WAITING FOR THE SMOKE TO CLEAR: THE COMPLICATED BEGINNINGS AND PROMISING FUTURE OF TRIBAL CANNABIS.

• Author: Florey, Katherine

1. INTRODUCTION

   In December 2014, when the Obama administration first indicated that its hands-off marijuana policy would apply to tribes as well as states,' much of Indian Country celebrated. (2) A cannabis law blog called this action a "financial boon" for tribes and noted that "[t]he possibilities for Native American Tribes in the cannabis industry are vast." (3) Tribes too remote for gaming operations to be feasible expressed hope that cannabis operation could provide a similar--or even a greater--boost to economic development. (4) A conference in Washington State about cannabis legalization attracted some seventy-five tribes, (5) and some tribal leaders were "swarmed by tribal members demanding that marijuana be immediately legalized." (6) Even in areas where marijuana remained prohibited at the state level, tribes sought to develop their own cannabis operations; the Flandreau Santec Sioux Tribe ("FSST"), for example, planned both a grow facility and a marijuana-centered resort to attract tourists. (7)

   Nearly seven years after the Obama administration's action, cannabis has become a fast-expanding industry, bringing in $17.5 billion in legal sales in 2020. (8) As of November 2021, all but four states have legalized or decriminalized the use of at least some cannabis products, and cannabis is fully legal in eighteen states and the District of Columbia. (9) In legal states, excise taxes on cannabis have bolstered state treasuries, bringing in $526 million in California and $469 million in Washington in the fiscal year 2020. (10)

   For some tribes too, the cannabis boom paid off relatively quickly." Other tribes have deliberately opted to remain on the cannabis sidelines due to concerns that public health or other negative consequences are not worth the potential economic gain. (12) For many tribes that were eager to move forward, however, early efforts proved more complicated than expected. (13) The fate of the FSST's marijuana resort illustrates some of tribes' early struggles: despite initial progress in building a grow facility, planting crops, and beginning work on a planned smoking lounge, the tribe encountered unexpected resistance from the surrounding state of South Dakota's attorney general, who threatened to prosecute nonmembers who visited the tribe's facilities. (14) After federal authorities warned of a raid if the tribe continued with its plans, the tribe was forced to suspend the project, burning existing crops in order to demonstrate good faith. (15) Other early efforts by tribes to enter the marijuana and hemp industry likewise were met with threats and raids. (16)

   Even where tribal cannabis policy is in sync with that of surrounding states, tribes have faced regulatory and market challenges. (17) In California, where medical cannabis has been legal since 1996, voters legalized recreational cannabis by ballot proposition in 2016. (18) The state spent the next year developing a complex regulation and taxation scheme, with adult-use cannabis sales beginning in 2018. (19) Since that time, California officials have generally not attempted to interfere with tribal efforts to grow and sell cannabis products on reservations. (20) But California's planning has taken little account of tribal interests, and California has not permitted tribes to enter the lucrative state market on their own terms, instead insisting they can do so only if they obtain a state license and waive their sovereign immunity. (21) While a handful of California tribes have developed innovative workarounds, (22) the state's intransigence has nonetheless put a damper on tribal efforts. (23)

   Yet despite these rocky beginnings, there are nonetheless recent signs that tribal cannabis efforts are on the upswing. (24) After its setback in 2015, (25) the FSST opened a medical marijuana dispensary in 2021, the first one to operate within South Dakota following the state's legalization of cannabis via ballot proposition in 2020 and subsequent legal wrangles. (26) In numerous other states, from Michigan (27) to Washington (28) to Nevada, (29) tribes have opened successful dispensaries. In some cases, tribes have acted after negotiations with surrounding states; (30) in others, they have forged ahead on their own. (31)

   These recent successes suggest that cannabis may yet prove to be a source of major economic gains for tribes positioned to take advantage of it. (32) As the prospects for popular acceptance and federal toleration of cannabis grow, tribes may find that the path to legalization and commercial success is becoming smoother. (33) At the same time, tribes' varied experiences to date highlight the importance of respect by federal and especially state authorities for tribal self-determination in setting cannabis policy. (34)

   This article reflects on some of the factors that caused tribal cannabis operations to move more slowly than anticipated, while also considering the brightening prospects for the future. It discusses two principal difficulties that hindered tribes' early efforts--in Part II, the special legal ambiguities that tribes have faced, and in Part III, the resistance by states to tribes' sovereign efforts to chart their own course in cannabis policy. This article concludes by arguing that both the growing acceptance of cannabis nationally and the pathbreaking efforts by tribes in surmounting early challenges suggest that the future of tribal cannabis looks much brighter than the tribal experience of the past several years might suggest.

