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David Postman Begins Board Chair Tenure
On March 2, 2021, the Liquor and Cannabis Board (LCB) announced that Gov. Jay Inslee had appointed David Postman as Chair of the LCB Board.
Prior to his appointment, Mr. Postman had served as Gov. Inslee’s chief of staff from Dec. 2015 until Nov. 15, 2020. He served in the Inslee Administration since the governor took office in 2013, first serving as his executive director of communications. Before joining the administration, Postman served as a senior director at Vulcan Inc., the company headed by Microsoft co-founder Paul Allen. Mr. Postman has a 26-year career as an award-winning journalist in Oregon, Alaska and Washington, including 14 years working as a political reporter for The Seattle Times.
"David has extensive experience bringing people together to work through complex and difficult issues," Gov. Jay Inslee said. "He is able to listen to divergent viewpoints and synthesize feedback to move toward resolution. He is committed to transparency and openness, and knows state government well. I know David will make an excellent addition to the LCB Board and I am so glad that he will continue to serve the people of Washington."
Mr. Postman succeeds former Board Chair Jane Rushford whose term expired in Feb. 2021.
“Jane served as the consummate professional. I thank her for her service to the Board, its employees and for her many contributions,” said Postman. “I am looking forward to carrying on efforts begun under her tenure, particularly the Board’s efforts to increase diversity and equity within the state’s regulated cannabis system.”
Mr. Postman began his six-year term March 15, 2021. He joins current Board Members Ollie Garrett and Russ Hauge.
Tier 1 Cannabis Producer Licensee Survey Report
Washington State law (RCW 69.50.345(3)) directed the LCB to adopt rules establishing the “maximum quantity of marijuana a marijuana producer may have on the premises of a licensed location at any time without violating Washington state law.” LCB adopted this directive in rule in October 2013 as WAC 314-55-075(6) by establishing a three-tier system based on the amount of actual square footage designated for as plant canopy. Within that system, the Tier 1 category authorizes a producer licensee to designate less than 2,000 square of their premises as plant canopy.
Requests for Increased Medical Cannabis Product
For the last few years, LCB has received requests from medical cannabis patients and segments of the industry to increase the availability of Department of Health (DOH) compliant product in licensed retail stores. The LCB also learned that Tier 1 licensees were concerned about business viability based on canopy space restrictions. Recognizing this, WSLCB opted to begin exploring how it could address the concerns of Tier 1 producers.
One of the initial ideas was to incentivize the production of DOH-compliant product. On December 18, 2019, the Board approved a Preproposal Statement of Inquiry (CR101) to open discussion about revisions and new rule sections would incrementally expand the plant canopy square footage allowed for licensed Tier 1 producers. This approach supported patient access to safe cannabis products in alignment with stated priorities of Second Substitute Senate Bill 5052 (2015 legislative session), and aligned with the goal of improving medically-compliant cannabis availability and identifying barriers to small business success described in LCB’s 2019 – 2024 Strategic Plan.
Although the LCB hoped to begin rule development after the first of the year, those efforts were delayed by the state response to COVID-19. Once the agency was able to do so, two virtual Listen and Learn sessions were held in June 2020. Although well attended, few Tier 1 licensees participated in the sessions.
2020 Survey of Tier 1 Licensees
To better understand the concerns of Tier 1 licensees, LCB surveyed them between August and October 2020. Results included, but were not limited to the following themes:
- Challenges in the ability to produce enough product to meet demand;
- Requests to expand canopy to allow Tier 1 licensees to be competitive in the current market; and
- Allow vertical integration or direct sales in some form.
Tier 1 Report Posted to the LCB Website
The full report titled, “Tier 1 Cannabis Producer Licensee Survey Report” can be viewed on the LCB website.
WSLCB sincerely thanks all participants. We appreciate and value your time and input, and look forward to working with you on this and other rule development projects.
Systems Modernization Project (SMP) Update
As you know, the agency has been working on the System Modernization Project (SMP) that will replace its aging online systems.
During the recent Discovery phase of the project, the project team analyzed all the features necessary for the replacement system and identified crucial components that would cost more than the project’s projected budget.
The current funding for the project budget, which includes on-hand funding, combined with the amount LCB requested during the current legislative session, is not enough to cover the costs of the additional features. Therefore, the project’s Steering Committee is examining all options for going forward. They expect to have a solid plan for next steps within the next 60 days, and will update you once a decision is made.
During Discovery the team made significant headway that will be carried to the next phase. They identified important data and defined many of the key requirements for the future system.
