What would legalized marijuana look like in the Last Frontier? Alaskans are in the midst of the debate surrounding Ballot Measure 2, the initiative seeking to legalize, tax and regulate recreational marijuana. In late September, Alaska Dispatch News headed to Washington state to see how the fledgling industry is taking shape and how legalized marijuana is affecting the state's economic and cultural landscape. Second of four parts.

On Nov. 4, Alaska voters will decide the fate of Ballot Measure 2, which seeks to legalize, tax and regulate recreational marijuana in the state. Alaskans have hotly debated the initiative's potential effects, from costs and revenue to societal impacts.

In Washington state, a new recreational marijuana industry is being built from the ground up. Passed in November 2012, the initiative contained some of the regulations and the rest were hashed out in the year following the initiative's passage. The first retail stores opened in July. Like Colorado, which also legalized recreational marijuana in 2012, Washington continues to tweak its rules as the rollout continues.

Now, Washington is beginning to see the effects of the emerging market. Alaska can look to Washington to see what has -- and hasn't -- happened so far when considering potential impacts in the Last Frontier.

People don't smoke pot everywhere

Like Colorado, Washington's law bans public use of marijuana. Smoking in public buildings and in vehicles is also banned. That means there's nowhere for people to smoke marijuana except private residences. Should Alaska choose to legalize, smoking in public would likewise be banned and subject to a citation of $100.

In Seattle, the city has focused on curbing behavior through warnings, not citations. The Seattle Police Department spokesperson Sgt. Sean Whitcomb said that issuing citations is not the department's first priority. "When it comes to open use of marijuana by adults, we are very responsive to community concerns and complaints, but beyond that, we typically don't seek it out. We've done a lot of public education on the subject (and) we do ask for voluntary compliance," Whitcomb said.

During a five-day visit to Washington in late September, little weed use was visible on the streets. At a Seahawks home game in Seattle's SoDo district on a Sunday afternoon, hundreds of tailgaters lined the alleyways near the CenturyLink Field stadium before the game, playing drinking games and blasting music. Only two people were spotted openly smoking marijuana. On a busy Saturday evening in Seattle's Capitol Hill area, the 20-something crowds weren't openly using it in the streets.

Marijuana monopolies haven't sprung up

To prevent monopolies, the Washington Liquor Control Board has limited the number of licenses that a producer or retailer can hold, spokesperson Mikhail Carpenter said.

Retailers can hold up to three licenses each and can't own more than one-third of the licenses in one area. That means if three retail licenses were allowed in a city, a company could have only one of them.

Producers can also apply for up to three licenses, but the board is only approving one license each for now, Carpenter said, as the board was flooded with applications and is trying to get new producers off the ground.

The hope in limiting producer licenses was to encourage growers to switch over to the legal market, often from the unregulated medical marijuana market. That decision has increased the board's workload dramatically, but it's worth it, Carpenter said, to help curb black-market weed.

"The easy thing to do here would be to license nine or 10 gigantic grows," Carpenter said. "(The board) didn't believe that was the spirit of the initiative … this ensures that you have a lot of smaller growers all involved."

The largest license one can have is Tier III, which is limited to 21,000 square feet of canopy. Eventually that will be expanded to 30,000 square feet. In addition, retailers and producers must be separate businesses. A retailer cannot grow marijuana. A producer cannot set up a retail business.

As of mid-October, 246 producers had been licensed statewide. Sixty-four retailers had been licensed. Thousands of applications were pending.

Alaska's initiative doesn't address limiting the number of retailers or producers. Neither did Washington's -- the decision was made by the Liquor Control Board after the law was passed.

In Colorado, there is no limit to the number of businesses an individual can have. According to Natriece Bryant, spokesperson for Colorado's Marijuana Enforcement Division, the state isn't worried about monopolies "unless it's like a big business in Colorado," because of a state requirement that one must be a Colorado resident for two years in order to put any money into a business. There is no potential for vested interests from outside the state, she said.

Marijuana businesses don't line the streets

In Washington, 334 retail outlets are allowed. Washington's initiative mandated a limit, and the Liquor Control Board used consumption and population data to arrive at this number.

Washington's rollout has been slow. In mid-October, only two stores had opened in Seattle out of the 21 allowed within the city of roughly 650,000.

"Getting everybody through the licensing process … it's been a challenge," Carpenter said. "We have a lot of people involved in this who have never operated within a regulated business atmosphere before."

