How to Open a Dispensary in Alaska

How to Open a Dispensary in Alaska in 2024

To open a cannabis dispensary in Alaska, a business entity must first obtain a retail marijuana store license. Applications for dispensary licenses must be submitted online to the Alcohol and Marijuana Control Office (AMCO) and can take up to six months to be approved. Municipalities in Alaska are allowed to opt out of granting operating permits to cannabis businesses, including dispensaries. Hence, it is important to find out whether the municipality where you intend to open a dispensary allows marijuana businesses.

Why Open a Dispensary in Alaska?

Alaska has a huge cannabis market because it has legalized both recreational and medical cannabis. According to a Marijuana Tax Annual Report Data by the Alaska Department of Revenue, in 2019, the state generated $18.80 million in cannabis tax. In 2020, the tax revenue collected from marijuana stood at $23.8 million, and in 2021, it was $29.6 million. Although there was a slight decrease in the amount of marijuana tax generated in 2022 ($28.3 million), the trend between 2019 and 2022 shows a consistent increase in demand for cannabis products.

In 2022, there were over 150 licensed cannabis dispensaries in Alaska, making it one of the states with the highest number of dispensaries. It is obvious that Alaska presents a promising business environment for cannabis dispensaries.

Types of Dispensary Licenses in Alaska

Alaska issues a retail marijuana store license to dispensaries operating in the state.

How to Get an Alaska Dispensary License

• Applicants must initiate the application process electronically on the website of the Alcohol and Marijuana Control Office
• Select the option to "Initiate Marijuana License" and create an account
• Applications must include fingerprint cards for all individuals listed in connection with the business entity applying for the license
• After all required documents have been uploaded online, the application portal will automatically produce a Public Notice, a Cover Sheet, and an Advertising Notice for use by the applicant
• The Cover Sheet must accompany every supplemental document required for the application
• The applicant must notify the public of their intent to open a cannabis dispensary by placing a public notice on the proposed dispensary premises for 10 days. The notice must also be placed at a public building such as a post office, city hall, or grocery store
• Applicants must also place public notices once a week for a three-week period in newspapers circulating in the locality where the dispensary will be located. If there is no local newspaper, the public notice can be placed on radio twice a week for a three-week period
• Public notices must be placed within 90 days of initiating the application process

The Alcohol and Marijuana Control Office is responsible for licensing cannabis dispensaries in Alaska. Applications for dispensary licenses in Alaska are accepted on a rolling basis. The state does not limit the number of dispensary licenses that can be issued.

Information and Documents Required for a Dispensary License in Alaska

Dispensary license applications in Alaska must be accompanied by the following documents and information:

• Application forms providing
• The applicant's name, if the applicant is an individual
• The applicant's business name
• The business license number
• The applicant's mailing address
• The names, mailing addresses, and telephone numbers of individuals with financial stakes in the business entity
• The address of the proposed dispensary location, including its GPS coordinates
• Ownership or lease documents relating to the proposed dispensary premises
• ID cards such as U.S. passports or state-issued driver's licenses
• Business plans
• Passport-size photographs
• Background checks
• Business entity documents
• Inventory control plans
• Marijuana Establishment Operating Plan
• Local Government Notice Affidavit
• Financial statements on Form MJ-09
• Patient care plans
• Proof of possession for the proposed location
• Publisher's Affidavit
• Premises Diagram
• Tax compliance documents
• Labor and employment documents
• Fingerprint cards
• Fingerprint fees
• Food Safety Permit

What Plans Do You Need to Open a Dispensary in Alaska?

It is important to draw up a business plan before applying for a dispensary license and opening a dispensary in Alaska. A business plan will outline the unique selling proposition of a proposed dispensary. It will also include such details as financial projections, product range, and marketing plans.

Alaska requires a retail marijuana store license applicant to submit a Marijuana Establishment Operating Plan and a Premises Diagram. The operating plan should include a breakdown of the following:

• Inventory tracking
• Security
• Advertising and signage proposal
• Proposal for employee training and qualifications
• Proposal for transporting marijuana products
• A control plan for individuals under 21
• A waste disposal plan

The Premises Diagram of a proposed cannabis dispensary in Alaska will typically contain details about:

• Entrances and exits
• Restricted areas
• Walls
• Partitions
• Storage areas

Are There Municipal Requirements for Opening a Cannabis Dispensary in Alaska?

