The Cannabis Patient Protection Act, commonly referred to as Senate Bill 5052 has some dispensaries here concerned both for the future of their businesses and the welfare of the patients they serve. The bill, which was passed earlier this summer, seeks to establish regulations for the formerly unregulated medical marijuana system and align it with the existing recreational one. 

The Spokane City Council recently passed an ordinance changing the city code in anticipation of the new state law. Paul Lugo, director of local dispensary Herbal Connection Inc., says he was present at that city council meeting, thanking the council for crafting the regulations, believing they would put many local dispensaries in a good position to stay open under SB 5052.

“The city ordinance mandated medical stores to fall within the parameters of SB 5052, so it’s made it easier for us be in compliance with it and stay open once it became law,” says Lugo. 

According to Lugo, city requirements include having a state business license, a reseller’s permit, a certificate of occupancy, compliance with zoning codes, and a medical cannabis collective garden regulatory license for the city of Spokane. Stores are also subject to inspection by police of storage and security surveillance systems. 

Under SB 5052, medical marijuana stores will now have to follow the same requirements and rules as recreational retailers, applying for a license from the WSLCB in order to operate legally.   

Formerly known as Washington’s Liquor Control Board, SB 5052 has given the Liquor and Cannabis Board its new name along with the authority to decide which medical marijuana shops and grow operations to legitimize and which ones must close. After July 1, 2016, medical businesses not in compliance with these regulations will be closed.

When applying for licenses, certain dispensaries will get priority. They include businesses that have been operating since January 2013, those that have previously applied to the Liquor Control Board for an I-502 license and those that have been paying local and federal taxes as a legitimate business.  

Lugo says medical marijuana businesses are still in a transition period, as the WSLCB works on creating more specific rules for the industry.

“No one is quite sure how it’s going to work, how they plan to roll us in,” says Lugo. “For now, we operate under the city’s rules and regulations, which are some of the best in the state.”

The WSLCB lists a total of 212 marijuana producer licenses in Spokane County. 

Mikhail Carpenter, a spokesman for the WSLCB, says, “Producer licenses are divided into three tiers, depending on canopy size. Canopy size varies depending on the height of the plants being produced, Tier 1 being less than 2,000 square feet, Tier 2 being 2,000 to 10,000 square feet, and Tier 3 being 10,000 to 30,000 square feet.” According to the WSLCB website, Spokane County has 36 Tier 1 licenses, 22 of which are active, 78 Tier 2 producer licenses, 40 of which are active, and 97 Tier 3 producer licenses, 27 of which are active. 

While he had heard that certain cities such as Tacoma already have begun shutting down medical dispensaries that aren’t in compliance with SB 5052, Lugo says he isn’t concerned Spokane will do the same.

“Unlike us, many cities and counties don’t have any kind of licensing system in place yet. Spokane is actually one of the most compliant cities in the state,” he says. “I don’t see them shutting down many places until July 1, 2016, when the new regulations will take effect.”  

 “We know there will still be a lot of changes to roll us into the system, but what those changes will be we just don’t know yet,” he adds. 

Lugo also believes the United Food Workers Union might take a more active role in the new regulations, on behalf of workers in retail and medical stores. “They’re just now stepping into the cannabis industry. I think they’d like to organize our workers now while we’re small so that when bigger corporations start stepping in, the employees are protected.”

Lugo says that besides the new regulations, financing remains a major issue for marijuana businesses, as banks, are still reluctant to work with them. The industry is also heavily taxed, and with businesses unable to get bank accounts, many are forced to find secure ways of transporting large amounts of cash just to pay their taxes.

Other than marijuana venders, the other major group concerned with SB 5052 are medical marijuana patients. Previously what were known as collective gardens, were allowed to produce and supply up to 10 patients with medical products. Under SB 5052, they have now been replaced with cooperatives, which allow four patients to grow marijuana together, with a maximum of 60 plants. The amount of cannabis a patient can possess and cultivate has also been reduced from 24 ounces to 3, and from 15 plants per person to six. 

“Patients are very concerned with their plant count now,” says Lugo. “Not so much for this growing season, as it’s nearly over, but soon their count will go down.”

