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Dawson County flips 'green,' local officials still leery on recreational cannabis

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Armadillo Buds

Kaari Fulton and her son, grower Lance Haugen, are shown at Armadillo Buds in Glendive.

GLENDIVE — Kaari Fulton took a big gamble in November 2020 when Montana voters legalized recreational cannabis use by a wide margin. Following the election, Fulton and her husband cashed out his retirement fund to license and open Armadillo Buds, a medical marijuana dispensary, outside of town here.

But then the state Legislature upped the ante and put their investment into jeopardy.

In framing the state's cannabis regulations in the 2021 legislative session, lawmakers set up a system in Montana similar "dry counties" in relation to alcohol. Cannabis use and possession remains legal statewide, but whether counties allow recreational cannabis sales now depends on whether or not that county approved legalization in the 2020 election.

The result split the state's 56 counties, with 28 "green" counties and 28 "red" counties.

Recreational cannabis legalization failed in Dawson County in the 2020 election by 341 votes, with 54% of the county voting against the initiative. That meant Armadillo Buds would have to sell off its inventory by February 2022 or pick up and move to a green county.

The arrangement was part of a series of compromises between GOP lawmakers who were conflicted about cannabis legalization but needed to reach a consensus. If they failed to pass a bill, the ballot initiative's language would set the terms of regulation in Montana, and some Republicans thought the initiative didn't go far enough.

Medical marijuana providers already located in red counties were "grandfathered in." Eighteen counties have no licensed dispensaries — all but one of those counties voted against recreational legalization in 2020 — so the final landscape didn't change much with the red-green dichotomy. 

Lawmakers did leave one option for Fulton and the six other shops in the same position: voters in red counties could hold an election to turn green. That would allow Armadillo Buds to continue operating as a medical marijuana dispensary until the end of the moratorium in mid-2023.

"I could not sit back and watch (my husband) lose everything on this," Fulton said. 

Following the state's new rules, Fulton gathered 1,398 signatures — three more than she needed — forcing a special election on Dec. 23 to flip the county green. On Thursday, Dawson County voted 55% to allow recreational cannabis sales. 

"We had to change the minds of 341 people," Fulton said. "I can stay in the house we've been in for 56 years."

Community concern

Fulton said Glendive, the town that raised her, had long rejected cannabis providers from its community fabric. City zoning ordinances have effectively kept dispensaries on the fringes of town. Fulton, too, was opposed cannabis use until recently.  

"I grew up with that propaganda: 'Here's your brain, and here's your brain on drugs,'" Fulton said.

A massage therapist for 31 years, Fulton saw how her clients had responded to medicinal marijuana for their chronic pain. While she could offer improvement to their muscles, she had heard and seen how cannabis had helped them physically, with chronic pain, and mentally, with PTSD.

"When I look at my own values, the way I think about this plant … I use hundreds of essential oils, from what? A plant. Why am I eliminating a plant that is actually helping?" Fulton said.

Even before Montana legalized recreational cannabis use, Fulton and her son, Lance Haugen, started mulling a bid into the business. Haugen is a medical patient, and he saw a community with few options in the region. After the 2020 election, the family agreed to dive in head-first.

Businesses line Merrill Avenue in downtown Glendive

Businesses line Merrill Avenue is shown in downtown Glendive. Kaari Fulton said Glendive, the community that raised her, had long rejected cannabis providers from its community fabric. 

Montana passed Initiative 190, legalizing possession and use, on Nov. 3, 2020. Fulton called the state health department the next day to sign up as a medical provider, and was fully licensed by Nov. 30.

At that time, according to the rules in the ballot initiative, Fulton and Haugen would start business as a medical marijuana dispensary and be allowed to sell recreational cannabis when the market opened Jan. 1, 2022.

But then the Legislature rewrote the rules in the last hurried month of its 2021 session. Lawmakers retroactively set the new deadline to enter the market as Election Day 2020. The change was intended to keep Big Weed from slipping into Montana's marijuana market ahead of the moratorium. But it also caught Fulton's family in limbo, with her husband's retirement account hanging in the balance. 

"We actually considered, you know, possibly going to the western side of the state," Fulton said. "But when you really think about the cost and the cost living over there, we're better off just kind of hanging out here."

According to the Department of Revenue, seven providers, including Armadillo Buds, were caught in the same snare.

Dawson County Commissioner Dennis Zander lived in Denver for a brief time that straddled Colorado's shift to recreational sales. He doesn't oppose medical marijuana use, or the medicinal environment in which that industry operates, but said he didn't like the character recreational cannabis sales brought to his corner of Denver. 

"It just totally turned it into a cesspool," Zander said. "A lot of people hanging around that don't have a purpose other than trying to panhandle and it just brought people from a different area to that nicer part of downtown. … It was pretty instantaneous."

Joe Sharbono, another county commissioner, also approves of medical use, albeit he's sure people who don't have medical needs have been gaming the system to access the cannabis. He didn't support the campaign to flip the county green. 

"I just don't want to see it legalized where anybody can get it," Sharbono said. "Personally I think it's a gateway drug."


