquid form +
7 g marijuana concentrate
• Consuming in view of general public prohibited
• DUI per se limit: 5 ng active THC / mL blood
• Effective Dec. 6, 2012
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Commercial Licensing
• Liquor Control Board licenses and regulates
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Producers
Processors
Retail stores (sell only marijuana, paraphernalia)
• Licenses limited to 3-month state residents
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Applies to all “members” of business entities
FBI criminal background checks for members and financiers
License application fee $250
Annual license fee $1,000
• Taxes
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25% excise tax on sales at each level
Earmarked for public health research and education
State budget has not assumed any revenue
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Federal Response
Department of Justice Memorandum to United
States Attorneys (Aug. 2013)
• Applies to all states.
• 8 priorities “will continue to guide the Department’s enforcement of
the CSA against marijuana-related conduct.”
• “If state enforcement efforts are not sufficiently robust to protect
against the harms, the federal government may seek to challenge
the regulatory structure itself in addition to continuing to bring
individual enforcement actions, including criminal prosecutions,
focused on those harms.”
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Federal Priorities
1. Preventing the distribution
of marijuana to minors
2. Preventing revenue from going to drug gangs
3. Preventing diversion of marijuana to other states
4. Preventing cover operations
for trafficking other drugs
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Federal Priorities
5. Preventing violence
and use of firearms
6. Preventing drugged driving and adverse health
effects
7. Preventing growing
on public lands
8. Preventing marijuana possession or use on federal
property
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Minors
• 1000’ buffer from schools
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No marijuana business locations
No advertising by licensees “in any form or through any
medium whatsoever” within 1000’
• No products, labeling, or advertising “especially
appealing to children”
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Preapproval for all edible products, labeling, and packaging
Child-resistant packaging
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Security
• Product tracking
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Clone-to-sale traceability
Every transaction entered in traceability system
• Facility security
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Alarm and video surveillance systems
8’ sight-obscuring fence for outdoor grows
• No firearms
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Enforcement
• Compliance with rules = safe harbor
• WSLCB limited authority enforcement officers
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Enforce WSLCB licensing rules
Refer unlicensed activity to local law enforcement
• No revenue earmarked for law enforcement
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Supply and Demand
• 30-day application window
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Over 7,000 applications received
• Producer/processor licenses
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Number of licenses not limited
One license per applicant; square footage limited
First producer/processor licenses issued March 5
109 as of mid July (over 5,000 pending)
• Retail licenses
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Stores allocated to cities/counties = 334 statewide
Lottery held to rank applicants for processing
First 24 retail store licenses issued July 7
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Local Jurisdictions
• Several cities/counties banned marijuana
businesses or imposed moratoriums
• Local authority
• I-502 does not preempt local jurisdictions from banning
marijuana businesses, per formal AG Opinion
• WSLCB will issue licenses without regard to local bans - I-502
does not authorize denials based on local law
• 2 lawsuits filed by licensees against cities with bans
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Public Health
• Quality assurance testing
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WSLCB accredited 3rd party testing labs
• THC extraction
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Professionally certified closed loop systems
• Food safety
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WSDA/FDA/USDA food rules inapplicable – adulterated
WSLCB rules for hazardous foods - may not be infused
• Edibles
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Limited to 10 mg THC per serving & 10 servings per product
Scoring and labeling to indicate servings
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Banking Challenges
• Deposits to banking system = money laundering
• Cash business = crime target
• USDOJ/FinCEN banking guidance (Feb. 2014)
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Authorizes filing special SARs
Requires bank due diligence - customer complying WSLCB rules
Banks waiting for guidance from federal regulators
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Medical Marijuana
• Unregulated
• Only sales tax (but illegal to sell)
• Possess 24X as much w/authorization
• No age limit
• Challenge for legislature
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Resources
• Initiative 502
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Codified at: Chapter 69.50 Revised Code of Washington
• Washington State Liquor Control Board
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Rules: Chapter 314-55 Washington Administrative Code
Website (Licenses, FAQs, Listserv): liq.wa.gov/marijuana
• Washington Attorney General’s Office
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Bruce Turcott, AAG: [email protected], (360) 586-2738
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