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Interim Ordinance Renewal Public Hearing

On October 24, 2017 at 5:30 P.M., the Board of County Commissioners will hold a public hearing on the renewal of Ordinance No. 14944, as amended, which enacted interim regulations for Marijuana/Cannabis Producers, Processors, and Retailers. The interim regulations will expire on November 8, 2017 if not renewed.

No changes are proposed with this renewal.

The full text of the proposed renewal ordinance with amendments is available here.

Public Hearing Information:

Date: October 24, 2017

Time: 5:30 P.M., or soon thereafter

Location: Room 280, Building 1
Thurston County Courthouse Complex
2000 Lakeridge Dr. SW
Olympia, WA 98501

Comments may be given at the hearing, mailed or sent via email. Please send email comments to Jeremy Davis at davisj@co.thurston.wa.us by 4:00 p.m. on October 24th. Please send mailed comments to:

Jeremy Davis, Senior Planner
Thurston County Resource Stewardship Department
C/O Jeremy Davis, Senior Planner
2000 Lakeridge Dr. SW
Olympia, WA 98502

Mailed comments must arrive by October 24, 2017 by 5:00 P.M. If you have any questions, you can email Jeremy at the address above, or call (360) 754-3355 ext. 7010.

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Issue

This briefing is in response to changes in state legislation that allow for licensed producers, processors, and retailers of marijuana products for medical and recreational use.
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Thurston County is proposing to limit state-licensed marijuana related activity by adopting regulations that mitigate potential impacts through appropriate land use review processes, zoning designations, and land use controls, such as but not limited to: setbacks, screening, landscaping, building height and development coverage.

Acronyms and Terminology

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Marijuana or marihuana means all parts of the plant Cannabis, whether growing or not, with a THC concentration greater than 0.3 percent on a dry weight basis; the seeds thereof; the resin extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds or resin. The term does not include the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound manufacture, salt, derivative, mixture, or preparation of the mature stalks (except resin extracted therefrom), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination.

Marijuana processer means a person licensed by the state liquor control board to process marijuana into useable marijuana and marijuana-infused products, package and label useable marijuana and marijuana-infused products for sale in retail outlets, and sell useable marijuana and marijuana-infused products at wholesale to marijuana retailers.

Marijuana producer means a person licensed by the state liquor control board to produce and sell marijuana at wholesale to marijuana processors and other marijuana producers. A marijuana production area not located in a legally permitted fully enclosed permanent building shall be considered an outdoor marijuana production area. Hoop houses and other temporary structures are not considered a legally permitted permanent building. Marijuana production may include growing, drying, cutting, and bagging marijuana to prepare marijuana for wholesale shipment to a marijuana processor.

Marijuana retailer means a person licensed by the state liquor control board to sell useable marijuana and marijuana-infused products in a retail outlet.

Sensitive Site means a child daycare, arcade (not limited to persons 21 years of age or older, recreation center, or publicly owned and/or regulated: school(s) (sans college, or university), library, playground(s) and park(s), or transit facility.

WSLCB (Washington State Liquor and Cannabis Board), formerly known as the Liquor Control Board, is responsible for administration of the application and license process, for Marijuana: producer, processor, or retailer.

WAC (Washington Administrative Codes) – Title 314 covers regulations of the executive branch agencies. Chapter 314-55 is the administrative code implemented by the WSLCB.

RCW (Revised Code of Washington) - Title 69 covers food, Drugs, Cosmetics, and Poisons. Chapter 69.50 is the Uniform Controlled Substances Act, and Chapter 69.51A is the Medical Marijuana Act. From here we get into the Articles I-VI; and Sections 101-609. These outline the definitions, standards, schedules, manufacturing, distribution and dispensing of controlled substances, offences and penalties, enforcement and administrative provisions. The county may pass an ordinance pursuant to RCW 69.50.331(8).

2SSHB 2136 ( Second Engrossed Second Substitute Hose Bill 2136) went in to effect July 24, 2015, and seeks to provide comprehensive marijuana reforms to ensure a well-regulated and taxed marijuana market in the State of Washington.

2SSB 5052 ( Second Substitute Senate Bill 5052) went into effect April 14, 2015, establishing the cannabis patient protection act.

Background

Initiative 502 was passed and went into effect on December 6, 2012.  As written, the voter approved Initiative intended to:
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“…stop treating adult marijuana use as a crime and… 1.) Allows law enforcement resources to be focused on violent and property crime; 2.) Generates new state and local tax revenue for education, health care, research, and substance abuse prevention; and 3.) Takes marijuana out of the hands of illegal drug organization and brings it under a tightly regulated, state-licensed system similar to that for controlling hard alcohol.”

