Alaska: One step forward, two steps back

Business owners push forward despite delays

 

Alaska mountain rangeAlaska’s adult use marijuana program is moving along slowly, carefully and with the expected amount of drama and setbacks. Over the four years I’ve been involved in the commercial marijuana industry, one theme has remained constant in every state: the cannabis movement always takes one step forward and two steps back.

But on Oct. 4, 2016, Alaska took one huge leap forward and showed the prohibitionists that the movement has some clout. The Mat Su Borough — the largest borough in Alaska, spanning a whopping 25,000 square miles — was on the verge of opting out of the commercial marijuana market. So cannabis enthusiasts took to the streets, registering people to vote, holding educational seminars and posting campaign signs — good, old-fashioned home-grown campaigning. And guess what? It worked!

Mat Su voters rejected the proposed ban on commercial cannabis activity, but now the borough has to scramble to catch up with the rest of the market, which has already been licensing growers and retailers, processing land use permits and building out facilities. For Mat Su applicants, the Marijuana Control Board refused to even consider their applications until the election on the opt-out provision was decided. In fact, the Mat Su Borough Assembly put its land use and local regulation process on hold until after the vote.

Businesses are already active in other parts of the state. One business, Rosie Creek Farms, even completed its outdoor harvest before the frost hit.

Retailers have been approved by the state and a few have completed their local land use requirements. A couple, including Herbal Outfitters in Valdez, have opened their doors to shoppers.

alaska-from-distanceA handful of infused product and concentrate manufacturers have been approved by the state, but as of this writing, none have been approved locally. Local and state fire marshals are struggling to determine what type of fire-proofing and requirements should be mandated for this new industry. It’s frustrating for applicants to get a response from the fire marshal two years after legalization that they don’t know how to treat manufacturing. Why haven’t officials been using the past 24 months to figure this out? Why was there so much procrastination that it’s now costing applicants time and money to get their facilities online?

The same phenomena are also occurring at local levels. According to state regulations, the 500-foot distance from protected spaces (such as schools or playgrounds) is measured by the “shortest pedestrian route.”  What is considered a pedestrian route? Is it across six lanes of traffic without a marked crosswalk? Municipal planners are struggling with this issue, and they’ve created conflicting and inaccurate messages for many business owners. One planner will measure the buffer zone for a marijuana business, and then another planner from the same office will measure the exact same buffer and come up with a completely different measurement. The process is proving unreliable and local government is failing to provide concise instructions to planners for fear of being blamed for killing the industry or allowing rules that are too liberal, depending on the politician.

Unfortunately, in Alaska, politicians have a well-deserved reputation for perching on the fence when faced with controversial issues, rather than making a decision, taking action and owning the consequences like real leaders are supposed to do. The state of Alaska has taken the largest slash to its income due to falling oil prices. It’s the only state in the nation that has allowed itself to become dependent on one industry; oil and gas revenues make up 92% of Alaska’s unrestricted income. Alaska now faces a $4 billion deficit and, despite multiple budget proposals aimed to mitigate its negative impact, guess what the state House of Representatives and Senate did after extending the legislative session five times … absolutely nothing! Without real leaders with backbones, this state gets nothing done.

Legalization in Alaska is just the beginning. Photo courtesy Rainforest Farms.

Legalization in Alaska is just beginning. Photo courtesy Rainforest Farms.

Thankfully, we are starting to see a welcome trend — cannabis leaders are running for local office and winning. Aaron Bean won a Sitka City Council seat in the largest election turnout in the city’s history. Bean is the president of Green Leaf, Inc., a marijuana retail and cultivation licensee. Shaun Tacke, chief financial officer for FSE, Inc., a cannabis cultivation and manufacturing company, won a coveted Fairbanks North Star Borough Assembly seat.

It is clear the old boys club that previously ran the state of Alaska may be on its way out as the voters are tired of those who fail to act for the benefit of the state. It is truly inspiring to watch Alaska’s cannabis movement not only pioneer the new industry, but also take out the trash. It’s creating a stronger, more independent Alaska for the future.

 

Jana Weltzin is the owner of JDW, a law firm in Anchorage, Alaska (jdwcounsel.com). She advises clients in the cannabis industry in Arizona and Alaska. She assists clients with business structure, compliance with state and local laws, zoning approval, site selection and product regulations.

 

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