Pubdate: Wed, 02 Dec 2015
Source: Alaska Dispatch News (AK)
Copyright: 2015 Alaska Dispatch Publishing
Note: Anchorage Daily News until July '14
Author: Laurel Andrews


Reversing an earlier decision, Alaska's Marijuana Control Board 
restored more stringent residency requirements for those hoping to 
take part in the state's commercial cannabis industry during a brief 
meeting Tuesday morning.

The amendment adopted Tuesday reverts Alaska residency requirements 
to Permanent Fund dividend eligibility, which, among other 
qualifications, requires a person be physically present in the state.

After little discussion, the amendment passed unanimously.

The decision comes after much back and forth regarding how the 
fledgling legal cannabis industry should take shape in Alaska.

The first draft of Alaska marijuana regulations matched residency to 
PFD requirements. But at its meeting on Nov. 20, the board changed 
the residency requirement to match voter registration, which is far 
easier to achieve, requiring only a physical address in the state and 
no voter registration elsewhere.

That decision was met with shock and concern by both the state and 
industry supporters. The next business day, the board announced it 
would meet again to review the last-minute change.

Board member Bruce Schulte said Tuesday that the voter registration 
requirement may have "inadvertently" put staff in a position where 
they did not have the resources to conduct needed background checks.

A second amendment was also introduced Tuesday morning that would 
have allowed for 12.5 percent Outside investment in Alaska 
businesses. Under the current regulations, Alaska marijuana 
businesses must be 100 percent Alaskan-owned.

Board member Brandon Emmett said "a small infusion of Outside money 
to help the industry get off the ground in general is going to be positive."

Assistant attorney general Harriet Milks stopped the board after 
Emmett explained the amendment.

"It's the Department of Law's position that this is outside the scope 
of the public notice for this meeting, therefore it shouldn't be 
discussed," Milks said.

The public notice, which said the board would "discuss and may amend 
residency requirements" Tuesday, didn't include proper notice for 
discussion of Outside ownership, she said.

Other board members agreed, and noted that the issue could be 
discussed during the board's next meeting in February.

The brief meeting was quickly adjourned.

The state's closed door to Outside investment and ownership is most 
closely aligned with Washington and Colorado, two states where 
recreational marijuana use is also legalized.

In Washington, all businesses and investors must be residents for at 
least six months, according to Washington State Liquor and Cannabis 
Board spokesperson Mikhail Carpenter.

In Colorado, there's a two-year residency requirement for all owners 
and investors. Employees must be residents when they apply. However, 
in May, Colorado made changes to the law that appear to crack open 
the door to outside investment.

In Oregon, another state where marijuana is legal, the laws are more 
open to outside investment -- allowing for 49 percent ownership by an 
individual who isn't a resident, according to Mark Pettinger, 
spokesperson for the recreational marijuana program with the Oregon 
Liquor Control Commission.

Residency requirements are seen as a way of safeguarding against 
federal interference, as federal authorities have made clear that 
states should be able to account for all the legal marijuana money 
flowing in the state.

The oft-cited Cole Memo -- a 2013 memo from the Department of Justice 
giving guidance on federal marijuana policy -- lists eight items that 
states are asked to prioritize, with preventing legal marijuana 
revenue "from going to criminal enterprises, gangs, and cartels" among them.

The state of Alaska has argued that it doesn't have the staff or 
resources to conduct background checks on applications from Outside 
investors, one of the reasons that Outside investment was rejected by 
the board last month.

Some have argued that even with 100 percent Alaskan ownership, 
Outside businesses will find loopholes allowing them to invest in 
Alaska's cannabis industry.
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MAP posted-by: Jay Bergstrom