Dawson County Commissioner Dennis Zander lived in Denver for a brief time during Colorado's shift toward recreational sales. He doesn't oppose medical marijuana use, or the medicinal environment in which that industry operates, but said he didn't like the vibe recreational cannabis sales brought to his corner of Denver. 

Youth drug use and impaired driving were both examples cited by lawmakers in the 2021 session who wanted to ratchet up regulations on cannabis. In Colorado, increased marijuana use after legalization was accompanied by a rise in the number of emergency department visits and hospitalizations related to acute marijuana intoxication, according to a 2016 U.S. Department of Health and Human Services study conducted by two Colorado doctors. Youth cannabis use was once higher in Colorado than any other state, but in two years after legalization, that rate fell to the state's lowest level in a decade, according to the National Survey on Drug Use and Health. Teen alcohol, tobacco and heroin use also fell sharply in that same timeframe, the Washington Post reported.

State Sen. Ken Bogner, a Republican whose district covers six red counties in Eastern Montana, was one of the first lawmakers to raise the alarm about the red-green county split during the 2021 session. People who may transport cannabis from green counties to red presented a potential danger on the state's highways, he said, as well as interstate transportation into Montana's bordering states, none of which have legalized recreational cannabis use.

Locally, the dynamic sets up opportunity for the black market alone, he said.

Sen. Kenneth Bogner, R-Miles City

Sen. Kenneth Bogner, R-Miles City, speaks on the Senate Floor during the 2019 legislative session. Bogner, a Republican whose district covers six red counties, was one of the first lawmakers to raise the alarm about the red-green county split during the 2021 session.

"If you can use and possess it, but you can't buy it, it just opens up a market that can't be filled legally and the black market is going to move in," Bogner said in a recent interview. 

But the Miles City Republican has since come around to the deal, which he notes still allows people to flip the county if the black market becomes an insurmountable issue. 

"I'm still concerned about it," Bogner said about the black market dynamics, "but I'm glad we did do the red and green counties as a compromise."

New revenue

The green counties make up roughly 90% of the state's population, according to figures from the Governor's Office of Budget and Program Planning. Since most of Montana lives in green counties, the Legislature's framework meant at a statewide level the potential windfall from tax revenue wasn't cut in half the same way the red and green scheme divided the state map in half. Revenue from a 20% tax included in the initiative is estimated to be about $130 million in the coming year and climb to nearly $200 million by 2023.

Communities can also add their own taxes. Along with flipping the county green last week, 79% of Dawson County voters also approved an additional 3% local sales tax. 

Neither Zander nor Sharbono were particularly entranced by the prospect of a new stream of tax revenue. Sharbono believes the county will spend more money on "dealing with the problems" than revenues would bring in. But he's also glad the decision on whether to allow recreational cannabis sales can be made locally through the green-and-red system.

All three county commissioners, all Republicans, had spoken with the Armadillo Buds family and told them they were against recreational marijuana. Still, Zander and Sharbono said they understood the predicament Fulton had fallen into. 

"The goal posts were kind of moved on them," Zander said. 

But once Fulton had gathered the requisite signatures to trigger a special election, she had the commission's attention. The commissioners decided to earmark the potential tax revenue for public safety, "to help address some of the problems that (recreational cannabis) may cause," Zander said.

Whether those concerns percolated throughout the community is harder to tack down. The Glendive Chamber of Commerce and Agriculture never endorsed or opposed recreational cannabis legalization in the special election, but executive director Terra Burman said the local business community never raised concerns about petty crime. Meth and opioids have already created those issues, she said, and local infrastructure is thirsty for new funding.

"We support any legal, local jobs and growth development here," Burman said. "We felt that (cannabis sales) would be a great opportunity for new tax revenues."

A group of people gathers at Makoshika State Park

A group of people gathers at Makoshika State Park to celebrate the opening of a newly reconstructed section of road they hope will boost travel throughout the region.

Glendive, like the rest of the state, has seen a wave of new residents buying property sight unseen. Meanwhile, a mold remediation project at the Lincoln Elementary School gym in August uncovered additional problems with the roof drains and waste drains, the Glendive Ranger-Review reported. Burman said Makoshika State Park is a big draw for tourists, and Glendive could use any help it can to bring travelers to its downtown shops, restaurants and hotels.

In fact, Glendive's business community offered a hand to Armadillo Buds' campaign, Burman said, leaving Fulton's petition out at restaurants and shops for patrons to sign.

"A lot of small businesses really came together," Haugen, Fulton's son, said. "They understand business. They don't let their personal beliefs get in the way of making changes that better something."

Fulton, her son and the community came up at deadline with 1,398 signatures, just three over the required number to force a special election. On Dec. 23, voters approved recreational cannabis use by 336 votes, nearly the same number that prevailed against cannabis in 2020. 

After the votes were tallied Thursday, Fulton said she could hardly process the win. 

"It was so surreal, and it's not just for me," she said Monday. "When (travelers) come on I-94 they're going to come through the greatest state in this county; they're going to go to Billings and Glacier and don't forget about Makoshika State Park. I don't think our community knows the amount of foot traffic that's going to be in their stores, uptown, the motels, the convenience stores. … That's going to boost our community."

Read Wednesday: Law enforcement's position in a new world of recreational cannabis, educated by a generation of medical marijuana in Montana.


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