2 Consultants Charged in South Dakota Tribal Pot Operation

BY REGINA GARCIA CANO AND JAMES NORD
ASSOCIATED PRESS

FLANDREAU, S.D. (AP) — Two consultants who advised a Native American tribe on its plans to open the nation’s first marijuana resort have been charged with drug offenses, South Dakota’s attorney general announced Tuesday.

Eric Hagen, chief executive of Monarch America, and the company’s vice president and cultivation expert, Jonathan Hunt, were charged with a range of marijuana possession charges, attorney general Marty Jackley said.

Hagen, 34, of Sioux Falls, is charged with conspiracy to possess more than 10 pounds of marijuana, possession of more than 10 pounds of marijuana and attempted possession of more than 10 pounds. Hunt, 43, of Colorado, was charged with conspiracy to possess marijuana.

The indictment comes eight months after the Flandreau Santee Sioux, citing fear of a federal raid, torched the weeks-old marijuana crop they had been growing on tribal land under Monarch America’s guidance.

The Santee Sioux began exploring a marijuana growing operation after the Justice Department in 2014 outlined a new policy clearing the way for Indian tribes to grow and sell marijuana under the same conditions as some states that have legalized pot.

When tribal leaders initially touted their plan to open the resort on tribal land near Flandreau, which is about 45 miles north of Sioux Falls, President Anthony Reider said they wanted it to be “an adult playground.” They projected as much as $2 million in monthly profits, with ambitious plans that included a smoking lounge with a nightclub, bar and food service, and eventually an outdoor music venue. They planned to use the money for community services and to provide income to tribal members.

They hired Monarch America as consultant, and the first marijuana seeds germinated in the 10,000-square-foot indoor growing facility in September.

But even before the first crop was seeded, Jackley warned that changes in tribal laws wouldn’t protect non-tribal members and wouldn’t apply to non-tribal land.

In November, tribal leaders moved to burn the crop, saying that federal officials had signaled a potential raid of the operation if their concerns weren’t met. Reider said at the time those involved sales of marijuana to non-Indians, along with questions about the origin of the seeds used for its crop.

Reider said then that tribal officials wanted to show good faith as it talked with officials in hopes of resuming the project. Tribal officials met with Jackley later that month, but Reider said Tuesday that there are no plans to resume the marijuana project. He said the tribe plans to turn the greenhouse into a vegetable growing operation.

Many tribes have hesitated to move into marijuana cultivation, in part because of uncertainty over the risks involved due to a tangle of state, federal and tribal law enforcement oversight on reservations. Just a few months before the Santee Sioux burned their crop, two California tribes had their growing operation raided by federal authorities who cited concerns about third-party ownership and pot distribution off tribal land.