Fairbanks asks state to deny renewal of Great Alaskan Bud Company marijuana licenses

A fight over who controls the land under a Fairbanks marijuana business has landed in front of state regulators.

The Fairbanks City Council voted unanimously Oct. 26 to ask the state Marijuana Control Board to deny renewal of Great Alaskan Bud Company's cultivation and retail licenses at 1905 Livengood Ave. The board takes up the renewals at its Nov. 18-19 meeting in Anchorage.

The council's main concern is the business's "apparent lack of control over the premises," according to the city's protest letter. State rules require a marijuana business to have the right to possess its licensed premises at all times.

The city's vote carries weight. Under state rules, the board upholds a local government's protest unless it finds the protest arbitrary, capricious and unreasonable. The Fairbanks North Star Borough has until Saturday, Nov. 14, to file its own.

At the center of the dispute is the business's sublease. Theresa Favero, who says she holds the Alaska Railroad ground lease for the land, says the sublease "expired by its own terms on January 9, 2021" and "has never been renewed, extended, or replaced." She says state regulators asked the business in March for updated proof that it has the right to be there, and it didn't provide any.

The business disagrees. In a Nov. 4 response, a lawyer for the licensee, SP&C Enterprises, pointed to a handwritten 2021 notation it says extended the sublease five years.

"We recognize that a five-year extension beginning in January 2021 would ordinarily end in January 2026," the lawyer wrote.

The response disputes that the ground lease passed to Favero and asks the board to consider the business's continued occupancy, later payments to the railroad and other agreements. It asks the board to renew the licenses and wait for a case in Fairbanks Superior Court to play out, or else let the business submit more proof before any denial. Favero says that case concerns a 2013 building contract, not the land.

Other objectors raised unrelated business disputes.

At the council hearing, Shawn Coyle, the business's designated licensee, asked the council to let the courts resolve the issues.