Washington Regulators Change Marijuana Laws to Appease Feds

The Washington State Liquor Control Board is making a few changes to keep their rules more in-line with federal laws. In particular, they are changing where marijuana retail stores will be allowed to operate. This will protect marijuana businesses and keep Washington on-track to begin issuing licenses at the end of this year.

When they first began to develop rules for legal marijuana, Washington tried to depart slightly from the federal rule that no one is allowed to sell drugs within 1,000 feet of a school. They wanted to allow stores to count the 1,000 feet along the road, instead of "as the crow flies". This would've allowed more marijuana stores to operate; however, now they are changing their minds.

If the federal government plans on enforcing their 1,000 feet rule "as the crow flies", then Washington doesn't want any of their retail stores to get harassed. As such, they are changing the rules to be more reflective of the federal law.

Even with the new rule change, Washington is on track to finalize its rules and start accepting applications for licenses in November. The hope is that the new rules will allow Washington marijuana businesses to operate without fear of federal prosecution. They also wish to calm the federal government's fears about newly legalized marijuana.

Feds Look to Legalize Marijuana Industry Banking

Washington's banks and financial institutions are still hopeful that they will be able to do business with legalized marijuana businesses without fear of prosecution. Deputy Attorney General James Cole told Congress that banks and financial institutions have been afraid to let marijuana-related businesses open accounts for fear of criminal prosecution.

This has been an ongoing problem since 1996 when California voters made it legal to use medical marijuana. Federally insured banks and other financial institutions were at risk for being prosecuted for drug racketeering, and thus refused to do business with medical marijuana dispensaries.

Since the Justice Department first announced its more permissive marijuana enforcement policy, marijuana advocates have been quick to point to banking issues as a roadblock to success. Legitimate marijuana businesses that operate on a cash-only basis are open to criminal activity, such as tax evasion, money laundering, and theft. It also presents a public safety concern because cash-only businesses could result in the presence of firearms and other weapons.

In addition to banking issues, the Justice Department is still trying to figure out how they will protect states where marijuana is still illegal from being infiltrated with legal marijuana from neighboring states. DEA chiefs are certain that "when marijuana will be fully legal to buy, diversion of the drug will explode".