Oregon Sets Massive Precedent — Refuses to Enforce THC Blood Limit for Driving

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Photo Credit: Sonoma County Sheriff’s Office
The state is leading the way by insisting that science and evidence prevail when it comes to marijuana and DUID.

There’s a lot to be said for states that have legalized recreational and/or medical cannabis, but even Colorado and Washington have one problem – arbitrary blood-THC limits which imply a driver is impaired.

These numbers, such as Washington’s 5ng/ml, have no scientific basis for assessing the level of impairment. Despite this, six states with legal weed have per se limits for tetrahydrocannabinol; being over that number automatically makes you guilty of driving under the influence of drugs (DUID).

Oregon, however, is bucking the trend. In its DUI Legislative Report, the state’s Liquor Control Commission said it is recommending against a per se THC limit. By relying on the actual state of science, this welcome exercise in rationality should set an example for other states setting up their own regulatory framework.

Oregon’s Liquor Control Commission was tasked in 2015 with “regulating the recreational marijuana market in Oregon, with studying the question of THC-related intoxicated driving.”

According to the report:

Due to restrictions on cannabis research and limited data, it is difficult to make definitive statements about the risk of THC-intoxicated driving. The body of evidence that does exist indicates that while attitudes towards driving after marijuana use are considerably more relaxed than in the case of alcohol, the risk of crashes while driving under the influence of THC is lower than drunk driving. Little evidence exists to compel a significant change in status quo policy or institute a per se intoxication standard for THC.

widely-reported study by the American Automobile Association in 2016 found no scientific basis for blood-THC limits and called on the six states using such laws to abandon them. Chemical tests for THC have not been shown to correlate to things like brake and gas pedal coordination, distance perception and general attention.

The only thing we know about blood-THC and driving is that it is not comparable to the tests for alcohol impairment. There is no THC breathalyzer test, and urine tests cannot detect it. Some blood tests can distinguish between THC and its longer-lasting metabolites, but these levels can vary widely depending on how often the person uses cannabis. Test results will also vary based on whether one smoked or ate the cannabis.

One person can feel impaired at 5ng/ml while another can function with no detectable impairment. In fact, many people charged with DUID based on arbitrary blood-THC limits have convinced juries they were not impaired when they were pulled over.

Even so, driving studies show driving while on cannabis is far less dangerous than driving on alcohol, including one finding virtually no driving impairment from cannabis. Other studies have found that speed is typically reduced while driving on cannabis, and people deliberately compensate for any impairment, although multitasking was somewhat affected.

In no way does this mean anyone can just toke up and get behind the wheel. Cannabis is psychoactive, and people unaccustomed to cannabis – especially teenagers – should certainly refrain from driving.

The Oregon Commission’s report also supports the premise that cannabis users are more responsible drivers than alcohol use.

The rate of drivers tested by Drug Recognition Experts who are positive for THC intoxication rose between 2013 and 2014, but did not increase following legalization. Fatal accidents data is highly variable year-to-year, making trend analysis difficult. But in Oregon in 2015 there were only three more traffic fatalities involving a driver testing positive for THC compared to 2004. Moreover, the rate of THC-related fatal accidents is also considerably lower than such accidents involving alcohol intoxication. Finally, while overall traffic fatalities and alcohol-related fatalities spiked in 2015, THC-related fatalities did not.

As a spokesman for AAA noted when their study was published, the increased risk from driving on cannabis is about the same as driving with a “noisy child in the back of the car,” and only half as dangerous as talking on a hands-free cellphone (legal in all states).While thankfully avoiding an arbitrary blood-THC limit recommendation, the Oregon Commission still felt compelled to offer advice on cannabis and driving. It recommended increasing the use of “Drug Recognition Experts” who administer lengthy sobriety tests specific to cannabis, as well as implementing a voluntary oral swab test to collect data.

Possible New Pot Laws for Oregon in 2017

asklawyer-istock-lushik-openrangestockISTOCK / LUSHIK / OPENRANGESTOCK

What New Legislation is on Oregon’s Docket?

What new pot laws might the state foist upon us?

BUCKLE UP, FRIEND. There could be several. The Oregon state legislature convenes next Wednesday, February 1, and its website contains a slough of pot law proposals (28 draft bills, by my count). Many of these will be revised, consolidated, or simply cast aside, but the legislature’s general thinking is now on display. Below are some highlights.

