Posts Tagged ‘nevada cannabis’

Nevada Runs Low in Weed, Gov. Declares State of Emergency

nevada-cannabisThere’s a first for everything, especially when it comes to the cannabis industry, so perhaps it’s not surprising that a weed shortage has led the governor of Nevada to declare a state of emergency.

Less than two weeks after recreational marijuana sales began, dispensaries report that they’re running out of product to sell. The state of emergency will allow state officials to decide on new rules to help alleviate the shortage.

The problem is that when Nevada approved recreational marijuana last November, the ballot measure stipulated that for the first 18 months of recreational marijuana sales, wholesale alcohol distributors would be granted the exclusive right to transport cannabis from grows to dispensaries.

However, the Department of Taxation hasn’t approved a single distribution license–and dispensaries are unable to restock their shelves. The department says that they haven’t issued any licenses because of incomplete applications and zoning issues.

“The business owners in this industry have invested hundreds of millions of dollars to build facilities across the state. They have hired and trained thousands of additional employees to meet the demands of the market. Unless the issue with distributor licensing is resolved quickly, the inability to deliver product to retail stores will result in many of these people losing their jobs and will bring this nascent market to a grinding halt. A halt in this market will lead to a hole in the state’s school budget,” said Department of Taxation spokeswoman Stephanie Klapstein.

The Nevada Dispensary Association estimated that dispensaries made about $3 million in sales and the state made about $1 million in tax revenue between July 1 and July 4. Over the next two years, Nevada tax officials expect cannabis sales to generate $100 million in revenue.

The Nevada Tax Commission will vote on regulation to expand the pool of eligible distributors on Thursday.

 

Recreational Cannabis in Nevada Hits a Roadblock

vegas-cannabisExcited for recreational marijuana in Nevada on July 1? Hold that thought.

On Tuesday, a Carson City judge, James Wilson, issued an injunction that reverses the Tax Department’s decision to allow more than just alcohol wholesalers to transport recreational marijuana from growers to dispensaries. The move could delay a planned July start date for recreational cannabis sales.

When voters approved Question 2 to legalize recreational marijuana in November, the initiative included a requirement that distribution licenses would be issued only to alcohol wholesalers for the first 18 months of sales.

Representatives from the Independent Alcohol Distributors of Nevada (IADON) and the state Department of Taxation gave testimony on Monday in an 8-hour hearing. In his 11-page ruling, Wilson said that a “brief filed on behalf of the liquor distributors corroborated evidence that the businesses would be shut out of the marijuana distribution business entirely if the tax department issues licenses to non-alcohol distributors…Once licenses are issued to others, it will be difficult if not impossible to revoke those licenses.

However, the Department of Taxation said in March that there was limited interest among alcohol wholesalers and that the requirement would result in an in insufficient number of distributors.

According to the spokesperson for the tax department, Stephanie Klapstein, at the end of the application deadline in May, only five of 93 applications for recreational cannabis distribution licenses were issued to alcohol wholesalers. And of those five, none have actually completed the application. The other 85 applications were from existing medical marijuana dispensaries.

The Nevada Department of Taxation is reviewing the court’s decision with the attorney general’s office and “will explore all legal avenues to proceed with the program as provided in the regulations,” Klapstein said in a statement.

The approval of Question 2 tasked the state with creating a regulated marijuana sales structure by the start of 2018. But after visiting and studying other states that legalized marijuana, Nevada officials determined that waiting a full year after the drug became legal would risk growing the black market. Instead, they planned for an “early start” to get the program up and running by July.

Applications for Nevada Recreational Cannabis Sales Now Open

Good news Nevada cannabis enthusiasts: the application period for recreational cannabis sales is underway and stores are expected to open by July 1. Licenses will be distributed to currently operating medical marijuana dispensaries. In addition, liquor wholesalers will be able to apply for temporary distribution licenses.

Here’s everything you need to know about applying for a recreational cannabis license:

The Department of Taxation began accepting applications Monday for businesses wanting to grow, produce and sell recreational marijuana. The licenses will allow medical marijuana dispensaries to sell cannabis products to adults 21 and older, with the goal of retail sales beginning July 1. The application deadline ends May 31.

The voter-approved ballot measure tasked the state with creating a regulated marijuana sales structure by the start of 2018. But after visiting and studying other states that legalized marijuana, Nevada officials determined that waiting a full year after the drug became legal would risk growing the black market.

Businesses will need similar licenses at the state level to begin selling marijuana to non-medical patients. Clark County, Las Vegas and North Las Vegas are all planning to issue licenses by July 1. Henderson implemented a six-month moratorium on retail marijuana in February.

Only currently licensed and operating medical marijuana establishments in good standing with the state are eligible to apply for retail, production, cultivation and testing licenses.

Distribution licenses are available to liquor wholesalers, medical marijuana companies and operating medical marijuana distribution companies.

Permanent regulations are being crafted by the Department of Taxation, and permanent licenses are expected to be issued on Jan. 1.

License to Sell

How much a 6-month recreational marijuana licenses will costs businesses:

$5,000 to apply for a license, plus an additional fee if the company is awarded a license.

Those additional fees range from:

  • $20,000 for retail stores
  • $30,000 for cultivation facilities
  • $10,000 for production facilities
  • $15,000 for testing labs
  • $15,000 for distributors

Marijuana Could Benefit Native Tribes in Nevada

tribal lands cannabisLast week, tribal leaders in Nevada testified in support of a bill that would bring the medical and recreational cannabis industry to tribal lands.

