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AN ACT Relating to comprehensive marijuana market reforms
to1ensure a well-regulated and taxed marijuana market in
Washington2state; amending RCW 69.50.334, 69.50.357, 69.50.369,
69.50.535,369.50.540, 69.50.331, 69.50.445, 69.50.4013, 18.170.020,
69.50.4014,466.08.050, 69.50.101, 69.51A.---, 69.51A.085,
69.50.530, 69.50.204,569.50.430, 69.50.---, 28B.20.502, 43.350.030,
42.56.---, and669.50.342; adding new sections to chapter 69.50 RCW;
adding a new7section to chapter 82.08 RCW; adding a new section to
chapter 82.128RCW; adding a new section to chapter 42.56 RCW;
creating new9sections; repealing RCW 69.51A.085 and 69.50.425;
prescribing10penalties; making appropriations; providing effective
dates; and11declaring an emergency.12
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF
WASHINGTON:13
PART I14Intent and Tax Preference Performance Statement15
NEW SECTION. Sec. 101. (1)(a) The legislature finds
the16implementation of Initiative Measure No. 502 has established
a17clearly disadvantaged regulated legal market with respect to
prices18and the ability to compete with the unregulated medical
dispensary19market and the illicit market. The legislature further
finds that it20
S-3280.2SENATE BILL 6136
State of Washington 64th Legislature 2015 2nd Special SessionBy
Senators Rivers, Mullet, and HatfieldRead first time 06/19/15.
Referred to Committee on Ways & Means.
p. 1 SB 6136
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is crucial that the state continues to ensure a safe,
highly1regulated system in Washington that protects valuable state
revenues2while continuing efforts towards disbanding the
unregulated marijuana3markets. The legislature further finds that
ongoing evaluation on the4impact of meaningful marijuana tax reform
for the purpose of5stabilizing revenues is crucial to the overall
effort of protecting6the citizens and resources of this state. The
legislature further7finds that a partnership with local
jurisdictions in this effort is8imperative to the success of the
legislature's policy objective. The9legislature further finds that
sharing revenues to promote a10successful partnership in achieving
the legislature's intent should11be transparent and hold local
jurisdictions accountable for their use12of state shared revenues.
Therefore, the legislature intends to13reform the current tax
structure for the regulated legal marijuana14system to create price
parity with the large medical and illicit15markets with the
specific objective of increasing the market share of16the legal and
highly regulated marijuana market. The legislature17further intends
to share marijuana tax revenues with local18jurisdictions for
public safety purposes and to facilitate the19ongoing process of
ensuring a safe regulated marijuana market in all20communities
across the state.21
(b) The legislature further finds marijuana use for
qualifying22patients is a valid and necessary option health care
professionals23may recommend for their patients. The legislature
further finds that24while recognizing the difference between
recreational and medical use25of marijuana, it is also imperative
to distinguish that the26authorization for medical use of marijuana
is different from a valid27prescription provided by a doctor to a
patient. The legislature28further finds the authorization for
medical use of marijuana is29unlike over-the-counter medications
that require no oversight by a30health care professional. The
legislature further finds that due to31the unique characterization
of authorizations for the medical use of32marijuana, the policy of
providing a tax preference benefit for33patients using an
authorization should in no way be construed as34precedent for
changes in the treatment of prescription medications
or35over-the-counter medications. Therefore, the legislature
intends to36provide qualifying patients and their designated
providers a retail37sales and use tax exemption on marijuana
purchased or obtained for38medical use when authorized by a health
care professional.39
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(2)(a) This subsection is the tax preference
performance1statement for the retail sales and use tax exemption
for marijuana2purchased or obtained by qualifying patients or their
designated3providers provided in sections 207(1) and 208(1) of this
act. The4performance statement is only intended to be used for
subsequent5evaluation of the tax preference. It is not intended to
create a6private right of action by any party or be used to
determine7eligibility for preferential tax treatment.8
(b) The legislature categorizes the tax preference as
one9intended to accomplish the general purposes indicated in
RCW1082.32.808(2)(e).11
(c) It is the legislature's specific public policy objective
to12provide qualifying patients and their designated providers a
retail13sales and use tax exemption on marijuana purchased or
obtained for14medical use when authorized by a health care
professional.15
(d) To measure the effectiveness of the exemption provided
in16this act in achieving the specific public policy objective
described17in (c) of this subsection, the department of revenue
must provide the18necessary data and assistance to the state liquor
and cannabis board19for the report required in RCW 69.50.535.20
PART II21Marijuana Excise Tax, Exemptions, and Distribution of
Revenues22
Sec. 201. RCW 69.50.334 and 2013 c 3 s 7 are each amended
to23read as follows:24
(1) The action, order, or decision of the state
liquor25((control)) and cannabis board as to any denial of an
application for26the reissuance of a license to produce, process,
or sell marijuana,27or as to any revocation, suspension, or
modification of any license28to produce, process, or sell
marijuana, ((shall)) or as to the29administrative review of a
notice of unpaid trust fund taxes under30section 202 of this act,
must be an adjudicative proceeding and31subject to the applicable
provisions of chapter 34.05 RCW.32
(((1))) (2) An opportunity for a hearing may be provided to
an33applicant for the reissuance of a license prior to the
disposition of34the application, and if no opportunity for a prior
hearing is35provided then an opportunity for a hearing to
reconsider the36application must be provided the applicant.37
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(((2))) (3) An opportunity for a hearing must be provided to
a1licensee prior to a revocation or modification of any license
and,2except as provided in subsection (((4))) (6) of this section,
prior3to the suspension of any license.4
(((3))) (4) An opportunity for a hearing must be provided to
any5person issued a notice of unpaid trust fund taxes under section
2026of this act.7
(5) No hearing ((shall)) may be required under this section
until8demanded by the applicant ((or)), licensee, or person issued
a notice9of unpaid trust fund taxes under section 202 of this
act.10
(((4))) (6) The state liquor ((control)) and cannabis board
may11summarily suspend a license for a period of up to one hundred
eighty12days without a prior hearing if it finds that public
health, safety,13or welfare imperatively require emergency action,
and it incorporates14a finding to that effect in its order.
Proceedings for revocation or15other action must be promptly
instituted and determined. An16administrative law judge may extend
the summary suspension period for17up to one calendar year from the
first day of the initial summary18suspension in the event the
proceedings for revocation or other19action cannot be completed
during the initial one hundred eighty-day20period due to actions by
the licensee. The state liquor ((control))21and cannabis board's
enforcement division shall complete a22preliminary staff
investigation of the violation before requesting an23emergency
suspension by the state liquor ((control)) and
cannabis24board.25
NEW SECTION. Sec. 202. A new section is added to chapter
69.5026RCW under the subchapter heading "article V" to read as
follows:27
(1) Whenever the board determines that a limited
liability28business entity has collected trust fund taxes and has
failed to29remit those taxes to the board and that business entity
has been30terminated, dissolved, or abandoned, or is insolvent, the
board may31pursue collection of the entity's unpaid trust fund
taxes, including32penalties on those taxes, against any or all of
the responsible33individuals. For purposes of this subsection,
"insolvent" means the34condition that results when the sum of the
entity's debts exceeds the35fair market value of its assets. The
board may presume that an entity36is insolvent if the entity
refuses to disclose to the board the37nature of its assets and
liabilities.38
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(2)(a) For a responsible individual who is the current or
a1former chief executive or chief financial officer, liability
under2this section applies regardless of fault or whether the
individual3was or should have been aware of the unpaid trust fund
tax liability4of the limited liability business entity.5
(b) For any other responsible individual, liability under
this6section applies only if he or she willfully failed to pay or
to cause7to be paid to the board the trust fund taxes due from the
limited8liability business entity.9
(3)(a) Except as provided in this subsection (3)(a),
a10responsible individual who is the current or a former chief
executive11or chief financial officer is liable under this section
only for12trust fund tax liability accrued during the period that
he or she was13the chief executive or chief financial officer.
