As Nevada nears the expected July 1 start date for its emergent recreational marijuana program, Republicans and Democrats put the finishing touches on the laws that will shape the state’s marijuana future for the next two years.
Tourists still have nowhere to smoke since the public consumption bill died, medical users still can’t buy guns and opioid addiction cannot be treated with cannabis despite Democrats’ best efforts.
All in all, though, marijuana advocates walked away from this year’s session with a lot of wins. Here is how marijuana will be taxed, labeled, regulated and how it’s going to affect you.
Despite Republicans’ efforts last week to kill the 10 percent retail tax on recreational marijuana, the Legislature ended up approving it last minute.
Why is the tax so important?
For one, Gov. Brian Sandoval most recently projected that recreational marijuana sales will bring in more than $60 million in state revenue over the next two years.
Starting in July, all marijuana — both medical and recreational — will be taxed 15 percent at cultivation, and only recreational marijuana will be sold with a 10 percent sales tax.
Medical marijuana currently is taxed 2 percent at cultivation, 2 percent at production and 2 percent at sale.
“What’s important Is that you’re creating that delta between medical and recreational costs – it’s keeping the cost down for medical,” Sen. Julia Ratti, D-Sparks, who sponsored the tax bill.
Revenue collected from the cultivation will be funneled toward schools, and revenue from recreational marijuana sales tax will go towards the state’s rainy day fund.
“This is a brand new industry, we really don’t know (how much it will bring in),” Ratti said. “To have no services dependent on this money, I think it’s really fiscally responsible.”
The way the bill is written, the money can be picked up out of the fund for education at any time.
Ratti’s bill also puts a cap on the license fee that cities may charge marijuana establishments. That fee can be no more than 3 percent of the establishment’s gross revenue.
As a whole, local governments statewide also will receive $5 million for their expenditure of resources.
One of the greatest challenges ahead is ensuring that prices remain competitive with those available on the black market.
Currently, an ounce of marijuana at a medical dispensary goes for about $300, while an ounce on the streets might go for a $100 less.
The Legislature may need to review its tax rates in two years, Ratti admitted, depending on how successfully the regulated market stomps out the black market.
“It’s everyone’s opinion here that is not going to exacerbate the black market?” asked Assemblyman Keith Pickard, R-Carson City.
Ratti could not give a definitive answer. Most of the information that state and federal officials have on the black market is speculative, Ratti said, so the tax rates are based on other state models.
Dispensaries — which will have control over retail prices— will have to be careful not to hike prices too high since Nevada soon will be competing with the black market, and California by January next year.
For fear that the medical marijuana program could be smothered by the new recreational program, lawmakers have made it easier to be a part of the medical program.
“The medical marijuana program already is at risk. We needed to update the program,” said Will Adler, executive director of the Nevada Medical Marijuana Association.
While medical cards used to cost about $100 for a year’s value, the cards now will cost half the price because background checks no longer are required. The cards will be good for two years.
“You were treated like a criminal if you wanted a card, and if you had a criminal background then you couldn’t get a card,” Adler said.
Because recreational marijuana is now legal and anyone can get product, there is no point in doing the background checks.
Assemblyman Nelson Araujo, D-Las Vegas, sponsored the bill that will make the medical program more accessible. It also will streamline the program, folding the administrative duties into the Department of Taxation.
The Department of Public Health will continue to issue the medical cards.
A main priority for legislators was to keep pot out of children’s hands.
Sen. Patricia Farley, Non-partisan-Las Vegas, sponsored a bill that restricts marijuana packaging from including images of cartoon characters, mascots, action figures, balloons or toys.
The product also cannot be based on another product that is marketed to children, such as gummy bears or lollipops.
“I’ve been working on this bill since last session,” said Farley, who is a mother of two.
Throughout the session, Farley amended the bill so that labels also will have to include warnings for pregnant women and notices that consumers should wait four hours before consuming any more since edibles are particularly potent and take time to be effective.
Dosage limitations that vary based on the product also are included in the bill. Most packages cannot contain any more than 800 milligrams total.
Farley also amended her bill to include a production date since concern arose about food poisoning.
“These are food products that are totally unregulated,” Farley said. “We want people to know exactly what they’re getting.”
Labels will also have to include bold print reading, “THIS IS A MARIJUANA PRODUCT.”
Starting on July 1, the same day that recreational marijuana is supposed to be on shelves in-state, law enforcement will only use blood tests from now on to determine whether drivers are are under the influence of marijuana.
Assemblyman Steve Yeager, D-Las Vegas, wanted to ensure that urine tests, which test for components of cannabis that do not indicate impairment, no longer are used. Blood tests still cannot determine when marijuana was consumed, or whether someone is impaired.
Results can come back negative for someone who is high positive for someone who is not. The threshold for marijuana compounds in the blood is 5 nanograms.
Anyone who previously was convicted of possessing up to an ounce of marijuana in the past can file for their judgment to be erased and all related records to be sealed.
If the conviction was tied to any child abuse, sexual crimes or violent crimes, the conviction is ineligible.
Assemblyman William McCurdy II, D-Las Vegas, who sponsored the bill hopes that it helps people whose employment, living situation and eligibility for other opportunities because of a past marijuana possession convictions.
Nevada could see dispensaries on its tribal lands in the future.
Segerblom sponsored a bill that will allow tribes to enter into compacts with the state, allowing the tribes to open their own marijuana establishments so long as the tribes are in line with the requirements of state law.