Regulations were officially approved in Alaska to allow cannabis dispensaries to apply for on-site consumption permits.
While some city ordinances in states like California, where cannabis is also legal, have allowed some in-store cannabis use, Alaska is the first state to establish a statewide licensing system to permit patrons to use the cannabis products they purchase before leaving the dispensary.
The on-site cannabis consumption licensing process can be compared to the process used to permit bars and restaurants to serve alcohol on-site. The retail locations must meet certain requirements in order to operate.
The Alaska Marijuana Control Board approved the on-site-use regulations in December, and the Governor’s office recently signed off on them, making it official and allowing the process to proceed.
Retail shops may begin applying for an on-site consumption license as early as April 11 of this year, but Alaskans are not expected to see the new law in action before the middle of July, according to Erika McConnell, director of the Alcohol and Marijuana Control Office.
Executive director of the Alaska Marijuana Industry Association Cary Carrigan warns that Alaskans should not expect very many dispensaries to begin offering on-site use right away.
“This is something that’s not happening anywhere else in the U.S. yet,” Carrigan told the Associated Press. “As we start to develop this, people are really looking at us, so I know that everybody wants to get it right.” Rolling out a program like this takes time and patience, and changes can still be made depending on the feedback received between now and then.
“I don’t want to have to get this pulled back and revisited,” Carrigan added.
In order for an on-site consumption application to be considered for a permit, the dispensary must first meet several special requirements. For example, only dispensaries located in free standing buildings will be considered. Any shop that is located in a strip mall or connected in any other way to another business or building will not be allowed to apply for a license. It is possible that in the future dispensaries may be allowed to apply for edibles-only consumption permits even if they are not free standing.
In order to apply for a permit, the business will also have to install a high-quality ventilation system and take other security measures.
To comply with the state’s existing cigarette smoking laws, the cannabis-smoking section must be kept separate from the retail portion of the facility where patrons make their purchases. On top of that, assuming the retail location wants to allow patrons to smoke dried cannabis flower on-site, a separate, smoke-free area must also be built for employees to be able to monitor the consuming-section without being subjected to smoke inhalation.
Dispensary customers will not be permitted to use cannabis products that they bring from home or buy from a different location. All products that are used on-site must have been purchased on-site.
Local governments will be able to decide whether or not on-site consumption permits will be issued in their jurisdiction. They will also be able to ban only certain types of methods of administration like smoking. Those who choose to ban smoking may decide to allow vaporizing or eating edibles. Each municipality will be able to decide what fits best for their residents.
Allowing on-site consumption will be a game changer in Alaska, especially for tourists. Like in most states that have legalized cannabis for recreational use, it remains illegal to consume in public places like hotels, Airbnb rentals, parks, the sidewalk, etc. This often leaves tourists and property renters without a safe space to consume the cannabis products they can legally buy. Allowing for on-site use will change that.
Alaska might become the first place in the U.S. to officially permit recreational marijuana consumers the right to use cannabis in specially state-licensed establishments.
The state’s Marijuana Control Board on Wednesday published proposed changes to regulations allowing cannabis dispensaries to seek approval for onsite consumption.
An earlier proposal for consumption lounges was rejected in February 2017.
If approved, Alaska marijuana retail stores would be able to apply for an on-site consumption “endorsement.” Applications would cost $1,000, with annual renewals running $2,000.
According to the proposal, dispensaries could sell “marijuana bud or flower in quantities not to exceed one gram to any one person per day” and “edible marijuana products in quantities not to exceed 10 mg of THC to any one person per day” to customers to consume on the premises.
Patrons would be able to sample purchases made at the dispensary at either a “fenced-off outdoor area” or a separate indoor ventilated area,” the Fairbanks News Miner previously reported.
Cannabis concentrates and tobacco products would not be allowed in the consumption areas, and the rules don’t allow for people to BYOB (bring your own bud). Dispensary workers couldn’t consume marijuana at work, and there would have to be “a smoke-free area for employees to monitor the marijuana consumption area.”
Permits could be protested by local governments, but unless a local government explicitly bans on-site consumption, the state marijuana board would have the final say whether to grant the license.
If the changes are approved, Alaska would be the first state to allow such dispensary/lounge hybrids (or “sampling rooms”) at the state level.
Currently, a limited number of businesses in Denver that are not dispensaries can seek cannabis consumption lounges, following approval of a local ballot initiative.
The first, a coffee shop and cafe called The Coffee Joint, opened up in the spring. Several San Francisco dispensaries operating under permits from the medical cannabis era have consumption lounges.
But these are exceptions.
