Exclusive: Seattle Officials Crafting Bill to Legalize Cannabis Delivery in WashingtonTobias Coughlin-BogueNovember 23, 2016
That could soon change. Legislation currently being crafted by a team in Seattle could revive a failed effort from last legislative session that sought to establish limited delivery services in the state. Though still in its early stages, the push has growing support among industry members and could one day set up a system to bring legal cannabis to your door.
A memo sent late last month to members of the Cannabis Organization of Retail Establishments (CORE), Seattle’s well-connected cannabis retail industry association, announced that a delivery bill was likely to be introduced during the next state legislative session. Titled “[Action Required!] City of Seattle – Outline of Delivery Legislation,” the Oct. 31 memo asked members for input on the bill’s proposed elements. It indicated that city officials had been drafting the bill, and it suggested the outreach was as part of a request by the mayor’s office for industry input.
“We are actively working with the Mayor's office and stakeholders to craft legislation that would allow this.”John Schochet, Seattle Deputy City Attorney
David Mendoza, a senior adviser to Mayor Ed Murray and the city’s chief cannabis policy expert, acknowledged the city’s participation on a past delivery bill but told Leafly he couldn’t confirm whether the city is working on one currently. “The City supported legislation that would create a legal form of cannabis delivery in the most recent legislative session,” he said by email, “and we are considering our options on how to approach this issue during the upcoming legislative session.”
While Mendoza couldn’t confirm the existence of a bill, Deputy City Attorney John Schochet indicated that something concrete was in the works.
“As Pete and the Mayor said last January, we support legislation allowing local jurisdictions to opt in to legal, regulated marijuana delivery,” he said, referring to City Attorney Pete Holmes. “We are actively working with the Mayor’s office and stakeholders to craft legislation that would allow this.”
Any bill the group arrives at would need a sponsor in Olympia to begin its long legislative journey, and that’s far from guaranteed. There’s also the matter of industry support, which was noticeably absent from the state’s past attempt to provide a legislative fix on delivery.
Indeed, despite loudly calling for the city to drive out illegal cannabis delivery services, which licensed retailers bemoaned as insurmountable competition, the industry actually opposed the prospect of a legal alternative. At the time, Stash Pot Shop owner KC Franks told Geekwire lawmakers were “putting the cart before the horse” with their proposed pilot program, citing concerns about driver safety and unfair allotment of delivery privileges.
The pilot program bill, HB 2368, written by Mendoza, Holmes, and legislative sponsor Rep. Christopher Hurst (D-Enumclaw), would have offered a limited number of delivery endorsements to retailers in cities with over 650,000 residents—of which there’s only one: Seattle itself. The bill’s announcement was timed to coincide with a splashy anti-illicit-delivery enforcement campaign being launched by Holmes’ office.
The measure, however, didn’t exactly get a warm reception. Retailers bristled at the idea that some stores would be permitted to deliver while others were restricted solely to storefronts. Some raised concerns over the apparent dangers of sending drivers out into a big city with potentially thousands of dollars’ worth of cash or product in the trunk. The criticisms were major deal breakers for Seattle’s licensed shops.
The bill nevertheless made it out of committee—with the crowd-pleasing amendment that the program be available to all retailers, not just a select few. From there, however, it lay in limbo on the House floor until after the voting cutoff date. The bill’s sponsor, Hurst, retired after the session ended. Seen as the most likely sponsor of another such bill, his departure left legal delivery in the lurch.
News of the new bill, however, breathes life back into the idea of delivery. And although the retail cannabis industry’s original concerns persist, operators do seem to be warming to the idea of a delivery program—so long as it’s crafted in a way they can get behind.
“One of the concerns with the last delivery bill is that it was creating an oligarchy or monopoly,” Shea Hynes, product buyer at Stash, told me. “Our largest concern is going to be the safety of our employees. For that, it’s really, really important to have not just cash exchanges and not just curbside drop off. I think those are all really important pieces to the puzzle.”
CORE’s operations manager, Brooke Davies, acknowledged the urgency of a delivery fix and said that, while her organization remains skeptical of delivery, they’d prefer to participate in a bill than oppose it. “Our members do have some concerns about the mechanics of how delivery would work, but we are committed to working with the city on whatever they want to do,” she said. “I know why it’s a priority for them. Part of the 502 initiative is obviously to regulate cannabis, but another part of it is to keep people out of jail for cannabis-related crimes. It’s really hard … to pass an initiative like that and then start arresting people for illegal delivery.”
