Pot lounges neither required nor wanted
September 26, 2017
While marijuana-industry written Question 2 passed statewide last November, it was defeated by voters in both Carson City and Douglas County.
Recreational marijuana is now "legal" throughout Nevada, but localities are free to choose to license, or not to license, commercial marijuana establishments. In Douglas County, a unanimous county commission chose to "zone out" all commercial marijuana establishments. By contrast, Carson City's board of supervisors is in the process of approving commercial recreational marijuana establishments—retail, cultivation and manufacture.
In states outside of Nevada that "legalized" marijuana, local communities have been cautious or resisted marijuana commerce. While Colorado voters "legalized" marijuana statewide, the vast majority (73%) of the state's cities and counties banned commercial recreational marijuana in their jurisdictions. Similarly, Oregon "legalized" marijuana statewide, but 89 cities and counties have banned all commercial marijuana activity. In Massachusetts, the 91 communities in the state that voted against legalization have been given authority by the state legislature to prohibit commercialization.
California voters "legalized" recreational marijuana in 2016. The initiative passed overwhelmingly in affluent and politically "liberal" areas like Palo Alto and Marin County. However, local officials in both these communities banned commercial marijuana establishments. The cited reason for the prohibition: "quality of life."
In comparison, Nevada stands alone among the states in an unprecedented rush to "Early Start" recreational marijuana sales that began on July 1. In passing Question 2, Nevada voters were assured recreational sales would begin six months later, on Jan. 1, 2018, after adoption of permanent regulations.
The haste in commencing recreational marijuana sales was urged by Nevada's medical marijuana licensees. They claimed that medical-only marijuana stores lost money and only with recreational sales would they make a profit. The "Early Start" program was effectively a marijuana industry "bail out," announced without public hearings or vote of approval by the governing Nevada Tax Commission.
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The hurried approach to recreational marijuana licensing at the local level in Nevada can be seen in the case of North Las Vegas, a predominately low income city with a high percentage of "at risk" youth. North Las Vegas city officials have already licensed 52 marijuana establishments—retail, cultivation and manufacture.
A request from the Las Vegas Review-Journal for names and ownership interests of marijuana establishments in North Las Vegas was denied. City officials based their refusal on an August 3 Nevada Supreme Court decision holding marijuana ownership records are "confidential" and unavailable to the public.
In contrast to marijuana, ownership interests for gaming and liquor licensees are held to be public records. Keeping ownership information confidential makes it impossible for the public to scrutinize government officials for conflicts of interest. The Nevada Press Association formally protested the withholding of marijuana ownership information by North Las Vegas city officials.
A new opinion from the Legislative Counsel Bureau holding that nothing in Nevada law prevents a business from establishing a lounge or hosting a special event where recreational marijuana is used, is creating the latest marijuana controversy. The opinion, requested by Sen. Tick Segerblom, came after the legislature defeated his bill in the last session to do expressly that. Segerblom argues that local governments should be allowed to license Amsterdam-like "pot lounges" and other public uses.
Gov. Sandoval disagrees with the legal opinion entirely and requested review by the Attorney General. Among Sandoval's concerns — putting Nevada in direct conflict with requirements of Federal law in the "Cole Memorandum" guiding handling of marijuana in states where it has been legalized.
None of the four other states where marijuana is legal for recreational use-Washington, Colorado, Alaska and Oregon—currently allow "pot lounges". The three other states where legalization regulations are being finalized—California, Massachusetts and Maine—are not currently considering "pot lounges." If approved, Nevada would stand alone.
Jim Hartman is an attorney residing in Genoa and was president of Nevadans for Responsible Drug Policy in 2016