NEWS

As tribe's marijuana plan goes forward, questions remain

Steve Young
sxyoung@argusleader.com
Flandreau Santee Sioux tribal officials intend to develop a marijuana grow facility on tribal grounds and sell the product in a tribal marijuana lounge.

Five months from now, according to the plan, Indians and non-Indians alike will be smoking marijuana on tribal lands in Flandreau.

The U.S. Justice Department told Indian tribes last December that they can grow and sell marijuana as long as they follow the same federal conditions laid out for Washington, Colorado and other states that have legalized the drug.

For the tribe and Colorado-based Monarch America, hired to design, construct and develop a grow facility on the Flandreau reservation, that has opened the door to a potentially rich new business enterprise — just as the advent of casino gambling did decades ago.

They intend to open by the first week of December, says Monarch America CEO Eric Hagen, who adds, with a smile, "Everyone will have a merry Christmas."

South Dakota Attorney General Marty Jackley isn't as confident of that. While he insists he's having positive talks with Flandreau officials about his concerns as they move forward on their project, Jackley says the future of marijuana on the reservation isn't so black and white.

He called the Justice Department's Cole Memorandum — authored in August 2013 by Deputy Attorney General James Cole to address the legalization of marijuana in states like Washington and Colorado — a complex directive that has created confusion on the tribal front.

While Hagen believes that memorandum allows tribal marijuana ventures in any state, Jackley questions where it was meant to apply only to tribes in states that have legalized marijuana.

Eric Hagen, CEO of Monarch America, which is in charge of implementing the marijuana growing operation at the Flandreau Santee Sioux Tribe, said Flandreau will have stricter regulations than any state with legal marijuana cultivation and consumption statutes on the books now.

South Dakota isn't one of those states. That said, he believes anyone with marijuana in their bloodstream or in their physical possession is in violation of state and federal law, including non-Indians on tribal lands and Indians who go off reservation.

"I want to encourage tribal leaders to continue to work with state authorities to better ensure ... that both Indian and non-Indian persons are not put in harm's way by the jurisdiction complexities being created by our federal government," he said.

That's not Hagen's perspective. The feds have said they aren't going to prosecute the growing or selling of marijuana by state or tribal jurisdictions that have legalized it as long as they are doing a strong job of regulating that growth and distribution, and addressing infractions, he said.

The Justice Department's bigger concern, outlined in eight priorities in the Cole Memorandum, is to keep marijuana out of the hands of minors. They don't want marijuana revenue going to criminal enterprises. They don't want marijuana legal in one state diverted to places where it isn't legal.

Tribe 'a safe haven' for people who wish to use

Hagen insists Flandreau will have stricter regulations than any state with legal marijuana cultivation and consumption statutes on the books now. And because of that, "I think people just need to know that when they come on to tribal lands to partake ... that it's a safe haven for them whether you're a tribal member or not," he said.

While he believes anybody in South Dakota with marijuana in their system or in their possession could be arrested, Jackley doesn't envision a situation where law enforcement will simply camp out and wait to arrest people coming out of a tribal lounge.

South Dakota Attorney General Marty Jackley says one of his concerns is whether the tribe can keep marijuana out of the hands of youth.

"You have to have a reasonable suspicion," he said. "If something looks like it's not right ... if they are staggering, if their eyes are bloodshot, if they hit the curb on the way out ... you have to have that level of criminal activity afoot, something that rises to a level of suspicion."

Simply knowing that someone was smoking marijuana in a tribal lounge won't cut it for law enforcement as they watch consumers leave a legal setting and cross into a jurisdiction where it isn't legal, Hagen said.

"I'm from Colorado, and I consume marijuana there," he said. "If I come into South Dakota and I'm visiting family, now all of a sudden I'm considered a criminal because of something I did in a jurisdiction where it's legal?

"If they want to arrest me because I have THC (tetrahydrocannabinol, the primary ingredient in marijuana) in my system from the state of Colorado, arrest me. I'll go to court, and I'll win all day long. It's the same with Flandreau. I think it's going to be very difficult for the state to prosecute someone like that. We already have a plethora of defense attorneys that say, 'If that happens, let us know. and we will come and defend those guys.' "

Any arrests and/or prosecutions will depend on the level of impairment or criminal activity, Jackley said. That's true of more than just marijuana consumption, he said.

For example, a person with a blood alcohol level of .079 is not legally drunk when it comes to driving in South Dakota, he said. But he or she is driving while legally impaired in Colorado, where that level is .05.

"What I'm saying is, I might disagree with (Hagen's) legal conclusions," Jackley said. "But obviously they're willing to sit down with me face to face and talk through this. And for me, that is a positive."

Feds have seized tribe's marijuana before

One of the other big concerns for the Flandreau tribe will be keeping track of its marijuana. Again, the federal government has said it will go after states and tribes if pot is leaving jurisdictions where it's legal and ending up in places where it isn't.

The feds did just that on Tuesday when agents seized 12,000 marijuana plants from tribal lands in California. Members of the Alturas Rancheria and Pit River tribes had said they were going to start growing medical marijuana, the only purpose for which pot can be used in California.

But officials in U.S. Attorney Benjamin Wagner's office said this week that an investigation of those tribes' cultivation facilities "indicates that both are commercial cultivation projects operated with the intent to transport large quantities of marijuana off tribal lands for distribution at various locations yet to be identified by the tribes."

Hagen is aware of that situation but insisted it is different from Flandreau's venture, especially with allegations that a Canadian cigarette manufacturer was financing the California grow centers.

"It's always been a red flag for both federal and state governments when you have a third-party foreign national funding marijuana projects," Hagen said. "In addition, there didn't seem to be a plan put into place for the distribution of finished products."

Law enforcement in Flandreau say they worry about where the tribal marijuana might end up. Hagen said that shouldn't be an issue, not with the "radio frequency identification (RFID) inventory and tracking system" his company is helping the tribe put in to follow marijuana "from seed to sale, ensuring products do not leave designated areas."

"I personally don't believe it will remain in the building," Flandreau Police Chief Anthony Schrad said. "You can purchase the marijuana in the lounge, but it seems to me it would be very easy to remove the RFID tag from the container you purchase it in, transfer the marijuana to your own personal vial and leave with it."

It won't be that easy, Hagen insisted, who added that the Flandreau tribe has a good track record with security, especially with the gaming operation it runs. The RFID system will only enhance that security, he said.

"I invite anybody to walk into their casino, go grab a beer and try to walk out the door with it, or try to go steal some chips off a blackjack table. It's not going to happen," he said.

Patrons will only be allowed to purchase one gram of marijuana at a time. Finish that and they can come back and buy another gram, which must be consumed in the lounge, Hagen said. "It's like beer and going to a bar," he said. "You don't grab a six-pack, then drink one and try to walk out the door with the other five. Again, it's just not going to happen."

Of course even the most strident efforts don't always reach perfection, he acknowledged. "I just read recently that five businesses in Sioux Falls sold (alcohol) to minors," Hagen said. "So I mean, what's the difference?"

He is confident that non-Indians and Indians alike will be smoking marijuana in a safe and legal environment on tribal land before this Christmas.

"People have to look at this as, 'We have a mini-Colorado in the state of South Dakota,' " he said. "We can go there, we can consume onsite, we're safe to consume and it's 100 percent legal in that jurisdiction. The way I see it, anybody who is of legal age will be welcome."