Director's office recommends denying petition to add mandatory patient verification for medical-cannabis tax exemption

The director's office told the caucus it will recommend the board deny a petition filed by John Kingsbury that would amend WAC 314-55-090 to add a new patient verification requirement before a licensee may apply a medical-cannabis excise tax exemption. Justin explained the recommendation by pointing to existing requirements: "the excise tax exemption can only be offered to qualified medical cannabis patients, who have a valid recognition card, that is in the DOH database."

Justin said current WAC requires stores with a medical-cannabis endorsement to have trained consultants, maintain transaction records for exemptions, and train staff to recognize valid recognition cards; auditors can hold licensees accountable and require payment if records are missing. He added that a real-time electronic verification system between DOH and LCB would likely be costly and still require manual review: "any real time electronic verification between DOH licensees and the LCB would likely require, a costly potentially prohibitively costly IT solution, and would still require a manual review and cross referencing of records by LCB staff."

Instead of rulemaking, staff proposed educational outreach (gov delivery/newsletter) stressing the importance of checking recognition cards on each transaction and indicated they will continue conversations with enforcement and auditing teams. The caucus did not vote; the recommendation will be presented to the board at their meeting the following day.