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Nevada eases marijuana consumption lounge rules, issues first licenses
Nevada regulators this week approved loosening air-ventilation standards for marijuana consumption lounges in Las Vegas and other parts of the state while granting the first three conditional licenses for such venues.
The Nevada Cannabis Compliance Board’s (CCB) actions provide more clarity for operators to move forward with construction and design plans – and could make it cheaper and easier for lounges to open their doors in one of the nation’s largest tourist markets.
Chris Anderson, president of Sala Consulting, told regulators during a meeting Tuesday that the changes significantly lower the barrier to entry for consumption lounge operators while “drastically reducing the upfront investment and ongoing operational energy costs of running these ventilation systems.”
Sala, a Las Vegas-based government relations and public affairs firm, represents Planet 13, one of three Nevada companies that received conditional license approvals for marijuana consumption lounges.
The other two are:
- Common Sense Botanicals Nevada, operating as The Venue at Sol Cannabis in Washoe Valley between Reno and Carson City, in the foothills below Lake Tahoe.
- Cheyenne Medical in unincorporated Clark County.
Despite the issuance of the conditional permits, the widespread launch of dozens of consumption lounges still appears months away.
The U.S. marijuana industry has closely followed developments in Nevada as consumption lounges represent the next iteration of retail and events, helping fuel nationwide attention given Las Vegas’ reputation as a tourist mecca.
Nearly 40 million people visited the city last year.
Some lounge operators had hoped to open their doors this summer, but timelines were derailed amid administrative setbacks, funding concerns and changing regulations.
Loosening air standards
The CCB on Tuesday unanimously approved reducing the number of complete air changes per hour in smoking rooms from 30 to 20.
That’s in line with other similar venues such as hookah bars, cigar lounges and taverns.
The CCB also lowered air revolutions in nonsmoking areas of cannabis consumption lounges to six times per hour from 20.
Leading up to the meeting, industry executives had raised concerns about the state’s consumption-lounge regulations, particularly those covering indoor air quality and the related, astronomic costs of installing and maintaining air-ventilation systems.
“The industry suggested changes to air-exchange requirements that will enable these new small businesses to operate safely while reducing overburdensome requirements that would cost hundreds of thousands of dollars,” said Scot Rutledge, partner at Argentum Partners, a government affairs and marketing firm based in Reno.
Those expenditures would render consumption areas economically unfeasible for most operators and a near impossibility for social equity licensees, according to cannabis insiders.
Regulators also approved the use of a smoke-elimination device, dubbed Billow, that’s designed to allow users to consume marijuana through a small, closed-loop filtration system.
“We are thrilled that the CCB approved language today that allows for innovative technology to be used in consumption lounges as an alternative to expensive HVAC systems, especially where we can protect employees and allow equity businesses to thrive,” Billow’s inventor, Shanel Lindsay, told MJBizDaily after this week’s vote.
Lounges still a ways from opening
The CCB’s approval of the three conditional licenses is among the last steps required to open a consumption lounge.
But it appears operators are still far from launch.
When pressed to lay out Planet 13’s vision, a company representative told regulators that plans remain in the concept phase.
When Nevada regulators approved consumption lounges a year ago, they agreed to issue up to 65 licenses.
Of those, around 40-45 licenses would be attached to existing cannabis shops.
Another 20 were expected to go to independent lounges – including 10 for social equity applicants, or those with a nonviolent marijuana conviction and who live in a designated disadvantaged area.
The board this week also signaled it might adopt further changes regarding air-quality standards at consumption lounges at its July meeting, but those changes are not expected to be major.
The CCB next month might also approve other conditional consumption licenses.
Source: https://mjbizdaily.com/nevada-eases-cannabis-consumption-lounge-rules-issues-first-licenses/
New Mexico regulators fined a cannabis operator nearly $300,000 and revoked its license after the company allegedly created fake reports in the state’s traceability software.
The New Mexico Cannabis Control Division (CCD) accused marijuana manufacturer and retailer Golden Roots of 11 violations, according to Albuquerque Business First.
Golden Roots operates the The Cannabis Revolution Dispensary.
The majority of the violations are related to the Albuquerque company’s improper use of BioTrack, which has been New Mexico’s track-and-trace vendor since 2015.
The CCD alleges Golden Roots reported marijuana production only two months after it had received its vertically integrated license, according to Albuquerque Business First.
Because cannabis takes longer than two months to be cultivated, the CCD was suspicious of the report.
After inspecting the company’s premises, the CCD alleged Golden Roots reported cultivation, transportation and sales in BioTrack but wasn’t able to provide officers who inspected the site evidence that the operator was cultivating cannabis.
In April, the CCD revoked Golden Roots’ license and issued a $10,000 fine, according to the news outlet.
The company requested a hearing, which the regulator scheduled for Sept. 1.
