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Can Marijuana Be Returned to the Retail Store?

WSLCB's Enforcement Division has recently received calls asking about customers' ability to return marijuana products to the retail store in which they are purchased.  The current regulation, WAC 314-55-079, allows for a marijuana retailer to accept returns of open marijuana products.
Returns
Products must be returned in their original packaging with the lot, batch, or inventory ID number fully legible in order for a customer to return the product to the retailer.
If a retailer accepts product from a customer, this is not an item that can be returned back to the processor for a refund.  This is a business decision on the retailer for customer service reasons.    
If you have questions on this topic, please contact your local Enforcement Office.

WSLCB Welcomes New Cannabis Manager

We are excited to welcome Kevin Milovac to the Licensing Management Team at the WSLCB. Kevin joined the Licensing Team as the new Cannabis Manager on May 1.
Kevin comes to the Liquor and Cannabis Board with over 13 years of state experience at the Department of Corrections and the Department of Social and Health Services. He is dedicated to issues of diversity, wellness, public safety, and customer service. 
Kevin

Intellectual Property Contract Reviews

Did you know Washington's marijuana licensees must disclose agreements and contracts related to intellectual property to us? RCW 69.50.395 requires this. Although the RCW requires licensees to submit these contracts, it doesn't require the WSLCB to approve them. However, we will review them for compliance with marijuana laws and regulations. 
The law states that all contracts must be final prior to submission; we will not review drafts, and that WSLCB staff can't provide legal advice or draft contract language for licensees. 
Steps to review these contracts:
  1. Licensee (or representative) sends completed contract to LicensingContracts@lcb.wa.gov.   
  2. Licensing staff will review the contract.  
  3. If there are questions about the contract language, Licensing will contact the licensee for clarity.
  4. If there continues to be questions about whether the contract is compliant with marijuana laws or rules, Licensing and Enforcement will engage in consensus building. (Some examples of issues that may initiate consensus building include a. True party of interest concerns under WAC 314-55-035, b. Terms inconsistent with RCW 69.50.395, and c. Concerns about prohibited practices identified in WAC 314-55-018.)
  5. If the WSLCB staff do not identify any compliance issues, Licensing staff will send an email to the licensee and their Enforcement Officer to notify them that upon review, the contract does not appear to violate any licensing rules.   
  6. If WSLCB staff do identify areas of concern, Licensing staff will contact the licensee to identify those areas of concern for further discussion. 
  7. Contracts submitted to Licensing that do not address the topics identified in RCW 69.50.395 will be added to the licensee’s licensing file without review. In those cases, Licensing staff will contact the licensee to notify them that the contract does not meet the requirements for disclosure.
WAC 314-55-087 requires marijuana licensees to keep records of all other contracts (e.g. updated leases, processor-to-processor agreements, employees’ contracts, etc.) for a period of five years. Disclosure of those agreements is not required before they are implemented. We may ask to see copies of these contracts or agreements at any time.

Tribal Compacts Law Review

A Law that was passed during the 2015 legislative session authorizes the Governor to enter into agreements with federally recognized Indian tribes concerning marijuana. These formal agreements, referred to as compacts, are needed so that Washington state licensees can legally purchase from and sell marijuana to Indian tribes. As allowed under the law, the Governor has delegated the authority to negotiate these agreements to the WSLCB and requires the agency to consult, when necessary, with the Department of Revenue and the Governor’s Office.
The state has successfully negotiated compacts with 11 Washington tribes and is currently in the process of negotiating several more.
For more information about these marijuana compacts, please visit our Tribal Resources web page.

Ownership Changes

Did you know licensees must receive prior Board approval before making any changes to a licensed marijuana business ownership?  All entity members must agree before the WSLCB will approve changes in ownership. Written agreements must be signed by the parties involved. You can find more information about ownership changes for marijuana businesses in WAC 314-55-120
What application do I file for a change in ownership? 
Licensing regularly gets questions about which application to file when you want to make a change to your business ownership. 
Ownership changes
There are two applications, depending on whether you are changing your existing entity structure, or if you are requesting to change the entity responsible for the license. 
Change in Governing People ($75 fee) is applicable if:
  • Your UBI  will stay the same
  • You are adding or removing members to the existing entity
Note: New people added will inherit all liabilities, assets and infractions of the entity.
Assumption ($250 fee) is applicable if:
  • UBI changes to the new business
  • New and/or existing members are allowed to file if creating a new business
Note: The LCB will collect the $250 application fee and new licensing fees before approving the license.
Insurance requirements
If you apply to move your location or make a change your licensed entity, Licensing will ask you for an updated insurance certificate before approving the change.  When you renew your insurance, be sure you keep an updated copy at your licensed location.  You do not need to send the WSLCB a copy, unless we request one. The most common reasons we request an updated copy of insurance include:
  • Changes to the name of the licensed entity (the insurance must reflect the name of the entity on the license)
  • Location Changes
Your insurance must include product liability and name the WLSCB, its agents and volunteers, in the additionally insured section. Most of the questions we receive about insurance have to do with the product liability requirement. WAC 314-55-082(b) requires that licensed marijuana businesses carry insurance that covers the licensee’s premises/operations, products, and personal injury.   

