What Alaska requires of cannabis and marijuana businesses
Alaska regulates marijuana establishments through the Alcohol and Marijuana Control Office and the Marijuana Control Board. State law taxes marijuana at the cultivation level under AS 43.61 and does not currently require a surety bond as a condition of a state license.
The bond requirement in Alaska is municipal. After voters approved a five percent retail sales tax on marijuana in April 2016, the Anchorage Assembly enacted Chapter 12.50 of the Anchorage Municipal Code. Under AMC 12.50.160, a marijuana retailer must guarantee the tax with a surety bond or other acceptable financial assurance.
| Bond | Penal sum | Who files it | Obligee | Authority |
|---|---|---|---|---|
| Anchorage Marijuana Sales Tax Bond | $10,000 or the estimated annual tax, whichever is greater | Retail marijuana stores in the Municipality of Anchorage | Municipality of Anchorage | AMC 12.50.160; AO 2016-49(S) |
What the bond guarantees
The bond is conditioned on payment in full of the marijuana retail sales tax, including penalties and interest that are due or become due during the bond term. The chief fiscal officer sets the amount from the retailer's own collections, a comparable retailer or industry averages, with a floor of $10,000. The bond must be issued by a corporate surety licensed in Alaska, in a form acceptable to the municipal attorney, and must stay in force for the term of the license.
Like every surety bond, this is a three party agreement and it is not insurance for the operator. If the surety pays a valid claim to the obligee, the principal must reimburse the surety under the general indemnity agreement signed when the bond is issued. Read how the different cannabis bond obligations work.
How we underwrite Alaska cannabis and marijuana bonds
Bonds at this size are transactional. For a penal sum of $25,000 or less we underwrite and quote on the strength of a completed cannabis license bond application alone, and most are issued the same business day. Personal credit is one input and the inquiry is a soft pull that does not affect your score. Damaged credit or no credit history does not mean a decline. It routes the file to our non-standard program.
More on cost, credit and collateral.
The parties to a Alaska bond
On a Alaska bond the principal is your licensed business, named exactly as it appears on the license or application. The obligee is Municipality of Anchorage. The surety is an insurance company admitted in Alaska, placed by Surety One, Inc. as producer and underwriting manager. Who files in Alaska: Retail marijuana stores in the Municipality of Anchorage ($10,000 or the estimated annual tax, whichever is greater).
Claims, cancellation and renewal in Alaska
If Municipality of Anchorage believes the bonded obligation has been breached, it makes a written claim on the surety. The surety opens a file, asks for documentation and notifies you, and you have the opportunity to respond and to cure. A valid, unresolved claim is paid up to the penal sum, and the surety then recovers that payment and its expenses from the business and the individual indemnitors. Because a Alaska bond of this size secures a defined compliance or tax duty, claims are rare and usually follow an abandoned license or an unpaid assessment.
Most forms let the surety cancel on written notice to the obligee, commonly 30 to 90 days. If a replacement is not on file before the effective date, the regulator can suspend the marijuana license. We send renewal notices 45 days ahead, and renewing at least 30 days early removes the risk of a gap.
Getting a Alaska bond issued, step by step
- Confirm the form and amount. Ask Municipality of Anchorage, Treasury Division for the current bond form and penal sum, or send us the license type and we will confirm them.
- Apply. Complete the online application. It collects the business details and the name, home address and Social Security number of each owner for a soft inquiry credit report.
- Receive the quote, usually the same business day. No financial statements are needed at this size.
- Bind and file. Pay the premium and sign the indemnity agreement. We deliver the executed bond to you and, where it accepts electronic filing, to the obligee. Wet signature originals go out overnight.
Keeping a Alaska bond in good standing
- File and pay every marijuana tax and fee on time. Delinquent taxes are the most common trigger for claims.
- Keep seed to sale records reconciled to physical inventory, and document every destruction event with photographs, witnesses and waste manifests.
- Tell us before you change the business name, ownership, location or license type, so the bond can be amended by rider before the regulator notices a mismatch.
- Protect the personal credit of every indemnitor and keep quarterly financial statements. Both are reviewed at renewal.
Terms such as penal sum, obligee and indemnitor are defined in the glossary. Changes to Alaska and other state requirements are logged with dates in regulatory updates, and an underwriter is available through the contact page.
What to send us
Send documents to Cannabis@SuretyOne.com or apply online. Confirm the current form and amount with the Municipality of Anchorage, Treasury Division before you file.
A note on vocabulary: cannabis and marijuana are the same plant and, for bonding purposes, the same business. Alaska law uses the term "marijuana". Operators look for this bond as a Alaska marijuana bond, a Alaska marijuana license bond, a Alaska cannabis bond and a Alaska cannabis surety bond. They are one instrument, and this site uses the words interchangeably. See marijuana surety bonds.
Primary sources
Official texts behind this page. We link to citation based addresses on legislature, code and agency sites because those are the least likely to move.
- Alaska Statutes Title 17, Chapter 38, regulation of marijuana (Alaska Legislature)
- Municipality of Anchorage
Alaska marijuana and cannabis bond questions
Does the State of Alaska require a marijuana bond?
Not as of this writing. Legislation has been introduced in past sessions that would have required cultivation facilities to bond their excise tax, but the operative requirement today is the Anchorage municipal sales tax bond. Other municipalities may adopt their own rules, so check locally.
Why is a tax bond easier to underwrite than a performance bond?
The obligation is a defined money debt. If a claim is paid, the amount is documented by a tax assessment, which makes the surety's exposure predictable. Most Anchorage tax bonds at the $10,000 floor are written on the application alone.
Is a Alaska marijuana bond the same as a Alaska cannabis bond?
Yes. Marijuana bond, cannabis bond, marijuana license bond and cannabis surety bond are different names for the same instrument. Alaska law uses the term marijuana, operators search under all of these names, and the bond form and amount are the same whichever word you use.
How much does a Alaska cannabis or marijuana surety bond cost?
You pay a premium, not the penal sum. The premium is a small fraction of the bond amount and depends on the size and wording of the obligation, your credit and your financial strength. Small compliance bonds carry low fixed annual premiums. Larger Alaska bonds are rated individually. Quotes are free.
Can I get a Alaska marijuana bond with bad credit?
Yes in most cases. Surety One does not automatically decline any applicant. Files with damaged or limited credit go to our non-standard program, which carries a higher rate and sometimes partial collateral.
Written and reviewed by C. Constantin Poindexter, MA, JD, CPCU, AFSB, ASLI, ARe, AINS, AIS, CPLP, CICS. Founder of Surety One, Inc., Cannabis Insurance Coverage Specialist, attorney and surety underwriter for more than thirty years. Author of The Contractor's Guide to Surety Bonds. View his cannabis insurance credentials. Last reviewed .