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How to open a dispensary in Alaska

How to Open a Dispensary in Alaska

Overview

How to open a dispensary in Alaska is a question that many aspiring entrepreneurs in the cannabis industry are asking. Alaska’s progressive stance on cannabis regulation provides a favorable environment for those looking to enter this dynamic market. However, the journey to opening a successful dispensary is complex and requires a thorough understanding of state laws and regulations.

Alaska’s cannabis industry has been steadily growing since the state legalized recreational marijuana in 2014, building on the legalization of medical marijuana in 1998. This dual legalization framework allows for both medical and recreational cannabis use, creating a diverse and robust market.

This guide offers a comprehensive overview for aspiring dispensary owners considering opening a retail marijuana store in Alaska. Although the term “dispensary” is common in other states, Alaska officially refers to these businesses as retail marijuana stores. For clarity, both terms may be used interchangeably in this guide, but remember to use the official terminology when applying for licenses and following state regulations.

The Opportunity Size

According to a forecast by Statista, marijuana sales in Alaska are projected to reach approximately 138 million U.S. dollars by 2025. This estimate highlights the significant growth potential in the state’s cannabis market, reflecting increasing consumer demand and the expanding legal framework supporting the industry.

Local Cannabis Restrictions & Laws

Local governments in Alaska have the authority to prohibit commercial marijuana establishments through either an ordinance or a petition election. Here is a spreadsheet showing which communities have opted out. 

Medical Marijuana Legalization

Alaska’s journey towards medical marijuana legalization began in the early 1970s. In 1972, voters decriminalized possession of small amounts of marijuana for personal use. However, in 1990, this stance was reversed when an initiative criminalized possession once again. The significant change came with Ballot Measure 8 in November 1998, when voters approved the legalization of medical marijuana for patients with specific debilitating medical conditions, including cancer, glaucoma, HIV/AIDS, and chronic pain. This measure allowed patients and their primary caregivers to possess up to one ounce of marijuana and cultivate up to six plants, with only three being mature and flowering.

Recreational Use Legalization

The legalization of recreational marijuana in Alaska was marked by the approval of Ballot Measure 2 in November 2014. This measure legalized the recreational use of marijuana for adults aged 21 and over, allowing them to possess up to one ounce of marijuana and cultivate up to six plants, with only three being mature. The law took effect on February 24, 2015. In 2015, the Marijuana Control Board was established to create regulations for the new recreational marijuana industry. By November 2015, the board had adopted regulations covering licensing, cultivation, product manufacturing, testing, and retail sales. The licensing process began in 2016, with the first recreational marijuana retail stores opening in October of that year. Since then, the Marijuana Control Board has continued to refine and update regulations to ensure the safe and effective operation of the marijuana industry in Alaska. Notably, in 2019, Alaska became the first state to allow on-site consumption of marijuana at approved retail stores.

Recreational Cannabis Program Opportunities

The Marijuana Control Board has no limit on the number of marijuana licenses it can issue at the state level. However, local governments may impose restrictions on the time, place, manner, and number of licenses. Check with your local government for any such limitations.

Applications can be submitted at any time, as there is no deadline. The Marijuana Control Board accepts applications throughout the year and reviews them during its regularly scheduled meetings.

Adult-Use Cannabis License Types

  • Retail Marijuana Store: A Retail Marijuana Store license allows the holder to sell marijuana and marijuana products directly to consumers.
  • Standard Cultivation Facility: A Standard Cultivation Facility license permits the holder to cultivate, process, and package marijuana. 
  • Limited Cultivation Facility: A Limited Cultivation Facility license is for smaller-scale marijuana cultivation. These facilities are limited in the number of plants they can grow and the amount of cannabis they can produce. 
  • Marijuana Product Manufacturing Facility: A Marijuana Product Manufacturing Facility license allows the holder to produce marijuana-infused products. 
  • Marijuana Concentrate Manufacturing Facility: A Marijuana Concentrate Manufacturing Facility license permits the holder to produce marijuana concentrates. 
  • Testing Facility: A Testing Facility license is for businesses that conduct quality assurance tests on marijuana and marijuana products. 

Application Process for a Dispensary License in Alaska

Opening a cannabis retail store in Alaska involves a series of steps regulated by the Alaska Marijuana Control Board and the Alcohol and Marijuana Control Office (AMCO). Here is a comprehensive guide to help you navigate the process.

