OLYMPIA – As legislators worked this week to blend the state’s recreational and medical marijuana laws, Spokane Valley officials asked them to consider one more wrinkle in the rapidly changing marketplace: pot lounges.
The Members Lounge, which is connected to a medical marijuana dispensary and allows consumption of some vapor and edible marijuana products on its premises, is an example of where the state’s two very different systems don’t mesh well. Using recreational marijuana in public is not legal, but the law is silent on public consumption of medical marijuana and the lounge contends its patrons aren’t in public but become members of a private club by paying a fee.
“I don’t want to insinuate they are doing anything illegal,” Valley City Attorney Eric Lamb said Thursday. “But bars have to get liquor licenses, why not marijuana lounges?”
Wednesday evening, a lobbyist for the Valley asked the House Finance Committee to add restrictions on marijuana lounges to the wide array of changes it is considering for medical and recreational pot. There’s nothing in the current proposals to address them, and there should be, Brianna Taylor said.
It was the first of night and morning hearings on a series of marijuana-related proposals on which the Legislature seems to be focusing after considering a wide array of ideas in the first eight weeks of the session.
“I think we all know that the people of Washington have embarked on a very important experiment that has social and economic and criminal justice implications,” Finance Committee Chairman Reuven Carlyle, D-Seattle, said. “We are all doing our best to embrace the will of the people and have a well-regulated and appropriately taxed marijuana market.”
That committee is considering changes to the tax system the voters slapped on recreational marijuana, which currently charges a 25 percent excise tax each time the drug moves from a grower to a separate processor and then to a retailer. If the grower also has a license to process what he or she grows, it’s only taxed twice. Members of the Washington Cannabusiness Association – which represent recreational marijuana operations –said they are struggling under the weight of taxes and regulation. They’d support the proposed change for the state to levy a single 30 percent sales at the retail level. It would lower the expected revenue to the state, but also drop the price of pot in the stores, making it closer to the cost of the illegal market.
Store owners could deduct sales tax paid to the state under federal tax rules, something they can’t do with the excise tax. Medical marijuana patients who are on a registry could be exempted from the sales tax when shopping at a recreational store.
Medical marijuana dispensaries would either have to be licensed by the state or close under that proposal and a separate one that has passed the Senate and received a hearing in the House Health Care and Wellness Committee Thursday morning. Cannabusiness members welcome that change because they contend the unregulated medical sellers are undercutting their prices while inventory of recreational pot piles up.
The medical marijuana businesses and users are split on the efforts to blend them into the more heavily regulated recreational system operated by the state Liquor Control Board.
Rick Rosio, a Spokane resident and member of Veterans for Compassionate Care, which advocates using the drug to treat some cases of post-traumatic stress disorder, told the Health Care Committee it was “important that structure be brought to the medical marijuana community.” Americans for Safe Access, an organization that represents some patients and dispensaries, support the changes the Finance Committee is considering.
But Steve Sarich of Cannabis Action Coalition, a separate group of medical marijuana businesses and patients, denounced the efforts to bring that system under the Liquor Board and require patients to register as an effort to disband the medical market. “This looks like a declaration of war to me,” he told the Finance Committee, which could vote on the bill as early as Friday.
Both proposals would require medical marijuana patients to register in some form with the state to shop at licensed dispensaries or to get a tax break at recreational stores that receive an expanded license to carry medicinal strains. Every other state that has legalized medical marijuana has some sort of database, Vicki Christopherson, of the Washington Cannabusiness Association, said.
It also would provide valuable demographic data on patients and prescribers, Kristy Weeks, of the state Department of Health, said. “When people ask how many patients do you have in the state of Washington, I don’t know.”
There’s also no accurate count of the number of medical marijuana dispensaries in the state, although David Mendoza, of the Seattle mayor’s staff, said a recent check in that city showed 103 within its borders. Half have opened since November 2012, when voters approved recreational marijuana, so it’s doubtful they are all just filling the need of medical marijuana patients, Mendoza said.
Some patients and co-op operators told legislators they are worried about any kind of registry.
“It gives the feds everything they need to come after patients and providers,” said Toni Mills of The Human Solutions International, a pro-marijuana network. She cited the recent case in U.S. District Court in Spokane of the Kettle Falls 5, in which a group of medical marijuana patients were tried on federal drug charges and couldn’t tell the jury they were patients or cite state laws.
But Jeff Gilmore, a licensed recreational marijuana grower, cited the same case as an example of growing public acceptance of the drug. Jurors acquitted the three defendants who eventually came to trial on four of five counts, he said. “The public is not going to tolerate a witch hunt.”