May 17 (Bloomberg) -- Marijuana retailers in Colorado will be required to grow a majority of what they sell. In Washington, retailers can’t also be growers and processors under proposed regulations.
The two states are designing regulatory frameworks for overseeing the new recreational-marijuana industry that voters approved in November, the first of its kind in the U.S.
Both states face the threat of having their efforts upended by the federal government, which considers marijuana a controlled substance and cracked down on state-sanctioned medical-marijuana operations in California in 2011. U.S. Attorney General Eric Holder said in March he is considering what the federal response will be to the two measures.
In Washington, “it’s safe to say the rules are not overly restrictive and, at the end of the day, it seems that we’re moving ahead in a positive light,” Kevin Oliver, executive director for the state branch of the National Organization for the Reform of Marijuana Laws, a Washington-based advocacy group.
The Washington State Liquor Control Board, which proposed its standards yesterday, is to begin issuing licenses to producers, processors and retailers by Dec. 1. Colorado legislators approved regulations this month for sales to begin Jan. 1.
Washington would require license applicants to submit to a background check, set laboratory testing of marijuana products and track the transportation of the product.
“The initial draft rules reflect the board’s stated goal of developing a tightly regulated and controlled recreational marijuana market,” the agency said in a statement yesterday.
In Colorado, existing medical-marijuana dispensary owners will be given first shot at licenses for the first nine months. No such preference was proposed in Washington, where medical-marijuana shops are considered illegal even though some cities have allowed them to operate.
“The Colorado law had substantially more of an outlaw vibe about it,” Mark Kleiman, a public policy professor at the University of California, Los Angeles, said by telephone.
“The rule that the state can’t require the retailer to keep records of their purchasers seemed to encourage purchase for out of state shipment,'’ said Kleiman, a consultant to Washington on marijuana issues. ‘‘The Washington statute was designed to keep the whole matter in-state and the board is certainly very concerned about that.”
In Colorado, marijuana shops must be licensed and owned by state residents. Washington retailers would have to comply with a three-month residency requirement.
In Colorado, stores are required to grow 70 percent of what they sell until September 2014. In Washington, a licensed retailer cannot grow or process marijuana, while producers and processors can do both.
Adults 21 and older can legally possess up to 1 ounce (28 grams) of marijuana for recreational use in the two states.
Eighteen states and Washington, D.C., allow the medical use of marijuana and 11 permit sales through dispensaries, according to the Denver-based National Conference of State Legislatures. California became the first state to allow medical-marijuana use in 1996.
To contact the editor responsible for this story: Stephen Merelman in New York at email@example.com.