Legal Weed Could Be a Godsend for American Indian Tribes

This article, along with others about the growing legalization of marijuana, is featured in Newsweek's Special Edition: Weed Nation.

Twenty-nine dollars and 85 cents. That's the amount of money on the property tax bill received by Russell and Helen Bryan, a modest sum that led to the creation of a multi-billion-dollar industry. The Bryans, an Ojibwe couple living in Minnesota's Leech Lake Indian Reservation, took umbrage at Itasca County taxing their property, land they felt the United States government had no right to tax. They took their case to the Supreme Court, which ruled in 1976 that absent a Congressional declaration, states cannot tax American Indians living on reservations or regulate their activities on reservations.

That unanimous opinion of the justices cleared the path for the casinos and legal gambling establishments that have become the economic engine for many tribes of American Indians. Now, with cannabis legalization sweeping through the United States, many in the tribal business community have been eyeing the potential cash crop as a complement to the blackjack tables and slot machines generating revenue for a population that is generally impoverished.

The economic opportunity offered by cannabis rests on the particular legal relationships between American Indian tribes and both the federal and state governments of the United States, a byzantine labyrinth of Congressional acts, Supreme Court rulings and arbitrary decisions by government bureaucrats. According to the Department of Justice's Bureau of Indian Affairs, the federal government deals with American Indian tribes as it would with any other sovereign nation. The bureau also attempts to clarify what authorities states have over the American Indians living on reservations within a state's borders. "Furthermore, federally recognized tribes possess both the right and the authority to regulate activities on their lands independently from state government control," reads the Bureau's website. "They can enact and enforce stricter or more lenient laws and regulations than those of the surrounding or neighboring state(s) wherein they are located. Yet, tribes frequently collaborate and cooperate with states through compacts or other agreements on matters of mutual concern such as environmental protection and law enforcement."

The ambiguity as to which state laws are enforced on tribal land and which are left to the discretion of the tribal governments becomes even murkier when talking about the cultivation and sale of cannabis. During the Obama administration, a series of memos and statements by officials indicated that the federal government wouldn't dedicate resources to snuffing out the budding cannabis businesses in states that had legalized the plant. In 2014, a Department of Justice memorandum explicitly stated American Indian reservations would be subject to the same lax enforcement as states that had legalized cannabis. "Consistent with the Attorney General's 2010 Indian Country Initiative, in evaluating marijuana enforcement activities in Indian Country, each United States Attorney should consult with the affected tribes on a government-to-government basis," the memo reads, uplifting words to both tribal leaders interested in getting into the cannabis industry and the business leaders eager to set up shop on Indian reservations.

One of those entrepreneurs, Duke Rodriguez, sees nothing but opportunity in Native American reservations. A former Secretary of Human Services in the New Mexico state government, Rodriguez founded Ultra Health in 2016, a company specializing in operating dispensaries and helping with cultivation of cannabis for medicinal use. "Ultra Health was conceived with the vision that we would be actively engaged with the tribal communities," Rodriguez says. He speaks passionately about the good legal cannabis can do not only for the physical health of American Indians living on tribal land, but their economic well-being. "If you already have an understanding of issues of sovereignty and self-determination you understand that it's a powerful tool for the tribes," Rodriguez says.

He also recognizes the beneficial attributes of working on tribal land. Because both the property and water rights are owned by a single entity—the tribal government—cutting down on the red tape, which is just one of the attractive qualities drawing cannabis businesses to tribal lands. "Right now, tribal reservations touch, I believe, between 60 to 80 percent of the U.S. population in 100 miles," Rodriguez says. "And due to their sovereignty they're able to present products generally at more favorable economic terms than non-Indians since they can avoid certain taxation."

The grand opening in October 2017 of Nuwu Cannabis Marketplace, the largest dispensary in the United States, on land belonging to the Paiute Tribe in downtown Las Vegas lends credence to Rodriguez's argument that many tribes are betting on green for their economic survival. "What we're trying to do is create an economic driver for the tribe and create an economic driver for this area," Paiute Tribe Chairman Benny Tso told local news KSNV during a tour of the facility. "There's lots of need for jobs over here."

The plans of Rodriguez, Tso and others, counting on a growing relationship between cannabis and tribal lands, look particularly fragile under President Donald Trump and his attorney general, Jeff Sessions. In 2016 Sessions, then a senator for Alabama, argued that the government needed to promote "knowledge that this drug is dangerous, you cannot play with it, it is not funny, it's not something to laugh about...and to send that message with clarity that good people don't smoke marijuana." In January of 2018, Sessions as attorney general announced Department of Justice attorneys no longer had to follow the strict Obama-era guidelines requiring proof of a cannabis-related crime's harm on larger society before prosecuting.

For tribes that had been dipping their toes into the legal cannabis industry, the change of attitude in Washington had a chilling effect on many of their ambitions. While sovereign entities, many tribes heavily depend on the federal government for block grants and other aid—deals that could be jeopardized by explicitly engaging in an activity illegal on the federal level that the Department of Justice now considers a priority.

"For a handful of states, we have witnessed U.S. attorneys more than browbeating tribes—literally threatening them," Rodriguez says. "They're saying, 'Aren't you worried that we will take away some of your federal grants, or [be] forced to take action against [the tribes]?'"

When asked for comment about the current relationship between the legal cannabis industry and tribal land, the Department of Justice emailed Newsweek: "The Attorney General is committed to reducing violent crime in Indian Country and to enforcing the laws as enacted by Congress, and the additional guidance provided by the Cole Memo is unnecessary. As was the case prior to the Cole Memo, the United States has the jurisdiction to enforce federal law in Indian Country, and we will continue to work with our tribal partners to keep communities safe."

Where does that leave tribes curious about investing in legal cannabis? In a confusing and frustrating no man's land. Businesses currently operating on American Indian land, such as NuWu Cannabis Marketplace in Nevada or Agate Dreams, a dispensary located on Suquamish tribal land in Washington State, do so in the permanent shadow of a federal shutdown. It's the uncomfortable risk familiar to most who are pioneering the brave new world of legal cannabis.

This article, by Senior Editor James Ellis, was excerpted from Newsweek's Special Edition: Weed Nation. For more on the changing laws and attitudes on legalization pick up a copy today.