memo

Date: February 23, 2012 To:

Lacey Planning Commission

From: David Burns, AICP, Principal Planner Subject: Medical Marijuana, focused work-session 1, Dispensary and Collective garden
options under state law?

I. Introduction and Summary discussion: A. Previous work-session - At the last work-session the Planning Commission had a short introductory briefing on Medical Marijuana and the interim ordinance the Council referred to the Planning Commission for review. We had a number of interested citizens join the Planning Commission in discussion of this topic. With the short amount of time on the agenda we did manage to get through most of the introduction and a number of concerns were identified by the citizens and discussed by the Planning Commission. Because the topic is new to the Planning Commission, most of the allocated time was spent learning about this topic and listening to citizen concerns. Representatives from Lacey Cross (Casey Lee) and Cannabis Outreach (Denny Coughlin) were present and were able to discuss their concerns. This report refers to Lacey Cross and Cannabis Outreach as local non profits, based upon the statement made by Denny Coughlin at the last work-session. I do not have the professional background to make a determination on their status as a nonprofit or a commercial business. B. Central issue identified - Based upon the discussion at the work-session, there were a number of issues that surfaced. Staff has prepared this report to help focus the Planning Commissions effort of reviewing this topic. This report identifies and focuses on a central issue important to members of the public that were at the last work-session, that of what a collective garden is and how the concept relates to Lacey Cross and Cannabis outreach. The basic issue at the heart of discussion is what the state and federal laws on marijuana mean for these two local non profits and the strategies they use to provide medical marijuana to qualified patients. Both Lacey Cross and Cannabis Outreach have had a successful, but unlicensed, business model in providing medical marijuana to qualified patients. The model used by Lacey Cross and Cannabis Outreach in providing patient access to Medical Marijuana is to have a central location for patients to pick up medical marijuana produced in undisclosed locations. This results in a very convenient situation for medical marijuana

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patients to access medical marijuana without having to buy it off the street with the risk that would involve a purchase off the black market. Patients can simply walk into one of the local non profits and purchase their authorized medical marijuana. It also consolidates the points of product distribution, in the existing case to the CBD commercial area of Lacey, which can have advantages, considering other models where supply points may be distributed throughout the community with more security issues and impacts to more areas. The City of Lacey considers use of this model illegal under state law and it has led to multiple felony charges of delivery of a controlled substance being filed in Thurston County Superior Court against the owners of both non-profits this year. The models used by these two non-profits is similar to what is described in the paper to the Langley City Council from Island Alternative Medicine, and can be referred to as a Cooperative business model; See paper to the Langley City Council attached dated February 13, 2012. C. Questions to consider - Regardless of how well these models work for patient access, the critical questions we need to ask include, Are these non profits and their operations permitted under state law? Are the existing operations a dispensary, which is not currently permitted under state law, or is there a way they can be considered a collective garden(s), which is permitted under state law? If the existing non profits are not considered collective gardens they way they are currently operating, is there a model that these non profits could adopt that would be consistent with state law? To clarify the concept of a collective garden and dispensary under state law, we have dedicated this work-session to exploring what the state law says about a collective garden and what options this might provide us considering the model currently used by these local non profits. D. Conclusions - Staff has come to the conclusion the current model used by these non profits may have worked under the draft version of ESSSB 5073 before the veto, where Lacey Cross and Cannabis Outreach may have been licensed by the state Department of Health as a dispensary and their suppliers (the producers/growers) could have applied to be licensed by the Department of Agriculture. However, specific provisions of ESSSB 5073 that would have permitted this were vetoed by the Governor and the final version that became state law does not allow dispensing of medical marijuana. Ways brainstormed by staff to modify the model to make it work under state law have not been successful, because all of the ideas developed are not compatible with provisions in state law that limit what a collective garden can be. These ideas and a model

Comment [HB1]: Just a notenon-profits do not have owners per se, just managers. Id like to add that Lacey Cross is currently under new management with KC Lee.

Comment [HB2]: Last week, I drafted proposed interim regulations for the City of Langley that Id be glad to share with the Planning Commission. Langley is likely going to allow access points to exist as the delivery portion of collective gardens (simultaneously with those collective gardens that make up the process and production portion); Issaquah adopted similar regulations in order to allow access points to operate. Comment [HB3]: I just want to emphasize that there is no legal definition of a dispensary and that it is a term of art created by the industry. Comment [HB4]: I also want to emphasize that aside from its regular definition, theres no legal definition of dispensing in RCW 69.51A, et seq. Furthermore, patients are allowed to cultivate and distribute to each other cannabis for medical purposes via collective gardens. I really think this is just semantics; theres no difference between distribution and dispensing without a legal definition to substantiate dispensing.