Advocates have argued that “consumption lounges” or other legal, permitted businesses where adults can consume marijuana without fear of penalty—for themselves or for the business—is one of the pieces missing from marijuana legalization, even as more states end prohibition or move in that direction.
In the states where marijuana is legal for adults 21 and over to consume, consumption in public is specifically forbidden and is punishable by a citation and fine.
Landlords also have the right to ban smoking in rental housing. This presents a conundrum. Such residents, including residents of subsidized units housing veterans or seniors, risk eviction if they consume marijuana inside. Outside, they risk a citation (or just public opprobrium). And tourists visiting legal marijuana states often have no place to consume their cannabis.
Alaska voters approved marijuana legalization in 2014.
Arguments against allowing consumption lounges similar to what consumers of alcohol take for granted—“bars”—include fears of stoned drivers causing havoc on roadways.
Regulators will accept written public comments on the proposed new rules until November 1, and will hold a public hearing on December 19 at which people can deliver oral feedback.
“After the public comment period ends, the Marijuana Control Board will either adopt the proposed regulation changes or other provisions dealing with the same subject, without further notice, or decide to take no action,” regulators’ notice says.
See the original article published on Marijuana Moment below:
Alaska Could Be The First State To Legalize And License Marijuana Lounges
Among the four states to legalize recreational marijuana use and sales on Election Night 2016, a clear winner in the competition to cash in on tax revenue has emerged.
Voters in California, Maine, Massachusetts and Nevada approved cannabis legalization measures on the same night two Novembers ago.
Of these, Nevada was the first to record licensed and regulated retail sales in July 2017, a full six months before the first day of sales in California on January 1, 2018.
And since sales began, Nevada marijuana retailers have enjoyed a booming market—and with it, higher-than-expected tax revenue for the state, much of which is going directly to schools.
According to Nevada state marijuana regulators, taxable sales in the 12-month period from July 2017 to June 2018 are expected to exceed $500 million.
That’s 25 percent higher than official state revenue projections, which generally err on the side of caution.
And it absolutely destroys sales figures seen in Colorado and Washington during those two states’ first-in-the-nation early days of retail sales. In the first six months of 2014, Washington recorded $67 million, and Colorado $114 million.
The relative ease with which Nevada rolled out retail marijuana sales and their overwhelming success stands in stark contrast to the other states. In California, first-quarter sales fell well behind official state projections, in large part due to a highest-in-the-nation tax burden and cities and counties slow to adopt or outright to retail marijuana sales.
And in Massachusetts and Maine, a combination of local NIMBYism and government foot-dragging has meant that neither state has yet recorded a single sale.
“We are viewed by many others outside Nevada as essentially being the gold standard,” Nevada Taxation Department Director William Anderson told The Associated Press. “It’s an often-used term, but it’s appropriate here.”
At the same time, Nevada still has a long way to go before it catches Colorado’s current sales figures. In 2018, fueled by visitors from New Mexico, Texas and elsewhere, retail sales of marijuana in Colorado exceeded a staggering $1.5 billion, according to the Denver Post.
According to official first-quarter sales figures released by the state Department of Tax and Fee Administration, California raked in nearly $61 million.
That’s still on pace to miss Gov. Jerry Brown’s (D) prediction of $175 million in tax revenue from the first six months of the year. At the same time, more cities and counties—which must license retail dispensaries for them to operate—that were slow to allow for retail sales, such as Los Angeles, have come online.
In Alaska, which voted to legalize recreational marijuana sales in 2014, revenue from state marijuana taxes increased almost tenfold from year to year, with sales expected to continue to increase this year.
According to official figures released Wednesday, the Alaska Department of Revenue collected more than $11 million in taxes during the fiscal year that ended June 30—compared to $1.7 million the year before.
“I don’t believe the market has saturated and we haven’t seen exactly what capacity the state is going to operate in as far as cultivation and retail stores and the other facilities,” Kelly Mazzei, a tax official with the Department of Revenue, told NBC affiliate KTUU.
Although cannabis is still illegal under federal law, cannabis businesses in Alaska are still required to pay state taxes. With no access to banking services, tax payments need to be made in cash. But that has become even more tricky in Alaska.
James Barrett, an owner of Rainforest Farms, a legal marijuana cultivator and retailer in Juneau, attempted to pay his taxes via mail at a post office, just as he had the previous month. This time, he was denied.
“Any proceeds from the selling of (marijuana) is considered drug proceeds under federal law, so you can’t mail that,”
said Postal inspector Aaron Behne.
