This post is intended to benefit entrepreneurs considering getting involved in the Washington State cannabis industry, and managers who need fast access to information regarding cannabis regulations in Washington. Here we’ve gathered some of the overarching information regarding operating a marijuana company in Washington into one document. We’ll briefly discuss Washington marijuana regulations and provide a list of links to important information and resources as well as Washington state cannabis forms and license applications.
Washington officially became the first U.S. state to legalize the recreational use of marijuana upon the passage of Initiative 502 in early December 2012. By that time medical marijuana had already been legal in the state for nearly a decade and a half.
In July 2016, Washington’s medical marijuana and recreational marijuana regulations were incorporated into one regulatory framework.
The sale of marijuana to the public, or the growing or processing of marijuana by any entity other than a state-licensed retailer constitutes a criminal violation.
Washington's cannabis industry regulatory agency is the Washington Liquor and Cannabis Board. The WSLCB offers six marijuana-related licenses.
To apply for a cannabis business license in Washington state you must be 21 or older. You must also have been a Washington resident for the prior six months. Moreover, all licensees must maintain residency in order to retain a license.
To review application options visit the Business Licensing Service's marijuana web page.
Although a company can own both grower and processor licenses, retailers are not permitted to obtain either grower or processor licenses. And growers and processors are not allowed to sell marijuana products directly to consumers.
Cannabis companies are permitted to own up to three of any one type of license. Although retailers may hold up to three retailer licenses, they are not allowed to hold more than 33% of the retail licenses allotted for the city or county in which they operate.
Washington state law allows for a total of two million square feet of production. However, the WSLCB has the authority to limit the number of licenses awarded. In 2013, the WSLCB offered a 30-day window to apply for licenses.
Currently, all available licenses have been awarded.
The only way to acquire a license at this time is to purchase an existing licensed business. Businesses are not allowed to sell licenses to other businesses.
The following information will also be required by the WSLCB upon applying for or transferring a license:
Washing offers three tiers of grower’s licenses based on the square footage of the operation.
The three tiers of producer licenses include:
Operations that fail to utilize half or more of their allotted space may be moved to a lower tier by the WSLCB.
In order to procure or maintain a marijuana producer license, plans must be submitted for each of the following:
The annual license and renewal fee is currently $1381, although it has been subject to change over the years.
If WSLCB offers more licenses in the future there will likely be a non-refundable application fee of $250.
If a business purchases an existing company a Change in Governing People, Percentage Owned and/or Stock/Unit Ownership form must be filed. There is an accompanying $75 fee.
The primary statutes for recreational marijuana are codified in chapter 69.50 RCW, beginning with RCW 69.50.325; the medical marijuana statutes are located in chapter 69.51A RCW.
The Liquor and Cannabis Board regulations for marijuana are found in chapter 314-55 WAC.
Cannabis grows must take place within a fully enclosed, secure indoor facility or greenhouse with rigid walls, a roof, and doors.
Outdoor produces may grow cannabis in “non-rigid greenhouses, other structures, or an expanse of open or clear ground fully enclosed by a physical barrier.”
Outdoor cannabis grows must be enclosed by a “sight obscure” wall or fence at least eight feet high.
Washington state law sets minimum security requirements for cannabis operations.
Required security measures include:
All persons who transport cannabis are required to obtain a license from the WSLCB. The Marijuana Transportation License fee is $250.
All licensed marijuana businesses operating in Washington State must comply with a wide range of local, state, and federal regulations and codes.
The Interagency Resource for Achieving Cooperation and a partnership of Washington Municipalities and industry representatives have published Regulatory Guidance for Cannabis Operations.
With the same goal, MRSC has prepared the following list of applicable regulations and codes clarifying which government agency is responsible for enforcing them.
In the state of Washinton, retail sales are taxed at a high rate of 37%. The majority of this revenue is earmarked for public health programs. The remaining funds go towards the Liquor and Cannabis Board, local governments, and the state general fund.
The 37% tax is in addition to any other regular state or local taxes that would apply to any Washington business. Some marijuana products, such as low THC products, are exempt from the 37% tax.
As of July 2016 retail sales tax does not applied to:
The statutes on “collective gardens” were repealed effective July 1, 2016 and replaced by more restrictive “cooperatives” statutes for the growing of marijuana for medical use. See RCW 69.51A.250.
Furthermore, local governments are authorized to prohibit medical marijuana cooperatives. See RCW 69.51A.250(3)(c).
Restrictions on medical marijuana cooperatives include:
City and county zoning measures adopted since initiative 502 was approved are diverse. Some jurisdictions have enacted total prohibition, while others have allowed cannabis businesses to operate in appropriate zoning districts.
Cannabis businesses are forbidden from operating within 1000 feet of any the following:
Furthermore, local authorities will also be notified of all cannabis license applications and are given the opportunity to file objections.
Cities, towns, and counties in Washington State can choose to opt out of the state’s cannabis program and or to designate appropriate zones for marijuana businesses, however, it is the WSLCB that has final authority over whether to grant or deny the license to operate in Washington State.
Cities, towns, and counties can file objections to the granting of a state license at a particular location and the Liquor and Cannabis Board must “give substantial weight to objections,” but it is still up to the LCB to make the state license decision. See RCW 69.50.331(10).
Counties and municipalities may also prohibit producers or processors from operating in areas zoned for residential or rural use. In order to avoid problems, be sure to run your plan by local authorities before applying for a state license.
You can sign up for Washington’s ListServ to receive important updates about application windows and other industry-specific regulatory information.
Address: Washington State Liquor and Cannabis Board
PO Box 43098
3000 Pacific Ave SE
Olympia WA 98504-3098
Phone: (360) 664-1600
Website: https://lcb.wa.gov/mjlicense/marijuana-licensing