Veto Request for Governor Inslee

The following is a request I submitted earlier today to Governor Jay Inslee that requests that he veto SB-5318 “Reforming the compliance and enforcement provisions for marijuana licensees.” that recently arrived on his desk after passing through the Legislature this session. I understand the bill is scheduled for his signature today.

I would like to request that Governor Inslee veto SB-5318, which I understand to possibly be scheduled for a signing ceremony later today.

 While placing limits on the admittedly inconsistent and occasionally heavy-handed enforcement by the WSLCB, SB-5318 effectively forgives the very bad and public-harming behavior of a handful of large licensees within the industry that have a long and consistent track record of breaking rules and putting Washingtonians at risk.


Some of these big “bad” licensees appear to be using SB-5318 as one of the tools in their aggressive attempts this session to execute regulatory capture over the WSLCB.   I am familiar with the use of positive incentives aimed at regulators in attempts to steer their efforts to favor a subset of those they regulate.  This year, Washington has seen an overtly aggressive negative effort on the part of some of the big “bad” licensees and their trade organization to directly attack the WSCLB and one of it’s Board members.   The attacks on Russ Hauge and, more generally, on the alleged culture within the WSLCB were aggressive and at least partially unfounded.


I am disappointed with my Senator (Palumbo) for being a sponsor of SB-5318.   His rationale seems to be to defend the jobs that will be lost if the big “bad” licensee that operates in his district that is currently facing license cancellation has that cancellation stand.   In taking this position, Sen. Palumbo appears to have ignored the substance and grievous nature of the history of violations demonstrated by this licensee (and their affiliates).  The licensee(s) in question has/have a history of over 20 warnings and/or infractions from the WSLCB.  The petitioners and supporters of this Bill have attempted to frame these violations as “de minimus” in nature.  I assure you, Governor Inslee, that many of their violations were anything but minimal in their impact on public health and safety.


One member of this affiliated group of businesses was just found to be selling pesticide-laden product and doing so in such a way that tracing the product through the regulated system would be next to impossible.  They appear to be selling product to Washingtonians that is labeled falsely.  They appear to be selling product that is not fit for human consumption.  They are responsible for a non-trivial fraction of the product on the shelves of retail stores across the state.


Two of the top 10 wholesalers in the industry are currently facing license cancellations for their egregious patterns of rule-breaking.  While a few hundred jobs would be lost upon cancellation of these licenses, the volume of business that these cheats currently conduct would be spread out over potentially hundreds of other licensees — many of whom are struggling today in part because these big players have, effectively, been allowed to cheat their way to the top over the past few years.   Some lost jobs could well mean the survival of dozens of businesses that would otherwise fail.


The WSLCB enforcement effort is dysfunctional, Governor.  It is the lack of meaningful enforcement in a number of areas of significant relevance to public safety and health that has enabled a competitive advantage for businesses that choose not to follow the rules.   However, the dysfunction of the WSLCB enforcement arm is no reason to sign into law a bill that allows big “bad” businesses that have gotten that way in part through their callous disregard for the rules to continue operating in a way that puts Washingtonians in harm’s way.


Additional constraint on how the WSLCB executes it’s enforcement of the cannabis industry Is necessary.  However, this bill appears to allow some of the worst offenders within the industry to continue operations, in spite of the clear negative impact that their approach to doing business has on the safety and health of Washingtonians.


Please do not sign SB-5318 into law, Governor Inslee.  This would be a good situation in which to use your veto power.


If I can be of any assistance to your office in better understanding the facts related to this issue, please feel free to have your staff reach out to me.


Thank-you 


Dr. James MacRae

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