Cannabis industry readies for next steps after first licenses approved

The first commercial licenses are issued, growers are gearing up to grow, the Marijuana Control Board is shuffling, and the Alaska marijuana industry is entering a new chapter.

Nearly year after the Marijuana Control Board began its commercial cannabis rollout, on June 9 the board gave the go-ahead to over two dozen marijuana growers looking to stock retail shelves later this fall.

The board approved just nearly 30 cultivation licenses, and did not outright reject any. It tabled three: two in the Mat-Su Borough, which will hold a borough wide ballot to ban commercial cannabis in October, and Stoney Creek Growers in Seward.

The remaining standard and limited cultivation licenses are scattered from Fairbanks to Ketchikan.

Fairbanks has the greatest representation of new cultivation licenses, consistent with the relatively cannabis-friendly attitude of the borough and city authorities. Unlike most other Alaska cities, Fairbanks requires no local license for marijuana businesses beyond a zoning requirement. The borough has approved over 30 cultivation facilities for zoning.

 Newly licensed companies include Alaskan Greenery in Valdez; Dream Green Farms in Anchorage; Rainforest Cannabis Cultivation in Ketchikan; Northern Lights Indoor Gardens LLC in Sitka; Elevated Innovations LLC in Fairbanks; Parallel 64 LLC in Anchorage; Tanana Herb Co. LLC in Fairbanks; Alaskan Bud Brothers Aerogardens LLC in Kasilof; Pakalolo Supply Co. Inc. in Fairbanks; Green Rush Gardens LLC in Sterling; Peace Frog Botanicals LLC in Kenai; Coyote and Toad’s Garden LLC in Skagway; Permafrost Distributors in Nikiski; and Talisman Farms in Homer.

Crucially, the board also approved testing facility licenses for CannTest LLC and AK Greenlabs, ensuring cultivators will be able to legally test their product when the board issues retail licenses in September.

Though licenses have been approved, cultivators and laboratories still require state and city inspections to make sure the extensive security requirements and other required regulations are filled along with the normal city and state inspection building codes.

Leif Abel, a board member of the Coalition for Responsible Cannabis Legislation and owner of Greatland Ganja cultivation facility in Kenai, said his cultivation facility should be ready for inspection in the next week.

“We’re feeling good about everything,” Abel said. “We’re basically in the last two weeks or so of wrapping everything up.”

Abel said the hard part is on the way, not behind them.

“I’ll be accepting congratulations when we get everything planted and get that first crop up for sale in the fall,” he laughed.

New chair elected

The board elected a new chairman, switching from an entrepreneurially minded industry representative to a police officer with a record of caution on legalization.

The board wrestled with personality conflicts from inception, as Bruce Schulte and Brandon Emmett, the two industry representatives on the five-person board, often disagreed the more conservative tendencies and suggestions of executive director Cynthia Franklin and fellow board members Loren Jones and Soldotna Chief of Police Peter Mlynarik.

Now that regulations are operable, though far from perfected, the dynamic could shift. During the June 9 board meeting, the board voted 3-2 to replace Schulte as chairman with Mlynarik.

The election immediately followed an executive session called by board member Mark Springer at the beginning of the meeting.

Mlynarik’s election was sandwiched between the executive session and the tense resignation of administrative officer John Calder. Reading from a statement, Calder said he was resigning because of Schulte’s behavior. The then-chair silenced him before Calder could continue what began as a list of grievances. 

Franklin and Calder did not respond to requests for interviews. 

Mlynarik acknowledges he and Schulte don’t always agree, but said he doesn’t expect the board’s tendencies to change substantially.

“I’m sure we have different outlooks on it,” said Mlynarik. “We come from different sides of it. I’m from law enforcement, he’s from industry, so obviously he’d like to see thing get cranked up. I think the board’s fairly diverse, so I don’t know if just changing the chair is going to change the direction of it. We move along on the majority of the vote.”

Schulte said that the decision of the board didn’t surprise him. He, Mlynarik, and Springer had each expressed interest in being board chair when the board convened for the first time nearly a year ago. Because the June 9 meeting was a rare meeting in which all members were physically present, it was only natural to have a vote.

Schulte agrees with Mlynarik that chairmanship doesn’t change the fact that one member still only has one vote.

“I don’t think it’s quite as significant as how people would have it be,” said Schulte. “The challenge of the chair is to manage the flow of the meeting and to make sure each member is getting their voice heard and there’s no hijacking of the discussion. That’s going to be Peter’s challenge. I certainly found it challenging.”

Schulte acknowledges that the new chair’s stances are more conservative than his own, but said he personally likes and respects Mlynarik.

“We’re going to continue to disagree, but it’s going to continue to be a healthy, professional disagreement,” he said.

Mlynarik, from a city with a moratorium on commercial marijuana, fills the statutorily designated role of public safety representative on the board.

While industry members residually fearful of law enforcement might have some reservations about a cop on their regulatory board, Mlynarik said he won’t have any more influence now than before he was voted chair.

“I don’t think there’s any changes from where I was,” he said. “I have one vote just like anybody else does.”

The police chief has a wary regulatory style, opposed to Schulte’s more laissez faire tendencies, and found himself on the losing side of several 3-2 votes on the five-member board.

His actions on the board contrast markedly with Schulte, who came from the activism front of the 2014 Ballot 2 Initiative, which legalized recreational marijuana sales in Alaska.

A commercial pilot who admittedly uses cannabis in his off-season, Schulte serves as president of the Alaska Marijuana Industry Association, and fills the industry representative/at-large designated seat on the Marijuana Control Board.

Mlynarik voted with Jones against allowing on-site consumption in retail cannabis shops. When the board took up retail stores, Mlynarik and Jones voted for stricter operational hours and voted against non-marijuana product sales when retail store merchandising came up.

Other tiebreaker votes swung in his favor. He supported smaller servings sizes for edible products, and successfully introduced a regulation that bars anyone with a misdemeanor drug possession charge from applying for a commercial cannabis license for five years.

DJ Summers can be reached at daniel.summers@alaskajournal.com.

 

Updated: 
06/22/2016 - 4:36pm

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