Liquor and Cannabis Board revises proposed cannabis equity legislation

The Liquor and Cannabis Board has revised its proposed cannabis equity legislation after receiving feedback in August on an earlier proposal.

Over the past few years, the state has undertaken a robust stakeholder process to gather input and insights into how to make the state’s cannabis retail landscape more equitable. The revised proposed legislation would:

• Encourage current cannabis licensees to submit a social equity plan;

• Authorize the Board to create additional social equity cannabis retailer licenses;
• Base the number of new licenses on population growth as indicated by the most recent census data and OFM’s annual population estimates;
• Permit social equity licensees to locate in any local jurisdiction that will allow their operation, but this portability feature is available only one time, at the point of initial licensure;
• Require the Board to select a third-party contractor to score social equity applicants using a rubric developed by the Board, and require the Board to rely on the score provided by the third-party contractor in issuing licenses;
• Authorize the Board to require by rule that social equity licenses may only be transferred to or assumed by individuals who qualify as social equity applicants for a period of at least five years from the date of initial licensure;
• Waive the annual license and license renewal fee for social equity applicants through December 31, 2029;
• Revise the definition of “disproportionately impacted areas” to mean census tracts in Washington where community members were more likely to be impacted by the war on drugs. These are areas of high unemployment, low income, and demographic indicators consistent with populations most impacted by the war on drugs, including areas with higher rates of arrest for drug charges;
• Revise the definition of a social equity plan to indicate that a plan may include how the cannabis licensee will work to promote social equity goals in their community, and remove other elements of the current statutory definition;
• Revise the definition of a “social equity applicant” to mean a person who meets at least two of three criteria listed below:
  1. Lived in a disproportionately impacted area for at least five years between 1980 and 2010;
  2. Has been arrested or convicted of a cannabis offense or has a family member who has been arrested or convicted of a cannabis offense; and
  3. Had a household income less than the state median in the year prior to submitting an application.

The biggest impact to cities would be where newly granted social equity licenses could be located in the state. Per the proposed legislation, all licenses issued under the social equity program may be located in any city or town that permits cannabis business activity, regardless of:

• Whether a license was originally allocated to or issued in another county, city, or town; and
• The maximum number of retail outlets established by the Board.

Cities can review a summary of the revised proposed legislation and read the draft bill language.