Seattle Mayor Proposes New Licenses for Marijuana Businesses

The somber tone lingering inside my local dispensary serves as a silent reminder; the major regulatory changes looming over Washington’s medical marijuana industry will go into effect in just over a year, and some major changes are already taking place. In addition to outlawing on-site cannabis consumption and the sales of medicine to current patients under 21, a provision banning the manufacturing of butane honey oil (BHO) and marijuana concentrates begins in less than two months, making it so only processors specially licensed by the Liquor and Cannabis Board (LCB) may produce extracts.

Seattle Mayor Ed Murray joined by Greta Carter, Maryam Mirnateghi, Jeremy Kaufman, Alex Cooley, and Daniela Bernhard. Source

Earlier this week, Seattle Mayor Ed Murray proposed legislation which would create a new Marijuana Regulatory Business License, similar to the ones used to regulate other local industries like taxicabs and tobacco retailers. The new license will give the city more power over the regulation of its medical marijuana dispensaries. “We’re strengthening the recreational marijuana market and creating safer, more consistent access for those those who rely on medicinal products,” said Mayor Murray. A spokesperson for the Mayor, Viet Shelton, added that they view the proposal as a way to “support a pathway for many other good actors in the industry to become legal in the long term.”

Until the LCB issues licenses for these medical marijuana businesses, the city of Seattle will allow the dispensaries in good standing to continue to operate until July 2016. A communication from the Mayor’s office clarifies that the medical marijuana dispensaries, cultivators, and producers which obtained their Title 5 city business license and established their operations before 1/1/13 would be able to continue operating without the proposed regulatory license (until SB 5052 goes into effect in July 2016), though all medical cannabis businesses established after 2012 will need to obtain one.

Councilman Nick Lacata, City Attorney Pete Holmes, and Mayor Ed Murray. Photo by Jason Chase.

With regards to the medical marijuana companies that began doing business in 2013 or later, enforcement priorities have been split into 3 tiers, with Tier 1 being the highest priority. Tier 1 violations include the distribution of marijuana products to anyone under the age of 21 [who is not a qualified patient], operating without a businesses license or one obtained after Jan 1, 2013, and distributing products that mimic trademark protected products or ones that “appeal to children” (that phrase consistently bothers me, not only because it naively implies that grown adults don’t like gummy bears or peanut butter cups, but because it insinuates that grown adults are not responsible enough to keep their medicine away from children). The second tier of enforcement would be those businesses in violation of building/ fire codes, offering medical marijuana delivery services, or allowing on-site consumption. Tier 3 applies to companies that do not lab test their products or are within 1,000 of a school or playground.

Jeremy Kaufman of Coalition for Cannabis Standards and Ethics. Photo by Jason Chase.

Under this proposed legislation, businesses violating any of the aforementioned enforcement priorities are subject to fines or legal action if they don’t close their doors. “Any sort of criminal action is our last resort,” said David Mendoza, the mayor’s policy adviser on marijuana, “only if our civil remedies fail to close a noncompliant business.” Adding to the sentiment, City Attorney Pete Holmes hopes and believes that “civil regulatory enforcement will be most effective in bringing all Seattle marijuana producers, processors, and retailers into I-502’s system by July 2016, and in most cases well before then.”

Though patients & medical marijuana business owners hold reservations, some are more accepting of the proposed change than others. A chair for the Coalition for Cannabis Standards and Ethics (CCSE), dispensary owner Jeremy Kaufman has “a hard time being sympathetic” towards medical cannabis dispensaries which opened after January 1, 2013, dismissing them as “the profiteers.” To his point, the first I502 provision regarding the legal possession of marijuana went into effect on December 9, 2012.

If the city legislation is approved, regulatory licenses for Seattle medical marijuana businesses—including ones for state-approved cannabis businesses—would cost about $1,000. Producers & processors in other parts of Washington that wish to sell their products in Seattle would also have to obtain a regulatory license for $500.