Cannabis/local laws

AN ACT Relating to prohibiting local jurisdictions from enacting 1
regulations to preclude cannabis producers, processors, and retailers 2
from their jurisdictions; amending RCW 69.50.335 and 69.50.540; and 3
adding a new section to chapter 69.50 RCW. 4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:5
NEW SECTION. Sec. 1. A new section is added to chapter 69.50 6
RCW to read as follows: 7
A local political subdivision may not enact any local ordinance, 8
regulation, or land use plan, or implement any other restriction, 9
that has the effect of precluding the siting or operation of licensed 10
cannabis producers, processors, or retailers within their 11
jurisdictional boundaries. 12
Sec. 2. RCW 69.50.335 and 2023 c 220 s 3 are each amended to 13
read as follows: 14
(1)(a) Beginning December 1, 2020, and until July 1, 2032, 15
cannabis retailer licenses, cannabis processor licenses, and cannabis 16
producer licenses that have been subject to forfeiture, revocation, 17
or cancellation by the board, or cannabis retailer licenses that were 18
not previously issued by the board but could have been issued without 19
exceeding the limit on the statewide number of cannabis retailer 20
H-3395.1
HOUSE BILL 2731
State of Washington 69th Legislature 2026 Regular Session
By Representatives Walen, Macri, Morgan, and Scott
Read first time 02/05/26. Referred to Committee on Local Government.
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licenses established before January 1, 2020, by the board, may be 1
issued or reissued to an applicant who meets the cannabis retailer 2
license, cannabis processor license, or cannabis producer license 3
requirements of this chapter. 4
(b) In accordance with (a) of this subsection, the board may 5
issue or reissue: 6
(i) Up to 100 cannabis processor licenses immediately; and7
(ii) Beginning January 1, 2025, up to 10 cannabis producer 8
licenses, which must be issued in conjunction with a cannabis 9
processor license. 10
(c) In addition to the cannabis retailer licenses and cannabis 11
producer licenses that may be issued under (a) and (b) of this 12
subsection, beginning January 1, 2023, and continuing every three 13
years until July 1, 2032, the board may, with the approval of the 14
legislature through the passage of a bill, increase the number of 15
cannabis retailer licenses and cannabis producer licenses for the 16
social equity program based on: 17
(i) The most recent census data available as of January 1, 2023; 18
and 19
(ii) The annual population estimates published by the office of 20
financial management. 21
(d) In addition to the cannabis retailer licenses that may be 22
issued under (a) of this subsection, beginning January 1, 2024, and 23
until July 1, 2032, the board may issue up to 52 cannabis retailer 24
licenses for the social equity program. 25
(e)(i) At the time of licensure, all licenses issued under the 26
social equity program under this section may be located in any city, 27
town, or county in the state that allows cannabis retail, cannabis 28
production, or cannabis processing business activities, as 29
applicable, at the proposed location, regardless of:30
(A) Whether a cannabis retailer license, cannabis producer 31
license, or cannabis processor license was originally allocated to or 32
issued in another city, town, or county; and 33
(B) The maximum number of retail cannabis licenses established by 34
the board for each county under RCW 69.50.345. 35
(ii) The board must adopt rules establishing a threshold of the 36
number of licenses created by this section that can be located in 37
each county. 38
(f) After a social equity license has been issued under this 39
section for a specific location, the location of the licensed 40
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business may not be moved to a city, town, or county different from 1
the city, town, or county for which it was initially licensed.2
(2)(((a))) In order to be considered for a cannabis retailer 3
license, cannabis processor license, or cannabis producer license 4
under subsection (1) of this section, an applicant must be a social 5
equity applicant and submit required cannabis license materials to 6
the board. If the application proposes ownership by more than one 7
person, then at least 51 percent of the proposed ownership structure 8
must reflect the qualifications of a social equity applicant.9
(((b) Persons holding an existing cannabis retailer license or 10
title certificate for a cannabis retailer business in a local 11
jurisdiction subject to a ban or moratorium on cannabis retail 12
businesses may apply for a license under this section.))13
(3)(a) In determining the priority for issuance of a license 14
among applicants, the board must select a third-party contractor to 15
identify and score social equity applicants, using a scoring rubric 16
developed by the board. The board must rely on the score provided by 17
the third-party contractor in issuing licenses. 18
(b) The board may deny any application submitted under this 19
subsection if: 20
(i) The board determines that, upon the advice of the third-party 21
contractor, the application does not meet the social equity licensing 22
requirements of this chapter; or 23
(ii) The board determines the application does not otherwise meet 24
licensing requirements. 25
(4) The board must adopt rules to implement this section. Prior 26
to adopting any rule implementing this section, the board must 27
consider advice on the social equity program from individuals the 28
program is intended to benefit. Rules may also require that licenses 29