However, if the14responsible individual had the responsibility or
duty to remit15payment of the limited liability business entity's
trust fund taxes16to the board during any period of time that the
person was not the17chief executive or chief financial officer,
that individual is also18liable for trust fund tax liability that
became due during the period19that he or she had the duty to remit
payment of the limited liability20business entity's taxes to the
board but was not the chief executive21or chief financial
officer.22
(b) All other responsible individuals are liable under
this23section only for trust fund tax liability that became due
during the24period he or she had the responsibility or duty to
remit payment of25the limited liability business entity's taxes to
the board.26
(4) Persons described in subsection (3)(b) of this section
are27exempt from liability under this section in situations
where28nonpayment of the limited liability business entity's trust
fund29taxes was due to reasons beyond their control as determined
by the30board by rule.31
(5) Any person having been issued a notice of unpaid trust
fund32taxes under this section is entitled to an administrative
hearing33under RCW 69.50.334 and any such rules the board may
adopt.34
(6) This section does not relieve the limited liability
business35entity of its trust fund tax liability or otherwise
impair other tax36collection remedies afforded by law.37
(7) The definitions in this subsection apply throughout
this38section unless the context clearly requires otherwise.39
(a) "Board" means the state liquor and cannabis board.40p. 5 SB
6136
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(b) "Chief executive" means: The president of a corporation
or1for other entities or organizations other than corporations or
if the2corporation does not have a president as one of its
officers, the3highest ranking executive manager or administrator in
charge of the4management of the company or organization.5
(c) "Chief financial officer" means: The treasurer of
a6corporation or for entities or organizations other than
corporations7or if a corporation does not have a treasurer as one
of its officers,8the highest senior manager who is responsible for
overseeing the9financial activities of the entire company or
organization.10
(d) "Limited liability business entity" means a type of
business11entity that generally shields its owners from personal
liability for12the debts, obligations, and liabilities of the
entity, or a business13entity that is managed or owned in whole or
in part by an entity that14generally shields its owners from
personal liability for the debts,15obligations, and liabilities of
the entity. Limited liability16business entities include
corporations, limited liability companies,17limited liability
partnerships, trusts, general partnerships and18joint ventures in
which one or more of the partners or parties are19also limited
liability business entities, and limited partnerships in20which one
or more of the general partners are also limited
liability21business entities.22
(e) "Manager" has the same meaning as in RCW 25.15.005.23(f)
"Member" has the same meaning as in RCW 25.15.005, except24
that the term only includes members of member-managed
limited25liability companies.26
(g) "Officer" means any officer or assistant officer of
a27corporation, including the president, vice president, secretary,
and28treasurer.29
(h)(i) "Responsible individual" includes any current or
former30officer, manager, member, partner, or trustee of a limited
liability31business entity with unpaid trust fund tax
liability.32
(ii) "Responsible individual" also includes any current or
former33employee or other individual, but only if the individual
had the34responsibility or duty to remit payment of the limited
liability35business entity's unpaid trust fund tax liability.36
(iii) Whenever any taxpayer has one or more limited
liability37business entities as a member, manager, or partner,
"responsible38individual" also includes any current and former
officers, members,39or managers of the limited liability business
entity or entities or40
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of any other limited liability business entity involved directly
in1the management of the taxpayer. For purposes of this
subsection2(7)(h)(iii), "taxpayer" means a limited liability
business entity3with unpaid trust fund taxes.4
(i) "Trust fund taxes" means taxes collected from buyers
and5deemed held in trust under RCW 69.50.535.6
(j) "Willfully failed to pay or to cause to be paid" means
that7the failure was the result of an intentional, conscious,
and8voluntary course of action.9
Sec. 203. RCW 69.50.357 and 2015 c 70 s 12 are each amended
to10read as follows:11
(1) Retail outlets ((shall sell no)) may not sell products
or12services other than marijuana concentrates, useable
marijuana,13marijuana-infused products, or paraphernalia intended
for the storage14or use of marijuana concentrates, useable
marijuana, or marijuana-15infused products.16
(2) Licensed marijuana retailers ((shall)) may not employ
persons17under twenty-one years of age or allow persons under
twenty-one years18of age to enter or remain on the premises of a
retail outlet.19However, qualifying patients between eighteen and
twenty-one years of20age with a recognition card may enter and
remain on the premises of a21retail outlet holding a medical
marijuana endorsement and may22purchase products for their personal
medical use. Qualifying patients23who are under the age of eighteen
with a recognition card and who24accompany their designated
providers may enter and remain on the25premises of a retail outlet
holding a medical marijuana endorsement,26but may not purchase
products for their personal medical use.27
(3)(a) Licensed marijuana retailers must ensure that
all28employees are trained on the rules adopted to implement this
chapter,29identification of persons under the age of twenty-one,
and other30requirements adopted by the state liquor and cannabis
board to ensure31that persons under the age of twenty-one are not
permitted to enter32or remain on the premises of a retail
outlet.33
(b) Licensed marijuana retailers with a medical
marijuana34endorsement must ensure that all employees are trained
on the35subjects required by (a) of this subsection as well as
identification36of authorizations and recognition cards. Employees
must also be37trained to permit qualifying patients who hold
recognition cards and38are between the ages of eighteen and
twenty-one to enter the premises39
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and purchase marijuana for their personal medical use and to
permit1qualifying patients who are under the age of eighteen with
a2recognition card to enter the premises if accompanied by
their3designated providers.4
(4) Licensed marijuana retailers ((shall)) may not display
any5signage ((in a window, on a door, or on the outside of the
premises6of a retail outlet that is visible to the general public
from a7public right-of-way, other than a single sign no larger than
one8thousand six hundred square inches identifying the retail
outlet by9the licensee's business or trade name. Retail outlets
that hold10medical marijuana endorsements may include this
information on11signage.12
(5) Licensed marijuana retailers shall not display
marijuana13concentrates, useable marijuana, or marijuana-infused
products in a14manner that is visible to the general public from a
public right-of-15way.16
(6))) outside of the licensed premises, other than two
signs17identifying the retail outlet by the licensee's business or
trade18name. Each sign must be no larger than one thousand six
hundred19square inches, be permanently affixed to a building or
other20structure, and be posted not less than one thousand feet
from any21elementary school, secondary school, or playground.22
(5) No licensed marijuana retailer or employee of a retail
outlet23((shall)) may open or consume, or allow to be opened or
consumed, any24marijuana concentrates, useable marijuana, or
marijuana-infused25product on the outlet premises.26
(((7))) (6) The state liquor and cannabis board ((shall))
must27fine a licensee one thousand dollars for each violation of
any28subsection of this section. Fines collected under this section
must29be deposited into the dedicated marijuana ((fund)) account
created30under RCW 69.50.530.31
Sec. 204. RCW 69.50.369 and 2013 c 3 s 18 are each amended
to32read as follows:33
(1) No licensed marijuana producer, processor, researcher,
or34retailer ((shall)) may place or maintain, or cause to be placed
or35maintained, an advertisement of marijuana, useable
marijuana,36marijuana concentrates, or a marijuana-infused product
in any form or37through any medium whatsoever:38
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(a) Within one thousand feet of the perimeter of a
school1grounds, playground, recreation center or facility, child
care2center, public park, or library, or any game arcade admission
to3which is not restricted to persons aged twenty-one years or
older;4
(b) On or in a public transit vehicle or public transit
shelter;5or6
(c) On or in a publicly owned or operated property.7(2)
Merchandising within a retail outlet is not advertising for8
the purposes of this section.9(3) This section does not apply to
a noncommercial message.10(4) The state liquor ((control)) and
cannabis board ((shall))11
must fine a licensee one thousand dollars for each violation
of12subsection (1) of this section. Fines collected under this
subsection13must be deposited into the dedicated marijuana ((fund))
account14created under RCW 69.50.530.15
Sec. 205. RCW 69.50.535 and 2014 c 192 s 7 are each amended
to16read as follows:17
(1) ((There is levied and collected a marijuana excise tax
equal18to twenty-five percent of the selling price on each
wholesale sale in19this state of marijuana by a licensed marijuana
producer to a20licensed marijuana processor or another licensed
marijuana producer.21This tax is the obligation of the licensed
marijuana producer.22
(2) There is levied and collected a marijuana excise tax equal
to23twenty-five percent of the selling price on each wholesale sale
in24this state of marijuana concentrates, useable marijuana,
and25marijuana-infused products by a licensed marijuana processor
to a26licensed marijuana retailer. This tax is the obligation of
the27licensed marijuana processor.28
(3))) (a) There is levied and collected a marijuana excise
tax29equal to ((twenty-five)) thirty-seven percent of the selling
price on30each retail sale in this state of marijuana concentrates,
useable31marijuana, and marijuana-infused products. This tax is
((the32obligation of the licensed marijuana retailer, is)) separate
and in33addition to general state and local sales and use taxes
that apply to34retail sales of tangible personal property, and is
not part of the35total retail price to which general state and
local sales and use36taxes apply. The tax must be separately
itemized from the state and37local retail sales tax on the sales
receipt provided to the buyer.38
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(b) The tax levied in this section must be reflected in the
price1list or quoted shelf price in the licensed marijuana retail
store and2in any advertising that includes prices for all useable
marijuana,3marijuana concentrates, or marijuana-infused
products.4
(((4))) (2) All revenues collected from the marijuana
excise5((taxes)) tax imposed under ((subsections (1) through (3)
of)) this6section ((shall)) must be deposited each day in ((a
depository7approved by the state treasurer and transferred to the
state8treasurer to be credited to)) the dedicated marijuana
((fund))9account.10
(((5))) (3) The ((state liquor control board shall)) tax
imposed11in this section must be paid by the buyer to the seller.
