Originally, the Washington State Liquor Control Board (WSLCB) had the following two rules:
- A single applicant, or true party of interest, could submit a maximum of three applications for a retail marijuana license.
- The landlord of a location for a proposed marijuana retail store could issue only one letter of intent.
Without notifying applicants, the WSLCB reversed both of these rules. This document proves it: http://www.booboobama.com/I-502_Unlimited_Applications_and_LOIs.pdf. In short, this has a devastating effect.
The more applications one party submits, the greater their odds are of winning a marijuana retail license. For example, In a lottery where 48 applications were submitted for 6 available license:
- If an applicant submitted 3 applications, their chance of winning one of the available licenses is 34%.
- If an applicant submitted 15 applications, their chance of winning one of the available licenses is 92%.
This is entirely unfair and does not ensure an even playing field. Plain and simple, richer applicants could submit as many applications as possible, increasing their chances of winning a marijuana retail license. Big money interests could effectively :”buy” a license. This is exactly what the WSLCB promised it would never allow.
Allowing only one letter of intent per location was another way to ensure an even playing field. Locations are hard to find. Not many landlords are willing to lease a property which is to be used as a marijuana store, that also meets the 1000-foot setback requirement. Regardless, by reversing the original rule, many applicants who did the work to secure a hard-won letter of intent saw their competitive advantage disappear.
It’s important to note that these rule changes violated the “spirit of the law” to which the WSLCB is bound:
Initiative 502: Section (9) “For the purpose of carrying into effect the provisions of this act according to their true intent or of supplying any deficiency therein, the state liquor control board may adopt rules not inconsistent with the spirit of this act as are deemed necessary or advisable.”
How is letting “big money” take over, “necessary or advisable?”
But doesn’t the WSLCB have some process they’re supposed to follow when changing rules? As a matter of fact, it does:
The Administrative Procedure Act (RCW 34.05.325(6)) requires agencies to complete a concise explanatory statement before filing adopted rules with the Office of the Code Reviser. This statement must be provided to anyone who gave comment about the proposed rule making. Once persons who gave comment during this rule making have had a chance to receive this document, the Liquor Control Board will file the amended rules with the Office of the Coder Reviser.
Unfortunately, when it comes to these two rule changes, none of these things happened. There was no public review. No due process was performed. The WSLCB tried to claim the rules hadn’t been changed and were this way all along; the facts prove otherwise.
Not only were these rule changes a really bad idea, they aren’t even valid.