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proposed by Island Alternative Medicine to the Langley City Council will be shared with the Planning Commission to illustrate the problems and challenges the existing state law presents, and how some non profits have proposed to operate under the classification of a collective garden. Literally everyone I have talked to, that is knowledgeable about this topic, agrees the state law is very much broken after the veto of ESSSB 5073 and is in need of serious repair. The only strategy that would allow these non profits to continue their existing model is the strategy adopted by Seattle. Seattles strategy is essentially to ignore the inconsistencies in state law regarding dispensaries and to make a policy decision the dispensaries are not a priority for law enforcement. The only other option we have to work with involves Collective Gardens as described in the interim ordinance. This is the concept the Council has referred to the Planning Commission for review. II. Existing state law and the collective garden concept: A. What is the basis of the collective garden concept; how did it come to be in state law - To understand this concept it is helpful to review once again quickly the context of the existing state law. The original version of ESSSB 5073 intended that the state Department of Health would license dispensaries and the Department of Agriculture would license growers. See Part VI and part VII of ESSSB 5073; page 20 and 26 ESSSB 5073. This model expected both the use and regulation of growers and dispensaries in meeting Washingtons medical marijuana demand. The concept of a collective garden was put forth in Part IV under new section 403; see page 14 ESSSB 5073. This concept was originally intended to be an option for the do it yourselfer (Urban agriculturist) that wanted to band together with several fellow patients to grow their own product, without the need for do it yourself oversight. Reading the whole of ESSSB 5073 it is clear collective gardens were was never intended to be the main model for supplying the entire medical marijuana demand. This concept was only an alternative. Most people are not an urban agriculturist type and do not have the capability or interest to be so. Unfortunately, after the veto removed the major provisions for dispensing and production of medical marijuana in ESSSB 5073, only the alternative for the do it yourselfer remained. In the interim, between now and when our state law is amended, the only opportunities for an individual qualified patient to access medical marijuana, is to grow his/her own, designate a care provider to grow it for them, or to band together in a collective garden. B. What exactly is a collective garden, how is it presented in state law?

Comment [HB5]: This is not necessarily true. If you read Seattles ordinance, they make clear that, albeit they are regulating collective gardens, they are not, at the same time, directly approving of any activity that is illegal pursuant to Federal law. To say enforcement is not a priority is also inaccurate; patients are entitled to an affirmative defense meaning they cannot be convicted of a crime at trial (this does not insulate them from arrest or prosecution). Police in Seattle are not going to enforce State drug laws against qualifying patients because of the affirmative defenseit would be a huge waste of tax payer dollars. And Seattle hasnt been authorized by the State to enforce Federal law against State access points.

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Th e wo rd c ol l ec ti v e is us e d in ag ric u ltu re t o d esc ribe a g ro u p o f g ro we rs wh o ac t ually f a rm to g et h e r, w o rk in g in a c los ed sys t e m, o n a n o t -f o r-p ro f it b as is, w ith no ou ts id e ma rk e t. State law provides a specific description of what a collective garden is and puts constraints on what it can include. Originally, it was not considered to be of enough significance for regulatory purposes. It was probably on the same low priority for regulation as an individual growing his/her own medical marijuana. In the original ESSSB 5073 it is in the same part IV as the provisions that deal with an individual growing his/her own. After all, the real action and regulation would have been the licensing of dispensaries and growing operations. Still some standards were needed to appropriately limit the scope. The key standards applicable to collective gardens from RCW 69.51A.085 (1) are as follows: No more than 10 qualifying patients may participate in a single collective garden at any time. A collective garden may contain no more than fifteen plants per patient up to a total of forty-five plants. A collective garden may contain no more than twenty-four ounces of useable cannabis per patient up to a total of seventy-two ounces of useable cannabis. A copy of each qualifying patients valid documentation or proof of registration with the registry established in section 901 of this act, including a copy of the patients proof of identity, must be available at all times on the premises of the collective garden. No useable cannabis from the collective garden is delivered to anyone other than one of the qualifying patients participating in the collective garden. The state law goes on to describe the model of a collective garden in RCW 69.51A085 (2) as follows: (2) For the purposes of this section, the creation of a collective garden means qualifying patients sharing responsibility for acquiring and supplying the resources required to produce and process cannabis for medical use as, for example, a location for a collective garden; equipment, supplies, and labor necessary to plant, grow, and harvest cannabis; cannabis plants, seeds, and cuttings; and equipment, supplies, and labor necessary for the proper construction, plumbing, wiring, and ventilation of a garden of cannabis plants. This seems straight forward describing a small collective garden operation run and managed by 10 or less qualified patients for their own personal medical marijuana use. C. The morphing of dispensaries into collective gardens:
Comment [HB7]: This portion was vetoed out of the Statute.