Veterans—SB 130 would waive medical marijuana card fees for veterans who have a “total disability rating of at least 50 percent” resulting from service, and who were discharged or released “under other than dishonorable conditions.” That’s a starting point, but it would be classier and less complicated to waive card fees for all the vets. Here’s hoping.

Administration—SB 300 would relieve the Oregon Health Authority (OHA) of its cannabis oversight and transfer that responsibility to an “Oregon Cannabis Commission.” Other bills, HB 2198 and 2200, would change the name of the Oregon Liquor Control Commission (OLCC) to the “Oregon Liquor and Cannabis Commission,” and euthanize OHA. However it plays out, we will likely see weed administration further consolidated in Oregon, and likely under OLCC. That’s a good thing.

Hemp—HB 2372 would establish an Oregon Industrial Hemp Commission, and HB 2371 would create a program at Oregon State University to label and certify agricultural hemp seed. The industrial hemp program in Oregon is finally gaining traction; these would be good steps.

Research—HB 2197 would direct the OLCC to work with a nongovernmental entity that conducts or funds research on weed and cannabis-derived products. Public dissemination of all research findings would be required. This would be terrific: Because of federal law, the double blind testing normally conducted on medical products—which is the gold standard for FDA approvals—has been mostly inaccessible for pot. Let’s hope this one passes.

Energy Efficiency—HB 2205 would direct the Oregon Department of Agriculture to work with vendors to create efficiency standards for pot production. Once these standards were developed, a certification protocol would ensue. Seems like another good idea.

Property Tax Exemption—HB 2151 would grant a state property tax exemption for new equipment for processors of cannabinoid edibles (as well as for makers of booze). This would make a big difference for some pot processors statewide, when you consider the steep cost of some of this equipment.

Pot Lounges! Pot Events!—SB 307 would exempt cannabis lounges from the onerous provisions of the Oregon Indoor Clean Air Act, so that we could have cannabis cafés, like Colorado does. The bill would also allow OLCC to grant temporary licenses to pot events.

Crime and Punishment—SB 570 would create two new crimes, related to “administering a marijuana item to the body of a person who is under 18 years of age,” intentionally or knowingly. The maximum penalties are intimidating: 20 years’ imprisonment, $375,000 fine, or both. Do not give pot to kids.

Is Home Cultivation Finally Coming to Washington State?

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A new bill in the Washington state Legislature would add a long-awaited provision to the state’s cannabis law to allow adults 21 and over to grow their own supply of cannabis at home.

The new legislation, HB 1092 introduced last week by Rep. Sherry Appleton (D-Poulsbo), would allow adults to grow cannabis plants at home for personal use—a move that would align Washington with the rest of adult-use states.

As it stands, Washington is the only state that allows retail sales of adult-use cannabis but still bars home cultivation. Currently only registered medical patients with a state-issued permit can legally grow at home.

If the bill is enacted, adults 21 and over would be able to grow up to six plants on their private property. Yields would be limited to no more than 24 ounces, or a pound and a half of useable cannabis. Homes with more than one adult resident could legally house up to 12 plants, for up to 48 ounces, or three pounds.

A big question that remains is how consumers would go about getting cannabis seeds in the first place. The purchase and sale of seeds is still illegal under state and federal law, despite the fact Washington has legalized cannabis itself. Under the current proposed bill, there is no mention of where consumers would be able to purchase cannabis seeds were the bill to become law.

Daniel Shortt, a Seattle-based cannabis lawyer at the firm Harris Bricken, told the Seattle Post-Intelligencer that he believes the new bill will have to answer how home growers can acquire seeds.

“The way the entire marijuana market is set up, producers and processors can sell to retailers, who can sell to the public. Would that mean that now, to get these seeds, potential home growers are getting seeds from the retail store?” said Shortt. “If those seeds are being sold, that’s really the only place where the government could actually get revenue from taxes.”

In 2016 alone, Washington lawmakers introduced 44 bills that deal with cannabis in some fashion. The list includes bills that relax residency requirements for licensed marijuana business owners as well as legislation around medical marijuana patients and their employers.

