WSLCB Small Business Impact Study Disregards Medical Cannabis (Part 1)

Cannabis-Question-Mark

After declaring that over 90% of medical cannabis is both a fraud and illegal, the Washington State Liquor Control Board (LCB) quietly released their amended Small Business Economic Impact Statement on September 4, 2013.  It went unnoticed by most.

In line with the plans for gutting the Medical Cannabis Act, the LCB is now claiming there is no legal medical business in Washington State.

It appears that the LCB is having problems with two different law questions.

1.  Why is the LCB not bothering to do a proper full small business economic impact study as required by law?

2. Why does the LCB refuse to see medical cannabis businesses in Washington State legal under state law when those businesses have been legal since 2011?

We’ll start with the second question for this blog post first.

Section 7 of the document gives a description of how the agency will involve small cannabis businesses in the development of the rules for I-502:

 

There is currently no legally established marijuana business, large or small, in Washington State.

Read the full study here

WSLCB Small Business Impact Study by 420leaks

This flies in the face of reality.  First off, medical cannabis was made legal in the 2011 bill passed by the legislators, partially vetoed by then Governor Gregiore.

This was followed by a Federal Court ruling in Spokane stating that the 2011 law gave protection from arrest, prosecution and property seizure.  It also states search warrants can’t be issued unless there is evidence that the patient is clearly not within state laws.  Specifically, it states,

…If the person complies with the medical marijuana statute, they have not committed a state crime….  It is uncontested that while the affidavit supporting the warrant included evidence of a marijuana grow, there  as no mention of the medical marijuana statute or an assertion that the grow violated the medical marijuana statute. This omission is fatal to the warrant as the warrant then does not show probable cause of a crime. The good faith exception cannot rescue the warrant as the three month old law was clear and the officers should  have been aware of its requirements. Thus, all fruits of the search shall be suppressed.

US WA MMJ arrest protect suit.pdf

The question of legality within the state was verified by the historic William Kurtz vs State ruling back on September 19th, 2013…

State vs Kurtz Appeal 09192013 by 420leaks

 

We found further proof the LCB is sticking its head in the sand about legal businesses.

According to KIRO News out of Seattle, MILLIONS are being paid to the Department of Revenue by cannabis businesses.  In fact, just recently, just one collective owner paid over $100,000 in cash…

KIRO 7 went along Monday as a medical marijuana business owner remitted around $110,000 in cash he had collected from customers. Ryan Kunkel of Have a Heart, a local medical marijuana business, put the money in a shopping bag and brought it to the Seattle office of the state Department of Revenue.


Department of Revenue states that over 2.5 MILLION was paid by cannabis related business in 2012 alone!

According to MSN News article titled, “Pot dispensaries popping up faster than Starbucks“,

In September 2011, the city licensed 63 businesses it believes to be marijuana dispensaries. (A name like “The 420 Collective” is usually a dead giveaway.) The following September, that number jumped to 145. By late May of this year, it reached 274. That’s almost twice the amount of Starbucks in town. (As of a year ago, the city boasted 139 Starbucks locations.)

274 storefonts JUST IN THE SEATTLE AREA ALONE!

How can the LCB continue to ignore these facts?

With the number of small businesses and individual patients in our state that rely on the current medical cannabis model, simply stating they don’t exist will not be very persuasive argument for closing down the current system and giving the entire industry to a recreational one.

Doing so could likely have serious economic impacts to our state in the loss of jobs, access points and revenue to the state in one of the worst economic times in US history.

The laws about doing small business impact studies are clearly not being followed.

RCW 19.85.030
Agency rules — Small business economic impact statement — Reduction of costs imposed by rule.

(1)(a) In the adoption of a rule under chapter 34.05 RCW, an agency shall prepare a small business economic impact statement: (i) If the proposed rule will impose more than minor costs on businesses in an industry; or (ii) if requested to do so by a majority vote of the joint administrative rules review committee within forty-five days of receiving the notice of proposed rule making under RCW 34.05.320. However, if the agency has completed the pilot rule process as defined by RCW 34.05.313 before filing the notice of a proposed rule, the agency is not required to prepare a small business economic impact statement.

(b) An agency must prepare the small business economic impact statement in accordance with RCW 19.85.040, and file it with the code reviser along with the notice required under RCW 34.05.320. An agency shall file a statement prepared at the request of the joint administrative rules review committee with the code reviser upon its completion before the adoption of the rule. An agency must provide a copy of the small business economic impact statement to any person requesting it.

