An industry in limbo: Recreational Pot in 2017

What will the new Administration in Washington DC do?

With recent changes in Washington DC, the future remains uncertain for the fledgling Recreational Cannabis industry across the nation. Time will tell if our incoming Attorney General, Jeff Sessions will go after the cannabis industry. My gut tells me they won’t, but that’s coming at it from a logical standpoint, and from what I’ve seen so far coming from DC,  logical deduction and hard facts seem to have been tossed into the dumpster.

Given the dollar amounts we are talking about in terms of taxes generated ($185 million in FY2016 for WA state), and the ensuing lawsuits that would follow, coupled with the enormous negative economic impact (jobs and productivity lost – especially in rural areas), I genuinely hope the incoming AG respects states’ rights and does not interfere with the legal Cannabis industry.

Changes in Washington State

Here in Washington state, there are a number of interesting proposed changes coming out of Olympia this session that would have a significant impact on the industry at large.

HB 5102 – Out of state ownership and investment

The first change has to do with allowing outside sources of funding (non WA residents) for i502 Businesses. Currently there are funding and lending restrictions that limit the amount of investment capital can flow in from outside the state. House Bill 5102, clarifying residency requirements for licensed marijuana businesses, has been introduced and is in committee. There is a public hearing scheduled for

The key changes in verbiage in HB5102 have to do with limiting the percentage ownership by out of state interests to 50% ownership and allowing “managers or agents” aka owners who are exempt from the residency requirement.

…with the exception that only those holding fifty percent of all ownership interests must meet the residency requirement;

A person whose place of business is conducted by a manager 21 or agent, unless the manager or agent possesses the same 22 qualifications required of the licensee, with the exception of the residency requirement.

Source: http://app.leg.wa.gov/billsummary?BillNumber=5102&Year=2017

HB 1092 – Allowing “Home grows”

House Bill 1092 would amend the i502 Legislation to allow any Washington state resident 21+ years old to cultivate up to 6 marijuana plants and possess up to 24 ounces of dried plant material from the personal cultivation. For any single residence if there are 2 or more adults 21+ or older, you may have up to 12 plants and 48 ounces of dried plant material. You may only leave your residence with up to an ounce of “home grown” at a time.

(4)(a) Subject to the requirements in this subsection (4), the possession by a person twenty-one years of age or older of no more than six marijuana plants and up to twenty-four ounces of useable marijuana harvested from lawfully grown plants is not a violation of this section, this chapter, or any other provision of Washington state law, provided:
(i) The plants are grown and possessed only within the premises of the housing unit in which the person resides; and
(ii) The useable marijuana has been harvested from plants lawfully grown within the premises of the housing unit in which the person resides and is not removed from the premises in amounts exceeding one ounce.
(b) No more than twelve marijuana plants and forty-eight ounces of useable marijuana may be possessed, in the aggregate, by the adult residents of a single housing unit, regardless of the number of persons twenty-one years of age or older residing in the housing unit.
(c) This subsection (4) does not apply to marijuana plants or useable marijuana possessed at a location other than the premises of the housing unit in which the marijuana plants were lawfully grown.

Source: http://lawfilesext.leg.wa.gov/biennium/2017-18/Pdf/Bills/House%20Bills/1092.pdf

Regardless of where you stand on legal cannabis, please take a minute to acknowledge that there are tens of thousands of business owners, employees, and fellow Washingtonians who are pouring their blood, sweat, and tears into being successful in this industry. As we have in the past, we continue the journey into uncharted waters. Onward we go!

BDE -∞+

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