The recently introduced House Bill 1060 has garnered bipartisan support. The measure would allow medicinal marijuana to be administered on school grounds to children who need cannabis to function normally, such as those who suffer from daily seizures.

A full list of cannabis bills that have been introduced in the state is available online.

Oregon reports big jump in marijuana business applications, licenses

In another sign that cannabis could be bigger business than previously forecast, the Oregon Liquor Control Commission says it received 1,907 recreational marijuana license applications in 2016 — far outstripping a projected 800 to 1,200, the agency said.

Seven hundred sixty-two of those applications were approved as of the end of last week, a big jump from 500 licenses in early December. In that time, the number of licensed retailers went from 99 to 260.

Processors, who have struggled with strict testing and labeling requirements, have been slower to get licensed, but the number in that category was up significantly as well, from 18 to 51.

“Our staff has worked nonstop and with determination to get this industry licensed,” OLCC Executive Director Steve Marks said in a statement. “Working after hours, working weekends, traveling long distances, this team has been flexible in getting this industry licensed, without compromising the trust placed in us to protect the public.”

Oregonians voted for legalization in November 2014, and the state began transitioning toward a regulated recreational market in October 2015 with “early start” rules, which allowed dispensaries to extend sales to adults who didn’t have medical cards.

That got recreational sales off to a fast start: In December, the Department of Revenue reported that tax payments totaled $54.5 million from Jan. 1 through Nov 30., $13.8 million more than the Legislative Revenue Office had projected.

But early sales ended with the arrival of 2017; all businesses operating in the recreational space now must be licensed by the OLCC.

The big increase in recreational retailers has coincided with a decline in dispensaries.

As of last week, since Oct. 1, 121 dispensaries had either surrendered their registration or withdrawn their application to go retail, and the number of dispensaries had shrunk from a peak of 425 to 307.

Senate Republican Leader Ted Ferrioli, co-vice chair of the legislature’s Joint Committee on Marijuana Legalization, told the Business Journal’s Elizabeth Hayes that he expected the number to ultimately dwindle to around 30.

In its statistics update, the OLCC also reported that it had approved 9,041 Marijuana Worker Permits out of 10,700 applications received.

Pete Danko

Some Oregon Marijuana Dispensaries Devastated by Recreational Sales Deadline

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By Keith Mansur     Oregon Cannabis Connection

There is definitely no wait at Stash Cannabis Company in Beaverton, Oregon, the past couple of days. Since the deadline for Oregon’s medical marijuana dispensaries passed on December 31, stores that have been waiting for their licenses from Oregon Liquor Control Commission (OLCC) are seeing a lot fewer customers.

It’s so bad that they had only two sales on January 4, for $125.00, and barely over $100 the previous day. The typical sales at Stash Cannabis Company, before they were forced to go back to medical-only sales, was about $4000 a day.

The problem has been devastating for dispensaries that are stuck in limbo between receiving their OLCC licenses and the deadline to end early sales that passed on December 31. These dispensaries, which had been allowed to sell to the recreational market since October 2015, are now out in the cold.“At that pace we will be at $3000 for the whole month,” explained Chris Mathews, owner of Stash Cannabis Company. “We’re turning away 75 or 80 people a day, at least.”

Mathews paid for his application on December 13, after waiting since August on a letter from his landlord showing he had legal occupancy of the building—an application requirement even though he had an operating medical dispensary under the Oregon Health Authority (OHA) system licensed by the city of Beaverton as a medical marijuana dispensary. He has still not gotten an appointment for an inspection walk-through, the last step before licensing. In fact, he may have fallen further back in line, according to his most recent conversation with OLCC.

Mathews emailed OLCC for the status of his application on December 21. They responded, telling him he was 10th in line. Anxious about the looming deadline, he emailed again December 27, and found he was still 10thin line. Finally, he checked on January 4 and found he was now further back in line,  suspiciously moved to 15th!

“It’s frustrating,” Mathews told Oregon Cannabis Connection (OCC). “I have met all the requirements, I took the Metrc training, and I’m just waiting for an inspection.”

He has been given no timeline, either. “They told me to call back next week and they will tell me where I am at then.