The Initiative authorized recreational marijuana, under Second Engrossed Second Substitute House Bill 2136 (2SSHB 2136) as the Uniform Controlled Substances Act, RCW 69.50. The Washington State Liquor and Cannabis Board (WSLCB) (formerly known as: the Washington Liquor Control Board) has developed, revised, and adopted administrative regulations under Washington Administrative Code (WAC) Chapter 314-55 - Marijuana Licenses, Application Process, Requirements, and Reporting on November 16, 2013.  The WSLCB began to accept applications for recreational marijuana related businesses on November 18, 2013.  The Second Substitute Senate Bill 5052 (2SSB 5052) was signed into law on April 24, 2015, which establishes regulations for medical marijuana as the Cannabis Patient Protection Act and seeks to align it with the existing recreational marijuana system.  On November 12, 2013, the Thurston County Board of County Commissioners (Board) adopted interim zoning controls for marijuana producers, processors, and retailers in Ordinance No. 14944. Subsequent to November 12th, the Board has amended and/or renewed the interim zoning controls, as follows (Please See Attachment):

  • Interim Ord. #14944 [Effective – Nov. 12. 2013]
  • Interim Ord. #14978 [Effective – Jan. 21, 2014] Amendments are represented in - BLUE
  • Interim Ord. #15086 [Effective – Nov. 11, 2014] Amendments are represented in - GREEN
  • Interim Ord. #15122 [Effective – May 11, 2015] - No Change
  • Interim Ord. #15157 [Effective – July 7, 2015] Amendments are represented in - PURPLE
  • Interim Ord. #15189 [Effective – Oct. 6, 2015] - No Change
  • Interim Ord. #15210 [Effective – Nov. 10, 2015] Amendments are represented in - ORANGE

Pursuant to RCW 36.70A.390, the Board held a public hearing for each of the enacted extensions and amendments to receive comments on the renewal of Ordinance No. 14944.  During these hearings the Board heard concerns from citizens about allowing marijuana production, processing, and retail in residential areas, concerns about outdoor marijuana production areas producing odors impacting adjacent property owners, and inadequate noticing for proposed marijuana related permits to ensure neighboring property owners have an opportunity to comment. Citizens also voiced concerns about appropriate screening of marijuana producers and processors from residential uses.

Amendments to the Thurston County Code (TCC) titles and chapters listed in Chapter 2.05 TCC Growth Management Public Participation, that do not involve an amendment to the Thurston County Comprehensive Plan (TCCP) must be placed on the Development Code Official Docket prior to formal consideration and adoption; and on December 16, 2014, the Board adopted the official docket, which included final marijuana regulations as a high priority. On January 29, 2015, County staff met with the Agricultural Advisory Committee to discuss final regulations for marijuana operations.  County staff has begun researching environmental and siting issues to determine appropriate final regulations for marijuana operations; and is currently considering a 2016-17 preliminary docket that includes final marijuana regulations as a high priority.