The agency knows its current systems are inefficient and can lead to extra work for you, other licensees and agency employees. By waiting until we have enough money to get the features that will improve our system’s shortcomings, we will better ensure a system that better your needs and the needs of LCB staff.
While this gap in funding is not what we’d planned or hoped for, it’s not uncommon in a project of this size. The agency and the project team are committed to developing an efficient and comprehensive solution to better meet your needs and modernize the agency’s aging systems.
The LCB's commitment to replacing the existing systems is solid and that the agency will continue pushing forward to get the additional funding necessary for the project’s completion.
You’ll be kept posted as changes happen.
Use of Federal Loans Prohibited for Cannabis Businesses
Recently, the Cannabis Licensing Team received requests from licensees to use funds from federal loans or loans guaranteed by the federal government to finance their cannabis businesses. This includes Paycheck Protection Loans, Economic Injury Disaster Loans, Federal Student Aid Educational Loans, Small Business Administration Loans, and all other loans from or guaranteed by the federal government.
The federal government is prohibited from loaning or guaranteeing loans to cannabis businesses. Washington Administrative Code (WAC) 314-55-050 (6) requires funds used for marijuana licenses to be obtained legally. Therefore, the Liquor and Cannabis Board must deny the use of funds obtained from a federal loan or from a loan guaranteed by the federal government.
If you invested federal funds or funds guaranteed by the federal government into your cannabis business, you need to return these funds using a funding source that meets federal requirements. All funds used to support your licensed cannabis business must be obtained legally and approved by the LCB.
Additional funding (personal funds from an approved owner on the license) may be used once the application is received, all other additional funding sources must be approved before use. Please submit an Application for Additional Funding to the LCB at PO Box 43098, Olympia WA 98504-3098.
The LCB understands there may have been confusion about the use of these types of funding. For more information about vetting financial sources, review WAC 314-55-035.
If you have questions, please contact the Cannabis Licensing Team at email@example.com.
Cannabis for Animal Use
Recently, LCB received a report about a pet experiencing a severe adverse reaction after ingesting a cannabis product. Please remember that manufacturing, marketing, or selling an infused edible product to the public for animal use is prohibited under RCW 69.50.101. “Marijuana-infused product” means products that contain cannabis, or cannabis extracts, which are intended for human use.
Authorized Representative Form and the
Role of the Authorized Representative
An authorized representative is a point of contact identified by the licensee and/or applicant to assist with the application process. These representatives are not on the license, but may speak on the licensee’s behalf in matters concerning the application process, such as finances involved, business/real property purchases, leases, etc. Authorized representatives do not have the authority to sign documents on behalf of the applicant.
Licensees or applicants must submit the Authorized Representative form to the LCB before the agency can work directly with the authorized representative. The authorized representative approval is only valid while the application is open. Each new change request requires a new form be submitted. This protects applicants from unauthorized people attempting to make changes to their business. Please request the form from your assigned Licensing Specialist. The completed form will be placed in your file.
Some examples why applicants choose to use an authorized representative include:
- Availability of the applicant to respond to questions from their Licensing Specialist.
- Using a subject matter expert on the change process to help with forms and documentation.
- Help with language barriers. You may choose to use an authorized representative for language barriers, but you don’t have to. The LCB is committed to serving diverse populations. We have access to a language line to better serve our customers in their preferred language. Licensing also has Korean and Spanish speaking staff available to help with the application process. Please let your Licensing Specialist know if you would like to use these services.
Message from the LCB Cannabis Manager
Happy spring 2021 everyone. The Cannabis Licensing Unit is working to make sure applications are being processed timely, the customer service is of the highest quality, and that we are educating everyone throughout the process. We are always looking to find ways to improve our service and to hear from you how we are doing with that effort.
Over the past year, the Cannabis Licensing Unit has made significant changes to our initial interview process. We are reviewing the impact of these changes and would like your feedback.
Some changes we made to the initial interview are:
- Ensuring plain talk is used in the interview questions;
- Restructuring the order of questions to ensure they are being asked in the most efficient manner;
- Creating a version of the initial interview that could be sent electronically to the applicant to prepare for the phone interview or to complete in lieu of the phone interview;
- Creating an initial interview for each change application type to make sure the questions are relevant to the change application.
We want to hear from you about your experiences with the initial interview. If you have any questions, concerns, suggestions, and/or kudos about the initial interview that you would like to bring to my attention, please reach out to me directly.