Washington and black market benefit

Martin Nickerson simply closed his McMinnville, Oregon, dispensary doors at Ocean Grown Cannabis Company. He knew it was a pointless endeavor to try and operate when the vast majority of his customer base was forced to shop elsewhere—which he knows means Washington state. Originally from Washington, Nickerson understands the market there and has even been told by his customers that’s where they are willing to go.

“We’ve shut down until we get our OLCC license,” Nickerson told OCC.
The county was holding up his Land Use Statement, or LUCS, which is a required part of the application. They received the LUCS January 4, the day we spoke with him. The OLCC now has a completed application and he is awaiting inspection.“The dispensary was being hit so hard on loss of product. We were watching customers go right to the black market or they are going right across the border to Washington,” Nickerson explained. “If you go across the border to Washington … they’ve got 50 different kinds of concentrates from $18.00 to $24.00 a gram. I have had customers tell me if it’s that much cheaper and there’s that much selection and accessibility to product, it’s worth the drive.”

“I want to see them helping us and not hurting us. If we could just work together and talk,” Nickerson said. “I appreciate the work they put in and all the time and effort that has gone into legalizing marijuana in Oregon, but they should be asking the cannabis community ‘what should we do here?’, you know?”

“We are trying to beat the black market and I am right here with the state to help them every step of the way but, boy, I hope they start to listen a little bit,” explained Nickerson.

Tax losses are huge already

The 420 Club in the City of Roseburg, Oregon, was the first licensed marijuana dispensary located in Douglas County, a county that still bans cannabis businesses due to a commission-imposed ban ordinance. The attempted repeal attempt failed in November 2016. Roseburg, however, has allowed dispensaries since 420 Club opened on November 6, 2014, and recreational sales eventually were allowed, too. One of the selling points for recreational cannabis to the city of Roseburg and an main argument for lifting the ban in the county was the tax benefits.

Four dispensaries were operating in Roseburg and 420 Club alone was contributing $18,000 in tax to the Oregon Department of Revenue every month, but that changed in October with the shortage of concentrates and edibles, and in some cases flower, for a few weeks.

“For the last two months we have collected $10,000 per month in taxes, but in the previous year we were collecting about $18,000 a month,” explained Hoyt. “As soon as the state started messing with the testing [on October 1, 2016], our sales dropped 40%.”

“However, now we aren’t collecting any taxes because of not being issued our license yet,” he told us. “We’re obviously not collecting anything for the state in taxes.”

They started their application process at the beginning of December and have faced delays similar to what other dispensaries have encountered. They submitted their application somewhat late because they had very low inventory and nothing available due to the testing backlog and timing of that with harvest. The same timing happened all across the state as dispensaries struggled to stock their shelves before the switch to OLCC retail sales.

“They did all the testing changes at harvest time, and that’s something you just don’t do because everybody and their brother has herb to be tested,” Hoyt pointed out. “That was just the wrong time to do what they did.”

It’s a widespread problem

“This was a completely avoidable disaster,” explained Casey Houlihan of the Oregon Retailers of Cannabis Association. “Several agencies dropped the ball and are now pointing fingers at one another, while our industry grinds to a halt. Scores of shops are scaling back employee hours, forced to turn away would-be customers because they are stuck waiting for a rubber stamp.”

The association has been working to help  cannabis businesses in Oregon negotiate policy issues. Their membership includes about 120 businesses and 65 dispensaries. They have provided guidance and input to legislators and administrators over the past few years in an attempt to prevent onerous rules and stifling regulations from being placed on the industry. They continue to address problems and suggest solutions to rulemakers and legislators.

“This was not the legislature’s intent when they passed ‘early sales’ [SB 460] in 2015,” Houlihan said. “The Oregon Retailers of Cannabis Association is doing everything we can to develop and organize for a solution to the current crisis, and we are working with policymakers to help make that happen.”

The number of licensed cannabis OLCC retailers (dispensaries) in Oregon as of December 30, 2016, was 216, according to the OLCC website information atwww.oregon.gov/olcc/marijuana. Of those only 178 have active licenses. 314 medical marijuana dispensaries remain on the OHA list, which is can be found athttp://public.health.oregon.gov/DiseasesConditions/. on their website. Rob Patridge, OLCC Chairman, told OCC that as of January 4, 257 applications have been approved.

Is there a solution?

