Groups seek to influence new rules for growing, selling pot

Groups seek to influence new rules for growing, selling pot
Lawyers, businessmen and farmers have formed new groups to lobby the Washington State Liquor Control Board as it writes rules for the world's first social-use marijuana-grower license.
Originally published Sunday, January 6, 2013 at 8:03 PM

Teams of lobbyists, lawyers, farmers and businessmen are lining up to make their case as the state begins to write the rules for growing and selling marijuana in a new legal and lucrative market.

The state Liquor Control Board (LCB), charged with launching the world's first regulated marijuana market for social use, expects to begin accepting applications for grower licenses April 17, with the first licenses to be issued in May.

State-licensed marijuana stores won't open until at least December, after marijuana-processor and retail licenses are issued. But several groups already have hired veteran lobbyists to influence the LCB, with business interests keenly aware of the potential.

"The investment potential is huge," said Chris Kealy, owner of the Iron Horse Casino in Auburn who recently joined the board of the Washington Cannabis Association, a marijuana-industry trade group. "I had guys coming at me with lots of dollars, as long as there's good rules."

The biggest question for now is how - and how many - grower licenses will be issued. A state fiscal analysis suggested 100 state-licensed growers would produce 187,000 pounds a year, a volume that would require warehouse-sized grows of several thousand plants.

Having fewer, larger grows could lower costs - but also invite federal attention.

It would also stifle the innovation of the existing fleet of marijuana growers, said Phil Wayt, past president of the state beer and wine wholesalers association and now the head of the Northwest Producers and Processors Association, a newly formed alliance of growers.

"There should not be a cap on licenses," said Wayt. "We are suggesting a model that will be like the system that worked well for craft brewing and the wine industry in Washington. It's allowed small business to foster and grow."

The marijuana law, approved by voters in November, does not specify whether the grow farms must be indoors, or if farmland could be plowed over with marijuana seeds. The only requirement is marijuana be grown in-state, in a secure location at least 1,000 feet from a school, park, transit center or child-care facility.

Seattle attorney Hilary Bricken said her new association, Cannabis Business Group, has six wealthy founding members and has hired a pair of lobbyists. Among the group's goals, she said, are to discourage the LCB from putting residency or investment restrictions on marijuana operations.
"We don't want it to be small time. We want it to be huge, because my clients want to be huge," said Bricken.

The agency is also figuring out what types of convictions will disqualify license applicants. Among the issues is whether a conviction for a marijuana-related crime should be a disqualifier.

The LCB is taking public comments on the grower license through Feb. 10, and has been inundated with emails from farmers, medical-marijuana patients and a self-described minister from The Order of the Starleafed Tree.

The agency plans to put out a bid for a marijuana-industry expert next week who would determine the scope of the state's appetite for marijuana. "We want to verify the consumption levels, and build up from there," said spokesman Brian Smith.

No decisions have been made on the number of grower licenses or how large the farms could be, Smith said. "What you don't want is to have oversaturation of the market, which exceeds consumption," said Smith. "Where would that product go?"

Kealy suggested the LCB was "already way behind" on the complicated task and should consider starting a pilot project for the grower license, then phase in a full licensing scheme.

The Legislature may be weighing changes to the medical-marijuana law. Medical-marijuana advocate Greta Carter, of Seattle, said her group, the Coalition for Cannabis Standards & Ethics, is pushing for new laws to protect patients from arrest and to explicitly allow medical-marijuana dispensaries.

State Sen. Jeanne Kohl-Welles, D-Seattle, said she is likely to propose a medical-marijuana bill, so long as it would be "amenable" to new leadership in the Senate, where a coup by fiscally conservative Democrats and Republicans upended Democrats' control.

Jonathan Martin: 206-464-2605 or jmartin@seattletimes.com. On Twitter @jmartin206.