Last November, Nevada voted to pass Question 2, a bill that legalized recreational marijuana in state. The measure detailed the process for creating a legal industry by 2018. Officials decided to speed up that timeline this year in order to begin to receive tax revenue and also conduct a test run of the industry before all the rules and regulations are finalized. The language in Question 2 specified that those who held a liquor license would have the first chance to obtain a recreational retail license. However, in March, the Nevada Department of Taxation stated that there wasn’t enough interest from the alcohol industry. They wrote a letter that “while some were ‘interested,’ none followed up to indicate that they had a plan going forward to be ready to serve the market or that they had sorted out issues with respect to their federal liquor license.” Therefore, the department decided to open up the recreational marijuana licenses to the medical marijuana industry.
A Temporary Restraining Order Issued
Medical marijuana businesses had until May 31st to get their applications in to participate in the recreational marijuana industry and be ready to begin sales on July 1st. On Tuesday night, however, a Carson City judge placed a hold on the deadline, implementing a temporary restraining order on the Nevada Department of Taxation. It requires that the department will only be able to distribute recreational retail licenses to those who hold a liquor license. Despite the initial lack of interest from the alcohol industry, liquor distributors have now united to make it clear that they do want to participate in recreational marijuana.
Questions About the July 1st Launch Date
There is now a concern that the July 1st launch date will now have to be pushed back. Deonne Contine, the director of the Nevada Department of Taxation, told News 4-Fox 11 that they are still hoping to stick to the date with no delays and she believes there will be a hearing about the restraining order in approximately 10 days to discuss the issue further. Until then, the recreational marijuana industry will have to hang in the air. A representative of the Department released this statement: “The Department is reviewing the temporary restraining order with our legal counsel. We do intend to defend our regulations to the fullest extent of the law.”
Federal Regulations and the Alcohol Industry
Another potential issue that remains with the liquor distributors is whether or not they will run into complications with the federal government. Alcohol distributors are subject to abiding by federal law but marijuana is still illegal on a federal level and there is a chance that this could create a conflict. Samuel McMullen, who is representing various alcohol distributors, believes that this will not be an issue. He has stated that if it is not presenting itself as a problem for other business owners, it will not be a problem for the alcohol industry.
Nevada officials are enthusiastic to initiate the recreational marijuana industry in the state and, if a delay occurs, it will likely be resolved as quickly as possible as the state pushes forward with the end of prohibition.