The deadline was put in place by statute, so  legislative action would be required to change it. But the problem is immediate and serious, so waiting for the legislature to take care of this is no solution at all. Unfortunately, it appears that is a major roadblock.
“OLCC remains committed to expediting late filing applications and has been taking steps throughout the year to facilitate a quick transition, including working directly with applicants to complete their applications. Applicants can speed up the process by inventorying their products and completing their Inventory Transfer Requests. The December 31 deadline cannot be changed without legislative action since it is in statute. The deadline has been in place for 17 months, starting on July 27, 2015, when SB 450 became effective. The OLCC has been accepting applications for a year and retailers that applied and were ready have been approved through the OLCC’s expedited process. As of yesterday, 257 retail licenses have been approved and staff expects more to be approved shortly as applications are completed.”Patridge explained:

We also reached out to Rep. Ann Lininger, who co-chairs the Joint Committee on Marijuana, but received no response.

The reasons for delays are numerous and many have been forced by local regulations, inattentive landlords, rules changes and myriad reasons other than procrastination. If they have already paid the application fee and are already a licensed dispensary under the OHA, is there no way to allow them to continue to operate?

Let’s hope a solution can be revealed sooner rather than later.

© 2016 Oregon Cannabis Connection.

Portland is Behind on Issuing Cannabis Business Licenses

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With only a few weeks to go until the Oregon Health Authority officially turns the new commercial cannabis industry over to the Oregon Liquor Control Commission there is not much time left for businesses to obtain all their needed licenses. In the city of Portland there have been delays in the permit process for several cannabis businesses – who were worried that they would be shut down come January 1st when those licenses become required. Luckily, the Portland City Council has taken action to ensure that businesses awaiting licenses will not have action taken against them at start of the new year.

“There was some concern in the media about lots of businesses being found out of compliance and shut down January 1,” Commissioner Amanda Fritz said. “As long as there are good faith efforts that they’re in the process that is not going to happen. We appreciate most businesses are working their way through the process”

In hopes of speeding up the process some, the council also agreed that retail dispensaries will be able to obtain their licenses from the Office of Neighborhood Involvement – even if they are still in the process of obtaining all the permits they need. As long as they get the permits and have been successful in working through the complicated process, then they will be eligible to get their license ahead of schedule. This will not however, be an option for growers or processors – likely due to the fact that there are much more in depth inspections required for such businesses.

“We want to be very clear that the city and the Cannabis Policy Program will not be taking enforcement measures against any legally operating marijuana business that is currently waiting in line for its recreational license to be issued,” Fritz said at the top of the Council meeting.

Along with the measure that aims to help push along the licensing of retail cannabusinesses, the city council also approved a measure that will allow for a new license – for marijuana couriers. Such a license wouldn’t allow businesses to have a retail storefront – but it would allow them to have a headquarters, receive orders between 8am and 8pm, and make deliveries of cannabis up until 9pm. This is a first of its kind license – headquarters would have to remain 1,000 feet away from schools like any other cannabis business, but they would be able to deliver to homes that are closer.

It’s exciting to see the city coming to the end of a long initial process that has created what will likely be a thriving industry – and bringing new opportunities, such as the new licenses for marijuana couriers. Both of these measures will be voted on a second time next week before they are officially passed, but both seem to be extremely well supported and it is unlikely there will be any issue.

Fresh evidence of Oregon cannabis industry’s pain

main-street-marijuina-gorilla-glue750xx5472-3078-0-285Pete Danko

Marijuana sales in Oregon slid at an accelerating rate after new testing and packaging regulations went into effect, according to a new report.

Colorado-based BDS Analytics, which says it collects actual point-of-sale transactions, said dispensary sales were $7.6 million the first week of the month, then after a gradual decline landed at $6 million in the final week.

For the month, the firm estimated sales of $29.5 million, down 8.5 percent from September and the first time since May that sales hadn’t cracked $30 million.

Late last week, after weeks of often desperate requests and complaints from the industry, state regulators issued temporary rules intended to ease the testing burden and get product moving through the supply chain again. Many in the industry, however, said the revisions fell short of what was needed.

Economist Beau Whitney, who released his own survey in late November showing more than a fifth of Oregon cannabis businesses shutting down, said the new rules were “like putting small twigs at the back of a beaver dam – the water is still backing up, with no apparent end in sight.”