Each seller12must collect from the buyer the full amount of the tax
payable on13each taxable sale. The tax collected as required by
this section is14deemed to be held in trust by the seller until
paid to the board. If15any seller fails to collect the tax imposed
in this section or,16having collected the tax, fails to pay it as
prescribed by the board,17whether such failure is the result of the
seller's own acts or the18result of acts or conditions beyond the
seller's control, the seller19is, nevertheless, personally liable
to the state for the amount of20the tax.21
(4) The definitions in this subsection apply throughout
this22section unless the context clearly requires otherwise.23
(a) "Board" means the state liquor and cannabis board.24(b)
"Retail sale" has the same meaning as in RCW 82.08.010.25(c)
"Selling price" has the same meaning as in RCW 82.08.010,26
except that when product is sold under circumstances where the
total27amount of consideration paid for the product is not
indicative of its28true value, "selling price" means the true value
of the product sold.29
(d) "Product" means marijuana, marijuana concentrates,
useable30marijuana, and marijuana-infused products.31
(e) "True value" means market value based on sales at
comparable32locations in this state of the same or similar product
of like33quality and character sold under comparable conditions of
sale to34comparable purchasers. However, in the absence of such
sales of the35same or similar product, true value means the value
of the product36sold as determined by all of the seller's direct
and indirect costs37attributable to the product.38
(5)(a) The board must regularly review the tax
level((s))39established under this section and make
recommendations, in40
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consultation with the department of revenue, to the legislature
as1appropriate regarding adjustments that would further the goal
of2discouraging use while undercutting illegal market prices.3
(b) The state liquor and cannabis board must report,
in4compliance with RCW 43.01.036, to the appropriate committees of
the5legislature every two years. The report at a minimum must
include the6following:7
(i) The specific recommendations required under (a) of
this8subsection;9
(ii) A comparison of gross sales and tax collections prior to
and10after any marijuana tax change;11
(iii) The increase or decrease in the volume of legal
marijuana12sold prior to and after any marijuana tax change;13
(iv) Increases or decreases in the number of licensed
marijuana14producers, processors, and retailers;15
(v) The number of illegal and noncompliant marijuana outlets
the16board requires to be closed;17
(vi) Gross marijuana sales and tax collections in Oregon;
and18(vii) The total amount of reported sales and use taxes
exempted19
for qualifying patients. The department of revenue must provide
the20data of exempt amounts to the board.21
(c) The board is not required to report to the legislature
as22required in (b) of this subsection after January 1, 2025.23
(6) The legislature does not intend and does not authorize
any24person or entity to engage in activities or to conspire to
engage in25activities that would constitute per se violations of
state and26federal antitrust laws including, but not limited to,
agreements27among retailers as to the selling price of any goods
sold.28
Sec. 206. RCW 69.50.540 and 2013 c 3 s 28 are each amended
to29read as follows:30
((All marijuana excise taxes collected from sales of
marijuana,31useable marijuana, and marijuana-infused products under
RCW3269.50.535, and the license fees, penalties, and forfeitures
derived33under chapter 3, Laws of 2013 from marijuana producer,
marijuana34processor, and marijuana retailer licenses shall every
three months35be disbursed by the state liquor control board as
follows:36
(1))) The legislature must annually appropriate moneys in
the37dedicated marijuana account created in RCW 69.50.530 as
follows:38
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(1) For the purposes listed in this subsection (1),
the1legislature must appropriate to the respective agencies
amounts2sufficient to make the following expenditures on a
quarterly basis:3
(a) One hundred twenty-five thousand dollars to the department
of4social and health services to design and administer the
Washington5state healthy youth survey, analyze the collected data,
and produce6reports, in collaboration with the office of the
superintendent of7public instruction, department of health,
department of commerce,8family policy council, and state liquor
((control)) and cannabis9board. The survey ((shall)) must be
conducted at least every two10years and include questions
regarding, but not necessarily limited11to, academic achievement,
age at time of substance use initiation,12antisocial behavior of
friends, attitudes toward antisocial behavior,13attitudes toward
substance use, laws and community norms regarding14antisocial
behavior, family conflict, family management, parental15attitudes
toward substance use, peer rewarding of antisocial16behavior,
perceived risk of substance use, and rebelliousness.
Funds17disbursed under this subsection may be used to expand
administration18of the healthy youth survey to student populations
attending19institutions of higher education in Washington;20
(((2))) (b) Fifty thousand dollars to the department of
social21and health services for the purpose of contracting with
the22Washington state institute for public policy to conduct the
cost-23benefit evaluation and produce the reports described in
RCW2469.50.550. This appropriation ((shall)) ends after production
of the25final report required by RCW 69.50.550;26
(((3))) (c) Five thousand dollars to the University of
Washington27alcohol and drug abuse institute for the creation,
maintenance, and28timely updating of web-based public education
materials providing29medically and scientifically accurate
information about the health30and safety risks posed by marijuana
use;31
(((4))) (d) An amount not ((exceeding)) less than one million
two32hundred fifty thousand dollars to the state liquor ((control
board as33is necessary for administration of chapter 3, Laws of
2013;34
(5) Of the funds remaining after the disbursements identified
in35subsections (1) through (4) of this section)) and cannabis
board for36administration of this chapter as appropriated in the
omnibus37appropriations act;38
(e) Twenty-three thousand seven hundred fifty dollars to
the39department of enterprise services provided solely for the
state40
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building code council established under RCW 19.27.070, to
develop and1adopt fire and building code provisions related to
marijuana2processing and extraction facilities. The distribution
under this3subsection (1)(e) is for fiscal year 2016 only;4
(2) From the amounts in the dedicated marijuana account
after5appropriation of the amounts identified in subsection (1) of
this6section, the legislature must appropriate for the purposes
listed in7this subsection (2) as follows:8
(a) ((Fifteen percent)) (i) Up to fifteen percent, but at
least9one million five hundred fifty thousand dollars annually, to
the10department of social and health services division of
behavioral11health and recovery for ((implementation and
maintenance)) the12development, implementation, maintenance, and
evaluation of programs13and practices aimed at the prevention or
reduction of maladaptive14substance use, substance-use disorder,
substance abuse or substance15dependence, as these terms are
defined in the Diagnostic and16Statistical Manual of Mental
Disorders, among middle school and high17school age students,
whether as an explicit goal of a given program18or practice or as a
consistently corresponding effect of its19implementation, mental
health services for children and youth, and20services for pregnant
and parenting women; PROVIDED, That:21
(((i))) (A) Of the funds ((disbursed)) appropriated under
(a)(i)22of this subsection for new programs and new services, at
least23eighty-five percent must be directed to evidence-based ((and
cost-24beneficial)) or research-based programs and practices that
produce25objectively measurable results and, by September 1, 2020,
are cost-26beneficial; and27
(((ii))) (B) Up to fifteen percent of the funds
((disbursed))28appropriated under (a)(i) of this subsection for new
programs and new29services may be directed to ((research-based
and)) proven and tested30practices, emerging best practices, or
promising practices.31
(ii) In deciding which programs and practices to fund,
the32secretary of the department of social and health services
((shall))33must consult, at least annually, with the University of
Washington's34social development research group and the University
of Washington's35alcohol and drug abuse institute;36
(b) ((Ten percent)) Up to ten percent, but at least eight
million37dollars annually, to the department of health for the
following:38
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(i) Creation, implementation, operation, and management of
a1marijuana education and public health program that contains
the2following:3
(((i))) (A) A marijuana use public health hotline that
provides4referrals to substance abuse treatment providers, utilizes
evidence-5based or research-based public health approaches to
minimizing the6harms associated with marijuana use, and does not
solely advocate an7abstinence-only approach;8
(((ii))) (B) A grants program for local health departments
or9other local community agencies that supports development
and10implementation of coordinated intervention strategies for
the11prevention and reduction of marijuana use by youth; and12
(((iii))) (C) Media-based education campaigns across
television,13internet, radio, print, and out-of-home advertising,
separately14targeting youth and adults, that provide medically and
scientifically15accurate information about the health and safety
risks posed by16marijuana use; and17
(ii) The Washington poison control center;18(c) ((Six-tenths of
one percent to the University of Washington19
and four-tenths of one percent)) Up to six-tenths of one
percent, but20at least two hundred six thousand dollars annually to
the University21of Washington, and up to four-tenths of one
percent, but at least one22hundred thirty-eight thousand dollars
annually, to Washington State23University for research on the short
and long-term effects of24marijuana use, to include but not be
limited to formal and informal25methods for estimating and
measuring intoxication and impairment, and26for the dissemination
of such research;27
(d) ((Fifty percent to the state basic health plan
trust28account)) Up to fifty percent, but at least seventeen
million two29hundred nineteen thousand dollars annually, to be
administered by the30Washington basic health plan administrator and
used as provided under31chapter 70.47 RCW;32
(e) ((Five percent)) Up to five percent, but at least one
million33seven hundred twenty-two thousand dollars annually, to the
Washington34state health care authority to be expended exclusively
through35contracts with community health centers to provide primary
health and36dental care services, migrant health services, and
maternity health37care services as provided under RCW
41.05.220;38
(f) ((Three-tenths of one percent)) Up to three-tenths of
one39percent, but at least one hundred three thousand dollars
annually, to40
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the office of the superintendent of public instruction to fund
grants1to building bridges programs under chapter 28A.175 RCW;
((and))2
(g) ((The remainder to the general fund.)) Up to one
million3eight hundred thousand dollars annually to the department
of commerce4provided solely for community mobilization purposes as
identified in5RCW 43.270.020, subject to the amounts appropriated
by the6legislature for this purpose; and7
(h) At the end of each fiscal year, the treasurer must
transfer8any amounts in the dedicated marijuana account that are
not9appropriated pursuant to subsection (1) of this section and
this10subsection (2) into the general fund, except as provided in
(h)(i) of11this subsection (2).12
(i) Beginning in fiscal year 2018 and each year thereafter,
if13marijuana excise tax collections deposited into the general
fund in14the prior fiscal year exceed twenty-five million dollars,
then each15fiscal year the legislature must appropriate an amount
equal to16thirty percent of all marijuana excise taxes deposited
into the17general fund the prior fiscal year to the treasurer for
distribution18to counties, cities, and towns as follows:19
(A) Thirty percent must be distributed to counties, cities,
and20towns where licensed marijuana retailers are physically
located. Each21jurisdiction must receive a share of the revenue
distribution under22this subsection (2)(h)(i)(A) based on the
proportional share of the23total revenues generated in the
individual jurisdiction from the24taxes collected under RCW
69.50.535, from licensed marijuana25retailers physically located in
each jurisdiction. For purposes of26this subsection (2)(h)(i)(A),
one hundred percent of the proportional27amount attributed to a
retailer physically located in a city or town28must be distributed
to the city or town.29
(B) Seventy percent must be distributed to counties, cities,
and30towns ratably on a per capita basis. Counties must receive
sixty31percent of the distribution, which shall be disbursed based
on each32county's total proportional population, including the
population33within incorporated cities and towns, and cities and
towns must34receive forty percent of this distribution, which must
be based on35each city or town's total proportional population.
