Pubdate: Sun, 17 Apr 2016
Source: Alaska Dispatch News (AK)
Copyright: 2016 Alaska Dispatch Publishing
Note: Anchorage Daily News until July '14
Author: Zaz Hollander


HOUSTON -- This scrappy town of 2,000 that straddles 22 square miles 
along the Parks Highway has long been the only place in Southcentral 
Alaska where buying fireworks is legal.

Now Houston is welcoming the state's nascent marijuana industry in 
hopes of drumming up some much-needed revenue for a city struggling 
to stay solvent.

If a voter-initiative ban goes through this fall, Houston could 
become the only place in the Ireland-sized Matanuska-Susitna Borough 
where commercial marijuana operations are legal.

A town that's too cash-poor to field a police department is the only 
one to offer pot entrepreneurs any kind of financial certainty amid 
the bans in place, or contemplated, throughout the rest of the Mat-Su borough.

Houston city officials say they're expecting sharp reductions in 
state revenue-sharing dollars as Alaska's budget situation remains 
dire. Locally, no big box stores are knocking on the door to join the 
downtown core: a campground, the fire station, the Houston Lodge and 
Millers Market.

"We're not having businesses come to Houston and say, 'We want to put 
up a gas station or the next Wal-Mart," said City Council member Jim 
Johansen, a laboratory technician at Providence Alaska Medical 
Center. "We can either let the city go, or we can try this. I don't 
touch the stuff, but I'm for the business side of it."

Cultivation begins

Houston's city clerk says she's heard of four possible marijuana 
businesses looking to open in the city but hasn't received 
notification of any applications from the Alaska Alcohol and 
Marijuana Control Office.

Ron Bass is one of the applicants.

Bass, 33, and his wife Lacey grew up in Houston and say they are 
getting their cultivation business up and running in time for early 
June, when the first licenses could get state approval.

The company, Calm N Collective, is based in a 3,500-square-foot 
cultivation facility along the Parks. Bass said the facility will be 
surrounded by a fence with someone on-site at all times and video surveillance.

He was diagnosed with multiple sclerosis about five years ago and 
signed up for Alaska's medical marijuana registry. He said he grows a 
medical strain high in cannabidiol dubbed "1ndun" that he credits 
with helping him feel better and shrinking the lesions on his brain.

Calm N Collective plans to offer that strain, plus a range of 
nonmedical indica and sativa varieties in a rainbow of colors and 
applications. Down To Earth Garden Supply, a local company, is an investor.

Bass says he wants to do something good for the community, which 
rejected a ballot question that would have banned commercial 
marijuana businesses in Houston.

Residents spoke with their vote and Houston's elected officials are 
listening, he said. "The politicians are backing their people."

Saying no elsewhere

Palmer and Wasilla chose not to allow commercial marijuana operations 
- -- Wasilla by a City Council decision, Palmer by popular vote. The 
Mat-Su Assembly is considering a moratorium on any commercial 
operations until October, when voters weigh a ban that would cover 
the entire borough except for the cities.

Mat-Su has long been Alaska's reputed cannabis capital for its famous 
marijuana strains, grow-friendly rural neighborhoods and proximity to 
Anchorage. Now it's drawing attention from scores of potential 
cannabis entrepreneurs. State license applications for cultivation 
and dispensaries cluster in Talkeetna, Willow and around the 
population centers of Palmer and Wasilla. But many business owners 
and investors are waiting for October before shelling out their 
investment funds, rather than risk losing them if the ban proposition passes.

That leaves Houston, which dissolved its small police department to 
save money. Last year, a delay in state revenue sharing prompted the 
mayor to furlough a half-dozen employees, including firefighters, 
until the money came through.

Houston is treading water financially, officials say. Houston 
survives mostly on property taxes plus sales taxes and state revenue sharing.

State revenue sharing is expected to drop by nearly $60,000 from more 
than $180,000 this fiscal year, according to Sonya Dukes, the city 
clerk. But it's possible future sales tax revenues by pot purchasers 
could make up that difference in the coming year alone, Dukes said. 
"Let's hope so. Sixty thousand, for our budget, is a good cut."

Shaking the moneymaker

The city stands to gain from the new industry in the form of excise 
or sales taxes, officials say.

Thursday night, the City Council approved a $10 per ounce excise tax 
on cultivators. Mayor Virgie Thompson said she's heard from several 
who estimate they'll produce 50 to 80 pounds a month.

The city's proposed budget of just under $1 million for the upcoming 
fiscal year includes a new estimated revenue source: a little more 
than $160,000 from excise tax revenues.

The Council also introduced a provision to eliminate marijuana sales 
from a sales tax provision that exempts single sales over $500, 
mostly to address vehicle or home sales. Cannabis sales of $500 or 
more will be taxed at the city's 2 percent rate. The Council will 
vote on that next month.

There's generally been a surge in commercial interest in Houston in 
recent months, as evidenced by rezone requests at the planning 
commission level but also real-estate inquiries.

Roger Purcell, a former city mayor, said his Wasilla company's real 
estate and legal consulting sides have seen "a huge increase" in 
people asking about Houston because of the city's atmosphere of 
political certainty surrounding cannabusiness.

"They're going to spend up to $15 million putting these places in," 
Purcell said, of the cultivation businesses eyeing Houston. "They 
want to make sure these facilities will still be there 10 years from now."

Slim mandate

Not everyone in town is a fan of the new industry.

Residents voted last fall on a proposal to not allow commercial 
operations in Houston. Just under 55 percent of voters opposed a ban 
- -- 150 votes compared to 127. That's not exactly a resounding mandate.

Angela Walker, a 44-year-old single mother, leases the kitchen at the 
Houston Lodge, which is up for sale. Walker reopened the 
long-shuttered restaurant over the winter.

At least one marijuana entrepreneur is looking at the building for a 
possible cultivation facility and dispensary, locals say.

Walker is trying to drum up money for a down payment on the lodge 
because, she said, she hopes the owner doesn't sell to someone who 
wants to start a marijuana dispensary. She said she wants to see the 
lodge maintain its family-friendly atmosphere.

"Basically, this is a facility for the community and the community's 
not going to be served really well," Walker said. "I don't know, with 
them selling that in here, (that it would) be a community-based operation."

Recent Council meetings to debate city regulations were forced by 
sheer numbers to move to the fire station from city hall.

The city's local regulations largely track with state law, though 
Houston's Council decided this week to not allow marijuana 
establishments and social clubs in multifamily residential areas. 
They also will require subdivision or neighborhood covenants be 
disclosed at the start of the review process.

Any new revenues from the new businesses could pay for parks or 
roads, officials say.

Johansen said as far as he's concerned, re-establishing Houston's 
police department should be a priority, given the complaints he hears 
about crime now.

"With us being the only ones that want to do it ... so be it," he 
said. "This is a huge moneymaking deal and times are changing."
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MAP posted-by: Jay Bergstrom