A “shadow” has been cast on the state’s medical marijuana industry by the ban of casino licensees involvement by state gaming regulators, a panel member reviewing Nevada marijuana laws said Thursday.
Las Vegas Councilman Bob Coffin criticized the Nevada State Gaming Control Board’s exclusionary stance that state casino licensees cannot be involved because the growing and sale of marijuana is still a federal crime, even if authorized at the state level.
“It makes us look schitzo in the eyes of the nation,” Coffin said to Control Board Chairman A.G. Burnett, who was appearing before the Advisory Commission on the Administration of Justice’s Subcommittee on the Medical Use of Marijuana, of which Coffin is a member.
Burnett had just restated the state gaming regulators’ unwavering position issued in May that “unless federal law is changed,” a gaming licensee and prospective license applicants cannot be involved in the medical marijuana.
“The last thing our state needs is an invitation to the feds to come in and intervene into gaming,” Burnett said. “A simple prosecution with a indictment with a large named gaming person on it is not going to help our state collectively.”
Since many banks refuse to do business with medical marijuana establishments, the industry is currently an all-cash model which could raise concerns of money laundering on the state and federal level, Burnett said.
Coffin said regulators could have let the casino licensees invest in the new industry at their own risk to federal law.
“From my perspective, we laid down awful fast,” he said. Coffin said after the gaming regulation bodies were formed 60 years ago, the state successfully stood against federal intrusion into the industry, telling them “we can do this better than you can.”
The ban has already forced the wife of Bruce Familian, owner of slot machine route operator Nevada Gaming Partners, to sell her 8 percent stake in a business that was awarded one of 18 medical marijuana dispensary licenses, pending state approval, in June by the Clark County Commission.
Other potential owners in the medical marijuana industry have also divested themselves of long-standing gaming interests, including Las Vegas Sun owner and publisher Brian Greenspun who sold casino interests to family members, and Troy Herbst, who separated himself from the family’s slot route operations.
Panel chairman and state Sen. Tick Segerblom said lawmakers want to remove the stigma of criminality if someone is involved in the medical marijuana business.
“What we’re trying to do is raise this from people involved in the medical marijuana business being perceived felons,” Segerblom said. “This is a new business and we want at some point have Nevada treat theses business people to be honored citizens instead of perceived as felons.”
Burnett also described for the 20-member panel the process gaming regulators go through in transferring of interest for gaming licensees.
Gaming licences are specific to individuals and their location when approved, and regulators need notification from both the gaming license applicant and the seller for any potential transfer of interest.
Chad Westom, director of the Nevada Division of Public and Behavioral Health, said medical marijuana establishment registration certificates are not transferable.
“There is an option that if the certificate is issued to a corporation, and they’re changing out ownership within the corporation, smaller percentage owners less than 10 percent can change,” Westom said. “They will have to go through a background check.”
The Legislature approved Assembly Bill 374 authorizing 66 dispensaries to operate in Nevada, with 40 in the Clark County. Unincorporated Clark County will have 18 dispensaries including one in Laughlin, with Las Vegas slatted for 12, Henderson five, North Las Vegas four and Mesquite 1.
Thursday was the final meeting of the 20-panel that first met in July. It consists of four state lawmakers and 16 appointees representing local government, law enforcement and the legal community.
Contact Arnold M. Knightly at firstname.lastname@example.org or 702-477-3882. Find him on Twitter: @KnightlyGrind.