Washington State tribe positioned to begin adult-use sales
- Seniors MMJ Network
- Sep 20, 2015
- 3 min read
The Suquamish Tribe has reached a compact with Washington state for the cultivation and sale of adult-use (recreational) Marijuana. The 10-year agreement will govern all aspects of the Marijuana industry on the Tribe's land, located in Kitsap County. The compact, which still requires Gov. Inslee's signature, is being hailed as the first of it's kind in the nation and a potential model for Tribes across the country. The Squaxin Island Tribe in Washington is currently negotiating a similar agreement. A deal is likely by the end of September, according to LCB spokesman Brian Smith.
“Our decision to enter into retail operations comes after careful consideration,” Suquamish Chairman Leonard Forsman said in an announcement released by the Tribe’s communications office. “With the passage of I-502, we knew we needed to adapt to the changing environment surrounding our reservation and saw an opportunity to diversify our business operations.”
Under the agreement, the Tribe will charge a tax equivalent to the state excise tax on sales to non-Tribal customers. All tax revenue collected will be used for Tribal government services. The Suquamish Tribe’s attorney, Rion Ramirez, said the Tribe is free to allocate the revenue as it deems necessary, which doesn't exactly pinpoint how the money will be used.
The Suquamish Tribe didn't necessarily need to enter into this compact with the state either. The Cole memorandum, updated last December , Federally grants permission for Native Tribes to implement Marijuana sales / cultivation in a similar fashion to the states that have already passed adult-use laws. Just like those legal states, Tribes will be accountable for meeting certain safety and oversight conditions or they could face Federal prosecution.
In May, Gov. Inslee signed HB 2000 into law, authorizing him to enter into compacts with tribal governments regarding regulation of marijuana businesses, enforcement of law, taxation, dispute resolution, ect.
Some of you may ask, why would a Tribe want to sign a compact with the state, when we've established that it isn't necessary? Robert McVay, an attorney with the Seattle-based firm Harris Moure, blogged about the topic on May 18: “The tribal business would gain access to licensed Washington marijuana businesses. That means that they could potentially wholesale to licensed producers, processors, and retailers.”
On the flip side, why would the state want to sign a compact with the Tribes? That's easy, to protect it's tax revenue coming from the Recreational market. The Marijuana market will ultimately boil down to a price war for consumers, similar to how it was with the medical vs recreational prices. Already there is talk of tribes offering lower prices to offset the tax cost, resulting in a significantly lower price to the end consumer.
If history is a guide, we'll see the Washington Rec. market lose market-share to the noticeably lower priced, but same quality Marijuana from tribal lands. Also, now that Oregon is legal and Rec. sales begin soon, Marijuana outlets in southern Washington are nervous about the better prices and lower taxes just a few miles away over the border. Already, they have seen sales falling.
For Seniors on fixed incomes, this could potentially be a source for lower cost Medical Marijuana. We'll keep a close eye on how the process and the final products play out. In a time of panic about the entire Washington system going recreational July 1, 2016, this could be an answer to some of those fears.
Where does the Washington experiment end or begin to even out? Who knows, but with this first of it's kind compact between state and tribal governments, we've added another piece to the puzzle.
Give us your thoughts by joining us on Facebook or Twitter -
Comments