Senate Bill 375, introduced by Sen. Tick Segerblom (D-Las Vegas), would allow the state to work with individual tribes whose tribal councils have approved medical and/or recreational cannabis.

“The tribes would oversee what is happening on their reservation, but when they participate in the system they would have to follow the state rules,” Segerblom said of the bill.

Opening marijuana dispensaries and production facilities could be a big deal for the tribes, bringing revenue and new opportunities to their communities. Most of the tribal leaders at last Thursday’s meeting said that marijuana could help mitigate high unemployment and poverty rates.

Tildon Smart, former chairman of the Fort McDermitt Paiute-Shoshone tribe, said that about 98 percent of her community of 1,100 are unemployed.

“We lack a tribal court system, we lack a police department, we lack health services – this may help create those services,” said David Decker, Chairman of the Elko Band Council for the Te-Moak Tribe of the Western Shoshone. “Just to pay for dispatch, this is very expensive. This could help us pay for all those economic securities that we currently can’t provide.”

If the bill passes, Nevada wouldn’t be the first state to reach a compact with tribes. In 2015, the Suquamish and Squaxin Island tribes signed 10-year compacts with the Washington State Liquor and Cannabis Board.

Unfortunately, Washington seems to be the exception rather than the rule when it comes to cannabis on American Indian reservations. Similar compacts between tribes and states have fallen flat, especially because tribes still have to contend with the federal government–many tribes rely on federal funds to keep their communities afloat.

“They are sticking their necks out on this one, but at some point you have to say, ‘We can’t sit around and twiddle our thumbs,'” Segerblom said. “I think the tribes – because they’re sovereign nations – they will have a better leg to stand on.”

Smoke-Free Cannabis Cup & Nevada’s End of Marijuana Prohibition

Las Vegas’ second-ever High Times Cannabis Cup wasn’t the toke-friendly festival that many hoped it would be–organizers were forced to make the Cup a cannabis-free event after a federal prosecutor sent a letter warning that anyone caught distributing or consuming marijuana would be subject to prosecution.

The Cannabis Cup, produced by cannabis-centric magazine the High Times, describes the event as the world’s leading marijuana trade show, “celebrating the world of ganja through competitions, instructional seminars, expositions, celebrity appearances, concerts and product showcases.” Recreational cannabis was legalized in Nevada as of January 1 this year, and the Cup was slated as an unofficial celebration of the new law.

However, that didn’t stop thousands of pot enthusiasts from attending the event at the Moapa Indian Reservation–the first Cannabis Cup held on U.S. tribal lands. 15,000 people were expected to attend the two-day festival, which featured musical acts Ludacris, B-Real, Chief Keef, and J Boog. A rally stage was a gathering point for speakers and activists; there were cannabis-themed panels on topics like legal and veterans issues and grow advice from experts. The festival included 300 vendors from 15 countries.

Daniel Bogden, the U.S. Attorney who sent the letter, went so far as to underline several sentences, emphasizing that,
“Marijuana remains illegal under federal law…[and] federal investigation and prosecution may still be appropriate.

…nothing in the Guidance Memorandum or the Cole Memorandum alters the authority or jurisdiction of the United States to enforce federal law in Indian Country or elsewhere.”

In response to Bogden’s letter, the High Times cautioned vendors and attendees prior to the event:

“Vendors, guests, performers and attendees are advised to comply with all local, state, and federal laws regarding the use and distribution of cannabis and cannabis related products. In order for the cannabis industry to continue to earn legitimacy and social acceptance, we understand that rules and laws need to be abided,” the letter stated. “High Times will continue to stand up for our civil liberties and advocate for our inalienable rights to cultivate and consume cannabis. We urge you to join us.”

The festival was scheduled to take place March 4-5, but in another turn of bad luck, day two of the event was canceled due to high wind. Gusts reportedly reached above 60 mph.

Read the entire letter from U.S. Attorney Daniel Bogden here.

Recreational Marijuana Won’t Tax Nevada’s Budget

Nevada state regulators are confident that launching the recreational marijuana market won’t strain the state budget, in large part because they plan to use funds from the state’s medical marijuana program to offset startup costs.

Democratic state Sen. Tick Segerblom told the Las Vegas Review-Journal that up front costs include licensing and inspections of the new dispensaries.

Question 2, which legalized recreational marijuana sales in Nevada, was approved by voters in November. The ballot measure takes effect on January 1, making it legal for adults 21 and older to possess up to an ounce of marijuana. The first retail shops are expected to open in 2018.

In fiscal year 2016, taxes from Nevada’s medical marijuana program raised $761,000, and $190,000 went to the health agency for administration of the program. The other $571,000 when to the public schools.

Segerblom said that to ensure a smooth rollout of recreational pot sales, he will propose to start such sales ahead of time using the medical marijuana dispensaries now in operation. This would give the Tax Department the time it needs to ensure the ballot measure is implemented without problems.

“The department is already working to develop temporary regulations,” said Deonne Contine, executive director of the Tax Department. “We intend to hold a public workshop very early in 2017 and then have our temporary regulations adopted so we can begin issuing licenses.”

In contrast, Massachusetts, which also approved recreation marijuana in November, is considering using the state’s rainy day fund to the tune of $30 million to implement the program by 2018, according to the Boston Globe. The money would be repaid from tax revenues generated by recreational cannabis sales.

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