Pubdate: Wed, 27 May 2015
Source: Seattle Times (WA)
Copyright: 2015 The Seattle Times Company
Contact:  http://seattletimes.nwsource.com/
Details: http://www.mapinc.org/media/409
Author: Evan Bush

MAYOR'S PLAN WOULD GIVE SEATTLE POWER TO REGULATE POT DISPENSARIES

As State Combines Medical, Recreational Systems

License Limits Could Shut More Than 50 Medical Operations

Mayor Ed Murray on Tuesday proposed legislation that could shut down 
more than 50 medical-marijuana dispensaries and give the city a 
tighter grip on the rest of Seattle's pot industry.

The plan would create a new business license specific to the 
marijuana industry and create priorities for enforcement against 
medical-marijuana businesses.

The mayor's plan follows state lawmakers' effort to fold medical 
marijuana into the state's recreational system. The new state law, 
approved last month, calls for the Liquor Control Board (which will 
be renamed the Liquor and Cannabis Board) to assess the merit of 
medical-marijuana businesses and license those that qualify by July 2016.

The LCB is still developing the rules for grading the 
medical-marijuana businesses, so it's not clear yet how many 
additional licenses Seattle will get or which businesses are 
positioned to receive those licenses.

The mayor's proposal addresses the transition of medical-marijuana 
businesses to the state's system between now and next July. During 
the interim period, medical-marijuana dispensaries in good standing 
with the city would be allowed to continue operating until the LCB 
issues state licenses.

"What we're proposing here is a responsible way to strengthen the 
legal market and support a pathway for many other good actors in the 
industry to become legal in the long term," said Viet Shelton, a 
spokesman for the mayor.

If the city legislation is approved, Seattle's Finance and 
Administrative Services department (FAS) could revoke some 
dispensaries' business licenses. Those businesses would be subject to 
fines and legal action if they don't shut down.

"Any sort of criminal action is our last resort - only if our civil 
remedies fail to close a noncompliant business," said David Mendoza, 
the mayor's policy adviser on marijuana.

The city would prioritize enforcement against businesses selling pot 
to underage buyers or people who don't qualify as medical-marijuana 
patients, dispensaries being investigated by law enforcement, those 
manufacturing edibles that knock off mainstream brands or appeal to 
kids, and dispensaries that did not receive a standard city business 
license before Jan. 1, 2013.

The city estimates about 45 of the estimated 99 medical-marijuana 
storefronts received business licenses before 2013.

"Establishments open before Jan. 1, 2013 - pending they don't fall 
into one of the enforcement priorities for other violations - will be 
allowed to operate until July 2016," said Mendoza.

In preparing for enforcement, the city has taken steps to catalog 
medical-marijuana businesses and complaints or code violations 
against them, said Mendoza. FAS also has conducted stings on 
medical-marijuana business to see if they were selling illegally.

"Some stores are selling without medical authorizations," said 
Mendoza. "We're building cases against them."

The city also listed second- and third-tier considerations that risk 
enforcement. Those include medical-marijuana delivery, violations of 
city fire and building codes, allowing on-site pot consumption, not 
testing marijuana sold to patients and being located within 1,000 
feet of a school or playground or within 500 feet of another 
marijuana store or dispensary.

Businesses can appeal violations assessed by the city and can contest 
suspensions or revocations of their license. The Office of the 
Hearing Examiner, an independent body, will handle those cases.

The medical-marijuana community is split over the mayor's proposal. 
Many organizations and store owners open before the January 2013 
cutoff supported the mayor's plan, with reservations about how it 
would be implemented. Those that opened after were upset about the 
development. Patient advocates expressed concerns over access.

Kari Boiter, a medical-marijuana patient, said she thought the city 
was taking "a hatchet approach rather than a scalpel" on medical 
marijuana. Boiter said she believed some of the so-called "good 
actors" opened after the mayor's January 2013 deadline. She said she 
would have preferred the mayor's office weighed how well businesses 
served patients and not when they opened.

"Patients suffer - it's hard to find a place that's conveniently 
located and has the products you need," said Boiter. "It's an unfair 
burden on the sickest and most vulnerable. Instead of looking at who 
those people are and their needs, we're looking at business issues."

Killy Nichelin, the co-owner of Iconic Cannabis, a medical-marijuana 
dispensary that opened after 2013, agreed with Boiter.

"It's been all about lotteries and dates there's no connection to 
quality," said Nichelin, who decided to open a medical dispensary 
after he lost out in the lottery to own a recreational marijuana store.

Jeremy Kaufman, chair at the Coalition for Cannabis Standards & 
Ethics, a trade organization, said his group is in favor of the 
legislation, but has concern.

"What it kind of comes down to is Seattle's execution," said Kaufman, 
who said the people who opened medical-marijuana dispensaries after 
recreational pot was legalized were "the profiteers."

"Anyone that came in to operate a cannabis business after that date, 
I have a hard time being sympathetic," said Kaufman.

Philip Dawdy, a lobbyist on behalf of some medical-marijuana 
businesses, said the biggest contention for many businesses is how 
the distance rules will be handled. The mayor's office seeks to 
dismantle clusters of medical dispensaries in some parts of town.

Dawdy said some stores have had to congregate because it's difficult 
to find real estate where it's legal to operate.

"You can't operate if nobody will rent to you," he said.

He said some clusters have generated community complaints, but others 
have kept a relatively low profile and shouldn't be penalized.

The mayor's office estimates the legislation will cost more than 
$800,000 to implement, not including costs to the city's law 
department or Seattle Fire Department.

Where will the money come from?

"We're finding it," said Mendoza. City regulatory licenses for pot 
businesses, including those already in the state system, would cost 
$1,000. Growers or processors outside of Seattle that sell wholesale 
marijuana products to retailers would have to get a $500 license.

"We're asking not just the places located in Seattle, but anyone 
selling in Seattle" to become licensed, said Mendoza. "If you're 
growing in Eastern Washington and selling in Seattle, you need a 
regulatory business license."

The mayor's office hopes state lawmakers will pass a bill being 
considered that would share pot excise-tax money with cities. Mendoza 
thought the city would receive about $400,000 from the state if the 
lawmakers approve the measure.

The mayor's regulations Seattle Mayor Ed Murray holds a press 
conference at Db3, which produces cannabis-infused edibles, on 
Airport Way South in Seattle. have been in the works for many months. 
Last November, Murray's office outlined a similar regulatory 
structure for pot, but tabled the idea as talks heated up in the 
state Legislature about folding medical pot into the state system.

Medical-marijuana businesses have proliferated since voters legalized 
recreational pot in 2012. But regulations for medical collective 
gardens and dispensaries were so lax, the city did not know how many 
businesses existed. Some were not paying taxes or operating with 
proper permits.

Even though the City Council passed an ordinance intended to stop 
licensing new pot businesses, FAS did not believe it had the 
authority to revoke or deny business licenses. New dispensaries 
continued to open.

Under the mayor's plan, the city will be able to actively enforce 
state pot rules, Mendoza said. It could fine businesses for 
disobeying rules about things as minor as improper signage or as 
major as selling to people under 21.

"We're considering our own compliance checks for underage buyers," 
said Mendoza.

The legislation will be sent to the City Council - which must 
eventually approve any new law - next week. Councilmember Nick Licata 
said he expects a council vote sometime later this summer.
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MAP posted-by: Jay Bergstrom