Every year, Salal’s Business Banking Officers attend various cannabis industry events, and most recently, both Michael McIntyre and Sylvia See had the opportunity to join the February meeting of Alaska’s Alcohol & Marijuana Control Office (AMCO).
Our officers are no strangers to Alaska or AMCO, having attended quarterly meetings in Anchorage and Fairbanks last year. This February, the meeting was held in Juneau. “It was a beautiful sunny day after a snowstorm when we flew into Juneau, providing us with outstanding mountain views from the airplane,” Sylvia shared. “Juneau is on a bay surrounded by mountains, and the sunny weather stuck around for our whole trip.”
During the recent meeting, Alaska’s legislators were also in session, giving cannabis license holders direct access to lawmakers. “The licensees are invited to give their feedback to the oversight group,” Sylvia elaborated, “and publicly be involved in all enforcement matters as well as approvals for new or transferred licenses.”
Michael considers this an essential aspect of these open quarterly meetings. “The political makeup in the Alaskan legislature is much different from other West Coast states,” he explained, “but like many states, they are facing a budget shortfall, so getting meaningful legislative change for Alaskan cannabis operators, like lower taxes, is going to be a big lift.”
Regulation wasn’t the only topic of the two-day session. “We sponsored events for the evenings,” Sylvia said, “allowing our team to meet the licensees in person and talk with them about what Salal Credit Union can offer.”
Even some of Alaska’s legislators attended the Juneau social events, which allowed cannabis industry members another opportunity to highlight their top concerns: the legal status of intoxicating hemp and the tax structure. “According to those who presented at the meeting, intoxicating hemp products, which were made illegal by the governor in Alaska, are openly being sold in gas stations and convenience stores as well as some of the licensed retail stores,” Sylvia relayed. “These products closely resemble and are often the same potency as the regulated and taxed products, but are sold without quality control, taxation, or regard for the buyer’s age.”
Our officers learned that these sales may be having a significant impact on licensed retailers. “How enforcement can work with a product regulated by the Department of Agriculture was discussed at length,” Sylvia said.
Michael heard the same message from the Alaska licensees. “Enforcement of current laws and regulations could have big benefits for the industry if they can find the means to enforce them,” he said.
Alongside enforcement, taxes remain a perennial issue for cannabis business owners. “The group has a bill before the legislature to change the way legal cannabis is taxed, away from rating the product by different grades and having different tax rates,” Sylvia said. “They have proposed a flat tax on all products.”
While all states that allow cannabis wrangle with enforcement and taxation questions, our officers found that cannabis licensees in Alaska face unique issues. “To begin with, many people who live in Alaska are very libertarian, want as little involvement from government as possible, and have been growing and selling marijuana long before legalization took place,” Sylvia recounted. “They were successful before legalization, and since being licensed, are now concerned that they will be failing soon under the compliance and tax burdens they face. Add in the competition from unregulated cannabis, and you have an outraged group of business owners.”
While the outcome of the proposed legislation is uncertain, the benefit of our banking and cash logistics services has been clear. “Distances are very long in Alaska,” Sylvia said. “Alaska operators are having to look at their overhead and have recognized that their time is too valuable to be driving cash around to pay bills and taxes.”
Salal’s commitment to our members and the cannabis industry is firm. “Like many states, Alaska has seen service providers jump into the market and then jump out, leaving folks with a bad taste and few options to turn to at times,” Michael said.
Sylvia also heard the same concern from Alaska licensees about the importance of consistency. “They tend to be very self-sufficient and mistrustful of institutions, especially ones from out of state,” she said. “Another credit union came into Alaska from out of state early on and then abandoned the industry after two years, so their lack of trust is well earned.”
But our members in Alaska and all the other states we serve have a home with Salal, and we always look forward to seeing you at cannabis industry events year-round. “We are planning to attend one more of these events later this year,” Sylvia suggested, “ideally in Anchorage, which has the largest concentration of licensees, showing our dedication to follow through on our promises and commitment to the Alaskan market.”
We’re Here to Help
In the meantime, if there’s anything we can do to help your business, please get in touch with your Business Officer or Business Services at 206.298.9398 or BusinessServices@SalalCU.org anytime.
