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Out-of-state ownership of cannabis licenses draws sharp division at committee hearing
Summary
House Bill 19-40 would remove a six-month Washington residency requirement for cannabis business ownership and add a temporary B&O tax exemption for social-equity licensees. Supporters said the change would unlock capital; opponents warned it would enable consolidation and harm small and social-equity businesses.
House Bill 19-40, presented Feb. 19 to the Consumer Protection & Business Committee, would authorize nonresident ownership of licensed cannabis businesses by removing a current six-month residency requirement. The bill also permits the Liquor and Cannabis Board (LCB) to impose additional licensing fees to recover investigation costs for nonresidents and would exempt social-equity cannabis producers, processors and retailers from the Business & Occupation (B&O) tax for five years after a licensee first exceeds $5,000 in sales revenue; that tax exemption language would expire on July 1, 2038 under the bill as presented.
Representative Melanie Morgan, the bill’s sponsor, framed the change as a tool to expand capital access for social-equity applicants and small operators who often cannot raise the…
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