The Marijuana Control Board on Monday laid out its most comprehensive set of draft regulations yet for Alaska's fledgling cannabis industry, including a proposal that would ban marijuana social clubs, even as owners of existing clubs spoke out against any actions by the state that would shutter their doors.
The newly created board is holding a two-day meeting at the Atwood Building in downtown Anchorage, and heard Monday morning from business owners who had been sent cease-and-desist letters by the state.
"We're not criminal actors," Green Rush Events co-owner Corey Rorem told the board.
Five of the six businesses that were sent letters testified to a packed room that held about 70 audience members. Only representatives from the Alaska Cannabis Club did not attend.
The owners of two marijuana delivery businesses spoke at Monday's meeting; Discreet Deliveries owner Rocky Burns and Absolutely Chronic Delivery Co. owner Michael Crites each gave public testimony. In past weeks, both Crites' business and the Alaska Cannabis Club had been served search warrants by the Anchorage Police Department.
At the meeting, Burns told the board that his business had also been the target of police raids.
"We are under attack," Burns said.
The three marijuana social clubs that received letters -- Wasilla's Northern Heights, Pot Luck Events in Anchorage, and Kenai's Green Rush Events -- told the board that they shouldn't be lumped together with businesses selling pot. Northern Heights manager Sarah Backlin told the board that there "truly is a need" for social clubs in the community, and Green Rush Events' Rorem said that "cannabis-friendly clubs … are a much needed asset."
Rorem said the state's argument comparing social clubs to bottle clubs, which are illegal under Alaska law, was not valid. He said he couldn't take the letter seriously.
The state has argued that social clubs are illegal for several reasons: The clubs lack marijuana business licenses, they fall under the definition of a public place in Alaska statute, and public consumption of marijuana is illegal. The state argues that the bottle club comparison is valid.
Board member Brandon Emmett asked Rorem what his understanding of a public place was, to which Rorem replied that the "intent" of Alaska's initiative was for marijuana to be "sheltered" from those who do not want to be exposed to it.
The definition of public, which includes businesses, has existed for years, Alcoholic Beverage Control Board director Cynthia Franklin said.
Later in the day, the board read through the next set of proposed regulations, including one that would specifically ban marijuana social clubs "unless authorized" under state statute.
But since there is no explicit wording for the social club licenses in the ballot initiative, the Legislature would need to add a license type to statute in order for such businesses to be authorized, as the board discussed in July.
During a mid-morning break, roughly a dozen people participated in a brief demonstration outside the Atwood Building, holding up signs that read "we need social clubs" and election signs from November that read "Vote Yes on 2," the ballot measure that legalized recreational marijuana in the state.
Pot Luck Events owner Theresa Collins said the demonstration was "about making sure the Marijuana Control Board is paying attention."
As the day wore on, the number of attendees dwindled. The board reviewed the first set of regulations, slowly working through the wording of local option law, before diving into a comprehensive overview of different types of marijuana businesses.
The 71-page document unveiled Monday covers a wide range of regulations, outlining proposed rules for cultivation and testing facilities, as well as possible fines for illegal sales.
Among the notable aspects of the proposed regulations:
• Three types of cultivation licenses: standard, for a business operating with 500 or more square feet of marijuana plants; limited, for a business with less than 500 square feet of plants; and a broker license, which provides the "essential business functions" of a limited marijuana cultivation facility.
• Each facility would need an inventory tracking system, and each plant that is 8 inches tall would need a tracking number.
• Packaging would be required to be childproof, without any sort of images, including cartoon characters, that "target individuals under the age of 21." All packaging would be opaque, so the product would not be visible.
• THC limits on edibles would be 50 milligrams per package and 5 milligrams per serving.
• Marijuana testing facilities would each need to employ a "scientific director" who has both academic and post-degree laboratory experience in chemical and biological sciences.
• Marijuana social clubs would be prohibited.
The public can comment on the proposed regulations from Tuesday to Sept. 10. Instructions on submitting public comment are available on the Alcoholic Beverage Control Board's website.
Reactions to the regulations, and the meeting, were mixed.
"From my standpoint, there probably is a little overreach … but less overreach than I expected," said Leif Abel, executive director of the Coalition for Responsible Cannabis Legislation. "Overall, I think it's really positive."
Abel said much of the conflict between businesses and state was due to the "societal transition" in Alaska in regard to the new industry.
"There's a lot of different approaches and strategies to approaching this new business," he said.
Abel, who also co-owns Greatland Ganja, said that "you will not see our business selling marijuana or opening a club until there's licensing by the state. That's the safe decision and that's (the coalition's) advice. Beyond that, I definitely see why the situation is the way that it is."
Attorney Ben Adams said the regulations appeared "designed to stifle" industry. Adams said banning social clubs would be "absolutely foolish" given Alaska's relatively small population and the potential impacts on tourists who may want someplace to smoke legally.
Adams noted that the formation of regulations is "an ongoing process, and I think a lot of the frustration of people, you know, who held protests and stuff, none of that's really called for. Put your energy into helping the board understand your point of view."
The board will meet again on Tuesday to discuss the set of regulations that it introduced in July.