At the hearing, the CCD testified that the company’s dried-cannabis weights in BioTrack were suspicious because they didn’t seem to accurately reflect how much weight marijuana loses as it dries.
Company employees also poorly accounted for why they were making adjustments in the system of up to 24 pounds of cannabis, making comments such as “bad” or “mistake” in the software, Albuquerque Business First reported.
Golden Roots was fined $298,972.05 – the amount regulators allege the company made selling products that weren’t properly accounted for in BioTrack.
The CCD has been cracking down on cannabis operators accused of selling products procured from out-of-state or not grown legally:
- Regulators alleged in August that Albuquerque dispensary Sawmill Sweet Leaf sold out-of-state products and didn’t have a license for extraction.
- Paradise Exotics Distro lost its license in July after regulators alleged the company sold products made in California.
Golden Roots was the first alleged rulebreaker in New Mexico to be asked to pay a large fine.
Source: https://mjbizdaily.com/new-mexico-cannabis-operator-fined-loses-license-for-alleged-biotrack-fraud/
Four marijuana companies, including a multistate operator, have filed a lawsuit against U.S. Attorney General Merrick Garland in which they allege the federal MJ prohibition under the Controlled Substances Act is no longer constitutional.
According to the complaint, filed Thursday in U.S. District Court in Massachusetts, retailer Canna Provisions, Treevit delivery service CEO Gyasi Sellers, cultivator Wiseacre Farm and MSO Verano Holdings Corp. are all harmed by “the federal government’s unconstitutional ban on cultivating, manufacturing, distributing, or possessing intrastate marijuana.”
Verano is headquartered in Chicago but has operations in Massachusetts; the other three operators are based in Massachusetts.
The lawsuit seeks a ruling that the “Controlled Substances Act is unconstitutional as applied to the intrastate cultivation, manufacture, possession, and distribution of marijuana pursuant to state law.”
The companies want the case to go before the U.S. Supreme Court.
They hired prominent law firm Boies Schiller Flexner to represent them.
The New York-based firm’s principal is David Boies, whose former clients include Microsoft, former presidential candidate Al Gore and Elizabeth Holmes’ disgraced startup Theranos.
Similar challenges to the federal Controlled Substances Act (CSA) have failed.
One such challenge led to a landmark Supreme Court decision in 2005.
In Gonzalez vs. Raich, the highest court in the United States ruled in a 6-3 decision that the commerce clause of the U.S. Constitution gave Congress the power to outlaw marijuana federally, even though state laws allow the cultivation and sale of cannabis.
In the 18 years since that ruling, 23 states and the District of Columbia have legalized adult-use marijuana and the federal government has allowed a multibillion-dollar cannabis industry to thrive.
Since both Congress and the U.S. Department of Justice, currently headed by Garland, have declined to intervene in state-licensed marijuana markets, the key facts that led to the Supreme Court’s 2005 ruling “no longer apply,” Boies said in a statement Thursday.
“The Supreme Court has since made clear that the federal government lacks the authority to regulate purely intrastate commerce,” Boies said.
“Moreover, the facts on which those precedents are based are no longer true.”
Verano President Darren Weiss said in a statement the company is “prepared to bring this case all the way to the Supreme Court in order to align federal law with how Congress has acted for years.”
While the Biden administration’s push to reschedule marijuana would help solve marijuana operators’ federal tax woes, neither rescheduling nor modest Congressional reforms such as the SAFER Banking Act “solve the fundamental issue,” Weiss added.
“The application of the CSA to lawful state-run cannabis business is an unconstitutional overreach on state sovereignty that has led to decades of harm, failed businesses, lost jobs, and unsafe working conditions.”
Alabama regulators are targeting Dec. 1 to award the first batch of medical cannabis business licenses after the agency’s first two attempts were scrapped because of scoring errors and litigation.
The first licenses will be awarded to individual cultivators, delivery providers, processors, dispensaries and state testing labs, according to the Alabama Medical Cannabis Commission (AMCC).
Then, on Dec. 12, the AMCC will award licenses for vertically integrated operations, a designation set primarily for multistate operators.
Licenses are expected to be handed out 28 days after they have been awarded, so MMJ production could begin in early January, according to the Alabama Daily News.
That means MMJ products could be available for patients around early March, an AMCC spokesperson told the media outlet.
Regulators initially awarded 21 business licenses in June, only to void them after applicants alleged inconsistencies with how the applications were scored.
Then, in August, the state awarded 24 different licenses – 19 went to June recipients – only to reverse themselves again and scratch those licenses after spurned applicants filed lawsuits.
A state judge dismissed a lawsuit filed by Chicago-based MSO Verano Holdings Corp., but another lawsuit is pending.
Source: https://mjbizdaily.com/alabama-plans-to-award-medical-cannabis-licenses-dec-1/
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