By Mark Goldfogel

You may soon have more than one way to experience fireworks by visiting your local Indian Reservation.

The U.S. Department of Justice recently announced that it will not pursue cannabis growers or sellers on tribal lands if they follow the same guidelines laid out for state governments.

This is another step in the systematic dismantling of cannabis prohibition. And like most steps, it comes in the form of an innocuous and ambiguous memo from the Justice Department.

Most of the country’s 566 Indian tribes were perplexed by this recent permission, as they had not asked for it, according to Oregon U.S. Attorney Amanda Marshall. She said that the Justice Department policy addresses questions raised by three tribes about how legalization of pot in states like Oregon, Washington and Colorado would apply to Indian lands.

A modern version of ‘Smokey and the Bandit?”

It would seem we are quickly approaching the modern version of “Smokey and the Bandit,” where cannabis will be purchased in legal communities and then transported to non-legal ones.

While cannabis diversion is illegal, it is very difficult to enforce. As cannabis legalization becomes more widespread, this will force the issue on a national level. Right now, some people transport tobacco and fireworks from tribal lands, which are not subject to the same federal, state, or local taxes or restrictions.

A major problem in the legal cannabis industry is finding local zoning ordinances which meets the requirements for indoor horticulture.

“Tribes might adhere to state regulatory guidelines on marijuana, but they are sovereign and therefore are not subject to challenges associated with municipal zoning, permitting and related taxes”, says Ehren Richardson, a consultant at the accounting firm JOSEPH EVE.

He added: “We serve over 120 tribes each year, and for tribes in the Pacific Northwest, this topic has been on their radar for some time. Tribal involvement in cannabis could create new opportunities for consultants, vendors, processors, and retailers.”

In a press release issued Jan. 6, United Cannabis, a publicly traded Colorado marijuana firm that grows proprietary strains and that is applying for patents, announced that it would be teaming up with Foxbarry Companies of Kansas City to look at three separate tribal cannabis cultivation partnerships on California reservations – one in the northern part of the state, one in the south, and one in the center.

Tax exemption as well as sovereign land issues are potentially big factors in how tribes could further accelerate the industry, driving down prices for product and providing more retail purchase locations.

This move also potentially opens another loophole to help address the biggest problem in the cannabis industry — banking.

Tribal banks are not governed by rules as state and federally chartered banks and credit unions are. Does this new lenient approach to cannabis on tribal lands open up tribal financial institutions? It’s probably too early to tell.

All of these reductions in enforcement from the Federal Government leave little doubt that the United States is methodically dismantling their drug war and anti-cannabis policies.

One other thing to note, however: Most tribes in the U.S. do not seem eager to bring another recreational drug onto their land. Alcoholism and unemployment are higher on reservations than most tribes would like.

But, the marijuana gold rush might provide the economic stimulus and jobs desperately needed on tribal lands, and market demand and bureaucratic obstacles provide fertile soil for this new industry to blossom there.

About the Author

Mark Goldfogel is a founder of C4EverSystems, a cash handling kiosk guaranteed to meet banking compliance guidelines for cannabis transactions, and was a co-founder of MJ Freeway, the popular point of sale software for cannabis businesses, guaranteed to meet government compliance regulations for cannabis. He held management positions at ADP and John Deere. You can reach him at [email protected].