Ten years ago, Washington voters created the first legal adult-use cannabis industry in the country. That industry drives billions in revenue to the state and provides 18,360 jobs statewide. But as we look at the last decade in preparation for the next, we are concerned Washington is losing its head-start advantage. It’s time to course correct, and we count on all industry stakeholders to work toward a common goal: a safe, equitable, quality-controlled and fully regulated market for cannabis.
Too many license-holders have been cut off early — some well before they even got started — and the agency holding the axe is the Washington State Liquor and Cannabis Board (LCB).
In 2012, the world changed almost overnight for the LCB. Although it was formed in 1934 as the state’s sole distributor of liquor, the LCB was confronted with an entirely new regulatory scope — liquor would be sold by the private sector, and the LCB had to develop state regulations for a federally illegal industry. In doing so, the state failed to account for the impacts of the War on Drugs on people of color, too many of whom were left out of opportunities created by legalization. This included when the LCB’s jurisdiction expanded beyond adult-use products and began regulating the state’s thriving medical cannabis industry. While not all of it was positive, the legalization of cannabis undoubtedly caused a tidal wave of change in the LCB.
Cannabis businesses endure unique hurdles, and too often that barrier is inconsistency and hostility at the LCB, which views itself more as a police department than a regulatory agency. Lawmakers have agreed. In 2019, the state legislature adopted a bipartisan package of reforms (SB 5318) to rein in the unnecessarily harsh punishment the LCB inflicted on cannabis businesses. An independent LCB-commissioned report confirmed eighteen recommendations on reforming the LCB. Unfortunately, many of the problems that led to the legislature’s reform of the LCB have not been cured.
A culture of bias within the agency has persisted. The Cornell Journal of Law and Public Policy, a prestigious national journal on law and public policy issues, is publishing a 65-page article in its upcoming edition titled The Turbulent History of Cannabis Regulatory Enforcement in Washington State. Authored by seven local cannabis experts, the article documents how “the LCB’s frequently hostile enforcement culture—including arguing to courts that cannabis licensees have no constitutional rights—has repeatedly converted de minimis regulatory violations into business-ending events.” It is disturbing that the LCB has argued that the entire essential industry it regulates has no constitutional rights whatsoever, and even more disturbing that it took this position after it was supposedly reformed.
Depending on who’s asked, cannabis could look like a joint, gel for a sore knee or a mug of tea. The cannabis plant, including hemp, is bred and grown for a myriad of purposes, and continues to reveal new compounds to scientists. Its social, medical and spiritual purposes are ancient and well-documented. The global cannabis market is projected to grow from $28 billion in 2021 to $197 billion in 2028. Such a dynamic industry deserves a better regulator.
The LCB is overseen by a three-member appointed board. With one member retiring, and another unconfirmed, it’s an ideal time to update the Board’s structure, which has been unchanged since 1934. The catalyst for this proposal is laid out in Senate Bill 5671. Importantly, this bill will not modify the Board’s power but will add members to strengthen its ability to understand the changing kaleidoscope of the global cannabis industry and the implications for license-holders, local communities and the state economy.
We welcome ideas on reshaping the LCB so that Washington’s cannabis industry can again be the best in the nation. The legislature’s priorities may not include agency modernization this year. But we wait at our peril.
Washington is already behind other states, and the global market is on our heels. SB 5671 is worthy of consideration as the legislature continues ten years of accomplishments toward a safe, equitable, quality-controlled and legal cannabis marketplace. As we look ahead, the next ten years should include expanded expertise in leadership roles at the LCB that must treat license-holders fairly while tackling social equity, innovation in the science of cannabis and competition in the marketplace.
Vicki Christophersen serves as the executive director of the Washington CannaBusiness Association, the industry organization in Washington representing licensed producers, processors, retailers and transporters in the regulated cannabis industry in our state.
Andy Murphy is an attorney at Miller Nash whose practice focuses on cannabis industry litigation and is a co-author of the forthcoming “The Turbulent History of Cannabis Regulatory Enforcement in Washington State” in the Cornell Journal of Law and Public Policy.