Unique Hurdles Facing Legal Pot in Live-and-Let-Live Alaska

Some investors plan on launching location-specific seed-to-sale businesses

The Chilkat Mountain Range is seen above the town of Haines, Alaska October 7, 2014. [CREDIT: Reuters/Bob Strong]

SOURCE: Reuters
AUTHOR: Steve Quinn

JUNEAU – Presiding over busy waterways and airspace that serve as unofficial highways of an inhospitable state twice the size of Texas, the federal government has a looming presence over Alaska and its famously live-and-let-live residents. And Uncle Sam considers marijuana illegal over every inch.

This poses unique hurdles for entrepreneurs hoping to capitalize on an Alaska move to legalize recreational marijuana, and who seek to grow and process products to be marketed across the state, much of which is accessible only via transport links policed by U.S. agencies and governed by federal law.

To get around such obstacles, some investors say they plan to launch location-specific seed-to-sale businesses, hoping to avoid blatant federal violations as well as the hazards of moving about in a vast, often bitterly cold state.

“With the risks along the way as far as law enforcement and the elements, most people believe it's the smartest thing to do,” said Charlo Greene, a prominent pro-cannabis activist who plans an Anchorage seed-to-sale business.

Reflecting a rapidly shifting legal landscape for marijuana, voters in four U.S. states have opted to legalize recreational pot since 2012, most recently in Oregon and Alaska, even as it remains illegal under federal law.

President Barack Obama's Justice Department has cautiously allowed the experiments to proceed, saying it would look to prosecute a narrower range of marijuana-related crimes, such as sales to children. But that could change if a more conservative President is elected in 2016, when Alaska's pot shops are likely to open.

Alaska pot entrepreneurs say they are wary of relying solely on federal discretion in a state so dependent on air and sea transport. Some 80 percent of communities are inaccessible by road, including Juneau, the state capital.

Juneau resident Ben Wilcox, who wants to ship pot to a nearby community by ferry and plane, said pot delivery is written into the voter-backed law and is crucial to meeting statewide demand and growing business.

Ben Adams, an attorney, said he has advised potential Alaska investors to confine their businesses to one locale: “If you're growing it and dispensing it in one place, it doesn't matter if that place is off the road system.”

Colorado and Washington have had fewer such quandaries because product is widely transported by road links policed locally, although one business group said some pot is taken to market on Seattle-area ferries.

A Seattle-based spokeswoman for the Drug Enforcement Administration said there have been no arrests for pot transport by licensed commercial businesses.

“Alaska is going to raise a lot of public policy questions in terms of this federal-state relationship that either haven't come up or will never come up in other states,” said Brookings Institution drug policy researcher John Hudak.


Alaska has long had looser marijuana rules than many other states. Four decades ago, the Alaska Supreme Court ruled that possessing small amounts of cannabis at home was protected by privacy rights. In 1998, voters approved medicinal pot but blocked dispensaries.

Libertarian-minded residents have long taken their pot on puddle-jumper planes, snow machines, ferries and boats, just as they have done with alcohol banned in some communities, state police said.

“The federal government doesn't [mess] with us out here,” said John Bouker, a Dillingham pilot who shuttles villagers on errands and state troopers to crime scenes in the highway-free Bristol Bay area.

“Our problem out here is the alcohol, the heroin, not the pot,” said Bouker, 49, who has occasionally noticed the scent of a stash in his Cessna.

But questions remain over the extent to which businesses will use federally policed paths to take pot to retail shops, and how often federal agents will intervene, if at all.

State rulemakers will take months to weigh the issue, with anti-cannabis community and tribal leaders already urging restrictive zoning and local bans.

Alaska Airmen Association spokesman Adam White said pilots should “be extremely careful with what they transport in their aircraft.”

The U.S. Coast Guard warns that pot remains illegal on ferries, and the Transportation Security Administration, which runs checkpoints at more than a dozen Alaska airports, said agents would alert local police to any pot found.

Police decide whether to make arrests. But DEA agents are stationed alongside police at larger airports, such as Anchorage, and could take an interest in big stashes of commercial weed, a TSA spokesman said.

“The ball is in the state's court to set up their own regulatory scheme and see how it operates,” U.S. Attorney for Alaska Karen Loeffler said. “If we end up with a marked public safety problem, like we have with heroin these days, obviously we will work jointly with our partners to deal with it.”

(Additional reporting by Dan Wallis in Denver; Writing and additional reporting by Eric M. Johnson in Seattle; Editing by Eric Walsh)



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