Senate Bill 5052, which is known as the Cannabis Patient Protection Act, is awaiting signature by Governor Inslee. It is unlikely that the bill will be vetoed and instead we can expect the new legislation to become law.
Key to the new legislation is the phasing out of collective gardens by July 1, 2016, at which time qualified patients will only be able to participate in medical marijuana cooperatives. The cooperatives will be limited to four patients and a maximum of 60 plants. This should lead to the shutting down of the numerous medical dispensaries purporting to operate as collective gardens throughout the state.
Medical Marijuana will be available for sale to qualified patients at I502 retail stores that obtain a medical marijuana endorsement. The state will have to issue new retail licenses to serve the medical marijuana market.
The Liquor Control Board, which is renamed the Liquor and Cannabis Board (the “Board”), is tasked with developing a merit-based application process for new licensees. Priority will be given to the following applicants:
- those who applied for a marijuana retail license prior to July 1, 2014;
- those who operated or were employed by a collective garden before
January 1, 2013;
- those who have maintained state and local business licenses; and
- those who have a history of paying state taxes
Similarly, marijuana production will need to be increased to provide medical marijuana to I502 retailers with medical marijuana endorsements. Marijuana producers will be required to apply to grow medical marijuana for sale at I502 stores. To meet the increased production need the Board is to do the following:
- increase the limits on the amount of square feet of marijuana production allowed statewide; and
- if current marijuana producers do not use all of the increased production space then the license period must be reopened for new applicants
- priority in licensing would be given to marijuana producer applicants that have pending license applications
Another bill is currently pending in the Senate, which separately addresses changes to the recreational marijuana industry. Among its numerous provisions, this bill calls for eliminating the current three tiered tax structure in favor of a single tax of 30% levied at the retail level. The bill would also divert a portion of tax revenues to cities and counties that do not prohibit marijuana businesses within their jurisdiction.
Stay tuned for more information on legislation affecting recreational and medical marijuana as well as expansion of the I502 marijuana licensing system.
For more information on the regulation of marijuana businesses in Washington State, please contact Heather Wolf.