Nevada’s legislative session is set to begin next month, and already the agenda is filled with over a dozen bill requests for changes in the state’s recently enacted recreational cannabis laws. The requested legislative measures would deal with a range of issues from banking to allocation of tax and regulatory revenue.
The language of the voter initiative which legalized recreational marijuana throughout Nevada in 2016 precluded lawmakers from making any changes to the language of the law for at least three years. Now, with a year and a half of legal sales on the books, the 2019 legislative session marks the first chance lawmakers have had to alter the law.
Nevada’s legislators plan to look at the past 18 months and take stock of the successes and failures to make the changes necessary to keep the industry healthy.
One lawmaker, Sen. Yvanna Cancela, D-Las Vegas, says she and her colleagues hope not only to help the industry flourish but to make Nevada an example of regulatory excellence nationwide. Below are some of the issues Cancela and her fellows will be looking at when the new session starts on February 4th.
After exceeding all expectations for its first year of sales, Nevada’s cannabis industry brought in over $425 million in revenue for recreational sales, which infused the state’s budget with almost $70 million in tax and regulatory revenue.
Under current law, this money goes into the state’s rainy day fund. A bill originally introduced by former state senator Tick Segerblom, and now sponsored by Sen. Dallas Harris, D-Las Vegas, would re-route that money into education and medical marijuana research budgets.
There are also provisions in the bill which would allow local communities to levy additional taxes to fund local school, housing, and justice programs.
There are at least four bills before the legislature this session which will try to solve the never-ending banking issue.
The main issue, which plagues cannabis businesses in all legal states, is that federal prohibition precludes banks insured by the FDIC from dealing with marijuana companies. Since most banks are federally insured, most cannabis businesses deal strictly in cash – which is extremely risky and, in the end, unsustainable as a long term solution.
Two bills that were already drafted and proposed by the Senate Judiciary Committee suggest different solutions to the problem. The first creates a state bank, which is insured privately, to handle money for the cannabis industry. The second is a reciprocity agreement with California, where cannabis is also legal and where such banks already exist. The agreement would allow Nevada businesses to work with California banks.
One bill, which is not ready yet, comes from Republican Senator James Settelemeyer, the Senate Minority Leader. Two other bills, one from the Assembly Committee on Growth and Infrastructure, and one from Senate Majority Leader Kelvin Atkinson, D-Las Vegas, would also create state banks for cannabis revenue.
Other proposed legislation would focus on making sure the public knows whether dispensaries are licensed or not, the number of dispensaries allowed in each county, and industry advertising.