In a first for Alaska's marijuana industry, a potential marijuana shop in Anchorage was rejected by the state due to concerns over an Outside company's stake in the business.
On a day when 21 other licenses were approved, Wild Flowers Holdings, LLC, was unanimously denied by the Marijuana Control Board on Friday. It's the first company rejected by the board, which has been reviewing and approving licenses since June.
Board members questioned discrepancies in the application and licensee Andrea Gribbin's answers, and the role that business Happiedaze LLC of Arizona was truly playing in the endeavor.
But Tiffany Young, co-owner of Happiedaze and Gribbin's niece, took issue with the board's actions. "I don't believe there are any laws that support their decision today," Young said when reached by phone Friday.
Under state regulations, all marijuana licensees must be Alaska residents, and no other person can have a direct or indirect financial interest in the business. There are two exceptions – rental property charges and consulting fees.
"We had some serious questions about this application early on," Cynthia Franklin, Alcohol and Marijuana Control Office executive director, told the board.
Franklin said that another woman, later identified as Young, had called the office repeatedly about the application. Eventually Franklin directed the staff to stop dealing with anyone but Gribbin, the sole owner of Wild Flowers Holdings.
Gribbin didn't contact the office "until I contacted her and told her that we would no longer be dealing with her agents," Franklin said.
Franklin told the board that Gribbin had eventually brought a "big crew of people from out of state" to a meeting, who had been aggressive toward the staff, Franklin said.
"From our perspective, Ms. Gribbin is not the person that's actually applying here," Franklin said.
The office had also received an objection that Gribbin's business was a "front" for an out-of-state company. The anonymous objection had been identified as "someone who was close enough to Ms. Gribbin that he was concerned about retaliation," Franklin told the board.
Franklin said they couldn't prove the allegations, but that Gribbin was "particularly not knowledgeable" about the industry, compared to other applicants.
"Our goal was never to circumvent the system in any way," Young said. "The goal was to provide information to the board that they've never seen before."
Young said that she had a power of attorney for Gribbin, which should have allowed her the right to speak on Gribbin's behalf, but was denied the chance to sit in on Friday's hearing.
During the meeting, board member Loren Jones questioned Happiedaze's role in the business. The application includes repeated reference to the company, and "seemed to indicate that they would be providing direct operational work for you … that raised a lot of questions in my mind," Jones said.
Gribbin replied that Happiedaze was a consulting firm assisting her with the process.
"It also talked about the rules in Arizona," Jones said of the application. "And I had some real questions. … Does this company understand Alaska, are they in Alaska?" Jones asked.
Gribbin said the company is in Alaska, and "yes, to me, they are an Alaska business."
Happiedaze is not incorporated in Alaska. It is a registered limited liability company in Arizona, according to public records. Young also signed emails to the state office from Wild Flowers Holdings' email, according to public documents.
"We are consultants. We have a dispensary in Arizona. We have a formula that works," Young said. "Alaska's our home. We're not out-of-state investors by any stretch of the imagination."
Happiedaze is listed as the tenant on the Spenard Road property where the cultivation facility would be housed. Wild Flowers Holdings will be sub-leasing the property, Gribbin said.
"So that's a little bit more than a consultant relationship," board member Mark Springer said.
Other businesses have had to prove "beyond a shadow of a doubt" that they are truly Alaskan, board member Brandon Emmett said. "It's also becoming apparent to me now, it seems like this entity … doesn't seem to know much about the marijuana industry," he said of Wild Flowers Holdings.
The board voted unanimously to deny Gribbin's application, to audience applause.
Gribbin declined to talk about the allegations after the vote.
Approved licenses and more talk of marijuana cafes
All other licenses – 21 total — were approved on Friday.
Cultivation facilities approved were Talkeetna Herb Co., in Talkeetna; The Naked Herbalist, in Willow; Green Degree, in Wasilla; JWS Enterprises, in Ketchikan; Alaska Cannabis Exchange, in Anchorage; Dank Research, in Houston; Calm N Collective, in Houston; Alaska Precision, in Willow; Terra House LLC, in Soldotna; Alpha Kilo, in Seward; Ester Horticulture and Research, in Fairbanks; Alaska Bud Brothers Aerogardens, LLC, in Kasilof.
Retail stores approved were: Red Run Cannabis Company, LLC, in Kenai; AK Slow Burn Cannabis Outlet, LLC, in Anchorage; GoodSinse, LLC, in Fairbanks; The House of Green, in Anchorage; Cannabis Corner, in Ketchikan; Uncle Herb's, in Anchorage; and The Fireweed Factory, LLC, in Juneau.
Lastly, Anchorage concentrate manufacturing facility R.C. Tinderbox, LLC was approved, as was another testing laboratory, Southeast Alaska Laboratories, LLC, in Juneau.
The board also voted 3-2 to strike down proposed rules around marijuana handlers cards, which would have been the most stringent rules in the nation, the Alaska Journal of Commerce reported.
On-site consumption areas – which would be areas in retail marijuana stores akin to marijuana cafes or bars – were also discussed as the meeting came to a close. The proposed rules around on-site consumption will again be sent back for public comment, after board member Jones added a condition that ventilation systems be verified by an electrician.
A first for Mat-Su
For the Matanuska-Susitna Borough, the licenses approved Friday represent the first cultivators that have been given the go-ahead in the borough.
Talkeetna Herb Co., The Naked Herbalist and Green Degree were unanimously approved at the Marijuana Control Board meeting in Anchorage. Later, cultivation facility Alaska Precision was approved.
"Huge hurdle I just jumped over, man," Green Degree CEO Kerby Coman said after the vote.
Applications for Mat-Su cannabis businesses had been on hold pending the outcome of a proposed commercial cannabis ban, which was rejected by borough voters in early October.
Coman's application was deemed complete in March, but he said the months since then have been "time well used" as he worked on other aspects of his business.
"It feels great. It's been such a long road to get here," Talkeetna Herb Co. owner Krystal Dietrich said.
"We completely stopped all progress until after the vote. That's why we're not ready to operate right now." Dietrich said.
Now the businesses need to receive a conditional-use permit from the borough. Coman hopes to open a retail store and have buds for sale by mid-January; Dietrich hopes to have her facility running within a month.
The board will meet again Nov. 10 to make up for Thursday's meeting that was cancelled in Nome due to stormy weather.