Retailers are also limited to where they can set up shop. Under Washington's initiative, retailers are not permitted within 1,000 feet of schools, playgrounds, public parks, libraries, child care centers, arcades or recreational centers.

Not everyone is pleased with the restrictions. Cannabis City owner James Lathrop said the zoning restrictions are "crippling" for would-be retailers in the metropolitan area.

As of mid-October, 118 communities statewide had also banned marijuana businesses.

Colorado also has a 1,000-foot rule that was written into regulation after the initiative passed. There's no statewide limit on the number of retail outlets in Colorado. Local jurisdictions can choose to limit the number in their area, Byrant said.

Like Colorado, a statewide threshold is not addressed in Alaska's initiative. The initiative specifies that local jurisdictions could limit the number of marijuana establishments in their area. Alaska's law also provides an opt-out option, banning all businesses.

In Washington, advertising has also been heavily restricted. Advertising can't be appealing to children. It can't promote over-consumption. It can't claim that marijuana has curative or therapeutic effects. Like the businesses themselves, advertisements aren't permitted within 1,000 feet of schools, public parks and the rest of the restricted areas.

Retailers can have one sign outside their shop stating only the business's name. They can't advertise in publications marketed to people under age 21, although they can advertise in newspapers. For radio and television, the board has advised businesses to consult attorneys regarding whether those ads will come into contact with children or go across state lines. Local governments can further these restrictions, the Liquor Control Board writes.

Colorado's advertising restrictions – which ban public advertising and limit television, radio and print publications – are being challenged by High Times magazine, which is suing the state, claiming the restrictions violate the U.S. Constitution's First Amendment.

The black market hasn't disappeared

So far, the black market continues to thrive in Washington, officials say, and it will take years before legal sales undercut it.

Alison Holcomb, criminal justice director for the American Civil Liberties Union in Washington and primary drafter of the initiative, said the biggest issue facing the legal market is its price. Demand has far outweighed the supply of legal pot, and prices are steep. To combat the black market, "we'll need to see those prices come down, which will probably take another year," Holcomb said.

On a larger scale, Holcomb believes "we can't really have a significant dent in the black market until more states follow suit. I think when California legalizes that it will have a tremendous impact on the black market."

Consumers buying legal weed are seeing prices for one gram between $25 and $30, Cannabis City owner Lathrop said. Black market prices are $6 to $12 per gram. Unlike Alaska, where a flat rate of $50 per ounce would be instituted, in Washington a 25 percent excise tax is charged at three separate points before it reaches consumers. Lathrop blames these taxes for the high price tags.

"There is nothing in (Washington's recreational marijuana law) ... that will influence the black market in any way," Lathrop said. "I'm sure that was the intention … but all it's done is made the black market incredibly successful here," as now black market dealers can possess marijuana without fear of repercussions, Lathrop said.

Seattle City Attorney Peter Holmes believes the restrictions on the number of retailers will ultimately harm the initiative, the purpose of which is to curb the black market. With only 21 stores permitted in Seattle, "I'm convinced that's inadequate," Holmes said.

Complicating the issue is Washington's medical market -- a largely unregulated gray market, Holmes said. The state legislature will need to address how to regulate medical dispensaries in order to support the legal market.

In Alaska, medical marijuana cardholders are allowed to possess and grow marijuana, but how they acquire that marijuana isn't spelled out in statute. "If you can come out of the box with a way to reconcile recreational with medical marijuana, you will be ahead of the game," Holmes said.

Snohomish Regional Drug Task Force Commander Pat Slack was pessimistic that the black market would ever be curbed in a meaningful way. "That ain't gonna happen," Slack said. "As long as the government taxes the hell out of it, there's going to be someone who's selling under the table."

The stigma of using marijuana hasn't changed overnight

At both the Herbal Nation retail store in Bothell and Cannabis City in Seattle, more than a dozen customers who were asked to be interviewed declined and didn't want their pictures taken. At Herbal Nation, an older crowd perused the products and quickly shied away from attention. At Cannabis City, both tourists and locals, generally a younger, urban crowd, also declined interviews. Many said they feared repercussions from their employers if it were publicized that they use marijuana.

"Stigma issues are huge," Lathrop said. "Particularly with recreational marijuana, people just admitting, 'Well, I'm using this just for fun,'" he said.

Cannabis City's customers want to follow the law, Lathrop said, and many are professionals. "Anybody associated with a government job … or any kind of arena where you just kind of have people look at you sideways because it's not universally accepted," will hesitate to admit they use marijuana, he said.