(2) Based upon the extent of disproportionate impact on small business identified in the statement prepared under RCW 19.85.040, the agency shall, where legal and feasible in meeting the stated objectives of the statutes upon which the rule is based, reduce the costs imposed by the rule on small businesses. The agency must consider, without limitation, each of the following methods of reducing the impact of the proposed rule on small businesses:

(a) Reducing, modifying, or eliminating substantive regulatory requirements;

(b) Simplifying, reducing, or eliminating recordkeeping and reporting requirements;

(c) Reducing the frequency of inspections;

(d) Delaying compliance timetables;

(e) Reducing or modifying fine schedules for noncompliance; or

(f) Any other mitigation techniques including those suggested by small businesses or small business advocates.

(3) If the agency determines it cannot reduce the costs imposed by the rule on small businesses, the agency must provide a clear explanation of why it has made that determination and include that statement with its filing of the proposed rule pursuant to RCW 34.05.320.

(4)(a) All small business economic impact statements are subject to selective review by the joint administrative rules review committee pursuant to RCW 34.05.630.

(b) Any person affected by a proposed rule where there is a small business economic impact statement may petition the joint administrative rules review committee for review pursuant to the procedure in RCW 34.05.655.

[2011 c 249 § 2; 2007 c 239 § 3; 2000 c 171 § 60; 1995 c 403 § 402; 1994 c 249 § 11. Prior: 1989 c 374 § 2; 1989 c 175 § 72; 1982 c 6 § 3.]

Notes:
Findings — 2007 c 239: See note following RCW 19.85.020.
Application — 1995 c 403 §§ 201, 301-305, 401-405, and 801: See note following RCW 34.05.328.

Findings — Short title — Intent — 1995 c 403: See note following RCW 34.05.328.

Part headings not law — Severability — 1995 c 403: See RCW 43.05.903 and 43.05.904.

Severability — Application — 1994 c 249: See notes following RCW 34.05.310.

Effective date — 1989 c 175: See note following RCW 34.05.010.

Publication of small business economic impact statement in Washington State Register: RCW 34.08.020.

RCW 19.85.040
Small business economic impact statement — Purpose — Contents.

(1) A small business economic impact statement must include a brief description of the reporting, recordkeeping, and other compliance requirements of the proposed rule, and the kinds of professional services that a small business is likely to need in order to comply with such requirements. It shall analyze the costs of compliance for businesses required to comply with the proposed rule adopted pursuant to RCW 34.05.320, including costs of equipment, supplies, labor, professional services, and increased administrative costs. It shall consider, based on input received, whether compliance with the rule will cause businesses to lose sales or revenue. To determine whether the proposed rule will have a disproportionate cost impact on small businesses, the impact statement must compare the cost of compliance for small business with the cost of compliance for the ten percent of businesses that are the largest businesses required to comply with the proposed rules using one or more of the following as a basis for comparing costs:

(a) Cost per employee;

(b) Cost per hour of labor; or

(c) Cost per one hundred dollars of sales.

(2) A small business economic impact statement must also include:

(a) A statement of the steps taken by the agency to reduce the costs of the rule on small businesses as required by RCW 19.85.030(2), or reasonable justification for not doing so, addressing the options listed in RCW 19.85.030(2);

(b) A description of how the agency will involve small businesses in the development of the rule;

(c) A list of industries that will be required to comply with the rule. However, this subsection (2)(c) shall not be construed to preclude application of the rule to any business or industry to which it would otherwise apply; and

(d) An estimate of the number of jobs that will be created or lost as the result of compliance with the proposed rule.

(3) To obtain information for purposes of this section, an agency may survey a representative sample of affected businesses or trade associations and should, whenever possible, appoint a committee under RCW 34.05.310(2) to assist in the accurate assessment of the costs of a proposed rule, and the means to reduce the costs imposed on small business.

[2007 c 239 § 4; 1995 c 403 § 403; 1994 c 249 § 12. Prior: 1989 c 374 § 3; 1989 c 175 § 73; 1982 c 6 § 4.]

Notes:
Findings — 2007 c 239: See note following RCW 19.85.020.
Application — 1995 c 403 §§ 201, 301-305, 401-405, and 801: See note following RCW 34.05.328.

Findings — Short title — Intent — 1995 c 403: See note following RCW 34.05.328.

Part headings not law — Severability — 1995 c 403: See RCW 43.05.903 and 43.05.904.

Severability — Application — 1994 c 249: See notes following RCW 34.05.310.

Effective date — 1989 c 175: See note following RCW 34.05.010.

Publication in Washington State Register: RCW 34.08.020.

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