Preliminary Steps

Review of Laws and Resources:

Preparing Your Application

  1. Online Application: Initiate your license application online. Ensure you have a current Alaska business license, a physical location with GPS coordinates, personal information for all proposed licensees, and a designated owner.
  2. Form MJ-00: Application Certifications: Each proposed licensee must certify the truthfulness and completeness of the application.
  3. Form MJ-01: Marijuana Establishment Operating Plan: Detail how the premises will comply with security, inventory tracking, employee qualifications, transportation, signage, and control plans.
  4. Form MJ-02: Premises Diagram: Submit a detailed diagram of the premises showing all entrances, boundaries, restricted areas, storage, and dimensions.
  5. Form MJ-07: Public Notice Posting Affidavit: Post a public notice at the proposed premises and another conspicuous location for 10 days.
  6. Form MJ-08: Local Government Notice Affidavit: Notify the local government and any community councils of your application.
  7. Publisher’s Affidavit: Publish an announcement in a local newspaper or broadcast on a radio station for three consecutive weeks.
  8. Form MJ-09: Statement of Financial Interest: Declare any direct or indirect financial interest in the business.
  9. Proof of Possession for Proposed Premises: Provide documentation (title, deed, lease) showing your right to the premises.
  10. Entity Documents: If applying as an entity, submit partnership agreements, operating agreements, articles of incorporation, etc.
  11. Fingerprint Cards and Fees: Submit fingerprint cards and fees for each proposed licensee.
  12. New Application Fee: Pay the $1,000 non-refundable application fee.

Requirements to Get a Retail License in Alaska

In addition to the requirements mentioned above, here are the specific requirements for retail marijuana stores:

  • Form MJ-03: Retail Marijuana Store Operating Plan Supplemental.
  • Food Safety Permit from the Department of Environmental Conservation or the Municipality of Anchorage’s Department of Health and Human Services.
  • License Fee: $5,000.

Submission and Review

Initial Submission:

  • Submit your initial online application and the three documents it generates: Cover Sheet, Public Notice, and Advertising Notice.
  • Attach the Cover Sheet to every set of supplemental documents submitted to AMCO.

Compliance and Verification:

  • Ensure that all forms are completed, signed, and notarized as required.
  • Schedule and pass an initial premises inspection to verify that the submitted premises diagram matches the actual premises.

Final Steps

Board Review:

  • The Alaska Marijuana Control Board reviews the complete application during its scheduled meetings.
  • Any amendments to the operating plan or premises diagram must be submitted prior to the board review, or accompanied by a $250 fee if submitted later.

Licensing:

For more information, you can check the Marijuana Establishment License Application Instructions.  

How Much Does It Cost to Open a Dispensary in Alaska?

Opening a retail dispensary in Alaska involves several fees. Here are some of the initial fees you can expect:

 

Expense Description

Fee

New Application Fee

$1,000

Fingerprint Fee (per person)

$48.25

Retail Marijuana Store License Fee

$5,000

Location and Zoning

To obtain a license for your cannabis retail store in Alaska, securing a specific physical location is essential, as all licenses are premises-based. You must demonstrate the right to possess the property, including a lease or rental agreement if you do not own it. Proper documentation will streamline the application process and avoid delays.

Zoning regulations in Alaska are primarily local, except for buffer zones. The Marijuana Control Board issues licenses only for locations permitted by local governments. Therefore, confirm that your chosen location complies with local zoning laws by contacting your local government, as the Alcohol and Marijuana Control Office (AMCO) does not provide zoning advice.

Financing Your Cannabis Dispensary

Starting a marijuana business involves careful planning, especially when raising capital. It is essential to understand both state and federal securities laws, as offering securities to investors is regulated. Consulting a professional experienced in securities transactions is highly recommended to navigate these complexities.

Before meeting specific securities law requirements, you cannot advertise for investors through print media, websites, social media, or online classifieds. Failure to comply with these laws can lead to civil liability and financial penalties.

To ensure you adhere to all regulations and mitigate risks, contact the Division of Banking and Securities for guidance and information.

Final Thoughts

In the upcoming weeks and throughout 2024, we expect developments in the cannabis landscape of Alaska. By joining our Alaska Cannabis Mailing List (below), you’ll receive updates on all relevant news, including hard-to-find information and insights on the Alaska cannabis industry. This includes but is not limited to:

  • What special programs will be available? 
  • Are there any funding or grant opportunities for cannabis businesses in Alaska?
  • And more

 

Simply fill out the information below to stay informed.

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