Marijuana

FAIRBANKS — It’s been nearly two years since the state started issuing marijuana business licenses, and the Alcohol and Marijuana Control Office is still processing applications.

The number of applications currently being processed is 467 with another 46 establishments ready for inspection, according to a Marijuana Control Office spreadsheet.

“There is seemingly a never-ending wave of potential licensees,” said Brandon Emmett of the Alaska Marijuana Control Board, which oversees the office. “There is always someone who is saying, ‘Hey, I am number 30 in the queue. When will I be number one?’”

There are 205 businesses in Alaska that are licensed and active. The May 8 spreadsheet shows that 97 of Alaska’s active cannabis companies — mostly growers — are located in Fairbanks or the outskirts of North Pole.

Emmett said there is discussion of extending the duration of Marijuana Control Board meetings to deal with the backlog of applications and also to manage a growing need to revise state regulations.

Raising application fees could help cover the cost of hiring more staff, he added.

“At the last meeting, we actually approved a couple of licenses that were just waiting for the meeting,” Emmett said. “They had everything done for quite some time.”

Business owners interviewed for this story said the state has been good to work with and that meeting state requirements is just one of the hurdles to clear before turning on the open sign.

“The person that I worked with, he isn’t there anymore. He was great,” said Barbara Paschall, who is opening a retail store, Nature’s Releaf, in Fairbanks.

Employee burnout is another challenge, according to Emmett.

“The job has gotten tougher,” he said. “I can see it in staff’s eyes at the meetings.”

The Alaska Marijuana Industry Association and the Marijuana Control Board requested more state funding from the Legislature for the Alcohol and Marijuana Control Office, but the request was denied, Emmett said.

Compounding matters is the growing need to shore up marijuana industry regulations.

Efforts are underway to develop regulations for on-site consumption. The marijuana board is also reviewing testing, shipping and packaging regulations as issues arise.

“Now that we have quite a lot of businesses doing commerce daily, we are starting to find the little nuances that work and don’t work,” Emmett said. “There is all of this stuff that is coming up that was kind of unforeseen when the first set of regulations was put forward two years ago.”

The growing number of marijuana companies is reportedly affecting the industry in other ways.

Business owners are growing worried about tighter profit margins from so much competition, said Emmett, who is planning to open a marijuana manufacturing business and also serves as president of the Alaska Marijuana Industry Association.

Growers are especially feeling the pinch, Emmett said, as more products enter the market. The state excise tax will eventually need to be revised, he said.

State tax records show increasing amounts of marijuana in Alaska is being bought and sold every month.

In October 2016, a handful of growers paid a total of $10,000 in taxes to the state. In March 2018, almost 100 Alaska growers paid more than $1 million, tax records show.

Keenan Hollister, whose family business is Fairbanks-based Pakalolo Supply Co., which does cultivation and retail, said he thinks the demand for marijuana in Alaska will continue to grow.

“The green rush for entrepreneurs still feels like it is on,” he said. “We are not seeing a slowdown in customers yet.”

Fourteen more marijuana companies — nine cultivators and five retailers — are close to getting their business license to open in the Fairbanks area, according to the spreadsheet by the marijuana control office.

Contact staff writer Amanda Bohman at 459-7587. Follow her on Twitter: @FDNMborough.