SUQUAMISH — The Suquamish Tribe has signed a marijuana compact with the State of Washington, with the intent of entering the retail marijuana market as early as this fall.

“Our decision to enter into retail operations comes after careful consideration,” Suquamish Chairman Leonard Forsman said in an announcement released by the Tribe’s communications office. “With the passage of I-502, we knew we needed to adapt to the changing environment surrounding our reservation and saw an opportunity to diversify our business operations.”

The retail store will be located on Highway 305 adjacent to Longhouse Texaco and is expected to be operational by November, the communications office reported.

According to the Washington State Liquor and Cannabis Board, the state-tribal marijuana compact is a first in the United States. The compact governs the production, processing, purchase and sale of marijuana on the Tribe’s land. The Suquamish Tribe, which as an indigenous nation is sovereign and self-governing, negotiated the compact to be “collaborative and cooperative” with the state, Forsman said in an announcement issued by the state board.

“We believe that our relationship with the state, including this compact, will best serve and protect our tribal community, surrounding neighbors, and residents of the state,” Forsman said.

Under the compact, the Tribe will charge a tax equivalent to the state excise tax on sales to non-Tribal customers on Suquamish lands. All tax revenue collected by the Tribe will be used for Tribal government services. The Suquamish Tribe’s attorney, Rion Ramirez, said the Tribe is free to allocate the revenue as it deems necessary.

The signed compact moves next to Gov. Jay Inslee for approval. Upon final signature, the compact remains in effect for 10 years.

“We believe that working closely with the Suquamish Tribe we can ensure a well-regulated marijuana market that protects the health and safety of Washington State citizens,” board Chairwoman Jane Rushford said in a press release. “This agreement is an excellent model for future compacts.”

On Aug. 29, 2013, the U.S. Department of Justice issued a memorandum setting forth the eight enforcement priorities of the federal government, which emphasized preventing access to marijuana by minors, preventing the criminal element from involvement in the industry, and preventing diversion of product out of state. On Oct. 28, 2014, the Justice Department clarified in a memo that the same priorities should guide federal enforcement priorities in Indian Country.

Suquamish Evergreen Corporation
Ramirez said the retail marijuana business will operate as a separate entity, Suquamish Evergreen Corporation. “Right now, it’s primarily a retail operation, [but] in the future [a grow operation] is a possibility,” he said. He didn’t know if the Tribe had designated an area where marijuana could be grown in the future. “That would be real speculative,” he said.

In an earlier interview, Forsman said voter approval of recreational-marijuana legalization brought the issue to the Tribe’s doorstep.

Legalization presents numerous issues for Tribal governments. If you don’t allow recreational use on Tribal land, how do you enforce your own law in a state where recreational use is legal? Because it’s legal in the state, should a Tribe continue to test potential employees? The Port Gamble S’Klallam Tribe tests; Port Madison Enterprises, the economic development arm of the Suquamish Tribe, does not.

Kelly Sullivan, executive director of the Port Gamble S’Klallam Tribe said the Tribe also tests potential foster parents as part of its licensing. “If they use recreational pot, they would fail our prescreening,” she said.

And, if you allow retail sales, how do you balance that with cultural teachings about alcohol- and drug-free living?

“I think that’s exactly why it hasn’t moved forward [at Port Gamble S’Klallam],” Sullivan said. “So much of our energy is put toward healthy lifestyles. Some Tribal members have a problem with us being in the alcohol and tobacco business at the casino. They think there should be more options for income than this type of thing. So, we’re not going to do something just because we can.”

Some Native Nations are just saying “no.”

The Yakama Nation, population 10,000, has banned the use of marijuana on its 1.2 million acre reservation in central Washington. And as far as the Nation is concerned, marijuana is illegal in its historical territory — 10.8 million acres of ancestral land it ceded to the United States in an 1855 treaty, but where the Yakama people maintain hunting, food-gathering and fishing rights.

Just saying no is likely easier in expansive, rural Yakama than in suburban Suquamish; the Port Madison Indian Reservation is checkerboarded with Native and non-Native property owners, presenting jurisdictional issues for Suquamish authorities. Since the Supreme Court decision in Oliphant v. Suquamish, Tribes have prosecutorial authority only over Native Americans, although they can now prosecute non-Natives for acts of violence against women on Tribal lands.

House Bill 2000 and compacts 
Gov. Inslee signed HB 2000 into law in May, authorizing him to enter into compacts with tribal governments regarding regulation of marijuana businesses, enforcement of law, taxation, dispute resolution, and a few other issues.

Why would a Tribe want to sign a compact with the state? Robert McVay, an attorney with the Seattle-based firm Harris Moure, blogged on the issue on May 18:

“The tribal business would gain access to licensed Washington marijuana businesses. That means that they could potentially wholesale to licensed producers, processors, and retailers,” McVay blogged.

“This is an important consideration, as a lot of tribal land in Washington State is not located in or even near population centers, and those tribes may not be able to support their own retail operations. These tribes that are out in the middle of nowhere could do real business as wholesalers, but would struggle if they needed to generate a lot of foot traffic. Additionally, entering into compacts can be a political move. Tribes can also have gaming and cigarette compacts with the state, and a concession on marijuana may lead to gains in other tribal business ventures.”

Another advantage: Tribal governments can implement a lower tax rate than the state.

“Though there is an exemption for sales to tribal members, tribes entering into the retail market would want to offer lower tax rates to non-tribal members as well, in an effort to encourage customers to go out of their way to purchase from the tribe,” McVay wrote. “Tribes that directly operate retail businesses could maybe avoid the negative implications of this tax by deciding to sell product at a steep discount, as tribal marijuana business income and tribal tax revenue would both ultimately end up benefitting the tribal government.”