Funds may only be36distributed to jurisdictions that do not
prohibit the siting of any37state licensed marijuana producer,
processor, or retailer; except for38counties that prohibit the
siting of any state licensed marijuana39producer, processor, or
retailer, but have cities or towns within the40
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county which contain marijuana retail stores, such counties
must1receive twenty percent of the funds they would otherwise
receive if2they did not prohibit the siting of marijuana producers,
processors,3or retailers. The funds forfeited by a county
prohibiting the siting4of any state licensed marijuana producer,
processor, or retailer must5be disbursed to the other counties on a
per capita basis using each6county's total proportional population,
including the population7within incorporated cities and towns.8
(ii) Distribution amounts allocated to each county, city,
and9town must be distributed in four installments by the last day
of each10fiscal quarter.11
(iii) By September 15th of each year, the state liquor
and12cannabis board must provide the state treasurer the
annual13distribution amount, if any, for each county and city as
determined14in (h)(i) of this subsection (2).15
(iv) The total share of marijuana excise tax revenues
distributed16to counties and cities in (h)(i) of this subsection
(2) may not17exceed fifteen million dollars per fiscal year through
June 30, 2019,18and may not exceed twenty million dollars per
fiscal year thereafter.19
For the purposes of this section, "marijuana products"
means20"useable marijuana," "marijuana concentrates," and
"marijuana-infused21products" as those terms are defined in RCW
69.50.101.22
NEW SECTION. Sec. 207. A new section is added to chapter
82.0823RCW to read as follows:24
(1) Beginning July 1, 2016, the tax levied by RCW 82.08.020
does25not apply to:26
(a) Sales of marijuana concentrates, useable marijuana,
or27marijuana-infused products, identified by the department of
health28under RCW 69.50.--- (section 10, chapter 70, Laws of 2015)
to be29beneficial for medical use, by marijuana retailers with
medical30marijuana endorsements to qualifying patients or
designated providers31who have been issued recognition cards;32
(b) Sales of products containing THC with a THC concentration
of330.3 percent or less to qualifying patients or designated
providers34who have been issued recognition cards by marijuana
retailers with35medical marijuana endorsements;36
(c) Sales of marijuana concentrates, useable marijuana,
or37marijuana-infused products, identified by the department of
health38under RCW 69.50.--- (section 10, chapter 70, Laws of 2015)
to have a39
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low THC, high CBD ratio, and to be beneficial for medical use,
by1marijuana retailers with medical marijuana endorsements, to
any2person;3
(d) Sales of topical, noningestible products containing THC
with4a THC concentration of 0.3 percent or less by health
care5professionals under RCW 69.51A.--- (section 35, chapter 70,
Laws of62015);7
(e)(i) Marijuana, marijuana concentrates, useable
marijuana,8marijuana-infused products, or products containing THC
with a THC9concentration of 0.3 percent or less produced by a
cooperative and10provided to its members; and11
(ii) Any nonmonetary resources and labor contributed by
an12individual member of the cooperative in which the individual is
a13member. However, nothing in this subsection (1)(e) may be
construed14to exempt the individual members of a cooperative from
the tax15imposed in RCW 82.08.020 on any purchase of property or
services16contributed to the cooperative.17
(2) From the effective date of this section until July 1,
2016,18the tax levied by RCW 82.08.020 does not apply to sales of
marijuana,19marijuana concentrates, useable marijuana,
marijuana-infused20products, or products containing THC with a THC
concentration of 0.321percent or less, by collective gardens under
RCW 69.51A.085 to22qualifying patients or designated providers, if
such sales are in23compliance with chapter 69.51A RCW.24
(3) Each seller making exempt sales under subsection (1) or
(2)25of this section must maintain information establishing
eligibility26for the exemption in the form and manner required by
the department.27
(4) The department must provide a separate tax reporting line
for28exemption amounts claimed under this section.29
(5) The definitions in this subsection apply throughout
this30section unless the context clearly requires otherwise.31
(a) "Cooperative" means a cooperative authorized by and
operating32in compliance with RCW 69.51A.--- (section 26, chapter
70, Laws of332015).34
(b) "Marijuana retailer with a medical marijuana
endorsement"35means a marijuana retailer permitted under RCW
69.50.--- (section 10,36chapter 70, Laws of 2015) to sell marijuana
for medical use to37qualifying patients and designated
providers.38
(c) "Products containing THC with a THC concentration of
0.339percent or less" means all products containing THC with a
THC40
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concentration not exceeding 0.3 percent and that, when used
as1intended, are inhalable, ingestible, or absorbable.2
(d) "THC concentration," "marijuana," "marijuana
concentrates,"3"useable marijuana," "marijuana retailer," and
"marijuana-infused4products" have the same meanings as provided in
RCW 69.50.101 and the5terms "qualifying patients," "designated
providers," and "recognition6card" have the same meaning as
provided in RCW 69.51A.010.7
NEW SECTION. Sec. 208. A new section is added to chapter
82.128RCW to read as follows:9
(1) From the effective date of this section until July 1,
2016,10the provisions of this chapter do not apply to the use of
marijuana,11marijuana concentrates, useable marijuana,
marijuana-infused12products, or products containing THC with a THC
concentration of 0.313percent or less, by a collective garden under
RCW 69.51A.085, and the14qualifying patients or designated
providers participating in the15collective garden, if such use is
in compliance with chapter 69.51A16RCW.17
(2) Beginning July 1, 2016, the provisions of this chapter do
not18apply to:19
(a) The use of marijuana concentrates, useable marijuana,
or20marijuana-infused products, identified by the department of
health21under RCW 69.50.--- (section 10, chapter 70, Laws of 2015)
to be22beneficial for medical use, by qualifying patients or
designated23providers who have been issued recognition cards and
have obtained24such products from a marijuana retailer with a
medical marijuana25endorsement.26
(b) The use of products containing THC with a THC
concentration27of 0.3 percent or less by qualifying patients or
designated providers28who have been issued recognition cards and
have obtained such29products from a marijuana retailer with a
medical marijuana30endorsement.31
(c)(i) Marijuana retailers with a medical marijuana
endorsement32with respect to:33
(A) Marijuana concentrates, useable marijuana, or
marijuana-34infused products; or35
(B) Products containing THC with a THC concentration of
0.336percent or less;37
(ii) The exemption in this subsection (2)(c) applies only if
such38products are provided at no charge to a qualifying patient
or39
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designated provider who has been issued a recognition card. Each
such1retailer providing such products at no charge must
maintain2information establishing eligibility for this exemption in
the form3and manner required by the department.4
(d) The use of marijuana concentrates, useable marijuana,
or5marijuana-infused products, identified by the department of
health6under RCW 69.50.--- (section 10, chapter 70, Laws of 2015)
to have a7low THC, high CBD ratio, and to be beneficial for medical
use,8purchased from marijuana retailers with a medical
marijuana9endorsement.10
(e) Health care professionals with respect to the use of
products11containing THC with a THC concentration of 0.3 percent or
less12provided at no charge by the health care professionals under
RCW1369.51A.--- (section 35, chapter 70, Laws of 2015). Each health
care14professional providing such products at no charge must
maintain15information establishing eligibility for this exemption
in the form16and manner required by the department.17
(f) The use of topical, noningestible products containing
THC18with a THC concentration of 0.3 percent or less by
qualifying19patients when purchased from or provided at no charge
by a health20care professional under RCW 69.51A.--- (section 35,
chapter 70, Laws21of 2015).22
(g) The use of:23(i) Marijuana, marijuana concentrates, useable
marijuana,24
marijuana-infused products, or products containing THC with a
THC25concentration of 0.3 percent or less, by a cooperative and
its26members, when produced by the cooperative; and27
(ii) Any nonmonetary resources and labor by a cooperative
when28contributed by its members. However, nothing in this
subsection29(2)(g) may be construed to exempt the individual
members of a30cooperative from the tax imposed in RCW 82.12.020 on
the use of any31property or services purchased by the member and
contributed to the32cooperative.33
(3) The definitions in section 207 of this act apply to
this34section.35
NEW SECTION. Sec. 209. The provisions of RCW 82.32.805
and3682.32.808(8) do not apply to the exemptions in sections 207
and 20837of this act.38
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NEW SECTION. Sec. 210. A new section is added to chapter
69.501RCW to read as follows:2
(1)(a) Except as provided in (b) of this subsection, a
retail3sale of a bundled transaction that includes marijuana
product is4subject to the tax imposed under RCW 69.50.535 on the
entire selling5price of the bundled transaction.6
(b) If the selling price is attributable to products that
are7taxable and products that are not taxable under RCW 69.50.535,
the8portion of the price attributable to the nontaxable products
are9subject to the tax imposed by RCW 69.50.535 unless the seller
can10identify by reasonable and verifiable standards the portion
that is11not subject to tax from its books and records that are
kept in the12regular course of business for other purposes
including, but not13limited to, nontax purposes.14
(2) The definitions in this subsection apply throughout
this15section unless the context clearly requires otherwise.16
(a) "Bundled transaction" means:17(i) The retail sale of two or
more products where the products18
are otherwise distinct and identifiable, are sold for one
nonitemized19price, and at least one product is a marijuana product
subject to the20tax under RCW 69.50.535; and21
(ii) A marijuana product provided free of charge with
the22required purchase of another product. A marijuana product is
provided23free of charge if the sales price of the product
purchased does not24vary depending on the inclusion of the
marijuana product provided25free of charge.26
(b) "Distinct and identifiable products" does not
include27packaging such as containers, boxes, sacks, bags, and
bottles, or28materials such as wrapping, labels, tags, and
instruction guides,29that accompany the retail sale of the products
and are incidental or30immaterial to the retail sale thereof.