Kathy DePriest, owner of the Spokane medical marijuana dispensary Evergreen Premier Medical LLC., says the patients are her main concern when it comes to the new Senate bill.  

“Many of these patients are suffering from severe illnesses. It is my understanding that the state is looking to reduce the amount of THC in some products, when some of these patients need that high concentration to fight their illnesses.”  

The bill also banned the use of butane in the production of hash oil, a product known as BHO, which DePriest says contains some of the highest levels of THC. 

“As a medical dispensary we can’t purchase it from recreational producers or processors. We also can’t sell it unless it was produced before the new law went into effect, so we had to stock up prior,” she says. 

DePriest says her shop brings in up to $3,000 in sales each day, seeing approximately 60 patients during that time, many of whom are also wary of the voluntary patient database put into place by SB 5052, which is said to protect patients and retailers from arrest.

“They’re afraid if they’re registered on a database like that, it will do just the opposite, and they will be targeted,” she says. She estimates perhaps 70 percent of the patients she has spoken with aren’t planning on registering with the patient database.

According to Lugo, Herbal Connections sees somewhere around 30 patients a day. “With this new registry, the difference between those who’ve registered versus not is a big concern for patients,” he says. 

Registered patients will be allowed to carry three times as much marijuana as recreational law allows. Unregistered patients can only carry as much as recreational users. 

“I have heard that nonregistered patients won’t be charged sales tax, but registered patients will be exempt from both sales tax and excise tax on marijuana,” says Lugo. 

DePriest had similar concerns over patients being taxed too much for medication that already isn’t covered by insurance. “It’s very unfortunate these patients have to fork over cash to pay for medication,” she says.

Another new rule under SB 5052 worrying patients is the allowance for stores to obtain a special endorsement from the Liquor and Cannabis Board indicating they’re knowledgeable in the medical use of cannabis. 

“I’ve been told they’re working on a training program to educate workers in the medical uses of cannabis so they can better understand patient’s needs,” says Lugo. “But some of these people have health conditions they don’t want to talk about in public spaces. The new regulations will have to take patient privacy into consideration as well.” 

The Washington State Department of Health’s website lists new rules that will go into effect as of July 1, 2016. According to the list all marijuana producers, processors and retail stores must be licensed by the WLCB, licensed retail stores may apply for and get a medical marijuana endorsement, and all marijuana and marijuana products must be tested for safety and THC/CBD levels, accurately labeled, and sold in child-resistant packaging. The listing also reiterates the new rules concerning medical patients’ entry into the patient database, patient purchase limits, and the disbanding of collective gardens, to be replaced with cooperatives.  

DePriest says she was surprised at the swiftness with which certain sections of the bill took effect.

“When I read SB 5052, it was my understanding most of it wouldn’t be put into effect until July of next year,” she says. “However the 21-and-older rule immediately caused us to let go an employee who was under the age of 21, and several of our young patients needed help being able to access their medication.”

She says that while the bill allows for patients under 21 to either have a parent or an individual designated as their provider pick up their medication, the process does involve paperwork and strict procedures to ensure the patient is able to receive their medication.

Lugo says the state Department of Health will be visiting Spokane this month to gather input from businesses and organizations concerning what products will be considered medical and why. “It’s historic that they would ask for our input before creating these rules. I’m happy to have such an active role,” he says. 

DePriest seems less optimistic that shops will have a say in the new rules and regulations, saying, “I wrote to Governor Inslee about SB 5052. I felt they should have taken the time to talk with the legitimate shops like ours, who are fully licensed and pay their taxes. I just wish someone would have talked with us about what a medical dispensary is and how it operates before they put this bill in place.”

Herbal Connection Inc. is a patient-owned and -operated cannabis collective garden, offering medical cannabis patients a wide variety of medical-quality cannabis and cannabis-infused products. It’s located at 3812 N Monroe. 

Evergreen Premier Medical LLC is a medical marijuana dispensary providing a variety of top-shelf medicinal products to Washington State medical cannabis patients. It’s located at 2225 E Sprague.