PETITIONERS MEMO ON SEPA AND I-502 RULEMAKING

I INTRODUCTION: THE LIQUOR CONTROL BOARDS I-502 RULES WILL HAVE STATEWIDE IMPACT ON TRADE, LAND USE, WATER QUALITY, AND LOCAL GOVERNMENT The Washington State Liquor Control Board has proposed to enact rules to implement I-502. These rules, (see Proposed Rules, available at http://www.mrsc.org/govdocs/w3wslcbrules.pdf) allow for outdoor cultivation of a new cash crop, set conditions for new retail stores statewide, and will have significant statewide impact on commerce, land use, endangered species, and the quality of life in urban areas. However, no SEPA determination accompanied the proposed rules1. This is a major omission, especially since the newly legal cultivation of thousands of acres of marijuana both indoors and outside, will require an entire set of regulations to address water quality, pesticides, land use, and impact on endangered species. In addition, the foreseeable impacts upon local quality of life and land use are so significant as to have precipitated over 50 moratoria and accompanying SEPA reviews across the state, making the issue of an EIS on the state level almost inevitable. II THE STATE ENVIRONMEMNTAL POLICY ACT (SEPA) APPLIES TO STATE AGENCY ACTION In Washington, the State Environmental Policy Act (SEPA) applies to all reports or recommendations of State Agencies like the Washington State Liquor Control Board. As one authority has recognized
1 W AC 197-11-055 provides (b) For rule making, the DNS or DEIS shall normally accompany the proposed rule. 1

PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS

SEPAs procedural requirements and substantive authorization and responsibility extend to all agencies of state and local government and virtually all of the decisions they make Washington State Environmental Policy Act: A Legal and Policy Analysis, Edition, 3, revised. Publisher, LexisNexis, 1987 Further, the requirement that State agencies like the Liquor Control Board must comply with SEPA in its rulemaking process is so well established as to be beyond reasonable dispute2. The potential environmental impact on land use, animal life, and water quality of newly legal statewide cultivation of marijuana is just one unaddressed category of effects. However, according to the LCB, no SEPA review has been conducted on the implementation of I-502 or I-502 rulemaking. III STATE AGENCY RULEMAKING IS SUBJECT TO SEPA It is firmly established in Washington law that agency rulemaking is subject to SEPA. There is even a specific WAC concerning agency rulemaking. WAC 197-11-055 provides (1) Integrating SEPA and agency activities. The SEPA process shall be integrated with agency activities at the earliest possible time to ensure that planning and decisions reflect environmental values, to avoid delays later in the process, and to seek to resolve potential problems (3) Applications and rule making. The timing of environmental review for applications and for rule making shall be as follows: (a) At the latest, the lead agency shall begin environmental review, if required, when an application is
2 See Risk Management Buletin #55, I-502s Effect on Local Land Use Regulations, by Walter, Estes, and Augen thaler of Keating, Bucklin and McCormack, Inc. P.S. In taking any land use or regulatory action affecting marijuana business authorized under I-502, remember to comply with the State Environmental Policy Act (SEPA). 2

PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS

complete. The lead agency may initiate review earlier and may have informal conferences with applicants. A final threshold determination or FEIS shall normally precede or accompany the final staff recommendation, if any, in a quasijudicial proceeding on an application. Agency procedures shall specify the type and timing of environmental documents that shall be submitted to planning commissions and similar advisory bodies (WAC 197-11-906). (b) For rule making, the DNS or DEIS shall normally accompany the proposed rule. An FEIS, if any, shall be issued at least seven days before adoption of a final rule (WAC 197-11-460(4)). In light of these administrative rules, and the broad scope of SEPA as applied to the actions of state agencies, the complete failure of the Liquor Control Board to comply with the State Environmental policy Act prior to issuing proposed rules is incorrect as a matter of law. In addition, the manifest and undeniable significant impacts identified by dozens of cities and counties across the state strongly suggests that the impacts of implementing I-502 will be so significant as to require a full EIS, with the input of the municipalities that have formally expressed their concern at the effect of I-502 on the quality of life on their citizens. IV BY ENACTING EMERGENCY MORATORIA MANY CITIES AND COUNTIES HAVE RECOGNIZED THAT I-502 WILL HAVE SIGNIFICANT FORESEEABLE IMPACTS Many cities and counties have recognized that I-502 will have significant impacts on land use and their citizens in formal ordinances enacting emergency moratoria. (See attachment 2, representative Moratoria and list of over 50 cities and counties with similar enactments) It is beyond dispute that many municipalities have identified reasonably foreseeable impacts from the implementation of I-502, and have

PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS

found them so significant as to justify emergency moratoria as necessary to address the impacts of I-502. The universal consensus of over 50 cities like Olympia, Bellingham, Lake Forest Park and Kent, and counties like Pierce, Mason and Grays Harbor County is that the implementation of I-502 will have wide ranging and significant impacts on many diverse aspects of the quality of life. All of these separate moratoria will have their own separate piecemealed SEPA review. Under such circumstances, the State cannot evade the requirement of environmental review in an EIS of the cause of these reasonably foreseeable impacts that scores of Cities and counties have already identified and which are already being reviewed in a haphazard and piecemeal basis in over 50 different jurisdictions. It is ironic that such piecemeal review3 is exactly what the State Environmental policy Act was intended to prevent. V HUMAN FACTORS SUCH AS DRUG RELATED ISSUES ARE SUBJECT TO ENVIRONMENTAL REVIEW Since SEPA was cut from the pattern of the National Environmental Policy Act, (NEPA), Washington Courts have always recognized the relevance of NEPA case lawWashington State Environmental Policy Act: A Legal and Policy Analysis, Edition, 3, revised. Publisher, LexisNexis, 1987

3 See Challenging Piecemealed Review under the Washington State

Environmental Policy Act, Keith H. Hirokawa, Seattle University Law Review, Vol. 25, No. 2, p. 343 (2001)
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PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS

A possibly more serious shortcoming of the analysis lies in the social, not physical, sciencesThat an EIS must consider these human factors is well established. Hanly v. Mitchell, 460 F.2d 640, 647 (2d Cir.), cert. denied, 409 U.S. 990, 93 S.Ct. 313, 34 L.Ed.2d 256 (1972). In Hanly v. Kliendienst, a federal court held that the agency was required to give attention to other factors that might affect human environment in the area, This Court concluded: "The Act must be construed to include protection of the quality of life for city residents. Noise, traffic, overburdened mass transportation systems, crime, congestion and even availability of drugs all affect the urban 'environment' Hanly I, 460 F.2d at 647, cited in Hanly v. Kliendienst 471 F.2d 823 (1972) The human factors involved in the implementation of I-502 have not yet been addressed, and the SEPA process is the proper forum for the review of such potential impacts, in one State coordinated review. VI THE PROJECTED ECONOMIC EFFECTS OF I-502 WILL CREATE A SIGNIFICANT IMPACT As the OMFs Fiscal Note for I-502 demonstrates, the amount of money involved in the implementation of I-502 is very large. http://www.ofm.wa.gov/initiatives/2012/502 fiscal impact.pdf This redistribution of revenue will in and of itself have significant foreseeable impacts, impacts that should properly be studied in the socioeconomic component of a SEPA Environmental Impact Statement.

PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS

VII CONCLUSION: THE LIQUOR CONTROL BOARD MUST COMPLY WITH SEPA IN THE IMPLEMENTATION OF I-502 AND ISSUE A SEPA DETERMINATION IN CONJUNCTION WITH ITS PROPOSED RULES The implementation of I-502 is a textbook case of an agency action that will have significant foreseeable impact on the environment and the quality of life. This is exactly the type of agency action with significant foreseeable impacts that SEPA was adopted to address, and one that has already prompted over 50 subdivisions of local government to take emergency action and conduct their own independent SEPA reviews. Unfortunately, due to the abdication of the duty of conducting SEPA review by the Liquor control Board, review of the potential impacts of I-502 have been shuffled off to the Cities and counties to address in over 50 separate piecemealed SEPA reviews of emergency moratoria. This is not an efficient use of resources, nor is it a proper use of the SEPA process, which was intended to require the assessment of reasonably foreseeable significant impacts at the earliest possible time in one review procedure. The cities and counties of this state cannot be vested, by default, with the responsibility to conduct review of the foreseeable impacts of I-502 in dozens of separate SEPA proceedings. The Washington State Liquor Control Board should be required to follow SEPA procedure in the adoption of the regulations necessary to implement and define the policy of I-502, and to assess the reasonably foreseeable impacts of I-502 implementation in one appropriate environmental document, which should probably be a complete Environmental Impact Statement. Done July 11, 2013. s/Arthur West__ ARTHUR WEST
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PETITIONERS MEMO RE SEPA AND LCBS I-502 RULEMAKING PROCESS