Examples of packaging that are31incidental or immaterial include
grocery sacks, shoeboxes, and dry32cleaning garment bags.33
(c) "Marijuana product" means "useable marijuana,"
"marijuana34concentrates," and "marijuana-infused products" as
defined in RCW3569.50.101.36
(d) "Selling price" has the same meaning as in RCW
82.08.010,37except that when product is sold under circumstances
where the total38amount of consideration paid for the product is
not indicative of its39true value, "selling price" means the true
value of the product sold.40
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(e) "True value" means market value based on sales at
comparable1locations in this state of the same or similar product
of like2quality and character sold under comparable conditions of
sale to3comparable purchasers. However, in the absence of such
sales of the4same or similar product, "true value" means the value
of the product5sold as determined by all of the seller's direct and
indirect costs6attributable to the product.7
NEW SECTION. Sec. 211. A new section is added to chapter
69.508RCW to read as follows:9
(1) Marijuana producers, processors, and retailers are
prohibited10from making sales of any marijuana or marijuana
product, if the sale11of the marijuana or marijuana product is
conditioned upon the buyer's12purchase of any service or
nonmarijuana product. This subsection13applies whether the buyer
purchases such service or nonmarijuana14product at the time of sale
of the marijuana or marijuana product, or15in a separate
transaction.16
(2) The definitions in this subsection apply throughout
this17section unless the context clearly requires otherwise.18
(a) "Marijuana product" means "useable marijuana,"
"marijuana19concentrates," and "marijuana-infused products," as
those terms are20defined in RCW 69.50.101.21
(b) "Nonmarijuana product" includes paraphernalia,
promotional22items, lighters, bags, boxes, containers, and such
other items as may23be identified by the state liquor and cannabis
board.24
(c) "Selling price" has the same meaning as in RCW
69.50.535.25(d) "Service" includes memberships and any other
services26
identified by the state liquor and cannabis board.27
PART III28Marijuana Business: Buffers and Licensee
Residency29
NEW SECTION. Sec. 301. (1) The legislature finds that
licensing30of marijuana producer and processor businesses within an
area zoned31for residential use or an area zoned for rural use with
a minimum lot32size of five acres creates a public nuisance, lowers
property values,33and increases the risk of criminal activity. The
impacts of these34businesses greatly affects the economic value of
the neighboring35properties through many factors, such as increased
traffic and the36
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potential for increased criminal activity, including
trespassing,1theft, and acts of physical violence.2
(2) The legislature finds that locating and relocating
these3businesses in other areas more suitable for producing
marijuana and4processing marijuana, useable marijuana, marijuana
concentrates, and5marijuana-infused products poses a smaller cost
on society than to6allow the businesses to diminish the public
health, safety, and7welfare of the neighboring residential and
rural properties. The8legislature also finds that the newly
prohibited areas have other9economically viable or beneficial uses
and are not diminished in10value by this act, and in many of these
instances this act may11increase the value of the properties in
question.12
Sec. 302. RCW 69.50.331 and 2015 c 70 s 6 are each amended
to13read as follows:14
(1) For the purpose of considering any application for a
license15to produce, process, research, transport, or deliver
marijuana,16useable marijuana, marijuana concentrates, or
marijuana-infused17products subject to the regulations established
under section 502 of18this act, or sell marijuana, or for the
renewal of a license to19produce, process, research, transport, or
deliver marijuana, useable20marijuana, marijuana concentrates, or
marijuana-infused products21subject to the regulations established
under section 502 of this act,22or sell marijuana, the state liquor
and cannabis board must conduct a23comprehensive, fair, and
impartial evaluation of the applications24timely received.25
(a) The state liquor and cannabis board must develop
a26competitive, merit-based application process that includes, at
a27minimum, the opportunity for an applicant to demonstrate
experience28and qualifications in the marijuana industry. The state
liquor and29cannabis board ((shall)) must give preference between
competing30applications in the licensing process to applicants that
have the31following experience and qualifications, in the following
order of32priority:33
(i) First priority is given to applicants who:34(A) Applied to
the state liquor and cannabis board for a35
marijuana retailer license prior to July 1, 2014;36(B) Operated
or were employed by a collective garden before37
January 1, 2013;38
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(C) Have maintained a state business license and a
municipal1business license, as applicable in the relevant
jurisdiction; and2
(D) Have had a history of paying all applicable state taxes
and3fees;4
(ii) Second priority ((shall)) must be given to applicants
who:5(A) Operated or were employed by a collective garden
before6
January 1, 2013;7(B) Have maintained a state business license
and a municipal8
business license, as applicable in the relevant jurisdiction;
and9(C) Have had a history of paying all applicable state taxes
and10
fees; and11(iii) Third priority ((shall)) must be given to all
other12
applicants who do not have the experience and
qualifications13identified in (a)(i) and (ii) of this
subsection.14
(b) The state liquor and cannabis board may cause an
inspection15of the premises to be made, and may inquire into all
matters in16connection with the construction and operation of the
premises. For17the purpose of reviewing any application for a
license and for18considering the denial, suspension, revocation, or
renewal or denial19thereof, of any license, the state liquor and
cannabis board may20consider any prior criminal conduct of the
applicant including an21administrative violation history record
with the state liquor and22cannabis board and a criminal history
record information check. The23state liquor and cannabis board may
submit the criminal history24record information check to the
Washington state patrol and to the25identification division of the
federal bureau of investigation in26order that these agencies may
search their records for prior arrests27and convictions of the
individual or individuals who filled out the28forms. The state
liquor and cannabis board ((shall)) must require29fingerprinting of
any applicant whose criminal history record30information check is
submitted to the federal bureau of31investigation. The provisions
of RCW 9.95.240 and of chapter 9.96A32RCW ((shall)) do not apply to
these cases. Subject to the provisions33of this section, the state
liquor and cannabis board may, in its34discretion, grant or deny
the renewal or license applied for. Denial35may be based on,
without limitation, the existence of chronic illegal36activity
documented in objections submitted pursuant to subsections37(7)(c)
and (((9))) (10) of this section. Authority to approve
an38uncontested or unopposed license may be granted by the state
liquor39and cannabis board to any staff member the board designates
in40
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writing. Conditions for granting this authority ((shall)) must
be1adopted by rule.2
(c) No license of any kind may be issued to:3(i) A person under
the age of twenty-one years;4(ii) A person doing business as a sole
proprietor who has not5
lawfully resided in the state for at least three months prior
to6applying to receive a license;7
(iii) A partnership, employee cooperative, association,
nonprofit8corporation, or corporation unless formed under the laws
of this9state, and unless all of the members thereof are qualified
to obtain10a license as provided in this section; or11
(iv) A person whose place of business is conducted by a
manager12or agent, unless the manager or agent possesses the
same13qualifications required of the licensee.14
(2)(a) The state liquor and cannabis board may, in
its15discretion, subject to the provisions of RCW 69.50.334,
suspend or16cancel any license; and all protections of the licensee
from criminal17or civil sanctions under state law for producing,
processing, or18selling marijuana, useable marijuana, or
marijuana-infused products19thereunder shall be suspended or
terminated, as the case may be.20
(b) The state liquor and cannabis board ((shall))
must21immediately suspend the license of a person who has been
certified22pursuant to RCW 74.20A.320 by the department of social
and health23services as a person who is not in compliance with a
support order.24If the person has continued to meet all other
requirements for25reinstatement during the suspension, reissuance
of the license26((shall be)) is automatic upon the state liquor and
cannabis board's27receipt of a release issued by the department of
social and health28services stating that the licensee is in
compliance with the order.29
(c) The state liquor and cannabis board may request
the30appointment of administrative law judges under chapter 34.12
RCW who31shall have power to administer oaths, issue subpoenas for
the32attendance of witnesses and the production of papers,
books,33accounts, documents, and testimony, examine witnesses, and
to receive34testimony in any inquiry, investigation, hearing, or
proceeding in35any part of the state, under rules and regulations
the state liquor36and cannabis board may adopt.37
(d) Witnesses ((shall)) must be allowed fees and mileage each
way38to and from any inquiry, investigation, hearing, or proceeding
at the39rate authorized by RCW 34.05.446. Fees need not be paid in
advance of40
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appearance of witnesses to testify or to produce books, records,
or1other legal evidence.2
(e) In case of disobedience of any person to comply with
the3order of the state liquor and cannabis board or a subpoena
issued by4the state liquor and cannabis board, or any of its
members, or5administrative law judges, or on the refusal of a
witness to testify6to any matter regarding which he or she may be
lawfully interrogated,7the judge of the superior court of the
county in which the person8resides, on application of any member of
the board or administrative9law judge, ((shall)) compels obedience
by contempt proceedings, as in10the case of disobedience of the
requirements of a subpoena issued11from said court or a refusal to
testify therein.12
(3) Upon receipt of notice of the suspension or cancellation of