awarded under this section only be transferred to or assumed by 30
individuals or groups of individuals who comply with the requirements 31
for initial licensure as a social equity applicant for a period of at 32
least five years from the date of initial licensure.33
(5) The annual fee for issuance, reissuance, or renewal for any 34
license under this section must be waived through July 1, 2032.35
(6) The definitions in this subsection apply throughout this 36
section unless the context clearly requires otherwise.37
(a) "Disproportionately impacted area" means a census tract or 38
comparable geographic area within Washington state where community 39
members were more likely to be impacted by the war on drugs. These 40
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areas must be determined in rule by the board, in consultation with 1
the office of equity, using a standardized statistical equation to 2
identify areas with demographic indicators consistent with 3
populations most impacted by the war on drugs. These areas must be 4
assessed to account for demographic changes in the composition of the 5
population over time. Disproportionately impacted areas must include 6
census tracts or comparable geographic areas in the top 15th 7
percentile in at least two of the following demographic indicators of 8
populations most impacted by the war on drugs: 9
(i) The area has a high rate of people living under the federal 10
poverty level; 11
(ii) The area has a high rate of people who did not graduate from 12
high school; 13
(iii) The area has a high rate of unemployment; or14
(iv) The area has a high rate of people receiving public 15
assistance. 16
(b) "Social equity applicant" means an applicant who has at least 17
51 percent ownership and control by one or more individuals who meet 18
at least two of the following qualifications: 19
(i) Lived in a disproportionately impacted area in Washington 20
state for a minimum of five years between 1980 and 2010;21
(ii) Has been arrested or convicted of a cannabis offense or has 22
a family member who has been arrested or convicted of a cannabis 23
offense; 24
(iii) Had a household income in the year prior to submitting an 25
application under this section that was less than the median 26
household income within the state of Washington as calculated by the 27
United States census bureau; or 28
(iv) Is both a socially and economically disadvantaged individual 29
as defined by the office of minority and women's business enterprises 30
under chapter 39.19 RCW. 31
(c) "Social equity goals" means: 32
(i) Increasing the number of cannabis retailer, producer, and 33
processor licenses held by social equity applicants from 34
disproportionately impacted areas; and 35
(ii) Reducing accumulated harm suffered by individuals, families, 36
and local areas subject to severe impacts from the historical 37
application and enforcement of cannabis prohibition laws.38
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(7) Except for the process detailed in subsection (1) of this 1
section, the process for creating new cannabis retail licenses under 2
this chapter remains unaltered. 3
Sec. 3. RCW 69.50.540 and 2023 c 470 s 1015 are each amended to 4
read as follows: 5
(1) For the purposes of this subsection (1), the legislature must 6
appropriate the amounts provided in this subsection:7
(a) $12,500,000 annually to the board for administration of this 8
chapter as appropriated in the omnibus appropriations act;9
(b) $11,000,000 annually to the department of health for the 10
following: 11
(i) Creation, implementation, operation, and management of a 12
cannabis, vapor product, and commercial tobacco education and public 13
health program that contains the following: 14
(A) A cannabis use public health hotline that provides referrals 15
to substance abuse treatment providers, uses evidence-based or 16
research-based public health approaches to minimizing the harms 17
associated with cannabis use, and does not solely advocate an 18
abstinence-only approach; 19
(B) Programs that support development and implementation of 20
coordinated intervention strategies for the prevention and reduction 21
of commercial tobacco, vapor product, and cannabis use by youth and 22
cannabis cessation treatment services, including grant programs to 23
local health departments or other local community agencies;24
(C) Media-based education campaigns across television, internet, 25
radio, print, and out-of-home advertising, separately targeting youth 26
and adults, that provide medically and scientifically accurate 27
information about the health and safety risks posed by cannabis use; 28
and 29
(D) Outreach to priority populations regarding commercial 30
tobacco, vapor product, and cannabis use, prevention, and cessation; 31
and 32
(ii) The Washington poison control center; 33
(c)(i) $3,000,000 annually to the department of commerce to fund 34
cannabis social equity grants under RCW 43.330.540; and35
(ii) $200,000 annually to the department of commerce to fund 36
technical assistance through a roster of mentors under RCW 37
43.330.540; 38
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(d) $200,000 annually, until June 30, 2032, to the health care 1
authority to contract with the Washington state institute for public 2
policy to conduct the cost-benefit evaluations and produce the 3
reports described in RCW 69.50.550; 4
(e) $25,000 annually to the University of Washington alcohol and 5
drug abuse institute for the creation, maintenance, and timely 6
updating of web-based public education materials providing medically 7
and scientifically accurate information about the health and safety 8