She cautioned that it was important that the bill be robust, addressing thorny questions of safety and equitability explicitly in its text rather than through to-be-determined regulation.
There are certainly still many thorny questions to answer, like whether or not drivers should be permitted to deliver to residences within 1,000 feet of a school and what kinds of limits should be placed the cash and product drivers take with them. But this time the city seems to be making an effort to address them.
According to the CORE email, the new plan would mandate that delivery privileges be tied to individual retail licenses, not a newly created category of license. Davies emphasized the importance of that, noting that many of Seattle’s smaller stores are struggling to compete as it is. Creating an additional license could increase costs, giving bigger businesses a greater advantage. The bill also would not be a pilot program but rather a full-fledged, permanent delivery system. It would also enable other local jurisdictions to opt in as they please, allowing cities outside of Seattle to participate.
“If you only want highly localized deliveries, you may not be getting to the heart of the illicit problem.”Liz Conway, Eaze
On the more granular level, the bill would also disallow curbside sales and include limits on total on-board cash and product. It wouldn’t require delivery vehicles to be marked as such, but it would mandate they have a bar code or sticker affixed to allow identification by law enforcement. Zoning rules would be hammered out before licenses are released.
Perhaps the only point identified in the memo that didn’t match up with priorities outlined by Davies was the issue of geographic limits. Such limits create local delivery zones, akin to the service area of your local pizzeria. The memo specifically says there would be “no geographic limit.” But Davies worries that without those limits, a large delivery service running out of a cheap warehouse could undercut mom-and-pop retailers across the city. She noted that Eaze, the San Francisco-based cannabis delivery app, had been poking around in Washington since the first delivery bill was introduced.
Indeed, according to the Public Disclosure Commission, Eaze paid Washington lobbyist Jennifer Ziegler $4,000 in February, when the previous bill was under consideration, and $5,000 again this September, presumably when the city started reviewing the issue again.
Eaze’s intentions may not be as nefarious as putting small shops out of business, however.
“We don’t actually do any of the deliveries ourselves,” said the company’s head of PR, Sheena Shiravi, adding that Eaze’s chief financial interest in delivery is as a platform that retailers could use to streamline the process.
Liz Conway, who runs Eaze’s public policy arm, explained Eaze’s hiring of a lobbyist as a means of helping build a system beyond Washington State. “We keep our eyes on anyone who is making rules, because a lot of the time states will make a rule and other states will copy them. We definitely want to shape best practices. The worst thing that can happen anywhere is that delivery is done poorly.”
In fact, the company’s app could be one of the key things that helps Washington do delivery well. It tracks the progress of deliveries in real time, which helps keeps drivers safe, Conway said. It also tracks information on customers, discouraging robbery attempts as well as attempted purchases by minors.
Eaze did push back against Davies on the issue of geographic limits, though. The company’s point? Limits help the black market. Removing them, said Conway, helps make sure a legal, regulated market can serve everyone. “If you only want highly localized deliveries, you may not be getting to the heart of the illicit problem,” she said. “Our experience in California is that allowing the market to serve the population really has helped cities to wipe out those illicit delivery pop-ups.”
Davies disagreed, suggesting the persistence of illicit delivery in Washington was due more to price than convenience. Though the black market is certainly competitive on price, convenience remains a major draw.
Perhaps the biggest safety risk for delivery drivers is the cannabis cash economy. Because of banking headaches, most retailers still only accept cash. Tech hopes to help there, too. CanPay, a company that offers debit services to cannabusinesses, recently launched a service that allows patients to pay through their phones. “We’re ready for delivery when it comes,” said founder Dustin Eide, CanPay’s founder. Retailers could require delivery customers to sign up for CanPay as part of the registration process, thereby solving the “car full of cash” problem.
Anyone eager to see functional legal delivery in Washington should be excited by the plan currently being constructed in Seattle. Barring any major snarls over geographic limits or other technicalities, any bill the city does come up with will likely be better positioned for success than ever.
“Delivery is great,” said Hynes at Stash. “It’s a tried and true method. So when we go for it, let’s make sure we’re taking the time and putting in the correct safeguards to make sure people stay safe.”