While marijuana retail stores will appear around the state next fall, illegal “street sales” won’t likely disappear because of the overlapping layers of laws and jurisdictions.
The Washington State Liquor Control Board released its draft rules on licensing and locating retail marijuana stores around the state, following the passage of Initiative 502 that legalized recreational use of marijuana. The draft rules are set to be approved Oct. 16, with the board starting to accept license applications on Nov. 18.
“These rules fulfill the public expectation of creating a tightly-regulated and controlled system while providing reasonable access to participation in the market,” said Liquor Control Board Chair Sharon Foster.
Some 334 retail stores will be allowed around the state, with cities and counties being allotted set numbers based on their population and projected customer bases.
“We wanted to give the most populated cities the largest share,” liquor board spokesman Brian Smith said.
Pierce County will have 31 retail marijuana stores county wide, with eight of them slated for Tacoma, two each for Puyallup, University Place and Lakewood and one for Bonney Lake. The remaining 17 will be licensed around the rest of county and smaller towns.
“There is nothing in I-502 that says communities can opt out,” Smith said, noting that cities with moratoria on marijuana sales and collective farms might face legal challenges if they attempt to outright ban retail shops from their borders. “There is potential for friction there.”
Sales from retail stores are projected to make up about 13 percent of the total marijuana market in the state during the first year and up to 25 percent after that, making untaxed – and therefore illegal – sales the bulk of the market. The liquor board has penalties for licensed marijuana growers diverting the plants for illegal street sales of untaxed cannabis products, but private sales from unlicensed grow operations will remain a smoky legal area. The federal government, which still regards marijuana as an illegal drug, has stated it will not enforce federal laws in Washington. But the sale of untaxed marijuana in private, unlicensed sales would remain illegal. It falls under the same sort of laws as untaxed cigarettes or bootlegged liquor. While the liquor board will have enforcement officers, they will spend most of their time on regulating licensed operations. That largely leaves small-time street dealers with an open market of untaxed pot sales in competition with legal retail stores and a hodgepodge of local and state rules few law enforcement agencies are staffed to handle.
“It’s kind of like this legal limbo,” Fife Police Chief Brad Blackburn said. “It’s like the old alcohol days.”
State regulators hope the normalization of marijuana use will drive pot buyers to licensed retail stores rather than street-corner purchases, since the license shops will have quality controls not found at “dime bag” dealers. Even with the state tax on marijuana in licensed stores, prices are expected to be about $10 to $12 a gram. That is roughly the street prices on the illegal market, without the tight quality and production oversights.