Comment [HB6]: I dont know if I agree with your legislative interpretations. Mainly because Gregoire made it very clear that she didnt want any State involvement with licensing anything related to cannabis. I dont necessarily believe that the spirit of an access point was meant to fall away from the law (a law which emphasizes patient access). If anything, Gregoire was concerned for State employees. I dont think she meant to stamp out access points altogether.

Comment [HB8]: This is my main concern. No where in that portion of the statute does the law say the collective garden must be small. And the statute does not say 10 people or less. I think Lacey runs the real risk of violating State law here by being too restrictive on patient access to medicine. Mukilteo and Issaquah agreed that they would not control patient access because of the fear of violating State law.

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When ESSSB 5073 was partially vetoed and sections for licensed dispensaries and growing operations were removed, dispensaries continued to be illegal under state law. In order to survive these businesses were forced to re-invent their operations. Because collective gardens were now the only mechanism remaining for providing medical marijuana to multiple qualified patients, it was necessary to come up with a way to meet the requirements of a collective garden provided in state law. From a reading of the state law this is a challenging proposition. Collective gardens are intended and designed to provide an opportunity for several patients to come together and grow their own medical marijuana, while the dispensaries are designed to serve a larger population that may have no interest in farming, but only needs access to the product. A major problem to overcome is a limitation of 10 patients with only a patient of the collective being able to transfer or deliver medical marijuana to another patient of the collective. If anyone in the collective delivers marijuana to someone other than the other nine in the collective, we have delivery of a controlled substance. If someone that is not in the collective delivers medical marijuana to a patient, other than a designated care provider, we have delivery of a controlled substance. This limitation was intended to limit the growing and use of the medical marijuana to the patients and as an urban agricultural self grow there were no standards it was expected to meet. Keep in mind, the original ESSSB 5073 provided dispensaries would be regulated by the Department of Health as to who and how medical marijuana could be obtained and provided quality control of the medical marijuana produced. Medical marijuana produced by the 10 patients in a collective garden was not permitted to go beyond the immediate collective group and was not going to be subject to standards. The dispensaries creatively attempted to address this issue by saying a qualified patient can be a member of multiple collectives which result in multiple collectives operating as a cooperative. Imagine 1000 collectives with an aggregate of 10,000 members. Imagine further patients can come to one and go to another with no restrictions. This would allow a patient in one collective (A) being able to join another collective (B) to purchase the product of (B). To avoid getting too many patients in any one collective a patient that buys the product from (B) is automatically revoked of the membership in (B) as soon as the purchase is made. To maintain collectives some will have only three permanent members and the rest will be transients going from one to another when there is a need to acquire the product. While creative, it would also be incorrect to conclude this is permitted under the state laws description of a collective garden. If it was the intent to allow membership in multiple gardens and coming and going from one to another with an aggregate of 10,000 patients, why would the collective garden have been limited to 10 individual patients? If it was the intent to allow trading between any of the 10,000 members of multiple gardens, there would not have been a limitation on the number of patients and there

Comment [HB9]: Where is this particular definition coming from for a dispensary?

Comment [HB10]: You have this regardless on a Federal level, even if qualifying patients from the same garden are delivering to each other.

Comment [HB11]: Again, not sure where this interpretation of legislative intent is coming from and I believe it is too restrictive.

Comment [HB12]: State law doesnt say that you cannot do this. In fact, State law doesnt even define membership in a garden and some citys have chosen that they cannot regulate patient membership because of that. Comment [HB13]: The devil is in the detailsits 10 people in a garden at any time. That particular phrase can and does allow for a rotating patient member base.

