Petersburg officials are making progress on coming up with a new local law regulating marijuana businesses in the borough. Local leaders will base the new proposed law on Petersburg’s existing liquor ordinance.
Borough staff started drafting a local pot business ordinance this winter, and initially started using language from laws drafted in other Alaska municipalities. Borough manager Steve Giesbrecht called that first attempt “a mess” and said he came up with a simpler way.

“After going through our attorney’s recommendations and looking through it, we needed to find a way to simplify things,” Giesbrecht said. “I actually took our current alcohol ordinance, used that as a base, and made some minor changes to it to add the marijuana thing to it. And it worked much much better for the attorney and we ended up with something that’s a lot closer to being, meets the needs of the borough.”

Giesbrecht told the assembly this month that he wanted to keep the local ordinance as simple as possible and let the state’s newly adopted regulations be the driver for local law enforcement. As a result, staff have added in definitions to the local liquor law and a few other new provisions for pot businesses.
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As proposed, there are a few differences in what would be allowed for alcohol and pot businesses in the borough, mainly because of the differences the state requires between the two. For instance, teenagers, 16-20 years old can be in a business licensed for alcohol in some circumstances and can even work at a hotel or restaurant licensed for liquor as long as they’re not serving booze. That wouldn’t be the case with pot – no one under 21 would be allowed to work in or even enter a pot business.

Petersburg’s liquor law doesn’t allow sale of booze in the wee hours, from 2 a.m. to 8 a.m. on weekdays and from 3 a.m. to noon on Sundays. However, restaurants can serve alcohol starting at 10 a.m. Sundays. Those could be the same hours for retail pot businesses although Giesbrecht asked the borough if they wanted different hours of operation for pot sales. He also wanted to know if onsite use of pot would be allowed for customers at retail businesses.

In all, the manager came up with a total of six questions for the assembly to consider as it fine tuned the local law. “Should the borough have a separate local license for marijuana facilities,” Giesbrecht wondered. “What this is about, the state is doing licensing now. Do you want the borough to get into the licensing business? I’ll be honest with you I recommend you don’t. It’s just an extra level of administration and hassle. We don’t currently license businesses. We have a sales tax registration. This would actually create a whole ‘nother set of bureaucracy, where we’d have to…the advantage is you might collect some revenue off it but I don’t think it’s a significant amount.”

Geisbrecht also wanted to know if the borough would allow a pot business on borough owned property. He said if the assembly decided no on that one it would rule out any borough-run pot business and also rule out businesses on property leased by the municipality.
Other questions were whether there should be any local limit on number of pot business permits and whether the borough should restrict any of the four types of businesses for cultivation, manufacturing, testing and retail sales of pot.

The manager told the assembly that Petersburg’s attorney told him the assembly wouldn’t be able to institute an excise tax without putting that question to local voters. “So at this point, borough revenue if something was to open up would be purely sales tax,” he said. “And then any revenue sharing that the state may choose to share down the road.”

Early reviews from the mayor and borough assembly were positive although they wanted to wait to hear more information and input on the issue. “My personal opinion is looking at the way you mirrored the marijuana or connected the marijuana ordinance to the liquor ordinance it looked like it would work for me anyway,” said mayor Mark Jensen.

Nancy Strand thought the state has regulated the pot industry enough. “If we were to add a fee, the black market would continue pretty much like it is. Everybody who applies for a permit should be allowed because the state has pretty much put the kibosh on it. If one thing doesn’t work, something else will.”

Giesbrecht agreed to post the six questions on the borough’s website and the assembly agreed to make decisions on those questions once the ordinance is up for three readings sometime this year.

There’s a video on the state Marijuana Control Board’s website to help potential businesses through the state’s license application process. The state has started accepting applications but doesn’t expect to begin issuing the first licenses until later this year.