Nevada regulators mull expedited marijuana supply licensing

IndustryNevada Wholesaler Steps Up to Restock Dispensaries Lisa Rough

IndustryNevada Wholesaler Steps Up to Restock Dispensaries Lisa Rough

Nevada has licensed roughly 100 marijuana growers, enough to supply the dispensaries as long as there is a way to transport the pot.

When the law went into effect in Nevada on July 1, there were almost 50 dispensaries already partaking in the medical marijuana business - and were licensed to sell the substance recreationally.

That was the biggest reason Deonne Contine, executive director of the state's Department of Taxation, cited in March when she first expressed concern about "insufficient interest" among liquor wholesalers, especially in Nevada where many of their biggest customers are hotel-casinos also subject to numerous federal statutes.

Language in the legislation stipulated that for the first 18 months only liquor wholesalers were allowed to apply for distribution permits - a nod to the powerful alcohol industry, which is anxious about new competition from pot. One was approved Wednesday and another Thursday.

"We're trying to do the right thing", DeVolld said.

The 47 retailers now licensed to sell recreational pot previously operated as medical marijuana outlets, which were allowed to move products between cultivators, manufacturers and retail store fronts. In California, third-party distribution was mandatory under a medical-marijuana regulation bill signed by Gov.

Emily Wilson said she found refuge in Las Vegas due to medical marijuana.

"I feel like a college student with a fake ID and like my parents are going to bust me any minute", said one woman, who declined to give her last name because she teaches at a local university and is anxious about what her students and employer might think. Contine said the department has issued two total licenses to alcohol wholesalers, but the other five submitted incomplete applications. "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".

In the meantime, the department awarded distribution licenses this week to one alcohol wholesaler in Reno and one in Las Vegas.

Kevin Benson, a lawyer for the Independent Alcohol Distributors of Nevada won that injunction, stopped short of threatening another lawsuit but testified at the hearing Thursday he's convinced the emergency regulation is invalid.

"Based on reports of adult-use marijuana sales already far exceeding the industry's expectations at the state's 47 licensed retail marijuana stores, and the reality that many stores are running out of inventory, the Department must address the lack of distributors immediately", Stephanie Klapstein, a spokesman for the Department of Taxation, told USA Today.

"Without the ability to license marijuana distributors to continue the flow of product to the retail store, a high likelihood exists that consumers will revert to the black market", Contine said. The state is challenging the interpretation of that law because of the bottleneck.

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