Montana Legislature passes bill to allow tribes to enter into cannabis compacts

Yahoo

28-04-2025

Kaiden Forman-Webster ICT + Montana Free Press
Though House Bill 952 is only two pages long, it has the potential to have major impacts on Montana tribes, according to those who advocated for its passage.
Sponsored by Rep. Frank Smith, D-Poplar, Sioux, the bill was requested by the State-Tribal Relations Interim Committee to help tribes navigate barriers in entering and engaging in the cannabis industry. It cleared the Legislature earlier this month, getting support from most Democratic legislators and enough majority Republicans to pass.
This is Smith's last year as a legislator before retirement. He was first elected in 1999 and is one of the longest-serving current members. During a recent Montana American Indian Caucus meeting, Smith was wished a happy retirement and congratulated for ending with what members called such an impactful bill.
Many of the challenges tribes face in growing and selling marijuana stem from past legislation. House Bill 701, a 153-page bill that became law in 2021, established laws to regulate newly legalized recreational cannabis. The bill placed major constrictions on tribes in regards to cannabis regulations.
HB 701 created three major hurdles for tribes when it was enacted. First, it only allowed for one combined-use marijuana licence per tribe, meaning each tribe could only have one location for growing, packaging, distributing and selling cannabis. Second, it restricted tribes to a single-tier canopy licence, meaning a tribe's dispensary and the growing operation must consist in a maximum of a single 1,000-square-foot building. Third, it required tribes to build dispensaries at least 150 miles outside of reservation boundaries and in a 'green county' that allows the sale of cannabis, essentially restricting tribes to operate in highly saturated markets, an issue raised by Patrick Yawakie, co-founder of Red Medicine, LLC, an organization that provides professional civic engagement and lobbying services to tribes.
Yawakie said this year's HB 952 will address many of those barriers. He helped draft the bill and said its language was mainly pulled from the Washington state-tribal cannabis compact, which allows Washington tribes and the state enter into agreements to regulate and define cannabis operations within their reservations. Twenty-two out of the 29 federally recognized tribes in Washington have compacts with the state and more are in the process.
HB 952 will allow for Montana tribes and the governor's office to create and enter into compacts to regulate cannabis on individual reservations. Each compact would be tailored to the tribes' unique needs. In the agreements, tribes and the governor's office can negotiate things like tax revenue deals for the state and tribes, whether a dispensary can operate on a reservation and how much cannabis tribes can grow and sell, among other things.
None of the many regulatory guidelines outlined in the bill would be required. Instead, Yawakie said that the guidelines and the bill itself offer a roadmap for tribes to use as sovereign governments navigating the cannabis industry.
'House Bill 952 is a proactive way to address tribal operations and other topics in partnership through intergovernmental relations,' Yawakie said while testifying as a proponent of the bill when it was heard in an April 4 meeting of the House Energy, Technology and Federal Relations Committee. He elaborated that these cannabis compacts are similar to tribal gaming compacts in language and organization. The compacts, he said, create a strong and well-structured system, unique to each tribe and their needs.
Proponents of the bill have echoed Yawakie's sentiment, saying some tribes may decide to stay out of the industry and enter a compact to mitigate cannabis use on reservations and address jurisdictional issues. Other tribes may use the opportunity as a way to promote economic growth and independence, they said.
Sen. Gayle Lammers, R-Hardin, who carried the bill on the Senate floor, called it a 'cleanup bill,' stating that tribes were not involved in the legislative process four years ago.
'Not all tribes have recognized legalization but they are noticing that oversaturation of non-tribal-owned dispensaries located in and near of their borders. This has led to products getting into the hands of youths, promoting black markets that could be stopped through the agreements included in HB 952,' Lammers told the Senate on April 17. 'It is pro-business, pro-revenue, pro-collaboration, pro-law enforcement legislation.'
Multiple senators stood to speak in opposition of the bill, notably Sen. Barry Usher, R-Laurel, and Senate Majority Leader Tom McGillvray, R-Billings.
Usher disputed Lammers' characterization of the bill.
'This is nowhere near a cleanup bill, a cleanup bill is not this extensive,' Usher said, adding that there are already cannabis dispensaries on reservations owned by non-Natives and that there is already 'plenty of marijuana' on reservations. He said that if the issue was only regarding tax revenue agreements, the Senate should leave the law as is.
Sen. Jonathan Windy Boy, D-Box Elder, Chippewa Cree, took issue with Usher's comments. He said while there are non-Indian dispensaries on the Fort Peck Indian Reservation, the tribes have no means to regulate them.
'There is no agreement and there has been some hiccups as far as the tribe not being able to hold these dispensaries accountable,' Windy Boy said. 'And [non-Indian dispensaries] say, 'Get out of here, mind your own business.''
McGillvray argued that revenue collected from cannabis sales is outweighed by the societal costs of marijuana use.
McGillvray then took issue with reservations legalizing cannabis, saying marijuana use would propel Native youth to illegal drug use.
Sen. Greg Hertz, R-Polson, who lives on the Flathead Reservation, addressed issues raised by his side of the aisle.
'If you live on a reservation, state cannot legally charge taxes there [on tribal members],' Hertz said. 'That is why we have entered into compacts between the state and the tribes so we do not have unfair competition.'
Hertz continued, saying he felt that compacts between tribes and the state would help ensure state and federal laws are followed.
In an interview with Montana Free Press and ICT, Yawakie said compacts are needed 'not just to combat access to cannabis within reservations that want to set some limits. But also, there's tribes in the state that are wanting to move forward with manufacturing or processing, testing, distribution, so that there's an opportunity for them or clarity whenever they come to the table with the state to maintain compliance with state regulations.'
This story is co-published by Montana Free Press and ICT, a news partnership that covers the Montana American Indian Caucus during the state's 2025 legislative session