The chair of the Alaska Alcohol and Marijuana Control Board is gathering signatures to have Kenai Peninsula Borough vote on outlawing commercial cannabis operations in areas of the borough outside cities. That isn’t sitting well with members of cannabis industry on the peninsula.
Peter Mlynarik is the chief of police in Soldotna, a community that instituted a two-year ban on commercial cannabis activity. He’s also the chair of the state Alcohol and Marijuana Control Board, tasked with regulating the fledging industry created with the passage of Ballot Measure 2 in 2014. And he’s a registered signature gatherer on a voter initiative to ban commercial marijuana in the Kenai Peninsula Borough outside the cities that have legal authority to determine their own rules.
Legally, there’s no problem with the intersection of these rolls. Harriet Milks, legal counsel for the board, has advised that a board member’s participation in political activity, even on issues relevant to the board, doesn’t violate the Alaska Executive Branch Ethics Act. Outside activity only constitutes an ethical violation when a board member would personally — primarily financially — benefit from an issue before the board.
But legal doesn’t mean acceptable to many in the commercial cannabis industry on the Kenai Peninsula. Dollynda Phelps is working toward opening Peace Frog Botanicals in Kenai in October.
“I know from a legal perspective he’s not violating any legal code of any type, but I think, morally, to play both sides is wrong,” Phelps said. “I believe that the chair of a board that’s set to regulate an industry should not on his free time turn around and work against that industry.”
Mlynarik said he wanted to be on the board to help regulate the new industry, particularly with an eye toward public safety.
“Trying to make sure that, as you’re starting this new industry, you keep those kind of matters, the public safety-type issues, in mind as regulations are being crafted, as licenses are being approved or if there’s any enforcement action that needs to be taken,” Mlynarik said.
He said his involvement gathering initiative signatures doesn’t affect his work on the board, nor would his personal opinion of commercial marijuana. In fact, he’s voted to approve every complete license application that’s come before the board.
“You can look at my voting record on the board. And you’ll see that I’m pretty consistent in the way I vote. And I’m not always the most conservative. I didn’t deny any of the licenses that came out on the principle that I did or did not like the establishments. We are there to regulate, and that’s our job for the board,” Mlynarik said.
He said he supports the initiative because Ballot Measure 2 gives municipalities the right to opt out of commercial marijuana if residents so choose. He wants the borough to exercise its right to decide.
“So when people voted for Ballot Measure 2 they also voted to allow local governments the option of whether or not they wanted to opt out. My hope is that people will be allowed to vote on that,” Mlynarik said.
Phelps said she doesn’t question Mlynarik’s right as a citizen to participate in the political process, nor does she say he’s been obstructive to the industry in his work on the board. Her concern is the combination of the two.
“We’re not talking about a conflict of interest being collecting signatures. The intent to work against the industry is the conflict of interest. You cannot work for the industry on a regulatory board and against the industry in your free time,” Phelps said.
Kenai Peninsula Borough Assembly Member Stan Welles is another registered signature gatherer. Phelps isn’t bothered by that, though.
“We all know where Stan Welles stands. He’s not working on one side to regulate an industry, he’s just 100 percent against it,” Phelps said. “Welles being a signature-gatherer was no surprise. I was surprised with Mlynarik, simply because of his role to create a regulated industry.”
She said Mlynarik’s actions erode trust in the board among the business owners who are investing a lot of money to participate in the new industry.
“Denying licenses that are outside (cities) of the borough, some of which have invested hundreds and hundreds upon hundreds of thousands of dollars, who are members of the community, who have children here in our community, who we all own businesses here in our community. Every one of us will be financially burdened by this,” Phelps said.
If the initiative passes, Phelps said it will be a blow to the legal commercial marijuana industry, as well as to public safety.
“Banning only outside of city limits is not going to get rid of commercial cannabis in our area. It’s going to push all the commercial cannabis into the very cities where most of the people that are involved with this don’t want to see it. And not allowing legal, licensed, regulated, inspected facilities, you are absolutely giving all the power back to the black market. The only way to shut down the black market is to support their competition. And the legal market is the only competition for the black market,” Phelps said.
If the initiative petition is approved, the question will appear on the October municipal ballot.