Additonal Information

Marijuana oriented businesses are responsible for knowing and meeting all regulatory standards set by the local jurisdiction and The State of Washington.  The following are the currently known standards applicable to Marijuana related activity under state law, italics indicate potential local controls.
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The information provided below (and more) may be found on the State of Washington, webpages for “Marijuana Permitting Considerations”. You may also follow the links.
  • Applicants must provide detailed illustrations to scale of the entire operation, including: size, location, security, traceability, employee qualifications and training, transportation of product, destruction of waste, testing procedures and protocols.
  • Except for schools and playgrounds, the County has the authority to reduce the 1000-foot buffer zones required by I-502 (RCW 69.50.331(8)(b)) to not less than 100-feet from recreation centers or facilities, child care centers, public parks, public transit centers, or game arcades admitting minors.
  • The State of Washington requires that applicants for marijuana licenses post a sign, provided by the WSLCB, on the outside of the premises to be licensed. Local government can require that these notices be sent at least 60 days before the license is granted.
  • Marijuana cannot be consumed in a “public place” as defined by RCW 66.04.010(35).
  • The WSLCB has stated no single entity may hold a retail license and a production or processor license, but a producer may also hold a processor license and vice versa. However, the county is not required to permit a producer who also holds a processor license to operate on the same parcel of land and vice versa.
  • Industrial hemp has not been legalized with this new legislation. It is still considered a schedule I drug by the federal government. The U.S. Attorney General is working with the Governors of The States of Washington and Colorado to “outline the federal government’s guidance on legalized marijuana”. However, the federal governments maintains that recreational marijuana is a schedule I drug, and subject to, “confiscation of assets”, and “prosecution if the federal government chooses to do so”.
  • According to the Washington State Attorney General (WSOAG), cities and counties may exercise their police powers and ban marijuana related commercial operations.  Law suits against the ban have been filed in Benton, Wenatchee, Pierce, and Clark counties. Thus far the courts agree with the WSOAG’s opinion.
  • Marijuana products may not be incorporated into existing business(s).
  • The state allows licensed retail marijuana stores to have two signs, no more than 1,600 square inches (11.1 sq. ft.) in size. This is the maximum allowed by the state in the absence of local regulation.  (It is noted that, Thurston County is currently reviewing its sign code for consistency with state and federal standards.)
  • Is inaccessible to the public and no part of the operation of the facility is in view of the general public. (County may consider additional screening requirements.)
  • The WSLCB has stated that odor was outside the scope of I-502, thereby leaving regulatory authority and enforcement to the Olympic Regional Clean Air Agency.
  • In the absence of clear local regulations, The Washington State DOE and DNR regulate on a case-by-case basis, the following relevant elements of marijuana activity: water consumption, pesticides, and runoff.  (Thurston County may consider the long range cumulative effects of individual businesses within the Thurston County.)
  • Beginning July 1, 2016, all marijuana collectives will no longer be allowed, and are not grandfathered. They are being replaced by “cooperatives” and must follow the licensing requirements as those set out in WAC 314-55. Including being subject to random inspection by law enforcement and WSLCB representative  (It is noted that names and addresses of registered patients that are allowed to grow within their homes, are not subject to public disclosure as stated in Section 22 and 23, of 2SSB 5052.)
  • Cooperatives may have no more than 4 persons as cooperative members, and grow up to 15 plants each (total of 60) within the domicile of one of the members.
  • Cooperative may not engage in commercial activity. Medical marijuana activities are exempt from state and local taxes.

Financial Impact

Effective July 1, 2015, tax reforms defined in HB 2136 change the existing marijuana excise tax structure. In addition to B&O and local sales tax, a 37% marijuana excise tax must now be collected exclusively at the retail level.
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Thurston County collects neither, business & operations tax or local retail sales tax; however, the state is engaging in revenue sharing as outlined in Section 206 of 2HSSB 2136. The State Treasurer will make transfers of collected marijuana revenue to local governments in four installments, by the last day of each fiscal quarter. For two fiscal years (2015-17 biennium), the state budget provides $6 million to counties and eligible cities. Thurston County receives $29,499.97* per quarter, and total of $117,999.88* per year. Beginning in 2018, 30% will go to counties, cities, and towns where retailers are located, based on the retail sales from stores within each jurisdiction; 70% will be distributed to counties, cities, and towns on a per capita basis, but only to jurisdictions that do not prohibit the siting of state-licensed producers, processors, or retailers. The legislation provides a retail sales and use tax exemption for marijuana purchased or obtained for medical use.

The total excise sales tax collected between July 1, 2014, and June 30, 2015 for all state-licensed marijuana related activity in Thurston County, came to $2,487,932.17*.  The total reported sales for that same time period in Thurston County was $9,951,728.55*.

(* figures provided and latest information regarding reported marijuana related revue and tax collection may be viewed at the WSLCB’s website under frequently requested Lists.)

Current land use review fees (when applicable) are $2,417.00; unless, combined in a single application for Producer and Processors. In which case, permit review fees equate to $3,282.00 (adds 5 hours).

SEPA

An environmental determination for the proposed code amendment is required pursuant to WAC 197-11-704.  That will be completed prior to a public hearing on the amendments before the Board of County Commissioners.

Sources

The following organizations were sourced for information:
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  • Thurston Long Range Planning (TLRP)
  • Municipal Research Services Center (MRSC)
  • Olympic Regional Clean Air Agency (ORCAA)
  • Washington State Liquor and Cannabis Board (WSLCB)
  • Washington State Department of Health (WSDH)
  • Attorney General of Washington (WSOAG)
  • Washington State Department of Agriculture (WSDA)
  • Washington State Department of Natural Resources (WSDNR)
  • Washington State Department of Ecology (WSDOE)
  • Washington State Legislature (WSL)
  • Washington Secretary of State (WSOS)

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