business

A Short Story: My Experience Obtaining a Retail Cannabis License

Photo by Get Budding on Unsplash
Rob Hendrix
Rob Hendrix 13 Aug 2019

My name is Rob Hendrix. I live in Ellensburg, Washington. I have been married to the same girl since 1979, I have three kids and five grandchildren. I have lived in the same house since 1991. I have a BS in Economics from Central Washington University, class of 1982. I am the very last person you would ever expect to own a pot shop.

For me the journey started in December 2013. We applied for a license to own and operate a retail cannabis store in Washington State following the passage of Initiative 502 in November 2012 legalizing recreational use of marijuana.

We began receiving calls from our licensing specialist, a very hard working State worker named Kimberly, in mid January 2014. We were informed during these first few calls the first legal cannabis stores were slated to begin opening in July later that year and that she wanted us to be in the first flight. Further, we were informed we, my wife Diane, and I would both be subject to two different background checks; a FBI as well as a Washington State Patrol background check.

We had to disclose our finances on a monthly basis, we had to prove residency, we had to have chosen a suitable and approved location to include a rental/lease agreement or a signed valid mortgage on said property.

Kimberly also walked us through the personal finances portion of the checklist to become eligible for a retail license. This seemed simple and straight forward and perfect for us as we did not have a very complicated portfolio; a house with a mortgage, two cars, a paltry savings account.

Washington State decided early on the best way to award limited numbers of licenses would be by lottery. We had to disclose our finances on a monthly basis, we had to prove residency, we had to have chosen a suitable and approved location to include a rental/lease agreement or a signed valid mortgage on said property.

This was an interesting step in the entire process. The state mandated the prospective location of any cannabis business must be at least 1000 feet from schools, hospitals, libraries, daycare facilities, any parks. Ellensburg is not a big town and it is a fairly conservative town so finding a location that both met State requirements and one who’s owner would look favorably on that location being used for a cannabis business was very, very difficult. We succeeded ultimately but just barely.

Your privacy will not be a high priority with your state or the federal government.

As we worked through the Spring toward the May 5 lottery day, it became apparent there would be seven qualifying entities in Ellensburg, where the state had previously decided two stores would be located. We were chosen #2, but we actually opened the very first retail cannabis shop in our city and county.

This is a very brief account of the vetting process in Washington to obtain a retail cannabis license to operate a retail cannabis shop. In Washington, the Cole Memo issued by the Justice Department back in August 2013 was always the backdrop for all the rules and regulations.

I suspect even though the Cole Memo has been, metaphorically speaking, torn up, verifying residency in most states will be key to a successful application. Additionally, verifying a lack of any significant criminal background, verifying (to some degree) an ability to open and operate a business, as well as verifying locations and employees are all going to be significant components in garnering the spot in a lottery should your state choose that path.

In Washington, the agency charged with overseeing all aspects of monitoring cannabis businesses, including enforcement, is the Washington State Liquor and Cannabis Board – usually referred to as the LCB. The LCB has access to all financial and transactions records via what is known as traceability. New England States will likely have a similar system in place.

This is necessary – among so many other controls – to keep the federal government at bay so cannabis businesses can actually conduct business without fear.

Your privacy will not be a high priority with your state or the federal government. Since cannabis is a Schedule 1 Controlled Substance, officially and technically, you are about to become drug dealers and money launderers. The scrutiny is something to behold and a facet of this industry that, at least for now, must be fully accepted and will become part of your daily routine.

There will be many questions, many roadblocks, many impediments in your journey should you choose cannabis as part of your future. Do your research. Knowledge is power, and education and preparation will get you successfully through anything anyone can throw at you. It has been life changing for me and my family, but was never easy, and therefore I say it is not for the faint of heart. But then again, if it were easy, anyone could do it!

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