In my capacity as general counsel for the National Indian Cannabis Coalition, I (and the rest of the industry) have been closely tracking the President-Elect’s Cabinet nominations.  Cannabis legalization is perched precariously on the two prongs of (1) states’ rights; and (2) the Department of Justice’s policy position allowing United States district attorneys to decline to enforce cannabis-related violations of the Controlled Substances Act.  Congress doubled down by passing legislation withholding funding for the prosecution of marijuana crimes when the activity is legal under state law.

Those thinking about this issue and trying to gaze into the crystal ball to see past January 19, 2017 generally think that the costs associated with infringing on a state’s right to make its own laws by federal enforcement of federal marijuana laws may be to high to be realistic.  The fact that over half the states have some form of legalized marijuana, the number of potential unhappy constituents, loss of tax revenue from a $7 billion dollar industry and number of jobs lost if the marijuana violations were prosecuted also creates a political reality that would be difficult to overcome.

However, the DOJ’s policy is just that – a policy, not a law.  It can be changed with the stroke of an Attorney General Session’s pen.  And while I believe the states’ rights argument may protect the states from federal enforcement, I am concerned that same argument might not apply to tribes.

The Wilkinson Memo allows a United States District Attorney the discretion to determine whether to expend resources prosecuting marijuana violations in Indian Country located within their district.  Indian Country is federal land.  Given his previous statements on marijuana, I can see how an Attorney General Sessions might leave the states legalization alone while taking a hard line position on enforcement and prosecution of marijuana violations on all federal land, including Indian Country.  After all, “good people do not smoke marijuana”.  

For now, we do not know whether the Senate will even confirm Sen. Sessions or if this will be an issue that the Trump Administration will care anything about.  What is clear, however, is that for there to be stability in the industry and for tribes to be able to participate in this booming economic development opportunity without fear of losing their investment or other federal funding, Congress will need to act.

“trying to see the future”

Lael

Seatte_totemA little over a year ago, the Department of Justice released the infamous “Wilkinson Memo” containing DOJ policy guidance to U.S. District Attorneys on Marijuana in Indian Country.

Chaos ensued.

Media and industry began shouting “Marijuana is legal in Indian Country!” from the rooftops. Tribal leaders were swarmed by tribal members demanding that marijuana be immediately legalized. State and local jurisdictions were worried about the impact of legalization on their jurisdictions. Some tribes immediately announced their intent to open large marijuana operations; other tribes issued strong statements against legalization, and lawyers all started scratching our heads.

As the debris settles, we look back at a year with several tribes attempting to enter into the industry. The federal government either closed down their operations or the tribes shut down their operations themselves. Two tribes successfully opened two retail shops.

The truth is that there is just too much uncertainty in the law for most tribes to confidently enter into the industry. But there does seem to be economic opportunity available and some tribes will be able to take advantage of that.

Here are my highlights from 2015:

  1. Development of the National Indian Cannabis Coalition. In February 2015, Jeff Doctor (Seneca) announced the establishment of NICC. NICC’s mission is to educate tribal leaders and elected officials on the emerging regulated cannabis industry while advocating for parity on behalf of Indian Country. NICC has been on the forefront of cannabis policy development in Indian Country, speaking at conferences around the country and weighing in on policy development at the Congressional and Administrative level.
  2. Development of a draft tribal marijuana bill. Congress has been paying attention to the concern in Indian Country that dabbling in the cannabis industry could lead to the termination of federal grants or other funding. House representatives drafted a bill that would clarify that tribes would not lose federal funding if they were engaged in economic development in the cannabis industry.
  3. HHS Secretary Burwell promised that tribes engaged in the cannabis industry will not lose their federal funding so long as they do not use HHS funds in those endeavors. (Now we need more such statement from other Agencies).
  4. Suquamish and Squaxin Island open and operate (successfully) two retail marijuana stores on their reservations. While other tribes were being raided, these tribes in Washington were quietly negotiating with the State and preparing to open their retail stores. Now I hear that several other tribes are in negotiations with Washington State to do the same.

What should we look for in 2016?

  1. Ruling in Menominee v. DEA and DOJ determining whether a tribal college is an “institute of higher learning” for the purposes of growing hemp under the Farm Bill.
  2. Congressional legislation protecting federal funding for tribes engaged in the cannabis industry.
  3. Development of a single federal policy regarding legalization of cannabis in Indian Country.
  4. Development of tribal cannabis businesses in states with some form of legalization.

There have been a couple tribes who have tried unsuccessfully to open marijuana operations within states that have no form of legalized marijuana. The logistics of ‘legalization on an island’ are at this point, in my opinion, too difficult to overcome. Instead, the focus should be on developments within states with some form of marijuana legalization. I understand that this means that tribes in restrictive states without other forms of economic development will lag behind others – but cannabis remains a schedule 1 Controlled Substance carrying severe penalties for those convicted of possession, intent to manufacture or distribute. It is just not worth the risk unless you KNOW your intergovernmental agreements are strong and protect tribal people and tribal investments.

We are still in the infancy of this industry, both in Indian Country and the “outside” world. Growing pains are inevitable. What is both encouraging and frightening is that for the first time since gaming, non-Native businesses are coming to Indian Country. A word of caution – be careful who you work with – the sharks are circling and while they can leave and change their name, we are tribal people and members of our tribal nations from the beginning of time to the end of time and these businesses will remain part of our tribal history forever. Make sure that history tells a good story of developing cutting edge industries in a good way.

With Respect and Hope for a Successful Year,
Lael