Challenges still exist on marijuana, officials say

OLYMPIA — Officials tasked with creating a regulated marijuana system in Washington state said Tuesday they are moving forward with a timeline of issuing producer licenses by August, but said that several challenges and uncertainties still exist surrounding the new law.

Pat Kohler, director of the state Liquor Control Board, told lawmakers on the House Government Accountability &Oversight Committee that those concerns include continued uncertainty about what the federal government will ultimatley do about Washington and Colorado’s voter-approved marijuana legalization laws.

Washington Gov. Jay Inslee and Attorney General Bob Ferguson met with U.S. Attorney General Eric Holder last week, but were offered no further clarity on how the federal government will respond to last fall’s votes in both states that set up legal markets for marijuana.

The two states voted to legalize recreational marijuana use by adults over 21 and to create state-licensed systems of growers, processors and retail stores that sell heavily taxed pot. The creation of those regulatory schemes poses a possible conflict with federal law, which outlaws marijuana, and the Justice Department hasn’t said whether it will sue to block the state laws.

Inslee is expected in the coming days to send Holder a memo outlining key regulatory and enforcement issues that the state will be looking at.

Kohler said another concern has to do with banking and how, if at all, they’ll be able to get federally-insured banks to do the banking for taxes and other revenue related to marijuana.

“I think it would be a public safety issue for it to be a cash operation,” Kohler told lawmakers, and said the Liquor Control Board is working with the state Department of Financial Institutions to discuss alternatives.

Rep. Steve Kirby, D-Tacoma, a member of the committee who also serves as chairman of the House Business &Financial Services Committee, said that banks and credit unions aren’t interested.

“They just won’t go there,” he said.

He raised the issue of the idea of a state bank, a measure that previously has not gained traction in the Legislature.

“That just might be a way to have a regulated system for handling the finances in this large industry,” he suggested.

Kohler said that several other concerns have been raised during the first two of six public forums on the issue that have been held to date, including concerns about the proposed taxation structure driving the price so high that it creates a black market, as well as how to deal with past criminal histories of potential licensees.

Rep. Chris Hurst, a Democrat from Enumclaw who is chairman of the committee, said he believed anyone who dealt in the recreational marijuana market, not medical marijuana, before the new law took effect should be considered a criminal and looked upon as such.

“They have been breaking state and federal drug laws, they have not been paying taxes, they’re engaged in money laundering,” he said. “What would cause you to think they would obey the law in the future?”

The agency is charged with regulating marijuana under Washington’s measure. It will hold four more public forums through the end of February, and a draft of proposed rules for producer licenses is expected to be filed by mid-April. Under their timeline, the board said that producer licenses would be effective in August, and processor and retailer licenses would become effective on Dec. 1.

More in Local News

Mill Creek councilman no longer lives in city, panel finds

The Canvassing Board determined Sean Kelly is not eligible to vote there.

A Democrat and ex-Republican team up to end two-party politics

Brian Baird and Chris Vance unveil a new organization called Washington Independents.

The beavers weren’t happy, either, about Mill Creek flooding

A tree fell on their dam, sending a rush of water into a neighborhood near Jackson High School.

Two windsurfers rescued from Port Susan near Kayak Point

The men had failed to return to shore during Sunday’s windstorm.

Herald photos of the week

A weekly collection of The Herald’s best images by staff photographers and… Continue reading

Stranger offered candy to student walking home from school

The Granite Falls School District is warning families about… Continue reading

Coming together as family

Special-needs students and teachers at the Transition Center cooked up a Thanksgiving feast.

Lynnwood’s property tax promise to homeowners sort of true

They were told consolidation of fire departments would save, but new rates likely will be more.

Woman who died in 5-car crash identified

A car driven by Susan E. Sill rear-ended another vehicle Wednesday on Smokey Point Boulevard.

Most Read