By Darren Smith, Weekend Contributor

The Washington State Liquor Control Board (LCB), charged with administering the state’s legalized marijuana industry, has shown once again its detachment from common sense and business acumen by increasing Initiative 502’s restrictions through crafting administrative rules that border on absurdity.

It is a small example of the duality of the LCB in how it proffers its desire to see windfalls of tax receipts for the state but acts to suppress the same industry it extracts these taxes from.

There are two parts to what has led to this bizarre set of administrative constraints of marijuana advertising: the Washington Administrative Code (WAC) and the agency rules; and policies formulated by the LCB. To understand the process, it is helpful to read WAC 314-55-155 below.

Advertising

(1) Advertising by retail licensees. The LCB limits each retail licensed premises to one sign identifying the retail outlet by the licensee’s business name or trade name that is affixed or hanging in the windows or on the outside of the premises that is visible to the general public from the public right of way. The size of the sign is limited to sixteen hundred square inches.

(2) General. All marijuana advertising and labels of useable marijuana and marijuana-infused products sold in the state of Washington may not contain any statement or illustration that:

(a) Is false or misleading;

(b) Promotes over consumption;

(c) Represents the use of marijuana has curative or therapeutic effects;

(d) Depicts a child or other person under legal age to consume marijuana, or includes:

(i) Objects, such as toys, characters, or cartoon characters suggesting the presence of a child, or any other depiction designed in any manner to be especially appealing to children or other persons under legal age to consume marijuana; or

(ii) Is designed in any manner that would be especially appealing to children or other persons under twenty-one years of age.

(3) No licensed marijuana producer, processor, or retailer shall place or maintain, or cause to be placed or maintained, an advertisement of marijuana, usable marijuana, or a marijuana-infused product in any form or through any medium whatsoever:

(a) Within one thousand feet of the perimeter of a school grounds, playground, recreation center or facility, child care center, public park, library, or a game arcade admission to which it is not restricted to persons aged twenty-one years or older;

(b) On or in a public transit vehicle or public transit shelter; or

(c) On or in a publicly owned or operated property.

(4) Giveaways, coupons, and distribution of branded merchandise are banned.

(5) All advertising must contain the following warnings:

(a) “This product has intoxicating effects and may be habit forming.”

(b) “Marijuana can impair concentration, coordination, and judgment. Do not operate a vehicle or machinery under the influence of this drug.”

(c) “There may be health risks associated with consumption of this product.” and

(d) “For use only by adults twenty-one and older. Keep out of the reach of children.”

Most of these advertisement rules do not significantly deviate from liquor and tobacco advertising, however the implementation and interpretation of these codes by the LCB is certainly cause for some confusion on behalf of licensees due to some rather contradictory policies leading to arbitrary enforcement.

From the LCB’s website, an insight into how the agency will enforce these rules gives pause to wonder what to expect. The agency does not seem to grasp the fact that marketing and advertising are an essential element of a successful business.

Starting from section (1) the WAC reads that recreational marijuana retailers are limited to one 1600 square inch sign on the premises. However, the LCB states that having an additional sign that directs visitors to the store, such as seen with drive-up restaurants with arrows, violates the signage requirement because this is advertising. But the LCB does not consider a common sign along with other retailers’ signs on a mall’s reader board to be advertising and therefore is exempt. Presumably, this can be larger than 1600 square inches.

Yet, the LCB states the marijuana retailer can use a billboard to advertise their business. The billboard may be across the street from their premises and can be as large as possible but the sign in front of the store must be only 1600 square inches. The sign can also have an arrow pointing to the retailer’s location, but an arrow sign inside the parking lot is not allowed.

The retailer cannot have more than one sign at the storefront. It cannot have two signs of 800 square inches. The store cannot have posters or logos of marijuana products in front of the building. It is ambiguous if the 1600 inch sign can have a store logo.

Retailers are prohibited from giving or selling promotional material such as t-shirts and pens with logos. But, the LCB states that logos on bongs and hash pipes are perfectly fine. The retailer may place their logo onto shopping bags but cannot hand out bumper stickers, yet they can furnish bars and taverns with beverage coasters advertising the marijuana retailer.

While the store cannot sell t-shirts with logos, employees may wear logos on their shirts.

The board states that a retailer may incorporate a separate business entity, perhaps next to their business, to sell these treacherous t-shirts, bumper stickers, and stuff, as long as they do not sell bongs and hash pipes. These cannot be co-mingled in the marijuana store.

The WAC prohibits a licensee from placing and maintaining advertising “[w]ithin one thousand feet of the perimeter of a school grounds, playground, recreation center or facility, child care center, public park, library, or a game arcade…” However, the LCB went to a new limit of what it considers to be “placing.”

Moving vehicles apparently now fall within this definition of placement at a location. The LCB states that vans and delivery vehicles having a retailer’s logo or other form of advertisement cannot travel as described within the 1000 foot limit of these areas where children frequent. Mobile advertisement signs fall into the same category somehow. So if a retailer has a store having only one roadway is out of luck if that street has a bus stop with a shelter.

Because of this restriction, if the retailer wished to have a delivery truck or vinyl advertisement on the side of their van, it would have to drive a rather circuitous route, avoiding all prohibited places such as schools, parks, bus stops, pinball arcades, etc.

Here’s a kind of delivery route any state legislature will certainly approve.

Yet, in another advertising space oddity, the LCB declared it would not enforce advertisement restrictions on newspapers as far as circulation is concerned. So, while a truck having a retailer’s logo may not drive past a school, the newspaper ad can be seen by students in the school library in the periodicals section. Plus, the newspaper delivery boy may effectively deliver marijuana ads to his grade school class.

To add another twist, the LCB states that the delivery trucks cannot have logos but the vinyl ads are “risky”.

The LCB declared that permitted advertisements may be freely made on the Internet. But, retailers should be careful to avoid social networking sites that might appeal to children, who of course, do not surf the Internet, or Facebook, either on their personal smartphones, at home, or in the school library.

The board also allows for direct marketing mailing to households and businesses, or by inclusion into newspapers. Apparently no impressionable children live at home.

Confused? Imagine being a new small business owner already racked with micromanagement by a state bureaucracy on top of trying to set up shop and make a profit–something proving increasingly elusive for marijuana retailers.

By Darren Smith

Source: Washington State Liquor Control Board

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