Are 'marijuana resorts' the new tribal casinos?

Get ready for some corny “peace pipe” jokes because Native American tribes are jumping on the weed wagon.

Ever since the U.S. Department of Justice sent out a memo last year giving tribes the green light to legalize marijuana, they’ve been trying to figure out how to prosper from it. FoxBarry, a Kansas company that helped build the first major tribal marijuana grow on a ranch in California, reportedly said that over 100 more tribes have reached out to them. Two Wisconsin tribes, the Menominee and the Ho-Chunk, have announced their plans to move forward with legal weed. And the Santee Sioux tribe in South Dakota caused a recent media stir by announcing it would open America’s first “marijuana resort.”

These tribes are hoping that pot resorts and industrial-sized grows will be the next casinos—or better yet, that selling weed will provide an even bigger economic boost to Native lands than gambling ever has. Despite the estimated $28 billion in revenue that Indian gaming pulled in last year, almost one in four Native Americans still live in poverty. Their median household income is 30% lower than that of the nation as a whole, and the Native American unemployment rate is nearly double that of the rest of the overall population.

Can legal weed do for tribes what gambling has so far been unable to do—ensure prosperity for future generations? “It’s too early to tell, but [legal pot] really could be the turning point,” says Simon Moya-Smith, a culture editor for Indian Country Today and a citizen of the Oglala Dakota Nation. “For all we know, in the next 100 years, Native Americans could be in a far better—or at least more independent—financial situation than we are now, across the board.”

Having a foothold in not one but two markets in which they have a major competitive advantage due to tribal sovereignty could be their economic salvation. Or not. Doubling down on Native American weed businesses could lead down a darker path, to an ongoing legal quagmire and an exacerbation of substance abuse issues.

And what better place for that quagmire to begin than the wild, wild west of weed: California. Just a few weeks ago, that first major tribal grow on the Pinoleville Pomo ranch—the one FoxBarry helped build—was raided by the Mendocino County Sheriff’s Office. They eradicated over 400 plants, which was well over the county limit of 25 plants per lot, as well as a “sophisticated honey oil extraction lab.” Though it’s unclear what the tribe’s intentions were with a grow that massive (to sell it as medicinal marijuana, or only to tribal members, or on the black market), one could easily make the case that the grow was legal under a delicate blend of tribal sovereignty and the state’s murky medical marijuana laws.

Three months earlier, another mind-blowingly massive grow in Alturas owned by two federally recognized Native American tribes was raided by over 100 officers from 12 different agencies, seizing 12,000 plants and over 100 pounds of raw cannabis. This raid points to a primary difference between Native American casinos and weed businesses: the casinos are legal under federal law; marijuana grows are not. So even though tribal sovereignty should shield the tribes from state and local officials, the feds can still stray from that go-ahead memo they sent out, and raid Indian weed businesses at their discretion.

“Raids by non-tribal law enforcement are of disastrous impact to tribal communities,” says Gabe Galanda, a Seattle-based attorney who specializes in tribal affairs. “Tribal sovereignty and territorial autonomy are vitiated and the reverberations are felt throughout the tribe. Civil rights violations against tribal members almost certainly occur in the process. Then costly and time-intensive criminal or civil litigation ensues…”

And if tribal grows are being raided in relatively weed-friendly California, what will happen in non-legal states like South Dakota? “Unless a tribe that legalizes marijuana sits in a state where it is likewise legal, a tribe should stay out of the marijuana business until the state’s laws change,” Galanda says. “A tribe looking to legalize and purvey marijuana absolutely must have the support of state and local government.”

The raids on the California tribes suggest that Galanda is right here: local law enforcement will not always be concerned that they don’t technically have authority on tribal lands. The Santee Sioux seem willing to take that risk, because the potential for profits is so high. But if the initial response from officials surrounding the Santee Sioux reservation is any indication, they might be in for a rude awakening. The state’s Attorney General, Marty Jackley, has issued a statement saying that South Dakota law prohibits marijuana use by non-Indians on reservation lands. Mark Bonrud, the mayor of Flandreau, the city nearest the Santee Sioux, said in an email to the Grand Forks Herald, “We as a city think it is a bad idea. More impaired drivers on our roads and impaired people on our streets.”

It’s not hard to imagine cops setting up drugged-driving roadblocks outside the Santee Sioux reservation. And considering the Attorney General’s statement combined with South Dakota’s draconian laws against marijuana possession, an all-out raid seems the more likely possibility.

Beyond these legal clashes, other Native American communities are wary of compounding existing drug and alcohol problems by legalizing weed. According to Indian Health Services, the rate of alcoholism among Native Americans is six times the national average. With this in mind, the Yakama Nation in Washington state banned marijuana on its reservation and is even trying to block state-regulated pot sales on lands where they hold fishing and hunting rights. And the Hoopa Valley tribe of Northern California has fought a protracted battle against illegal pot grows on its reservation, on the grounds that they’ve already got drug problems and the grows have damaged the environment.

“There is a substance abuse problem on many reservations,” says Moya-Smith. “They don’t want to bring another substance onto the reservation. Even though you would regulate it like you would alcohol, they’re still just like, ‘We haven’t even dealt with the alcohol problem on the reservation yet.’”

But the Santee Sioux are trying to stay a step ahead of this argument. Their representatives claim that the proceeds from the marijuana resort will be used to establish a tribally owned treatment center for alcoholism and drug addiction, which they concede are already problems on their reservation. This approach is similar to that of the state of Colorado, which is using a large percentage of its marijuana tax revenues toward drug treatment. But in both cases, a cynic might argue that these programs are creating a vicious cycle by merely acknowledging a drug problem that they’re simultaneously perpetuating.

So where is this all headed? Sorry to be a buzzkill, but most likely…to the courts.

In the past, high-stakes Native American bingo operations in states like California and Wisconsin led to the contention by state governments that bingo was dipping into their own gaming profits. The ensuing legal war ultimately led to the controversial Indian Gaming Regulatory Act (IGRA) that now regulates Native American casinos.

Considering how many Native American tribes—and lawyers—are now seeing green, it’s a matter of time before a battle royal between states and tribes reach the highest courts of the land…all over a simple plant.

Ryan Nerz is the host of “The Cannabusiness Report” and the author of two books about American subcultures: “Eat This Book” (competitive eating) and “MARIJUANAMERICA” (weed culture). He lives in Miami.