a13license, the licensee ((shall)) must forthwith deliver up the
license14to the state liquor and cannabis board. Where the license
has been15suspended only, the state liquor and cannabis board
((shall)) must16return the license to the licensee at the
expiration or termination17of the period of suspension. The state
liquor and cannabis board18((shall)) must notify all other
licensees in the county where the19subject licensee has its
premises of the suspension or cancellation20of the license; and no
other licensee or employee of another licensee21may allow or cause
any marijuana, marijuana concentrates, useable22marijuana, or
marijuana-infused products to be delivered to or for23any person at
the premises of the subject licensee.24
(4) Every license issued under chapter 3, Laws of 2013
((shall25be)) is subject to all conditions and restrictions imposed
by chapter263, Laws of 2013 or by rules adopted by the state liquor
and cannabis27board to implement and enforce chapter 3, Laws of
2013. All28conditions and restrictions imposed by the state liquor
and cannabis29board in the issuance of an individual license
((shall)) must be30listed on the face of the individual license
along with the trade31name, address, and expiration date.32
(5) Every licensee ((shall)) must post and keep posted
its33license, or licenses, in a conspicuous place on the
premises.34
(6) No licensee ((shall)) may employ any person under the age
of35twenty-one years.36
(7)(a) Before the state liquor and cannabis board issues a new
or37renewed license to an applicant it ((shall)) must give notice
of the38application to the chief executive officer of the
incorporated city39or town, if the application is for a license
within an incorporated40
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city or town, or to the county legislative authority, if
the1application is for a license outside the boundaries of
incorporated2cities or towns.3
(b) The incorporated city or town through the official
or4employee selected by it, or the county legislative authority or
the5official or employee selected by it, ((shall have)) has the
right to6file with the state liquor and cannabis board within
twenty days7after the date of transmittal of the notice for
applications, or at8least thirty days prior to the expiration date
for renewals, written9objections against the applicant or against
the premises for which10the new or renewed license is asked. The
state liquor and cannabis11board may extend the time period for
submitting written objections.12
(c) The written objections ((shall)) must include a statement
of13all facts upon which the objections are based, and in case
written14objections are filed, the city or town or county
legislative15authority may request, and the state liquor and
cannabis board may in16its discretion hold, a hearing subject to
the applicable provisions17of Title 34 RCW. If the state liquor and
cannabis board makes an18initial decision to deny a license or
renewal based on the written19objections of an incorporated city or
town or county legislative20authority, the applicant may request a
hearing subject to the21applicable provisions of Title 34 RCW. If a
hearing is held at the22request of the applicant, state liquor and
cannabis board23representatives ((shall)) must present and defend
the state liquor24and cannabis board's initial decision to deny a
license or renewal.25
(d) Upon the granting of a license under this title the
state26liquor and cannabis board ((shall)) must send written
notification to27the chief executive officer of the incorporated
city or town in which28the license is granted, or to the county
legislative authority if the29license is granted outside the
boundaries of incorporated cities or30towns.31
(8)(a) Except as provided in (b) through (d) of this
subsection,32the state liquor and cannabis board ((shall)) may not
issue a license33for any premises within one thousand feet of the
perimeter of the34grounds of any elementary or secondary school,
playground, recreation35center or facility, child care center,
public park, public transit36center, or library, or any game arcade
admission to which is not37restricted to persons aged twenty-one
years or older.38
(b) A city, county, or town may permit the licensing of
premises39within one thousand feet but not less than one hundred
feet of the40
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facilities described in (a) of this subsection, except
elementary1schools, secondary schools, and playgrounds, by enacting
an ordinance2authorizing such distance reduction, provided that
such distance3reduction will not negatively impact the
jurisdiction's civil4regulatory enforcement, criminal law
enforcement interests, public5safety, or public health.6
(c) A city, county, or town may permit the licensing of
research7premises allowed under RCW 69.50.--- (section 1, chapter
71, Laws of82015) within one thousand feet but not less than one
hundred feet of9the facilities described in (a) of this subsection
by enacting an10ordinance authorizing such distance reduction,
provided that the11ordinance will not negatively impact the
jurisdiction's civil12regulatory enforcement, criminal law
enforcement, public safety, or13public health.14
(d) The state liquor and cannabis board may license
premises15located in compliance with the distance requirements set
in an16ordinance adopted under (b) or (c) of this subsection.
Before issuing17or renewing a research license for premises within
one thousand feet18but not less than one hundred feet of an
elementary school, secondary19school, or playground in compliance
with an ordinance passed pursuant20to (c) of this subsection, the
board must ensure that the facility:21
(i) Meets a security standard exceeding that which applies
to22marijuana producer, processor, or retailer licensees;23
(ii) Is inaccessible to the public and no part of the
operation24of the facility is in view of the general public;
and25
(iii) Bears no advertising or signage indicating that it is
a26marijuana research facility.27
(9) The state liquor and cannabis board may not issue a
marijuana28producer or marijuana processor license for any premises
located29within an area zoned for residential use or an area zoned
for rural30use with a minimum lot size of five acres.31
(10) In determining whether to grant or deny a license or
renewal32of any license, the state liquor and cannabis board
((shall)) must33give substantial weight to objections from an
incorporated city or34town or county legislative authority based
upon chronic illegal35activity associated with the applicant's
operations of the premises36proposed to be licensed or the
applicant's operation of any other37licensed premises, or the
conduct of the applicant's patrons inside38or outside the licensed
premises. "Chronic illegal activity" means39(a) a pervasive pattern
of activity that threatens the public health,40
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safety, and welfare of the city, town, or county including, but
not1limited to, open container violations, assaults,
disturbances,2disorderly conduct, or other criminal law violations,
or as3documented in crime statistics, police reports, emergency
medical4response data, calls for service, field data, or similar
records of a5law enforcement agency for the city, town, county, or
any other6municipal corporation or any state agency; or (b) an
unreasonably7high number of citations for violations of RCW
46.61.502 associated8with the applicant's or licensee's operation
of any licensed premises9as indicated by the reported statements
given to law enforcement upon10arrest.11
PART IV12Consumption of Marijuana in a Public Place13
Sec. 401. RCW 69.50.445 and 2013 c 3 s 21 are each amended
to14read as follows:15
(1) It is unlawful to open a package containing
marijuana,16useable marijuana, ((or a)) marijuana-infused products,
or marijuana17concentrates, or consume marijuana, useable
marijuana, ((or a))18marijuana-infused products, or marijuana
concentrates, in view of the19general public or in a public
place.20
(2) For the purposes of this section, "public place" has the
same21meaning as defined in RCW 66.04.010, but the exclusions in
RCW2266.04.011 do not apply.23
(3) A person who violates this section is guilty of a class
324civil infraction under chapter 7.80 RCW.25
PART V26Transportation of Marijuana Products27
NEW SECTION. Sec. 501. A new section is added to chapter
69.5028RCW to read as follows:29
(1) A licensed marijuana producer, marijuana processor,
marijuana30researcher, or marijuana retailer, or their employees,
in accordance31with the requirements of this chapter and the
administrative rules32adopted thereunder, may use the services of a
common carrier subject33to regulation under chapters 81.28 and
81.29 RCW and licensed in34compliance with the regulations
established under section 502 of this35act, to physically transport
or deliver marijuana, useable marijuana,36
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marijuana concentrates, and marijuana-infused products
between1licensed marijuana businesses located within the
state.2
(2) An employee of a common carrier engaged in
marijuana-related3transportation or delivery services authorized
under subsection (1)4of this section is prohibited from carrying or
using a firearm during5the course of providing such services,
unless:6
(a) Pursuant to section 502 of this act, the state liquor
and7cannabis board explicitly authorizes the carrying or use of
firearms8by such employee while engaged in the transportation or
delivery9services;10
(b) The employee has an armed private security guard
license11issued pursuant to RCW 18.170.040; and12
(c) The employee is in full compliance with the
regulations13established by the state liquor and cannabis board
under section 50214of this act.15
(3) A common carrier licensed under section 502 of this act
may,16for the purpose of transporting and delivering marijuana,
useable17marijuana, marijuana concentrates, and marijuana-infused
products,18utilize Washington state ferry routes for such
transportation and19delivery.20
(4) The possession of marijuana, useable marijuana,
marijuana21concentrates, and marijuana-infused products being
physically22transported or delivered within the state, in amounts
not exceeding23those that may be established under section 502(3)
of this act, by a24licensed employee of a common carrier when
performing the duties25authorized under, and in accordance with,
this section and section26502 of this act, is not a violation of
this section, this chapter, or27any other provision of Washington
state law.28
NEW SECTION. Sec. 502. A new section is added to chapter
69.5029RCW to read as follows:30
(1) The state liquor and cannabis board must adopt
rules31providing for an annual licensing procedure of a common
carrier who32seeks to transport or deliver marijuana, useable
