Regulators at the Iipay Nation of Santa Ysabel’s cannabis operation in December seized nearly 60 pounds of black market marijuana they say tribal employees purchased with unauthorized tribal funds and brought to the North County reservation with the intent of selling the pot out of the tribe’s legal Mountain Source Dispensary.
On Sunday, the tribe contacted the Sheriff’s Department, which has taken possession of the marijuana and opened an investigation into the matter.
Three employees of the tribe’s cannabis business have been fired, the tribe said.
“In December 2019, Santa Ysabel Tribal Cannabis Regulatory Agency (TCRA) personnel intercepted approximately 50 pounds of organic cannabis material transported to the Santa Ysabel Botanical Facility for intended sale through the Tribe’s legal, regulated cannabis retail establishment, the Mountain Source Dispensary,” the agency’s executive director, Sharon Osuna, said in a news release.
“The TCRA immediately secured the suspect cannabis material and initiated an investigation to determine the source of the material. Tribal government employees were identified as being involved in purchasing the cannabis material from an unlicensed source utilizing Tribal funds. The TCRA took immediate regulatory action, suspending the individuals’ access to the Botanical Facility and the Tribal Council subsequently terminated the employment of the individuals involved.”
Dave Vilapando, a consultant to the tribe and the former executive director of the TCRA, said the tribe’s regulations don’t allow any cannabis to go to an unlicensed or unregulated location or allow any cannabis to be shipped to the facility from an unlicensed or unregulated jurisdiction.
“One of the reasons we referred it to the Sheriff’s Department is that they may have an illegal grow somewhere,” he said.
The Sheriff’s Department confirmed Friday that deputies from its Ranchita station took custody of about 59 pounds of marijuana.
“We are reviewing the information provided by Santa Ysabel employees for possible law violations. Navigating marijuana laws as they relate to Tribal lands and dispensaries is complex as we continue to maneuver in that environment,” Lt. Ricardo Lopez said.
The employees had access to the funds through the tribal development corporation, Vilapando said. However, he declined to say how much money was involved. He said at least one of the employees is a member of the tribe and the other two “have been associated with the tribal government for years and years.”
Vilapando said the reason the tribe decided to alert the public to what happened was to show the tribe has acted responsibly and done nothing wrong.
The tribe opened its dispensary south of Lake Henshaw off State Route 79 in January 2019 inside what used to be a casino that closed five years earlier.
The dispensary and the tribe’s extensive cannabis-growing and byproduct-manufacturing operation is not licensed by the state but because it is contained within the sovereign reservation it has been allowed to operate without legal interference. Business at the dispensary has been good. Prices are better than can be found at licensed dispensaries, partly because there are no taxes.
Vilapando said the tribe’s strict regulations and constant electronic surveillance of the operation led to the discovery of the black market pot.
“That’s our commitment,” he said. “We’re not going to allow any gray market, black market suspect cannabis to hit the stream of commerce. Not from Santa Ysabel.”