Per Alaska cannabis law, municipalities have the right to opt out of licensing cannabis dispensaries. Cannabis dispensaries in Alaska are subject to rules and regulations adopted by the municipalities in which they operate.

How Long Does It Take to Get an Alaska Dispensary License?

The AMCO takes between 4 to 6 months to approve Alaska dispensary license applications.

Where Can You Locate a Cannabis Dispensary in Alaska?

Cannabis dispensaries can only be located on premises approved by the AMCO and municipal authorities. Alaska law prohibits situating marijuana dispensaries within 500 feet of schools, worship centers, recreational facilities, and prisons. Municipalities are allowed to set their own specific zoning regulations.

Here is a list of cannabis dispensaries in Alaska.

Can Licensees Have More Than One Dispensary Location in Alaska?

Yes, cannabis dispensary license holders in Alaska are allowed to operate in more than one location in the state. However, each dispensary location operated by a single business entity must have a separate retail marijuana store license.

How Much Does It Cost to Open a Marijuana Dispensary in Alaska?

The following are the costs that a person can expect to incur to open a marijuana dispensary in Alaska:

• Application fee: $1,000
• License Fee: $5,000
• Fingerprint fee: $48.25 per individual with a financial stake in the business applying for a license
• Onsite Consumption Endorsement Application/Approval Fees: Dispensaries must also pay $1,000 to apply for onsite consumption endorsement and $2,000 for endorsement approval
• Lease/Facility Construction Costs: It can cost up to $350,000 to construct a cannabis dispensary facility, depending on the location of the store and the size of the property to be used. Monthly rent for dispensary property can go as high as $10,000
• Inventory costs: The cost of stocking up on cannabis products can reach as high as $100,000 per month
• Taxes: This will vary. Although Alaska does not impose sales tax on dispensaries, municipalities are allowed to charge taxes to dispensaries operating within their jurisdictions
• Employee Salaries: Depending on the number of employees it has, a cannabis dispensary will spend upwards of $50,000 on salaries annually

Do You Need an Insurance Policy for a Cannabis Dispensary in Alaska?

No, Alaska does not require cannabis dispensaries to have insurance coverage. However, insuring a cannabis dispensary in the state can help business owners recover in the event of unforeseen circumstances like theft or fire.

The following types of insurance policies are recommended for cannabis dispensaries in Alaska:

• Property Insurance: This will protect the dispensary building and its inventory against theft, fire, or natural disasters
• General Liability Insurance: This policy will provide coverage in the event of any personal injury or damage to property that occurs on the dispensary premises
• Property Insurance: This policy will provide coverage in the event of any physical damage to the dispensary property or any loss or damage to the inventory

Insurance premiums for cannabis dispensaries are influenced by such factors as location, state laws, and the dispensary's revenue. Other factors dictating premiums include the limits of the particular insurance policy signed up for by the dispensary owner.

How to Get a Grant to Open a Dispensary in Alaska

Several financing options are available to individuals and businesses interested in opening cannabis dispensaries in Alaska. They include the following:

• Self-funding: Individuals or businesses with adequate personal capital can finance their dispensary operations without recourse to loans or other funding types
• Family and friends: Raising funds through family members and friends is an option open to individuals who want to open a cannabis dispensary in Alaska. Family members can either give interest-free loans or in exchange for stakes in the business
• Loans: Entrants into the cannabis dispensary business can obtain financing from lending institutions that specialize in funding cannabis businesses
• Equity funding: Cannabis dispensary owners can raise capital by giving up equity to private or institutional investors
• Cannabis-specific lenders: These types of lenders specialize in offering short-term, high-interest loans to cannabis businesses
• Inventory Financing: Cannabis dispensaries can acquire a stock of marijuana products by approaching companies that offer inventory loans to cannabis retailers

Does Alaska Have a Social Equity Program for Cannabis Dispensaries?

No, Alaska does not have a Social Equity Program for cannabis dispensary licensees.

Does Alaska Tax Marijuana Dispensaries?

No, marijuana dispensaries in Alaska do not pay a retail tax. Only marijuana cultivators are required to pay a weight-based tax. However, municipalities in the state are allowed to impose taxes on dispensaries operating within their jurisdictions.