marijuana, marijuana33concentrates, and marijuana-infused products
within the state.34
(2) The rules for licensing must:35(a) Establish criteria for
considering the approval or denial of36
a common carrier's original application or renewal
application;37
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(b) Provide minimum qualifications for any employee authorized
to1drive or operate the transportation or delivery vehicle,
including a2minimum age of at least twenty-one years;3
(c) Address the safety of the employees transporting
or4delivering the products, including issues relating to the
carrying of5firearms by such employees;6
(d) Address the security of the products being
transported,7including a system of electronically tracking all
products at both8the point of pickup and the point of delivery;
and9
(e) Set reasonable fees for the application and
licensing10process.11
(3) The state liquor and cannabis board may adopt
rules12establishing the maximum amounts of marijuana, useable
marijuana,13marijuana concentrates, and marijuana-infused products
that may be14physically transported or delivered at one time by a
common carrier15as provided under section 501 of this act.16
Sec. 503. RCW 69.50.4013 and 2015 c 70 s 14 are each amended
to17read as follows:18
(1) It is unlawful for any person to possess a
controlled19substance unless the substance was obtained directly
from, or20pursuant to, a valid prescription or order of a
practitioner while21acting in the course of his or her professional
practice, or except22as otherwise authorized by this chapter.23
(2) Except as provided in RCW 69.50.4014, any person who
violates24this section is guilty of a class C felony punishable
under chapter259A.20 RCW.26
(3)(a) The possession, by a person twenty-one years of age
or27older, of useable marijuana, marijuana concentrates, or
marijuana-28infused products in amounts that do not exceed those
set forth in RCW2969.50.360(3) is not a violation of this section,
this chapter, or any30other provision of Washington state
law.31
(b) The possession of marijuana, useable marijuana,
marijuana32concentrates, and marijuana-infused products being
physically33transported or delivered within the state, in amounts
not exceeding34those that may be established under section 502(3)
of this act, by a35licensed employee of a common carrier when
performing the duties36authorized in accordance with sections 501
and 502 of this act, is37not a violation of this section, this
chapter, or any other provision38of Washington state law.39
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(4) No person under twenty-one years of age may
possess,1manufacture, sell, or distribute marijuana,
marijuana-infused2products, or marijuana concentrates, regardless
of THC concentration.3This does not include qualifying patients
with a valid authorization.4
(5) The possession by a qualifying patient or designated
provider5of marijuana concentrates, useable marijuana,
marijuana-infused6products, or plants in accordance with chapter
69.51A RCW is not a7violation of this section, this chapter, or any
other provision of8Washington state law.9
Sec. 504. RCW 18.170.020 and 2007 c 154 s 2 are each amended
to10read as follows:11
The requirements of this chapter do not apply to:12(1) A person
who is employed exclusively or regularly by one13
employer and performs the functions of a private security
guard14solely in connection with the affairs of that employer, if
the15employer is not a private security company. However, in
accordance16with section 501 of this act, an employee engaged in
marijuana-17related transportation or delivery services on behalf
of a common18carrier must be licensed as an armed private security
guard under19this chapter in order to be authorized to carry or use
a firearm20while providing such services;21
(2) A sworn peace officer while engaged in the performance of
the22officer's official duties;23
(3) A sworn peace officer while employed by any person to
engage24in off-duty employment as a private security guard, but
only if the25employment is approved by the chief law enforcement
officer of the26jurisdiction where the employment takes place and
the sworn peace27officer does not employ, contract with, or broker
for profit other28persons to assist him or her in performing the
duties related to his29or her private employer; or30
(4)(a) A person performing crowd management or guest
services31including, but not limited to, a person described as a
ticket taker,32usher, door attendant, parking attendant, crowd
monitor, or event33staff who:34
(((a))) (i) Does not carry a firearm or other dangerous
weapon35including, but not limited to, a stun gun, taser, pepper
mace, or36nightstick;37
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(((b))) (ii) Does not wear a uniform or clothing
readily1identifiable by a member of the public as that worn by a
private2security officer or law enforcement officer; and3
(((c))) (iii) Does not have as his or her primary
responsibility4the detainment of persons or placement of persons
under arrest.5
(b) The exemption provided in this subsection applies only when
a6crowd has assembled for the purpose of attending or taking part
in an7organized event, including preevent assembly, event operation
hours,8and postevent departure activities.9
Sec. 505. RCW 69.50.4014 and 2003 c 53 s 335 are each amended
to10read as follows:11
Except as provided in RCW 69.50.401(2)(c) or as
otherwise12authorized by this chapter, any person found guilty of
possession of13forty grams or less of ((marihuana)) marijuana is
guilty of a14misdemeanor.15
PART VI16Funding for Marijuana Health Awareness Program17
Sec. 601. RCW 66.08.050 and 2014 c 63 s 3 are each amended
to18read as follows:19
The board, subject to the provisions of this title and the
rules,20must:21
(1) Determine the nature, form and capacity of all packages to
be22used for containing liquor kept for sale under this
title;23
(2) Execute or cause to be executed, all contracts, papers,
and24documents in the name of the board, under such regulations as
the25board may fix;26
(3) Pay all customs, duties, excises, charges and
obligations27whatsoever relating to the business of the
board;28
(4) Require bonds from all employees in the discretion of
the29board, and to determine the amount of fidelity bond of each
such30employee;31
(5) Perform services for the state lottery commission to
such32extent, and for such compensation, as may be mutually agreed
upon33between the board and the commission;34
(6) Accept and deposit into the general fund-local account
and35disburse, subject to appropriation, federal grants or other
funds or36donations from any source for the purpose of improving
public37
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awareness of the health risks associated with alcohol and
marijuana1consumption by youth and the abuse of alcohol and
marijuana by adults2in Washington state. The board's alcohol
awareness program must3cooperate with federal and state agencies,
interested organizations,4and individuals to effect an active
public beverage alcohol awareness5program;6
(7) Monitor and regulate the practices of licensees as
necessary7in order to prevent the theft and illegal trafficking of
liquor8pursuant to RCW 66.28.350;9
(8) Perform all other matters and things, whether similar to
the10foregoing or not, to carry out the provisions of this title,
and has11full power to do each and every act necessary to the
conduct of its12regulatory functions, including all supplies
procurement, preparation13and approval of forms, and every other
undertaking necessary to14perform its regulatory functions
whatsoever, subject only to audit by15the state auditor. However,
the board has no authority to regulate16the content of spoken
language on licensed premises where wine and17other liquors are
served and where there is not a clear and present18danger of
disorderly conduct being provoked by such language or to19restrict
advertising of lawful prices.20
PART VII21Cannabis Health and Beauty Aid Exemption22
NEW SECTION. Sec. 701. A new section is added to chapter
69.5023RCW to read as follows:24
(1) Cannabis health and beauty aids are not subject to
the25regulations and penalties of this chapter that apply to
marijuana,26marijuana concentrates, or marijuana-infused
products.27
(2) For purposes of this section, "cannabis health and
beauty28aid" means a product containing parts of the cannabis plant
and29which:30
(a) Is intended for use only as a topical application to
provide31therapeutic benefit or to enhance appearance;32
(b) Contains a THC concentration of not more than 0.3
percent;33(c) Does not cross the blood-brain barrier; and34(d) Is
not intended for ingestion by humans or animals.35
PART VIII36Signage and Public Notice Requirements37
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NEW SECTION. Sec. 801. A new section is added to chapter
69.501RCW to read as follows:2
(1) Applicants for a marijuana producer's, marijuana
processor's,3marijuana researcher's or marijuana retailer's license
under this4chapter must display a sign provided by the state liquor
and cannabis5board on the outside of the premises to be licensed
notifying the6public that the premises are subject to an
application for such7license. The sign must:8
(a) Contain text with content sufficient to notify the public
of9the nature of the pending license application, the date of
the10application, the name of the applicant, and contact
information for11the state liquor and cannabis board;12
(b) Be conspicuously displayed on, or immediately adjacent
to,13the premises subject to the application and in the location
that is14most likely to be seen by the public;15
(c) Be of a size sufficient to ensure that it will be
readily16seen by the public; and17
(d) Be posted within seven business days of the submission of
the18application to the state liquor and cannabis board.19
(2) The state liquor and cannabis board must adopt such rules
as20are necessary for the implementation of this section, including
rules21pertaining to the size of the sign and the text thereon, the
textual22content of the sign, the fee for providing the sign, and
any other23requirements necessary to ensure that the sign provides
adequate24notice to the public.25
(3)(a) A city, town, or county may adopt an ordinance
requiring26individual notice by an applicant for a marijuana
producer's,27marijuana processor's, marijuana researcher's, or
marijuana28retailer's license under this chapter, sixty days prior
to issuance29of the license, to any elementary or secondary school,
playground,30recreation center or facility, child care center,
church, public31park, public transit center, library, or any game
arcade admission to32which is not restricted to persons aged
twenty-one years or older,33that is within one thousand feet of the
perimeter of the grounds of34the establishment seeking licensure.
