A lone-wolf Democratic lawmaker is proposing changes to the state's landmark marijuana initiative. Changes that, despite being presented as technical fixes, raise questions about the role of small businesses and the use of funds set aside in the 2011 measure for public health.
A major focus of the amendment from Rep. Chris Hurst of Enumclaw is increasing the amount of money the state could collect from marijuana right away. Along with eliminating limits on license fees charged by the liquor control board, the amendment released Tuesday proposes creating a whole new master license that could be bought and sold on the open market.
Referring to licenses to grow and sell the plant, which the initiative set at a fixed price, Hurst said: "Why would we sell these for a thousand dollars? I've had folks in my office who've said they'd be happy to pay a quarter million."
In interviews earlier this year, Hurst said fees as high as Colorado's $18,000 license fees should be considered, and the state should get as much money as possible out of the drug. Hurst now proposes that fees for licenses only be sufficient to cover the cost of issuing the licenses, which could even be a cost savings if those costs are low. But any savings would likely be undone by another requirement in his bill that the state Liquor Control Board get as much money as possible from the sale of the separate master licenses.
Called a "502 marketing certificate," the master license would be in addition to the three separate licenses described in the initiative. Anybody who wanted to grow, process or sell the drug would have to obtain the certificate first, before they could apply for an actual license. The certificates would be re-sellable — and the initiative requires the liquor board to sell them for as much as the market will bear.
Higher fees would raise the specter of problems for small growers already in the market and hoping to become legal. Many are generally unable to secure loans to expand and might have trouble affording more expensive licenses.
When the issue was raised, Hurst expressed ambivalence. "The idea of the small time players, that there has to be a place for them, is an absolute misnomer," he said.
In the House, Hurst is known as a maverick. In 2010 he gained attention — from the media and senior Democratic Party officials — for switching his party affiliation to "Independent Democrat." Since then, Hurst has made a name for himself as part of the so-called "roadkill caucus" of moderate Democrats. Most recently, he cast one of the "no" votes on a popular gun control bill.
The passage of the amendment is also far from certain. The state constitution contains strong protections for initiatives within their first two years as law. During that time, any change requires a two-thirds majority in both chambers.
Once that process has begun, however, additional changes can be attached to the amendment. Since some lawmakers have already expressed interest in diverting part of the funds expected from the legal sale of pot, some worry that even a modest amendment would open the doors for gutting a system of earmarks written into the initiative. The initiative language aims to divert pot tax money to public health and drug abuse prevention.
According to the marijuana initiative's original author, any move that pushes small businesses out of the market would be contrary to the spirit of the measure.
Alison Holcomb, the policy lawyer who took a break from her job at the ACLU to write the first draft of the initiative and has served as its first spokesperson since the election, said the changes would seriously harm the legalization effort. In the months prior to the amendment, Holcomb repeatedly said that fees had been set low on purpose, to encourage small growers to join the market.
"You need to deal with the reality that people want to come in," Holcomb said. "Why are you going to shut them out?
"The point is to allow as many people to get legal and play by the rules as want to."
Allowing small businesses in, Holcomb said, would also help keep a powerful pot lobby from developing, similar to so-called "big tobacco" and "big alcohol" — business groups with the legislative muscle to bend laws and the advertising budget to push their product on teens.
Not giving small growers a way into the legal market also creates the risk that those growers will stay in the black market, Holcomb said.
Hurst said that he didn't think most small growers actually want to go legal.
Instead, at a press conference in the Capitol where he unveiled the amendment, Hurst described the spectrum of growers as basically black-and-white. On one side, Hurst said, is a small minority of growers who have been doing their best to obey laws, and should be included in the new market. On the other there are armed criminals who freely use violence to get ahead in the business.
Those on the criminal end of the spectrum, Hurst said, had it too easy for too long to ever be reliably enticed into participating in the legal market. "If someone's been in this market for 20 years, why would you expect them to pay taxes they never have?"
Hurst's statements on the shape of the Washington market and the motivation of growers appeared to run contrary to the majority of testimony given at forums the Liquor Control Board held around the state. Beginning with a standing-room-only event in Olympia earlier in the year, the eight forums were packed by crowds that reliably included significant numbers of small growers, who took time to tell the board what a relief it was to finally be legal.
Asked about those people in the middle, neither perfectly legal nor depravedly criminal, and who might not have the money to buy their way into an expensive market, Hurst said: "Maybe it's time for them to work for somebody."
In addition to the changes to the license and license fee structure of the initiative, Hurst's amendment also proposes two other changes he called fixes. One of the two is a proposition to shrink the no-marijuana-stores buffer zone around places where minors congregate to 500 feet from the 1,000-foot rule originally written into the measure. Hurst and others mentioned the buffer zone earlier this month as a potential problem: There could be large swaths of Seattle where no stores could exist under the law.
The other of the two was a modification of the liquor board's authority to punish businesses that break the rules. Currently, the initiative says the board can only fine up to $1,000 for each rule violation. Hurst's amendment toughens that, eliminating the cap and giving the board the ability to suspend the licenses of offending individuals.
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