Kevin Milovac – Cannabis Licensing Manager
Email - firstname.lastname@example.org,
Work Cell Phone - 360-338-2881
Making Changes to
Your Business: LCB Change Request
Any changes to your currently licensed premises, a registered cooperative, operating plan, and/or investing additional funding, etc., must be approved by Licensing before you make the changes. You can find the following change request applications on our website at LCB change request:
- Additional Funding (personal funds from an approved owner on the license may be used one the application is received, all other additional funding sources must be approved before use)
- Added Medical Cannabis Endorsement
- Cooperatives Change Authorization
- Expanding plant canopy to maximum allotted
- Request to Alter Cannabis Site and/or Operating Plan
- Splitting a Producer and Processor License
Making Changes to Your Business: BLS Change Request
Some change requests must be filed with Business Licensing Services (BLS). However, they require LCB approval. Access the applications for these changes on the LCB’s website at BLS change request:
- Change in Governing People, Percentage Owned and/or Stock/Unit Ownership
- Change of Location
If you need assistance or have questions please contact LCB Customer Service at 360-664-1600 or email@example.com
Director Rick Garza Remarks on the "Future of Cannabis" in Washington
On Wednesday March 25, 2021, LCB Director Rick Garza addressed the House Commerce and Gaming Committee in advance of a work session on the “Future of Cannabis in Washington.”
He updated the committee with first-hand insights into discussions between the national Cannabis Regulators Association (CANNRA) made up of state regulators with federal regulators and major Canadian industry members. Garza serves as First Vice President of CANNRA.
Director Garza’s remarks begin at approximately the 01.40 mark.
Carefully Consider your Cannabis Canopy
Spring has arrived and the 2021 outdoor growing season is upon us. As you are putting away the snow shovels it is also a good time to prepare for how much cannabis canopy you plan to produce.
As a reminder, regardless of whether your grow is indoor, outdoor or a combination of both, all producers have a maximum canopy allowance per WAC 314-55-075. The three marijuana production tier maximum canopy limits are:
- Tier 1 – Less than 2,000 square feet;
- Tier 2 – 2,000 square feet up to 10,000 square feet; and
- Tier 3 – 10,000 square feet up to 30,000 square feet.
How is Canopy Defined?
Per WAC 314-55-010 - "Plant canopy" means the square footage dedicated to live plant production, such as maintaining mother plants, propagating plants from seed to plant tissue, clones, vegetative or flowering area. Plant canopy does not include areas such as space used for the storage of fertilizers, pesticides, or other products, quarantine, office space, etc.
Plan for Harvest as You Start Planting Now
While developing your growing plan for this year, be sure to plan for the amount of square footage your plants will occupy when they are fully mature and ready for harvest otherwise you may be growing in excess of your allotted/approved canopy.
If you submitted an operating plan that is less than your tier’s maximum canopy and you want to grow the maximum amount for your tier you can send an e-mail to firstname.lastname@example.org. More details on this process are available at the Cannabis Licensing section of the LCB website.
What happens if I Exceed My Canopy?
Licensees operating outside of their operating plan is a violation of rule and may be subject to enforcement action, which may include destruction of plants in excess of their maximum approved canopy. Dedicated growing space cannot exceed the maximum square footage for each tier and canopy space must be clearly indicated on approved floor plans with measurements or a reference scale.
Now is a Great Time to Ask Questions
If you are still unsure about how plant canopy limitations may affect your operation, please reach out to the assigned compliance consultant for your area.
Things to Know Before 4-20 Activities
As 4-20-21 is rapidly approaching, we wanted to send you a risk management reminder of activities we have seen in the past that violate state law. These activities could lead to violations before or during your 420 events:
Some things to avoid:
- Any outdoor signs related to your 420 event that are visible outside of the “adult only” enclosed area
- Any advertising which might be
especially appealing to minors Employing or using mascots, costumed
characters, or sign spinners outside of your premises
- Having any giveaways –
including free food or beverages
- Selling unauthorized
merchandise other than what is allowed by law
- Using coupons or
“bring-this-to-get-that” type promotions
- Providing alcohol to customers
- Allowing consumption of
cannabis in the licensed premises or parking lot, sidewalk, etc;
- Hosting or promoting “smoke
friendly” events. The opening or consumption of cannabis is only allowed
in private areas, outside of public view. If your event is advertised, or
charges a fee to attend, or is held in a public place, it is likely not a
The LCB’s mission is to protect public safety. You can help us to help you be successful by avoiding violations which could lead to fines or suspension of your retail cannabis license. If you have any questions about cannabis rules, or want to run ideas for advertising or promotions by us, please do not hesitate to call your local Enforcement Officer before you take action.