2. THE UNCERTAIN LEGAL LANDSCAPE

   Although Supreme Court decisions over the past few decades have narrowed tribal sovereignty in some respects, particularly as applied to nonmembers, tribes remain independent sovereigns with most accompanying powers, especially when it comes to their own members. (35) In theory, tribes have the power to make fundamental decisions about whether and how to legalize cannabis, free from state involvement and subject only to federal law. (36) As a result, the Justice Department's decision to deprioritize enforcement of federal cannabis law in most circumstances should have brought tribes the same freedom to experiment with cannabis legalization that states have begun to exercise. (37)

   At the same time, tribes faced legal obstacles in the cannabis arena that states did not. (38) Perhaps most important, the exact contours of tribal sovereignty as applied to nonmembcrs are quite uncertain. (39) Because the viability of most tribal cannabis enterprises depends on sales to nonmembers to some degree, tribes have faced a climate of legal uncertainty and threats that have been difficult for many tribes with limited resources to weather. (40)

   Famously, in the foundational 1832 case of Worcester v. Georgia, (41) the Court described tribes as "distinct communit[ies], occupying [their] own territory," in which state law "can have no force." (42) Although the Court has never entirely repudiated those views, cases in recent decades have significantly undermined them. (43) In 1978, in one of a series of decisions that would weaken tribal autonomy over nonmembers, the Court decided Oliphant v. Suquamish Indian Tribe (44) which held that tribes lacked criminal authority over non-Indians. (45)

   Oliphant, as well as the decisions and congressional actions that followed it, led to a complicated patchwork of rules in the criminal arena. (46) Tribes have criminal powers over Indians (47) in Indian Country. (48) Other than the few states earlier that were granted criminal jurisdiction in Indian Country under Public Law 280 ("P.L. 280"), states do not have any criminal authority over Indian Country crimes involving Indians (49) but can prosecute crimes involving only non-Indians whether they occur within or outside Indian Country. (50) It is currently unclear whether states may prosecute victimless crimes by non-Indians--arguably including cannabis-related offenses--although some have tried. (51) The federal government also possesses some criminal authority over certain Indian Country crimes, (52) sometimes concurrently with tribes. (53)

   This scheme is a little different in states that have opted into P.L. 280, a 1953 law that granted several states the ability to assume criminal jurisdiction in Indian Country if they wished, with no requirement of tribal consent. (54) Among states that were early legalizers of cannabis, California, Oregon, and (to a lesser extent) Washington possess powers under P.L. 280. (55) In yet another area of unpredictability, states' powers under P.L. 280 are murky when it comes to laws that fall on the borderline between civil regulatory laws (which P.L. 280 states have no power to enforce in Indian Country) and criminal prohibitory laws (which states may enforce) under the scheme put forth by the Supreme Court in California v. Cabazon Band of Mission Indians ("Cabazon Band"). (56) This distinction is "not a bright-line rule" (57) and often hinges on how much of a given activity is prohibited under state law, which in turn is dependent on how the activity is defined. (58) Because a state may, for example, maintain a general prohibition on cannabis but decriminalize it for certain purposes or legalize a very narrow category of use, the Cabazon Band test may be particularly tricky to apply in this arena. (59)

   Mapping the outer limits of tribal civil authority may also be difficult. Tribes are subject to most federal law (60) but otherwise have broad authority to regulate the on-reservation (and perhaps some off-reservation) activities of tribal members. (61) Over the past few decades, however, the Supreme Court has sharply limited tribes' civil authority over nonmcmbers, although there are signs that the trend may, at last, be abating or reversing. (62) Under Montana v. United States, (63) tribes have authority over nonmember activity on private land only if one of two fairly narrow exceptions is met--either the nonmember has formed a ''consensual...