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would not have been a restriction that only a patient in a specific collective garden can deliver a fellow patient in the same collective garden the product. The collective garden was intended for 10 or less patients working together to grow their own, nothing more. The morphing of dispensaries into collective garden requires pushing the envelope of intent to the breaking point. The requirement to temporarily join a collective garden and be automatically revoked after a transaction is bazaar, and demonstrates the activity does not fit the collective garden model. While we might applaud the creativity to make something not designed for a particular purpose fit a particular need, we should remember what we are dealing with. We have a schedule 1 drug that is still considered illegal under Federal law, even for medical use. A state law cannot supersede Federal law and state laws that permit the use of medical marijuana are treading lightly to minimize conflicts. What a local government permits under state law on this topic should be consistent with the letter and intent of the state law on its face, without a need to imagine a process or strategy for supply and delivery that falls well beyond. The intent of a collective garden is clear, and it does not include serving the medical marijuana needs of thousands of patients. It was designed to serve the needs of ten (10) patients who by themselves cannot grow their own marijuana. Models that centralize production and distribution, while better able to meet demand, need to wait for reworking of the state law. D. Models to serve the product needs of the medical marijuana qualified patients: Review of ESSSB 5073 depicts a model that was well designed to serve the medical marijuana needs of qualified patients. It provided for centralized dispensaries and growing opportunities that could serve a large number of people. The models used by the local non profits have been successful in meeting consumer needs. All of the models provide a centralized and organized way of supplying product to qualified patients, minimize land use impacts and minimize security issues. Unfortunately, ESSSB 5073 underwent a partial veto and sections providing for a model that centralizes production and dispersion were removed from the legislation. Until the state law is amended, local jurisdictions are left with personal grows for personal use and collective gardens as the only methods of providing the medical marijuana demand of qualified patients. These may be a poor substitute for the models currently being used, but they are the only mechanisms available to local jurisdictions under state law. E. Options for the Planning Commission to consider: 1. Follow the advice of the City Attorneys office and this report, considering the intent and requirement of state law for collective gardens. This is essentially the position that a collective garden must be a separate entity limited to 10 patients that work

Comment [HB14]: Just to analogizewhen a person goes to Bartells and doesnt see what they need on the shelf, what is to stop them from going to Walgreens to get what they need to treat their pain? Cities dont regulate their drug stores so restrictively and, albeit subject to a different set of rules, you dangerously tread impeding the freedom of choice and association by calling into question a rotating patient base. Again, other cities, with just as large/small a population as Lacey have decided to allow patients to dictate their own choices because they cannot prove otherwise that it is lawful to regulate patient access in such a way. Comment [HB15]: There is no conflict between State and Federal law; the Feds can still enforce against Lacey Cross if they see fit. The Feds have clearly telegraphed that if a medical cannabis operation is abiding by State law that that operation is not a priority for enforcement. Furthermore, the City of Lacey should not be preoccupied with enforcing Federal law against its citizens. To do so is undemocratic, unconstitutional, and bizarre. Comment [HB16]: I have to be honest, if Lacey regulates this way, collective gardens will start popping up all over the place. In the last meeting, it was said that Lacey wouldnt regulate home grows/personal grows. If you go this route, you will force yourselves to do just that and enforcement will be a nightmare. State law is not as restrictive as Lacey intends it to be and regulating a store front (that actually wants to follow your guidelines) is much easier and cost effective than regulating home grows for the intended collective garden of just 10 people or less.

Comment [HB17]: Mukilteo, Issaquah, Seattle, Gig Harbor, and Langley say different.

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together to grow their own product. It cannot involve a cooperative model involving multiple collective gardens. 2. Consider the argument for the cooperative model reasonable, given the circumstances of the partial veto, the discussion presented in the paper to the Langley City Council provided by Hillary Bricken (Attorney for Lacey Cross), and what is in the existing state law, and provide for Councils consideration of an alternative ordinance that allows this strategy. 3. Collaboration to build an alternative. While we always suggest considering variations of positions and collaboration to build consensus to find something that works for everyones needs, in this case our options are limited. Staff has spent a significant amount of time considering this topic and options provided under state law. If we stay true to what we believe is the purpose and function of a collective garden, models needed for the existing non profits to work do not fit. III Staff recommendations: Staff recommends the Planning Commission make a determination that the cooperative model does not fit state law and chose option 1 above. With this decision made, additional work-sessions can be focused on issues associated with making collective gardens work in our community under the parameters provided in state law. IV Work-session expectations: The Planning Commission will be briefed on the central issue of dispensaries versus community gardens. The Planning Commission will then have an opportunity to discuss this issue with participating citizens and determine what direction it wants to go on this issue. The direction the Planning Commission takes on this issue will determine the organization of the next few work-sessions. It the Planning Commission follows the staff recommendations we will be ready to move on to the next issue of focus where we will begin to consider what zones collective gardens should be permitted to best serve the intent and need of collective gardens while protecting the land use interests of the community.

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