The notice must provide the35contact information for the liquor and
cannabis board where any of36the owners or operators of these
entities may submit comments or37concerns about the proposed
business location.38
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(b) For the purposes of this subsection, "church" means
a1building erected for and used exclusively for religious worship
and2schooling or other activity in connection therewith.3
PART IX4Marijuana-Infused Products and Concentrates5
Sec. 901. RCW 69.50.101 and 2015 c 70 s 4 are each amended
to6read as follows:7
((Unless the context clearly requires otherwise, definitions
of8terms shall be as indicated where used in this chapter:))
The9definitions in this section apply throughout this chapter
unless the10context clearly requires otherwise.11
(a) "Administer" means to apply a controlled substance,
whether12by injection, inhalation, ingestion, or any other means,
directly to13the body of a patient or research subject by:14
(1) a practitioner authorized to prescribe (or, by
the15practitioner's authorized agent); or16
(2) the patient or research subject at the direction and in
the17presence of the practitioner.18
(b) "Agent" means an authorized person who acts on behalf of
or19at the direction of a manufacturer, distributor, or dispenser.
It20does not include a common or contract carrier,
public21warehouseperson, or employee of the carrier or
warehouseperson.22
(c) "Commission" means the pharmacy quality assurance
commission.23(d) "Controlled substance" means a drug, substance, or
immediate24
precursor included in Schedules I through V as set forth in
federal25or state laws, or federal or commission rules.26
(e)(1) "Controlled substance analog" means a substance
the27chemical structure of which is substantially similar to the
chemical28structure of a controlled substance in Schedule I or II
and:29
(i) that has a stimulant, depressant, or hallucinogenic effect
on30the central nervous system substantially similar to the
stimulant,31depressant, or hallucinogenic effect on the central
nervous system of32a controlled substance included in Schedule I or
II; or33
(ii) with respect to a particular individual, that the
individual34represents or intends to have a stimulant, depressant,
or35hallucinogenic effect on the central nervous system
substantially36similar to the stimulant, depressant, or
hallucinogenic effect on the37
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central nervous system of a controlled substance included in
Schedule1I or II.2
(2) The term does not include:3(i) a controlled substance;4(ii)
a substance for which there is an approved new drug5
application;6(iii) a substance with respect to which an
exemption is in effect7
for investigational use by a particular person under Section 505
of8the federal Food, Drug and Cosmetic Act, 21 U.S.C. Sec. 355, to
the9extent conduct with respect to the substance is pursuant to
the10exemption; or11
(iv) any substance to the extent not intended for
human12consumption before an exemption takes effect with respect to
the13substance.14
(f) "Deliver" or "delivery," means the actual or
constructive15transfer from one person to another of a substance,
whether or not16there is an agency relationship.17
(g) "Department" means the department of health.18(h) "Dispense"
means the interpretation of a prescription or19
order for a controlled substance and, pursuant to that
prescription20or order, the proper selection, measuring,
compounding, labeling, or21packaging necessary to prepare that
prescription or order for22delivery.23
(i) "Dispenser" means a practitioner who dispenses.24(j)
"Distribute" means to deliver other than by administering or25
dispensing a controlled substance.26(k) "Distributor" means a
person who distributes.27(l) "Drug" means (1) a controlled
substance recognized as a drug28
in the official United States pharmacopoeia/national formulary
or the29official homeopathic pharmacopoeia of the United States, or
any30supplement to them; (2) controlled substances intended for use
in the31diagnosis, cure, mitigation, treatment, or prevention of
disease in32individuals or animals; (3) controlled substances
(other than food)33intended to affect the structure or any function
of the body of34individuals or animals; and (4) controlled
substances intended for35use as a component of any article
specified in (1), (2), or (3) of36this subsection. The term does
not include devices or their37components, parts, or
accessories.38
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(m) "Drug enforcement administration" means the drug
enforcement1administration in the United States Department of
Justice, or its2successor agency.3
(n) "Electronic communication of prescription information"
means4the transmission of a prescription or refill authorization
for a drug5of a practitioner using computer systems. The term does
not include a6prescription or refill authorization verbally
transmitted by7telephone nor a facsimile manually signed by the
practitioner.8
(o) "Immediate precursor" means a substance:9(1) that the
commission has found to be and by rule designates as10
being the principal compound commonly used, or produced
primarily for11use, in the manufacture of a controlled
substance;12
(2) that is an immediate chemical intermediary used or likely
to13be used in the manufacture of a controlled substance; and14
(3) the control of which is necessary to prevent, curtail,
or15limit the manufacture of the controlled substance.16
(p) "Isomer" means an optical isomer, but in subsection
(((z)))17(bb)(5) of this section, RCW 69.50.204(a) (12) and (34),
and1869.50.206(b)(4), the term includes any geometrical isomer; in
RCW1969.50.204(a) (8) and (42), and 69.50.210(c) the term includes
any20positional isomer; and in RCW 69.50.204(a)(35), 69.50.204(c),
and2169.50.208(a) the term includes any positional or geometric
isomer.22
(q) "Lot" means a definite quantity of marijuana,
marijuana23concentrates, useable marijuana, or marijuana-infused
product24identified by a lot number, every portion or package of
which is25uniform within recognized tolerances for the factors that
appear in26the labeling.27
(r) "Lot number" ((shall)) must identify the licensee by
business28or trade name and Washington state unified business
identifier29number, and the date of harvest or processing for each
lot of30marijuana, marijuana concentrates, useable marijuana, or
marijuana-31infused product.32
(s) "Manufacture" means the production, preparation,
propagation,33compounding, conversion, or processing of a
controlled substance,34either directly or indirectly or by
extraction from substances of35natural origin, or independently by
means of chemical synthesis, or36by a combination of extraction and
chemical synthesis, and includes37any packaging or repackaging of
the substance or labeling or38relabeling of its container. The term
does not include the39
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preparation, compounding, packaging, repackaging, labeling,
or1relabeling of a controlled substance:2
(1) by a practitioner as an incident to the
practitioner's3administering or dispensing of a controlled
substance in the course4of the practitioner's professional
practice; or5
(2) by a practitioner, or by the practitioner's authorized
agent6under the practitioner's supervision, for the purpose of, or
as an7incident to, research, teaching, or chemical analysis and not
for8sale.9
(t) "Marijuana" or "marihuana" means all parts of the
plant10Cannabis, whether growing or not, with a THC concentration
greater11than 0.3 percent on a dry weight basis; the seeds thereof;
the resin12extracted from any part of the plant; and every
compound,13manufacture, salt, derivative, mixture, or preparation
of the plant,14its seeds or resin. The term does not include the
mature stalks of15the plant, fiber produced from the stalks, oil or
cake made from the16seeds of the plant, any other compound,
manufacture, salt,17derivative, mixture, or preparation of the
mature stalks (except the18resin extracted therefrom), fiber, oil,
or cake, or the sterilized19seed of the plant which is incapable of
germination.20
(u) "Marijuana concentrates" means products consisting wholly
or21in part of the resin extracted from any part of the plant
Cannabis22and having a THC concentration greater than ((sixty)) ten
percent.23
(v) "Marijuana processor" means a person licensed by the
state24liquor and cannabis board to process marijuana into
marijuana25concentrates, useable marijuana, and marijuana-infused
products,26package and label marijuana concentrates, useable
marijuana, and27marijuana-infused products for sale in retail
outlets, and sell28marijuana concentrates, useable marijuana, and
marijuana-infused29products at wholesale to marijuana
retailers.30
(w) "Marijuana producer" means a person licensed by the
state31liquor and cannabis board to produce and sell marijuana at
wholesale32to marijuana processors and other marijuana
producers.33
(x) "Marijuana products" means useable marijuana,
marijuana34concentrates, and marijuana-infused products as defined
in this35section.36
(y) "Marijuana-infused products" means products that
contain37marijuana or marijuana extracts, are