Small Indian tribe plans Midwest’s first grow-processing-retail cannabis business

Bay Mills Indian Community, a small tribe of about 2,200 members located near Sault Ste. Marie in Michigan’s upper peninsula, announced plans yesterday to build a cannabis grow facility, processing, and dispensary all in one location, with operations starting this fall. The all-in-one location, branded Northern Lights, would be the first of its kind west of the Mississippi. Initially, retail sales would be limited to visitors on tribal lands.

“We’ve partnered with a Michigan-based cannabis company, Soil to Smoke. They are the expertise coming in to refine what we have in place and to teach us what we don’t already know,” said tribal attorney Whitney Gravelle.

Bay Mills’ plans have been long underway, says Gravelle. Since the tribe legalized cannabis on tribal lands in April 2019, there have been internal discussions about how to best take advantage of Michigan’s legalization of recreational cannabis. For over a year the tribe, a sovereign nation by treaty with the United States, has been seeking a compact with Michigan’s Marijuana Regulation Agency (MRA) to sync up regulations. Frustrated with their lack of progress with state bureaucrats, Bay Mills decided to go it alone.

“It’s been more of a long time anticipated approach that we finally had to move forward on because we’re not getting anywhere with our conversations with the State of Michigan,” said Gravelle, who claims the tribe missed out on multiple potential business opportunities since they could not create a compact with the state. Without a compact, cannabis companies operating in Michigan did not want to risk aggravating MRA officials, so they broke off talks with Bay Mills, says Gravelle. 

Bay Mills already operates a number of businesses, including a resort and casino on Lake Superior and a farm operated by the tribe’s community college that includes a hemp growing pilot program run in conjunction with Michigan State University.

“Grow operations would include upwards of 12,000 to 15,000 square feet of [indoor] grow operations. That would be a phased approach. We’ll start with about half of it, and as our capacity goes, we’ll add on more,” said Gravelle. “We’re also looking at 110 acres of land [surrounding the indoor site.] We do envision product grown outside.”

Because the tribe is building a unified grow, processing, and retail location, Bay Mills is counting on significant efficiencies, not to mention a lack of Michigan taxes, which can add up to 16 percent for recreational cannabis. Eventually, if Bay Mills finds other tribes interested in selling their cannabis products, it’s possible they would license it for sale on other tribal lands, but sales off-lands are not under consideration.

Bay Mills will not use Michigan’s seed to sale tracking system, Metrc, but otherwise it is working to align tribal laws and regulations with Michigan. 

“We’re not trying to create any jurisdictional issues with what you can sell within the Michigan market. For instance, I think in the state you can have 2.5 ounces on person. That is what the tribe will adopt as well. When it comes to quality control and safety we plan to mirror Michigan,” said Gravelle.

In contrast to Bay Mills, other Michigan tribes have chosen to merely lease land to already operating Michigan cannabis companies, citing the risk of getting into a complex new business as well as the possibility of aggravating Michigan and federal agencies that don’t look kindly on tribes entering the cannabis business. Gravelle brushes those concerns aside.

“I think what a lot of what Bay Mills is doing comes down to tribal sovereignty. We are a sovereign government that can rule itself. Through that sovereignty we are engaging in cannabis. That is why we are moving forward essentially,” said Gravelle. “It’s how you make laws for your people.”