This was news to Ken Alper, Alaska Department of Revenue Tax Division’s Director, who was under the impression that the state had an established mechanism for collecting taxes from cannabis businesses, “We thought we had done that and this throws a tremendous wrinkle into our processes,” he said.
Marijuana businesses owners are forced to conduct much of their transactions in cash due to federal law. Without the digital footprints and automatic payments that banks facilitate, cannabis businesses must laboriously keep track of cash. Barrett estimates that he spends one day per week dealing with cash by hand-delivering payments, counting currency, and entering transactions into a database.
“It’s difficult. People like cash, but it does take a lot to move it, especially when you have to account for it properly,” Barrett said.
Kevin Anselm, Alaska’s banking regulator, mentioned that while cannabis businesses are currently allowed to operate in their own state, federally-regulated banks still face strict consequences. He stated,
“Until there is an act through Congress, I understand why the banks are very concerned. Just because the law is not being enforced today does not mean it won’t be enforced tomorrow.”
There is also a safety risk at play. The amount of cash businesses like Rainforest Farms handle means they are a target for crime. Alaska state law requires cannabis business owners to properly protect their cash and inventory, but other states with similar regulations have still experienced fatal consequences.
Cary Carrigan, executive director of the Alaska Marijuana Industry Association (AMIA), posed the question,
“Does somebody need to get shot or robbed or killed for somebody to pay attention to this issue?”
Fortunately, lawmakers are attempting to make the marijuana industry safer through banking. Representative Don Young, R-Alaska, along with a group known as the Cannabis Caucus, announced the SAFE Banking Act, legislation that, “ensures institutions can service marijuana-related businesses without the fear of reprisal from the federal government,” according to Matt Shuckerow, a spokesperson for Young.
Until this kind of legislation passes, the Alaska marijuana industry must continue to use cash, or use tactics that hide the nature of their businesses to their banks. Lacy Wilcox, president of the Southeast Chapter of AMIA, thinks the marijuana industry in her state will eventually streamline financial transactions.
“We’re all rooting for each other, and I think collectively we’ll get there,” said Wilcox. “The only question is, how long is it going to take?”
In a state where flying can be the only way to transport goods, distributors in Alaska’s legal marijuana industry are balancing federal laws with the cooperation of local law enforcement to get their product to retailers.
TSA’s policy on traveling with marijuana had to be reiterated in early April when a website glitch momentarily suggested that medical marijuana was allowed on flights. Their policy has been to not actively search for marijuana, instead focusing on immediate security threats. If marijuana is discovered during a search, they refer the matter to local authorities.
This is where Alaska’s local law enforcement and airport police step in.
Michelle Cleaver, owner of Weed Dudes in Sitka, pioneered a method that other cannabis business owners have since adopted. By contacting law enforcement prior to her flights, she then notifies TSA at the airport of the contents of her luggage, which can be cannabis flowers by the pound and as much as 65 pounds worth of edibles. At that point, TSA’s policy on marijuana kicks in, and she is referred to airport police, who have already been notified of the marijuana in her carry-on.
“As long as they have all of their proper Marijuana Control Board documentation … they can continue to travel at their own risk,”
said Deputy Chief Aaron Danielson of the Fairbanks International Airport Police and Fire Department.
Aside from Juneau’s airport police, airports throughout Alaska have been allowing the transport of cannabis within the state’s borders using similar methods. Alaska’s Alcohol and Marijuana Control Office is aware of how cannabis is being transported by plane, according to AMCO Director Erika McConnell.
Cleaver is careful to follow state law regarding the transportation of cannabis. She packages her marijuana with care to ensure there’s no cannabis odor, and transports it in her carry-on luggage so that it doesn’t leave her hands during transit.
“If it smells like pot, the whole deal’s off,” she said.
The FAA has no policy on file for flying with marijuana, wrote Allen Kenitzer, spokesperson for the FAA. If marijuana was discovered, the FAA’s duty would be to determine if the airline and its pilots followed the law.
Alaska Airlines’ prohibits marijuana on their planes, according to their website, but they have no established process for inspecting luggage.
“I don’t think we can search every bag. All we can do is let the customer know what the rules are,”
said Marilyn Romano, regional vice president for Alaska Airlines.
State law requires those traveling with marijuana to document their travel itinerary in its entirety. As long as Cleaver keeps the contents of her carry-on luggage to herself and local law enforcement, she can avoid confrontation with the airlines.
Since marijuana is still a Schedule I substance according to federal drug policy, Cleaver and her colleagues in the business take a risk each time they travel with marijuana. But thanks to her arrangement with local authorities whose priority is to uphold state law, “It has gotten easier,” said Cleaver.