Nevada adopts emergency rules to combat pot bottleneck

People wait in line at the Essence cannabis dispensary, Saturday, in Las Vegas, when Nevada dispensaries were legally allowed to sell recreational marijuana starting at 12:01 a.m. Las Vegas, Nevada, July 1, 2017 | AP Photo by John Locher, St. George News

CARSON CITY, Nev. (AP) — Nevada moved Thursday to reduce supply problems at recreational marijuana stores that have faced overwhelming demand for newly legal pot and the possibility of their shelves going empty.

A cashier rings up a marijuana sale at the Essence cannabis dispensary Saturday when Nevada dispensaries were legally allowed to sell recreational marijuana starting at 12:01 a.m. Las Vegas, Nevada, July 1, 2017 | AP File Photo by John Locher, St. George News

Regulators approved emergency rules that would speed up licensing for pot distributors, a sticking point that launched a legal battle and threatened the flow of supplies after dozens of retailers started selling recreational marijuana on July 1.

Nevada’s law is unique among legal pot states, dictating that only alcohol wholesalers can transport the drug from growers to storefronts for the next 18 months. But the state rewrote the rules Thursday used to enforce the state’s pot law to make it clear that it’s legal under certain circumstances to license some retailers to transport pot from growers to storefronts.

Gov. Brian Sandoval endorsed the proposal last week after a judge ruled in June state law dictates only alcohol wholesalers can transport pot from growers to store fronts the next 18 months.

The judge had rejected the state’s claim it has the authority to license some pot retailers to serve as their own middleman if there aren’t enough alcohol distributors to do the job.

In this Saturday, July 1, 2017, photo, people line up at the NuLeaf marijuana dispensary in Las Vegas. Recreational marijuana sales have exceeded the expectations of Las Vegas area store owners, who have seen long lines outside their dispensaries since Saturday, when Nevada became the fifth state with shops selling pot to the public. Las Vegas, Nevada, July 1, 2017 | AP File Photo by John Locher, St. George News

The new regulation makes it clear that’s legal, at least for now. A lawyer for the alcohol wholesaler groups that won the court injunction told the tax panel during Thursday’s three-hour hearing that he’s convinced the new regulation is just as illegal as the earlier one the judge threw out.

James DeVolld, chairman of the Nevada Tax Commission charged with regulating recreational marijuana, sought reassurances from state attorneys that they are on solid legal ground before joining the other commissioners in backing the emergency regulation unanimously.

“I think like all the commissioners, this is such an important time in the state of Nevada’s existence that I just want to do it right,” DeVolld said.

Many retailers were previously licensed to sell and distribute medical pot, so they started stockpiling supplies months ago in an anticipation of high demand for recreational marijuana.

But representatives of several of the 47 retailers now licensed to sell recreationally testified before the tax panel Thursday their shelves are nearly empty because there’s no distribution mechanism that allows them to restock.

In this July 1, 2017, photo, plants are on display during the first day of recreational marijuana sales at The Source dispensary in Las Vegas. The Nevada Tax Commission is expected to approve an emergency regulation on Thursday to issue distribution licenses needed to address an anticipated supply shortage in the coming weeks. Las Vegas Nevada, July 1, 2017 | AP File Photo by John Locher, St. George News

Nevada Department of Taxation Executive Director Deonne Contine announced at the hearing in Carson City that the agency has approved licenses for two alcohol wholesalers in compliance with a court order to begin distributing recreational pot to retailers.

But she said it’s too soon to tell if Crooked Wine of Reno and Rebel Wine of Las Vegas will be able to handle the demand statewide. She said one of the new licensees is “pretty stressed out about what he’s going to be asked to do.”

“There’s room in this market for plenty of more,” Contine said, adding that she’s hopeful some additional alcohol wholesalers could be licensed in the days or weeks ahead.

“Businesses could close their doors or are not going to be able to get products they are legally licensed to sell,” she said.

The state has filed an appeal asking the Nevada Supreme Court to overturn Carson City Judge James Wilson’s ruling prohibiting distribution licenses for anyone other than alcohol wholesalers.

In this June 28, 2017, file photo, Alessandro Cesario, the director of cultivation, looks at marijuana plants at the Desert Grown Farms cultivation facility in Las Vegas. Frenzied activity at these facilities have been focused on one goal: Getting ready for the start of recreational marijuana sales which became legal at 12:01 a.m. Saturday, July 1, 2017. Las Vegas, Nevada, June 28, 2017 | AP File Photo by John Locher, St. George News

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. He told The Associated Press after the hearing he wants to review the regulation before deciding whether to challenge it in court.

The Tax Department last week declared the need for the emergency rules after marijuana retailers recorded more than 40,000 transactions in the first weekend.

“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.

She said unless the matter is resolved quickly, the distribution bottleneck will cost both the state and investors millions of dollars, thousands of jobs and “cause this nascent industry to grind to a halt.”

Written by SCOTT SONNER,  Associated Press.

Email: news@stgnews.com

Twitter: @STGnews

Copyright 2017 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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8 Comments

  • ladybugavenger July 14, 2017 at 10:48 am

    I love man’s law. I love it! That’s why I went to school to study law. It can be manipulated, interpreted differently, and changed. Gods law – always stays the same. The 10 commandments have not changed. Man’s law – always can be changed. It’s awesome! I think it’s fascinating

    • Bowlinggreen123 July 14, 2017 at 10:02 pm

      Funny? The LDS church changes it’s laws quite a bit. Are they God’s law or just a man’s law?

      • ladybugavenger July 15, 2017 at 7:49 pm

        Definitely man’s law

  • ladybugavenger July 14, 2017 at 10:53 am

    Have you ever tried to manipulate God? I’ll tell ya- it doesn’t turn out well. Man’s law, on the other hand is totally manipulated and sometimes it works in a criminals favor and sometimes, not guilty of the crime people are thrown in jail and that’s a tragedy. (I put it that way because none of us are innocent)

    Stay close to God! Have a blessed day my friends

  • DRT July 14, 2017 at 12:00 pm

    You have to wonder if the judge is in the pocket of the booze distributors, or if he has ties to the black market.

    • Billy Bob Ray July 15, 2017 at 12:40 am

      I think this entire business of having the only legal avenue for the distribution of marijuana being in the hands of alcohol distributors is about as crooked as if the only legal distribution was through pharmaceutical companies who supply pain killers, sleeping pills, tranquilizers, mood elevators, etc.

      I’m pretty sure you can figure out the problem with having such distributors as the only legal avenue of stocking dispensaries yourselves……..

      • mesaman July 15, 2017 at 5:06 pm

        Where is FEMA when there is an international crisis such as this? Maybe we should consider importing from Mexico.

  • Sapphire July 15, 2017 at 4:52 pm

    Who ever thought not being able to get pot would be a state emergency? What a weird country this has become.

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