risks posed by cannabis use; 9
(f) $300,000 annually to the University of Washington and 10
$175,000 annually to the Washington State University for research on 11
the short-term and long-term effects of cannabis use to include, but 12
not be limited to, formal and informal methods for estimating and 13
measuring intoxication and impairments, and for the dissemination of 14
such research; 15
(g) $550,000 annually to the office of the superintendent of 16
public instruction to fund grants to building bridges programs under 17
chapter 28A.175 RCW; 18
(h) $2,423,000 for fiscal year 2022 and $2,423,000 for fiscal 19
year 2023 to the Washington state patrol for a drug enforcement task 20
force; 21
(i) $270,000 for fiscal year 2022 and $290,000 for fiscal year 22
2023 to the department of ecology for implementation of accreditation 23
of cannabis product testing laboratories; 24
(j) $800,000 for each of fiscal years 2020 through 2023 to the 25
department of health for the administration of the cannabis 26
authorization database; and 27
(k) $621,000 for fiscal year 2022 and $635,000 for fiscal year 28
2023 to the department of agriculture for compliance-based laboratory 29
analysis of pesticides in cannabis. 30
(2) ((Subsections [Subsection])) Subsection (1)(a) through (g) of 31
this section must be adjusted annually based on the United States 32
bureau of labor statistics' consumer price index for the Seattle 33
area. 34
(3) After appropriation of the amounts identified in subsection 35
(1) of this section, the legislature must annually appropriate such 36
remaining amounts for the purposes listed in this subsection (3) as 37
follows: 38
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(a) Fifty-two percent to the state basic health plan trust 1
account to be administered by the Washington basic health plan 2
administrator and used as provided under chapter 70.47 RCW;3
(b) Eleven percent to the health care authority to:4
(i) Design and administer the Washington state healthy youth 5
survey, analyze the collected data, and produce reports, in 6
collaboration with the office of the superintendent of public 7
instruction, department of health, department of commerce, family 8
policy council, and board. The survey must be conducted at least 9
every two years and include questions regarding, but not necessarily 10
limited to, academic achievement, age at time of substance use 11
initiation, antisocial behavior of friends, attitudes toward 12
antisocial behavior, attitudes toward substance use, laws and 13
community norms regarding antisocial behavior, family conflict, 14
family management, parental attitudes toward substance use, peer 15
rewarding of antisocial behavior, perceived risk of substance use, 16
and rebelliousness. Funds disbursed under this subsection may be used 17
to expand administration of the healthy youth survey to student 18
populations attending institutions of higher education in Washington;19
(ii) Develop, implement, maintain, and evaluate programs and 20
practices aimed at the prevention or reduction of maladaptive 21
substance use, substance use disorder, substance abuse or substance 22
dependence, as these terms are defined in the diagnostic and 23
statistical manual of mental disorders, among middle school and high 24
school-age students, whether as an explicit goal of a given program 25
or practice or as a consistently corresponding effect of its 26
implementation, mental health services for children and youth, and 27
services for pregnant and parenting women. In deciding which programs 28
and practices to fund under this subsection (3)(b)(ii), the director 29
of the health care authority must consult, at least annually, with 30
the University of Washington's social development research group and 31
the University of Washington's alcohol and drug abuse institute; and32
(iii) Contract with community health centers to provide primary 33
health and dental care services, migrant health services, and 34
maternity health care services as provided under RCW 41.05.220;35
(c)(i) One and one-half percent to counties, cities, and towns 36
where licensed cannabis retailers are physically located. Each 37
jurisdiction must receive a share of the revenue distribution under 38
this subsection (3)(c)(i) based on the proportional share of the 39
total revenues generated in the individual jurisdiction from the 40
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taxes collected under RCW 69.50.535, from licensed cannabis retailers 1
physically located in each jurisdiction. For purposes of this 2
subsection (3)(c), 100 percent of the proportional amount attributed 3
to a retailer physically located in a city or town must be 4
distributed to the city or town; 5
(ii) Three and one-half percent to counties, cities, and towns 6
ratably on a per capita basis. Counties must receive 60 percent of 7
the distribution based on each county's total proportional 8
population((. Funds may only be distributed to jurisdictions that do 9
not prohibit the siting of any state licensed cannabis producer, 10
processor, or retailer)); 11
(iii) By September 15th of each year, the board must provide the 12
state treasurer the annual distribution amount made under this 13
subsection (3)(c), if any, for each county and city as determined in 14
(c)(i) and (ii) of this subsection; and 15
(iv) Distribution amounts allocated to each county, city, and 16
town in (c)(i) and (ii) of this subsection must be distributed in 17
four installments by the last day of each fiscal quarter; and18
(d) Thirty-two percent must be deposited in the state general 19
fund. 20
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