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In 2012, Washington and Colorado voters made history when they approved measures to legalize recreational marijuana. Washington Initiative 502 “authorizes the state liquor board to regulate and tax marijuana for persons twenty-one years of age or older.”Since the vote in Washington, the Liquor Board has written a complex set of rules for the state’s new, legal recreational cannabis marketplace. The agency has also set limits on the amount of marijuana that can be grown. And the Board has begun to license growers, processors and retailers.For now, the Obama administration has signaled it will not interfere with Washington and Colorado’s legal pot experiment, unless there is evidence that legal pot is “leaking” to other states or children are getting access to the legal product. The feds are also watching to see if criminal organizations exploit the legal market.The first marijuana retail stores in Washington opened in July 2014.Recreational marijuana is also set to become legal in Oregon on July 1, 2015 after voters approved Measure 91 in November 2014.

Washington Liquor Board Rolls Back How Much Pot Producers Can Grow

Applicants to grow recreational pot in Washington could have their state licenses in hand two weeks from now.

But they won’t be able to produce as much marijuana as they originally thought. Washington’s Liquor Control Board on Wednesday instituted new limits designed to avoid a market glut.

Here’s the problem. Nearly 3,000 would-be pot growers applied for a state license.

Some back of the napkin math by the Liquor Control Board revealed the state was on track to exceed its own production cap by nearly 18-fold.

So what to do? The agency won’t allow growers to hold multiple licenses. And growers will only be able to produce 70 percent of what their license allows – at least initially.

Chris Kealy had applied for three licenses to grow 90,000 square feet of marijuana. He’s even got a building under construction. Now he’ll only be able to grow a fifth of what he was planning.

But Kealy’s not complaining.

"We understood the risk we were taking and respect the decision they are making," he says.

Kealy wants Washington’s experiment with recreational pot to work.

He says if the state overproduces marijuana it will end up on the black market, and that will invite federal intervention.

In the short term, Kealy says he’ll sublet the extra space in his warehouse.

Washington’s Liquor Control Board has also decided to proceed with issuing licenses to applicants even if that license conflicts with a local government ban or moratorium on pot businesses.

So far Lakewood, Sea Tac and Wenatchee have instituted outright bans on marijuana businesses. More than 30 other cities from Kent to Richland have enacted temporary moratoria. That’s according to The Center for Study of Cannabis and Social Policy.

Liquor Control Board member Chris Marr says the decision to move ahead with the issuance of licenses is not an "in your face" response to local moratoria.

The board also notes that a state marijuana license is not a license to operate. Applicants must still comply with local regulations.

Meanwhile, for the first time, Washington revenue forecasters are including tax proceeds from marijuana sales in their quarterly outlook. The forecast released Wednesday projects $51 million in pot money during the next two year budget cycle.

Since January 2004, Austin Jenkins has been the Olympia-based political reporter for the Northwest News Network. In that position, Austin covers Northwest politics and public policy, as well as the Washington State Legislature. You can also see Austin on television as host of TVW's (the C–SPAN of Washington State) Emmy-nominated public affairs program "Inside Olympia."