What Retailers Can Learn from the Healthy Youth Survey

Every two years, the Washington State agencies conduct the Healthy Youth Survey (HYS), a school-based survey across sixth, eighth, tenth and twelfth grade students, to understand health and behavioral choices and realities that are affecting students’ lives.
Healthy Youth Survey
These data sets are used to monitor the well-being of youth in Washington, to plan prevention and intervention services throughout communities statewide, to evaluate the effects of programs and policies and to conduct academic research. 
In short, these survey results act as a barometer for the status of health of Washington youth.  The survey is a vetted extensively by school districts, public health officials, community members and even WSLCB.  A portion of revenue from legal marijuana sales is dedicated to support HYS data collection ($500k annually since FY2016).
Results from the 2018 HYS were released this spring. Of most interest to the Liquor and Cannabis Board are the questions that ask about alcohol, marijuana, alcohol, tobacco and vapor and usage. Here are a few highlights:
  • Current marijuana use amongst all age levels has remained relatively steady. In 2018, 7% of 8th graders, 18% of 10th graders, and 26% of 12th graders reported using marijuana recreationally in the past month. Over a third of those who used marijuana in the past month indicated they used on six or more days.
  • Of the students who said they had obtained marijuana in the past month, only 6-9% of those students (8th, 10th, 12th grades) reported buying marijuana from a store. Six percent of those 8th graders said their marijuana was stolen from a store.
  • The percentage of WA state kids who think that it would be easy to get marijuana increases as they older, from 7% in 6th grade to 61% in 12th grade.
Retailers: thank you for your diligence at checking identification and other best practices that prevent minors from purchasing marijuana!
Interested in seeing the rest of the Healthy Youth Survey data? Take a look at the full results at AskHYS.net.

Update on the Leaf Traceability System

Earlier this month, we decided that additional time was needed to test the data conversion associated with this release.
Out of an abundance of caution, WSLCB (LCB) postponed the implementation of Leaf Data Systems Software Release 1.37.5, previously scheduled for June 6.
Since that time, data validation and several mock deployments have been completed by the project team. The release is currently ready to implement. However, in recent conversations with some licensees and third-party commercial integrators, the message we are hearing is that they need more time to prepare.
To provide additional time, but ensure the project continues to keep with schedule, the new date for “go live” will be July 15, 2019. Leaf Data Systems will not be available for approximately 30 hours prior to the release in order to migrate and validate the data. To ensure this has the least possible impact on our market, the outage will begin at 11:00 p.m. on Saturday, July 13th and run through 8:00 a.m. on Monday, July 15th. The outage period was developed through feedback with licensees and integrators that confirmed this was the lowest transaction period for producers and processors. Retail licensees can continue to operate during the outage since the point-of-sale systems can cache data until the system is restored on Monday.
Software Release 1.37.5 code remains frozen with no changes planned before the “go live” date. We will follow up with you as we get closer to provide exact hours and details.
Lastly, we are regularly reaching out to integrators to gauge their readiness and to determine if they need anything else from us to be ready.  
Software Release 1.40.0
During this period, we will continue to move forward with preparations for Software Release 1.40.0. That release is scheduled to “go live” Sept. 20, 2019.
Training
As always, the LCB traceability section of the LCB website is your source for training materials and videos specific to software releases. The website contains instructions for accessing the Leaf training environment.

2019 Legislative Fact Sheets Available Now

We've recently posted fact sheets for legislation pertaining to alcohol and cannabis that passed this session.
These brief documents and contact information and can be found on the WSLCB website

Save the Date: Listen + Learn 

WSLCB will host a second Listen and Learn forum to gather information and ideas on mitigation and phase in strategies for Quality Assurance Testing and Product Requirements (QA) draft conceptual rules.
We are interested in hearing your innovative ideas and solutions regarding reducing, or mitigating licensee impact if all marijuana produced and processed in Washington State were tested for pesticides and heavy metals. This forum is an opportunity for all licensees, industry partners, or any interested party to contribute to the conversation. 
Listen and Learn Forum on June 25
The agenda is located here: http://bit.ly/MJQuality. You can participate in person at WSLCB headquarters or online via Webinar
April Session
Did you attend the first session on April 9? You can find the comments we gathered on our rules page here: April Session. Find an agenda from April's forum to give you an idea of the session's contents here: Agenda
Feedback Process
Information will be gathered in person and in writing. This is an exploratory, facilitated conversation that will inform WSLCB on possible future action. The information gathered is considered public comment and may be shared in documentation that captures the feedback received in person and in writing. 
These meetings are intended to provide a forum for input to WSLCB staff for future consideration. They are not designed to discuss other topics or issues other than what is outlined in this notice. The length of time for each participant will be moderated to ensure that all who express an interest in providing in-person feedback have an opportunity to do so.
Please send written comments to rules@lcb.wa.gov. 

Warnings Required on Text Message Advertising 

The WSLCB recently issued an enforcement bulletin to licensees about text message advertising. 
Advertising in this medium is required to follow the advertising warning requirements like any other general marijuana advertisement. WAC 314-55-155(6) states that except for outdoor advertising, all advertising must contain the following warnings:
(a) "This product has intoxicating effects and may be habit forming.";
Texting
(b) "Marijuana can impair concentration, coordination, and judgment. Do not operate a vehicle or machinery under the influence of this drug.";
(c) "There may be health risks associated with consumption of this product."; and
(d) "For use only by adults twenty-one and older. Keep out of the reach of children."
Warnings alone may not be attached via a link, or any other method that would require the recipient or receiver of the text advertisement to perform an action to access the warnings separate from the text message.
An example of what would be allowed would be a trade name or non-advertising language, accompanied by a link within the text that takes individuals to the advertisement which contains the required warnings. If any part of the text message itself can be considered advertising, however, it will need to contain all required warnings.
Please take a moment to assess your current text advertisement warning practices and correct, if appropriate. If you have questions about these requirements, please contact your area LCB enforcement officer.

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WSLCB Mission: 

Promote public safety and trust through fair administration and enforcement of liquor, cannabis, tobacco, and vapor laws.