Oregon Warm Springs tribe approves marijuana sales project

AP News
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Posted: Dec 18, 2015 5:50 PM

PORTLAND, Ore. (AP) — Members of the Confederated Tribes of Warm Springs have approved a plan to build a facility to grow marijuana on their reservation in central Oregon and sell it at tribe-owned stores outside the reservation.

The vote comes a year after a U.S. Department of Justice policy indicated tribes could grow and sell pot under the same guidelines as states that opt to legalize. The tribe is one of the first in the country to enter the pot business.

Tribal officials said more than 80 percent of tribal voters favored the proposal. 1,450 of the 3,300 eligible voters turned out for the referendum Thursday.

Warm Springs' plan is to build a 36,000-square-foot greenhouse to grow and process the cannabis. Officials expect the project will create more than 80 jobs. Net revenue from the three proposed tribal-owned retail would top $26 million annually.

The tribes say they will enter into an agreement with state agencies to ensure testing and other regulations are consistent with state law. Sales are slated to start in winter 2016.

"Our main purpose is to create jobs on the reservation and produce revenue for the tribes," said Don Sampson, of the tribes' economic development corporation. "We think we will have a model other tribes will look to as they investigate this business and industry."

The proposal doesn't change the law that bans marijuana possession on the reservation, about 90 miles southeast of Portland.

Many tribes have opposed legalization and marijuana sales, due to the potential to compound alcohol and drug problems already present on reservations. Some tribes, like the Yakama Nation in Washington state, outright banned marijuana.

But at least a half dozen tribes this year have legalized marijuana on their reservations or have pursued marijuana projects, hoping to bolster their tribal economies with the revenue.

Last month, the Squaxin Island Tribe in Washington state opened what is believed to be the first retail marijuana store on a reservation. The tribe isn't growing the marijuana but is buying it wholesale from the state-regulated system used by the recreational pot industry.

Washington allows for medical and recreational marijuana use, and the Squaxin entered into a compact with the state that sets guidelines for taxing pot sales. Another Washington tribe, the Suquamish, has also signed a tribal compact with the state for a marijuana store. That store is still under construction.

Other tribes are also considering the move. The Passamaquoddy Tribe in Maine signed a letter of intent in September with a medical marijuana management and consulting company to build a cultivation facility on tribal land. The tribe wants to use the facility to make industrial hemp, not marijuana, though officials said they might consider expanding operations when laws around marijuana change.

And leaders of the Omaha Tribe in Nebraska are considering land in western Iowa for growing marijuana. That's after tribal members approved three referendums last month giving the Tribal Council the authority to legalize marijuana for medicinal and recreational use and to grow plants for industrial hemp. The tribe will launch a study will examine whether the business would make financial sense.

Some tribes have faced challenges in the pot business — especially those within states where marijuana isn't legal.

The Flandreau Santee Sioux in South Dakota — a state where both medical and recreational marijuana is prohibited — decided in November to burn its cannabis crop amid fears it could face a federal raid. The tribe was the first tribal nation to legalize recreational marijuana and had big plans to open the country's first marijuana resort — complete with smoking lounge, nightclub, bar and private rooms for medical marijuana patients — on its reservation north of Sioux Falls.

Tribal officials said the main challenges centered on whether the tribe could sell marijuana to non-Indians, along with issues over where the seed used for planting originated. The tribe vowed to move forward with its operation in the future.

In October, federal agents raided the Menominee Nation's reservation in Wisconsin, a state where marijuana is illegal, eradicating 30,000 cannabis plants. Tribal leaders said the plants were intended for research into growing hemp, but authorities believed the tribe was growing pot. The Menominee Nation has since sued two federal agencies over the raid.

And this summer in northern California, where medical marijuana is legal, federal authorities raided the tribal cannabis operations of the Alturas and Pit River Indian rancherias, with agents seizing 12,000 marijuana plants and some process marijuana.

The regional U.S. attorney's office said in a statement that the two neighboring tribes planned to distribute the pot off tribal lands and the large-scale operations may have been financed by a foreign third-party.