Marijuana industry advocates are crying foul about a residency clause in Alaska's draft marijuana regulations that would require all business owners and investors to be Alaska residents.

With the deadline for crafting Alaska marijuana regulations just three months away, the Marijuana Control Board must decide whether the requirement -- which board member Brandon Emmett said "basically crushes the American dream" -- is the best choice for a fledgling market teeming with risk.  

Current draft rules read like this: Anyone who wants a marijuana business license, whether an individual, partnership, limited liability company or corporation, must be an Alaska resident. That includes every corporate shareholder and partner. Only a licensee may have a “direct or indirect financial interest,” and all licensees must be Alaska residents.

Growers, retail stores, manufacturing and testing facilities -- and any investors -- must all be Alaska-grown.

At the Marijuana Control Board meeting in mid-August, business owners were dismayed by the proposed regulation, which they believe...