Oregon Cannabis Roundup: Fall 2024

12 Sep Oregon Cannabis Roundup: Fall 2024

Now that Labor Day is in the rear view and people are paying attention again, it seems like a good time to drop a line on Oregon cannabis. Here are some highlights, to launch you into fall.

OLCC’s 2024-2028 Strategic Plan

A draft of the 2024-2028 Strategic Plan was first circulated at a Commission meeting in June, and finalized and published sometime last month. The Plan covers both alcohol and cannabis, because OLCC regulates both of those things. The Plan is probably very interesting and salient to various people inside of the Commission; less so to most of the rest of us. Still, it contains a couple of highlights for the local cannabis industry.

License reassignment program

Finally. The Plan sets forth a delayed initiative to “establish criteria and process for marijuana license reassignment that offer opportunities for qualified members of underserved communities and those historically affected by cannabis criminalization.” That longish, unpaced sentence belies a welcome sentiment.

The license reassignment concept came in through House Bill 4016 in the 2022 legislative session. If you are interested in the background on this, please read our 2022 posts here and here. And also this post from February, where I explained why this should be coming in 2024. My guess (just a guess) is that delays here stem from OLCC conferral with the State DOJ, to try to minimize lawsuit exposure. Regardless, let’s hope the Commission can find a way to get more diversity into the license pool.

Improved licensing processes

The Plan adopts a goal to “improve licensing processes to eliminate unnecessary burden on applicants, increase efficiency and reduce wait-times [sic].”

I love this goal too. Even in the best of times, OLCC marijuana licensing has been a three- to four-month process. In the worst of times, it bogged down entirely due to a combination of application volume, insufficient staff, and excessive application requirements. Today, we’re somewhere in the middle, with applications submitted on or before June 3 being assigned to investigators (a typical license issuance might occur 6-8 weeks after such assignment).

Related to this “optimization” goal, OLCC began a phased rollout of its new Cannabis and Alcohol Management Program (CAMP) earlier this spring. We all sort of hated it– the system was cumbersome and frustrating in various ways. Things seem to be improving somewhat, though, and OLCC has been responsive in working through snags.

In all, we’re happy to see a focus on pace and refinement. Buyers and sellers of Oregon cannabis licenses would welcome “increased efficiency and reduced wait times” now that OLCC is no longer taking new marijuana license applications in almost all categories. Closing on these transactions is pegged directly to OLCC license issuance, which extends nearly all sales timelines (and sometimes tanks them).

Rules review

Another goal that jumped out for me was OLCC’s initiative to “conduct a multi-year review and revision of our rules structure and language [with industry parties, including licensees].”

You may appreciate that most or all OLCC cannabis rules did come through a review and vetting process. Many collaborators weigh in prior to rulemaking, at the legislative level, and others through rules advisory committees (RACs) hosted by OLCC. Things change, though, and in my opinion many of the OLCC marijuana rules—where the Commission isn’t pinned down by statute—could use a second look. In the most general sense, I’d like to see cannabis in Oregon regulated more like alcohol, despite the chain-of-custody difference. It can be done.

OLCC in general

From this observer’s perspective—informed in part by talking with Commission staff—things have settled down inside of OLCC. Staff will acknowledge that last year’s La Mota and liquor-hoarding scandals cast a pall over the Commission, but the shadow has passed (even with La Mota hanging onto its licenses). The Commission’s marijuana side, by all reports, is very collaborative, better systematized, and back to “business as usual”– especially now that licenses are capped.

Speaking of license caps, last month a RAC convened on the topic. I’ve explained that, due to House Bill 4121, we probably won’t see an increase in producer or retailer licenses in most of our lifetimes. That is still the case. Wholesale licensing, on the other hand, could open up as soon as next year, and processing perhaps in 2026 or 2027. The way the statutory language is written, OLCC would open the portal when licenses dip below certain counts. Interestingly, OLCC will have to come up with application denial criteria for relevant, previous applicants.

Elsewhere, OLCC is still active in the Cannabis Regulators Association (Cann-Ra), an organization for cannabis regulators all around the United States. Historically, Oregon has purchased a statewide membership, which means that OLCC and other Oregon agencies regulating cannabis – including OHA, DOR and ODWR – are also at the table. Hopefully OLCC finds a way to export some of its best ideas (e.g. early removal of resident-ownership requirements; interstate compact promotion), while leaving off some of the historically frustrating strictures (e.g. individual plant tagging; opaque and inconsistent enforcement rules and policies).

Ballot Measure 119 – cannabis labor peace agreements

This one is on the November 5 ballot as an initiated state statute, and I’m surprised people aren’t talking about it more.

If Measure 119 passes, every cannabis retailer and processor will be required to submit a signed labor peace agreement to OLCC. Measure 119 would not apply to producers, wholesalers, or labs. (Note: I’m a union guy, but I also believe the requirement for producers, in particular, would be a shit show. It’s neither here nor there.)

Compulsory peace agreements aren’t anything new in cannabis, although it would be something different here in Oregon. California, for example, requires labor peace agreements for many of its cannabis licensees, and has for many years. We had clients struggle with the concept initially, and we saw some fumbled roll-outs, but people eventually adjusted.

Measure 119 further provides that retailers and processors would be required to remain neutral, under the peace agreements, when labor organizations communicate with employees about collective bargaining rights “with any licensure or renewal application.” That part is not exactly clear to me; let’s see how it goes.

The United Food and Commercial Workers Local 555 spent a good deal of money to get Measure 119 on the ballot, rounding up some 163,000 signatures when only 117,173 were required. This follows on a stymied effort to get House Bill 3183 passed last year, which would have accomplished the same thing legislatively.

I’m not aware of any polling on Measure 119, but my guess is that it will pass– Oregon is a “union” state, consistently outpacing the U.S. at large in per capita union membership. So this is one to watch.

Rumblings on legislative priorities

The 2025 Oregon legislative session will be a long session, stretching from January into the summer. The deadline for pre-session bill filing isn’t until December 13, so we are a ways out on seeing any concrete proposals of record. That said, CIAO keeps its legislative priorities list updated here, and it has been in active discussions with membership as to what folks would like to see.

Here at the firm, we’ve been talking with a few private parties on special interest bills, and you can expect to see certain cannabis bills that expired in 2024’s short session to be revived. We’ll check in on all of this in January, as we always do here on the blog.

In the meantime, here’s to a beautiful September, with nobody’s farm smoked out by the fires. See you soon.