Regulators look back at how COVID brought about lasting changes to the industry’s rules and regs
In early 2020, a mysterious new virus began to spread through the population, sickening and killing people of every age group. Much of the world, essentially, shut down. Offices were emptied, schools were shuttered, sports were canceled, and stores, aside from those deemed “essential,” shut their doors.
Among those industries deemed essential, in most states, was cannabis. But staying open during a pandemic meant some changes were going to be necessary.
“We really tried to put things in place where people didn’t have to actually go physically in the store if they didn’t want to,” says Amanda Borup, policy analyst for the Oregon Liquor and Cannabis Commission.
In Oregon and across the country, regulators began making allowances and passing emergency rules to ensure that cannabis farms and retail stores could continue to safely operate, including allowing delivery or curbside pickup, online ordering and other changes.
And in many states, the policies proved popular enough to continue some of the changes even three years later as the world has mostly returned to normal.
“While we didn’t proactively use this period as a test case for new regulations, we did observe that the emergency rules in place didn’t cause any significant public health and safety concerns,” Colorado Marijuana Enforcement Division spokeswoman Shannon Gray said in an email. “And this did inform our subsequent considerations in recommending permanent rules.”
During the initial wave of Covid-19, the focus for regulators was finding ways to keep employees and customers safe.
In Colorado, for example, the emergency regulations needed to allow employees and customers in cannabis shops to wear masks, and for businesses to make modifications to the floor plan to accommodate social distancing, without pre-approval.
In many states, the biggest change was online ordering and curbside pick-up options that allowed patients and customers to get what they needed without going inside a store. But while dropping a bag of groceries in someone’s trunk is easy enough, it wasn’t that simple in such a highly regulated industry as cannabis.
“Typically, there are no curbside pick-ups allowed,” says Justin Nordhorn, director of policy and external affairs for the Washington State Liquor and Cannabis Board. “All the businesses have to sell their product in the store or on premises.”
Washington regulators, like in several other states, temporarily allowed for curbside pickup, as long as the transaction remained on premises and was covered by the store’s cameras.
“This created that outdoor space as well as the opportunity for folks to continue to get the product that they were looking for,” Nordhorn says.
Washington also allowed for stores that had windows to use them as walk-ups, though drive-throughs, which were prohibited by statue, were not allowed.
However, in Oregon and Colorado, emergency regulations allowed for drive-through windows, along with walk-ups and curbside pickup.
Regulators in most states also made changes to licensing rules to allow for online renewals. In Colorado, there were automatic 30-day extensions and the requirements for fingerprints were dropped. In California, there were 60-day license fee deferrals.
Several states, including Washington and California, also suspended rules about retailer giveaways or additional item sales in order to allow stores to provide customers with hand sanitizer, despite the laws against such things being “very strict,” according to Nordhorn.
“It’s not that somebody’s going to be leveraging more business over somebody else because they’re giving out hand sanitizer for customers coming in,” Nordhorn said. “So we went ahead and afforded that type of a giveaway.”
Brand advertising on hand sanitizer containers was not allowed.
While most of the regulatory changes focused on the retail side, Washington also relaxed a regulation to allow children of license-holders into grows for the first time.
“Because if you have a family farm, you can’t leave your kids in the main house,” Nordhorn says, noting that childcare was particularly difficult to come by for those in rural areas of the state.
And though children or grandchildren of the license-holders were permitted on the premises, they were not allowed to perform acts of employment or allowed in transportation vehicles, but parents could set up an area for kids at the facility.
Curbside pick-up and more
Though initially passed as emergency measures, many of the changes put in place have proven popular, and several, including curbside pickup in most states, have been continued or made permanent in the years since they were first promulgated.
In Oregon, for example, OLCC director of analytics and research T.J. Sheehy says there was not a lot of “pushback” over the changes, due, in part, to the emergency nature of the pandemic, but admits the changes were “fairly patched together” at the time and created some “internal contradictions” — like camera coverage issues for curbside pick-up — that caused regulators to “expand our tolerance,” in the words of OLCC spokesperson Mark Pettinger.
However, in Oregon, temporary rules can only last six months, so the state made some of the changes permanent, even if the details are still being worked out today with stakeholders. For example, on-site delivery was made permanent in late 2020.
“So right now, the on-site delivery and drive-through is still in that in-between space where technically it’s permanent, but we’re undergoing discussions of what that long-term future is going to look like for it,” Sheehy says.
In Colorado, the allowance for curbside and walk-up delivery options were also made permanent, though permanently allowing online ordering is prohibited by statute, which means it will require a change from the Legislature.
In Washington though, the emergency rules expired with the governor’s declaration of an emergency, including curbside pickup and walk-up windows. However, the LCB has kept the child variance in place for cultivators and is working to develop a permanent rule.
Meanwhile, California made its curbside pickup rules permanent, and Illinois recently extended their emergency rules to continue allowing for it as well.
Not all emergency rules worked as expected though. In Oregon, for example, the state changed purchase limits to allow medical patients to purchase up to 24 ounces a day, but according to Sheehy, OLCC regulators began to see medical card holders “abusing” the emergency allowance.
“We were seeing some abuse in that system where people would come every single day and buy 24 ounces and that begs some questions about what are they doing with that product?” Sheehy says. “So we let that lapse because there was just too much potential for abuse.”
Though none of the agencies used the pandemic as a test period for new regulations, most said the opportunity to see some of the emergency regs in action gave them confidence to push the boundaries, with many saying the dialogue between license-holders and regulators helped strengthen the relationships between the two sides.
“In the instance of COVID-19, the licensing programs remained extremely responsive to licensee requests and attune to any necessary modifications driven by COVID-related health concerns,” DCC spokeswoman Moorea Warren said in an email.
“Our ability to navigate an unprecedented experience like the pandemic couldn’t have been done without the support, insight and coordination between the Governor’s Office, agency partners and other stakeholders, including our customers/industry members who provide critical insight to inform our work,” echoed Gray in Colorado, who cited strong outreach to license-holders pre-pandemic as being key when it hit.
In Oregon, Sheehy says the pandemic has helped create a new normal as to how the OLCC connects with stakeholders.
“I think, like everyone, the pandemic has changed our process and how we engage people and how people engage with us,” he says.