Seattle Changes Its Tune (Again) About Medical Cannabis

Washington and Medical MarijuanaSeattle has been on a roller-coaster ride with medical cannabis since summer 2010. We’ve blogged before about how the Emerald City, which once embraced collective garden access points (a/k/a medical marijuana dispensaries), has gone somewhat sour on them in recent months due to a general lack of state regulation. At one point, Seattle even threatened to shut down all collective garden access points that did not also have a license to operate under I-502 from the Washington State Liquor and Cannabis Board (LCB).

Once again, the tide has changed in Seattle when it comes to MMJ.

This time, on the heels of the passage of SB 5052, Seattle Mayor Murray is proposing to significantly adjust cannabis regulations within city limits to mandate that all cannabis operators have marijuana-specific, city-issued business licenses “akin to those required for taxi operators and pawn shops” by July 2016 or face shutdown if they don’t. And, from what we can glean from the proposed municipal regulations, most collective garden access points will not make the cut unless they were in operation before January 1, 2013:

Seattle officials say that by their tally, 54 of the city’s 99 medical marijuana storefronts opened after that date or have been operating without a city business license. Murray’s office says those businesses won’t be getting the special license and need to shut down. The rest will be allowed to remain open long enough to see if they wind up being permitted by the state.

Aside from shuttering more than half of the city’s operating MMJ dispensaries by summer 2016, what else does new city law propose to do?

  1. It creates a Title 6 regulatory license for marijuana operators that will be limited to those business entities that have been granted an operational license from the LCB.
  2. The Seattle Department of Finance and Administrative Services will oversee issuance of these licenses.
  3. LCB rules for marijuana businesses will be incorporated through rulemaking by the Director of Finance and Administration. Important to note, other than what’s set forth in SB 5052, the LCB hasn’t created any MMJ-based rules yet, but it certainly will this year.
  4. The city will provide an exemption from acquiring regulatory business licenses to non-state licensed medical marijuana businesses in compliance with Medical Use of Marijuana Act and city enforcement guidelines, and it will only be extended to those MMJ businesses that acquired city business licenses and began operations prior to January 1, 2013.
  5. Exempted MMJ businesses must apply for and obtain a license from the LCB by July 1, 2016. If they fail to do so, they will be required by the city to close down.
  6. The city will stop issuing businesses licenses to medical cannabis businesses and will have the power to revoke the existing business licenses of any operating MMJ business that does not meet the new city regulations or exemptions, either now or by the given deadlines.
  7. All businesses, including the existing ones, licensed to produce, process or sell marijuana by the LCB are required to obtain the proposed Title 6 marijuana regulatory business license.
  8. The new regulations leave enforcement up to city agencies other than the police department. Specifically, the city claims that “[l]egal action that might arise from enforcement actions [against existing MMJ businesses] will be primarily due to business license and building permit violations and not drug-related offenses.”

Right now, these regulations are just in the proposal phase, though the Mayor’s office strongly believes that the Seattle City Council will adopt them, and we predict that as well.

In the wake of SB 5052 and with the pending passage of the new Seattle marijuana laws, our phones have been ringing off the hook with questions regarding the future of medical marijuana in Washington State and how adult use and current and future MMJ business will be impacted by all that has been happening. To better answer these mounting questions for everyone and to address other recent Washington State enforcement, regulatory, business concerns, our cannabis lawyers along with key representatives from the Washington State Liquor Control Board will be speaking at a legal business seminar, “Preparing Your Business for the Future of Medical Marijuana in Washington,” on June 22nd at the Washington State Convention Center. Early Bird tickets at reduced pricing are on sale now until June 14th, and tickets can be purchased here.

If you’re a stakeholder in either the medical or adult use marijuana industries in Washington or if you’re interested in or concerned about obtaining a license from the LCB in the future, we urge you to attend our seminar on the future of MMJ and recreational cannabis in the Evergreen State.