In its report, BDS said edibles have been particularly hard hit since October, with sales falling from $3 million in September to $2 million the following month. Producers of those products have faced the most extensive and costly testing burden.

BDS also released November data from a subset of dispensaries that feed the firm information and found same-store sales down 21 percent from September to November, “with some stores declining more than 60 percent in retail dollars.”

 

Can’t pay for your medical marijuana? A new fund might help.

potThe Washington CannaBusiness Association said on Tuesday that the new charitable effort will expand patient access to medical marijuana. Steve Bloom Staff file, 2016

 

Marijuana industry brought to a standstill by new pesticide testing regulations

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Molly Harbarger | The Oregonian/OregonLive

Once packed with marijuana concentrates and extracts, the Human Collective’s shelves are nearly empty.

Some pot leaf-patterned socks and glass pipes sit scattered among what’s left. A static screen with just 13 flower options has replaced a digital “bud list” that used to scroll through the shop’s options for people waiting in line. The lines are gone, too. Only one or two budtenders work at a time – cut in half from before.

Within months of Oregon’s full recreational marijuana market coming online, the industry has come to a standstill with low supplies and big price jumps for consumers.

Don Morse, owner of the Human Collective in Southeast Portland, and other retailers, growers and processors blame Oregon’s strict pesticide rules for the problem.

The regulations – the first mandatory pre-emptive testing in the country for marijuana – went into effect Oct. 1. But the state has so far licensed only a handful of laboratories to do the tests on thousands of products, including flowers, edibles, concentrates, oils and extracts.

And the tests are expensive – in some cases more than six times what companies used to pay, they report. Then they must wait weeks to get their products back and find out if they passed or failed.

Morse has laid off five budtenders since last month. He’s down to about 10 percent of the concentrate inventory he had before October. He can’t find anyone to sell him enough marijuana to fully restock.

That’s happening in most of the more than 400 marijuana dispensaries around the state.

For Morse, the gridlock is ironic because he pushed for the rules. He helped convince growers and processors that reasonable pesticide limits and testing regulations would be better for them and consumers. But now the fledgling businesses are in jeopardy, he said.

“We don’t want to come off like it’s boohoo and we’re only in it for ourselves,” Morse said. “The people of the state said they wanted this both medically and recreationally. They left it to the state to set the rules and the state has set the rules to the point where it’s no longer available to them. It’s this roundabout way of making cannabis illegal again.”

Megan Hatfield bought a vape pen cartridge of Sour Diesel for $45 at Morse’s store. It’s usually around $30 there, but she still considered it a bargain. She tried two other pot stores earlier in the week, finding only two other options, both at $80 for a gram.

“Honestly, I have been to a couple of places that didn’t have a selection nearly as big as this,” Hatfield said.

The Governor’s Office is expected this week to announce some temporary fixes to address the testing backlog, while the Oregon Health Authority has borrowed inspectors from other divisions to help license labs.

The slowdown is the price of safety, said Jonathan Modie, a spokesman for the  health authority.

“Our goal is to protect public health,” he said, “by making sure that all marijuana products are tested for pesticides and other compounds by an accredited lab and that marijuana products that fail pesticide testing don’t reach consumers.”

***

Starting a year ago, anyone 21 and older could buy a limited amount of marijuana flowers, starter plants and seeds. Edibles and extracts were added in June. The state expects to issue 850 recreational licenses for everything from retail outlets to growers by the end of the year.

The state has debated how to handle pesticides for more than a year and came up with the nation’s most stringent rules for chemicals used in legal marijuana cultivation and the amounts that can show up in finished products, be it flowers or edibles.

While other marijuana states such as Washington have pesticide limits on crops, Oregon is the only state to require testing of each product before it hits shelves.

Labs here must test for a longer list of chemicals with stricter limits and in larger batches than before Oct. 1, when the rules didn’t say how to do the tests, who could do them and what happened if products failed. Today, labs must follow state-specified protocol and then state agencies follow up with growers and processors to make sure any products that fail are retested or destroyed.

So far, the state has issued two recalls for tainted marijuana flowers that made it to retail shelves.

The health authority has certified six labs for pesticide testing. It’s a long process that requires extensive proof that the labs are using the correct methods and that the results are consistent before a state assessor shows up to double check the work.

