Thirty years after casino gaming revolutionized the economics of Native America?the “new buffalo,” tribal leaders called it?Indian governments are now looking to marijuana to be the new game-changer on reservations nationwide.
James “Chief” Billie, the enterprising Seminole who led his Florida tribe’s transformation in the 1990s from bingo halls to the global gaming and resort powerhouse it would later become, has plans for leveraging the political sovereignty tribes enjoy under federal law to cash in on an industry he says could be “bigger than bingo”.
He’s formed a company called MCW and he’s secured a partner in a company called Electrum, based in Nevada, where recreational marijuana recently was legalized. Their business model is to assist tribes across the country with establishing medical marijuana ventures.
“We are bringing the benefits of our tribal sovereignty to the cannabis industry and the cannabis industry leadership is partnering with us to enable the next huge economic development opportunity for the Native American Community,” Billie said in a statement.
The sovereignty piece is seen as key. Tribally owned businesses are exempt from taxation in the states where they operate; and if it works out that they also won’t be required to play by the same state licensing and regulatory regimes that govern mainstream cannabis players, it could be a huge competitive advantage.
“They have a government within themselves, so they can look to create economic opportunities for their people. They can leverage their unique tax situation to help them,” explained Leonard Salgado, who heads business development for a company called Ultra Health, which provides medical pot to five New Mexico counties and recently struck a similar deal with Nevada’s Las Vegas Paiute Tribe.
In 2014 the U.S. Justice Department issued a memorandum giving tribes the freedom to engage in marijuana-related activities. In combination with the Obama administration’s earlier release of a list of temporary guidelines intended to prevent federal prosecutions in states that have legalized marijuana the memo is interpreted as a protection for tribes cultivating and selling marijuana on reservation lands.
Not that this has gone altogether smoothly. But then reservation casinos have had their bumps in numerous states too.
The Pinoleville Pomo Nation in Northern California claimed they were the first tribe to grow and cultivate marijuana on tribal land following the 2014 memo. But the tribe was later raided by a local sheriff’s department, allegedly for overstepping state regulations.
Later, North Dakota’s Santee Sioux Tribe made national headlines when they announced plans to create a marijuana resort that would double as an “adult playground” only to have to suspend the venture and burn off crop estimated to be worth millions to forestall a possible federal raid. Their consultants currently face criminal charges.
Chief Billie and his partners don’t plan on making the same mistakes. They will specifically target “areas where it’s already legal and won’t be controversial,” or so Billie recently told The Miami Herald.
They won’t be the first. Earlier this year, New Mexico’s Pueblo of Acoma partnered with Delaware-based Bright Green Group of Companies to house a 150-acre greenhouse for growing and researching medicinal plants, including marijuana.
Ultra Health claims to operate a 22,000-square-foot greenhouse with 7,000 square feet dedicated to producing mature pot plants in only eight weeks.
New Mexico had $50 million in medical marijuana revenue last year alone, the company says, and it’s expected to exceed $80 million this year.
Salgado said, “We are very much engaged with Indian tribes throughout the country who are looking to explore the possibilities to get into the cannabis industry.”