Through the end of the year, the state has three permanent full-time assessors and one full-time temporary assessor working. The Oregon Department of Environmental Quality has loaned three extra assessors – one full time and two part time – to help with the assessments and administrative tasks.

More labs will be certified through the state’s general lab-accreditation program, ORELAP, in the future, Modie said. There are eight more labs that have applied for accreditation, but none are ready for inspection yet.

“ORELAP’s role is to offer lab accreditation services, not to ensure that labs succeed in getting accredited or that there is sufficient supply of accredited labs in the for-profit market,” Modie said.

Rodger Voelker, lab director of one of the pesticide testing laboratories, Eugene’s OG Analytical, said that while some of the pesticide limits might be stricter than necessary, the delays are a temporary growing pain of a new industry.

“I hear this constantly — people saying this is totally unfair, that they don’t expect this of anybody else,” Voelker said. “That’s actually completely wrong. These things are expected of any industry where people are putting things in their mouth.”

Both state and federal agencies oversee food safety regulations that can be rigorous and expensive. Some of the health authority’s cannabis guidelines go above what’s required of food items, including a bigger sample that must be tested from each batch. But there’s also less scientific evidence about the effects of heating and inhaling marijuana products treated with pesticides, so the limits may evolve as research reveals new information.

Voelker was instrumental in pushing the state for the first comprehensive marijuana pesticide testing guidelines.

He acknowledged that the exacting new process created problems that the state and marijuana companies could have foreseen and are now causing pain. For instance, companies that take marijuana flowers and turn them into extracts and then infuse the extracts into other products are dealing with ingredients that are tested at each stage of the process. In the short-term, it brings those companies to a halt while that extract undergoes the lengthy process to get approval.

But Voelker predicted enough supply will soon be available and the system will be running smoothly a year from now.

“The bottom line is regulations are not perfect,” Voelker said. “They are made by humans for humans. In my opinion, although this isn’t fun to go through right now, we should be proud as Oregonians to put in place a system that is arguably better than any out there in regards to cannabis.”

***

The uncertainty is causing processors to reconsider their investments.

Sara Lessar and her husband have two plans for the future. The first is to wait until Oregon loosens its rules on pesticide limits for marijuana concentrates so their oils can get back onto dispensary shelves.

Across Oregon, processors and shop owners are saying they can’t get any concentrates through the testing process. Lessar buys marijuana flowers that are tested by state-certified labs and pass. But during processing, the pesticide traces are packed together and creep above the .20 parts per million maximum.

They can keep testing their oils to see if they can get them below the allowable limit, but the cost of testing is straining their ability to keep prices low, Lessar said. Before Oct. 1, they spent about $2,000 every six months on testing, but now they must pay $20,000, she said.

That’s tough because they just bought a new property in Coos Bay to produce Bandit Oils but have no revenue coming in and laid off three full-time employees and five part-time employees.

They’re considering their second option: Moving to California or one of the other states with legal recreational marijuana that doesn’t impose such strict pesticide limits.

Lessar isn’t against testing, she said, but the rules for concentrates seem almost impossible to overcome.

Others are hitting similar barriers.

“I have very few vendors who will sell me any extracts whatsoever and I have two vendors who will sell me edibles,” said Matt Walstetter at Portland dispensary Pure Green. “We used to have hundreds of products and tons of vendors.”

He said he usually has 15 varieties of shatter and five to 10 wax options — both types of concentrates. Now he has six shatters and one wax.

Walstetter stocked up before the transition date and like Morse relied on that to carry him for a while. But that will soon run out, he said.

The only edibles in Brad Zusman’s Cannadaddy’s dispensary are his own product. He created a marijuana-infused chocolate bar that he sold to retail stores around the state. But he decided to close the company, Blaze, when the bars couldn’t pass the pesticide tests.

He laid off his Blaze staff – 12 people — but he was still stuck with $80,000 worth of the bars made before the new testing rules. He was allowed him to “grandfather” the bars into his own inventory. But, because they weren’t state-approved, he couldn’t distribute them to other retail stores to sell to customers.

“That should have gone into all these other dispensaries, but people didn’t have cash to buy product,” Zusman said. “It’ll all be gone probably by the first of the year.”

The bars are almost a blessing in disguise, though, because he is struggling to find any other edible suppliers to sell to him. He lost $40,000 in October alone between slow business at his dispensary and the loss of sales for his edibles, he said, and told his 33 Cannadaddy’s employees that he might have to lay off 30 of them after the holidays.

“I predict you’re going to see 70 to 80 percent of the dispensaries you see today, you won’t see next year,” Zusman said. “If there’s not an emergency way to get products on the shelf, there’s no way to sustain leases or rent or equipment leases.”

***

Zusman’s prediction shouldn’t surprise anyone. Industry leaders warned state agencies that the new rules would create chaos.

Yet many were still surprised at the scale.

“We first started the conversation with the Legislature and Governor’s Office in August,” said Amy Margolis, an attorney who represents marijuana businesses. “And in that time we’ve lost good actors, people who have invested their lives and their livelihoods in this.”

The health authority’s accreditation program already had a large caseload before marijuana testing was added. The division also accredits labs that do environmental and water quality testing, as well as air toxics and industrial waste. It works with labs in more than a dozen states and three countries.

The administrator for the program warned that most marijuana labs need significant help shaping up and it can take months to get them there.

A new report says that the delay could cost the state millions.

The state collected $25.5 million in taxes from marijuana businesses by April and projected $44.4 million by the end of the year.

Beau Whitney, an economist for a national cannabis analytics company, doubts those projections will hold up now. He opened an online survey this month that so far is reporting that 80 percent of the responding Oregon businesses report that their bottom line is “severely impacted” by the market’s stall.

More than 22 percent of the 72 businesses that responded as of last week said they were going out of business or in danger of it and nearly all planned to raise prices for consumers if they hadn’t already.

Whitney said the survey shows nearly half of the businesses are losing $20,000 a month or more on average, some with their revenue cut in half. While Portland’s market is often considered oversaturated, Whitney said what’s happening isn’t explained by natural industry fluctuations.

“This is not just settling of the dust of the market,” Whitney said. “This is apparently policies that were put in place that have essentially devastated a market.”

He estimates the state stands to lose as much as $10 million of the projected tax revenue by the end of the year.

— Molly Harbarger

mharbarger@oregonian.com
503-294-5923
@MollyHarbarger

NWCC Monday Night Sesh

5Here is an article by 420 Culture about NW Cannabis Club and The Monday Night Sesh!

NWCC Monday Night Sesh

An old crow sits atop the sign that says NWCC – Northwest Cannabis Club – a rustic venue off of Powell in downtown Portland, OR. At first glance you may assume it’s another dispensary or headshop, however it is so much more! The NWCC has opened it’s doors to the cannabis community to create an environment where the culture can thrive, the community can network & businesses can grow with exposure. Every Monday night they host the “Monday Night Sesh” – several vendors set up & showcase / sample out products while heady glass collectors from around the world come together to sesh and show off. 

Join us for Monday Night Sesh

Every week NWCC is the host of the Monday Night Sesh, a gathering that brings the community together for an evening of smoking & networking. The venue is in the heart of Portland, OR. – 1195 SE Powell blvd. – a central location for the Oregon community. The club offers a sanctuary for dabbers and weed tokers to enjoy their products in a safe, private environment. Legalities prevent any cannabis products from being sold on the premises, the best bet is to come prepared with your own stash. Occasionally local extract companies or dispensaries will set up as vendors for the sesh & sample out products for free.

The Monday Night Sesh attracts a “heady” crowd of glass collectors & enthusiasts. When you first walk into the club you’re greeted by the friendly staff, once they get you taken care of you’ll have free range of the dab bar & the downstairs lounge.  On any given week during the sesh you can find over $50,000 in functional glass that people are passing around in the downstairs lounge. You can also find a pool table, foosball and a flatscreen TV in the lounge.

Come on down to the NW Cannabis Club and see what it’s all about for yourself. A lifetime membership will cost $20, this will give you the ability to use the club as a social venue for a $5 daily fee. The membership allows the club to operate as a private venue, which is an essential part of providing the community with a safe sanctuary.

Every few weeks we try to make it down to partake in the terpiness, hang out with some friends & network with new potential clients. We always bring our cameras & capture epic moments so we can share the experience with you & everyone else. Enjoy these photos from previous Monday Night Sessions :

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Where the buzz is created….

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