Consumption Lounges on the Horizon for Nevada

By the middle of next year, Nevada is poised to offer a new type of venue to get high.

State lawmakers on Wednesday approved funding for the Nevada Cannabis Compliance Board to oversee so-called “cannabis consumption lounges” there.

Members of the Interim Finance Committee “unanimously approved three items that will provide the [Cannabis Compliance Board] with funds to hire more staff, work with the state attorney general’s office to hammer out regulations, and direct cannabis revenue toward education funding,” according to the Nevada Independent.

The Independent reported that the committee “would direct $10.9 million to fund 23 new full-time employees at the regulatory agency,” which “would include positions responsible for cannabis lounge licensing, pre-opening and ongoing compliance checks, background checks, lounge suitability determinations and criminal investigations.”

Tyler Klimas, the executive director of the Cannabis Compliance Board, told the committee on Wednesday that the additional funding places the new businesses on track to open their doors early next year.

“All goes as planned, we’re looking at—at least the first quarter, or the first half of 2022,” Klimas said, as quoted by the Nevada Independent. “Not only to see the lounges open, but then also the first part is where we would start to realize that revenue.”

The new type of businesses were put in motion last month after Nevada legislators passed a bill aimed at diversifying the state’s still-nascent recreational marijuana industry.

The legislation also included provisions for the cannabis consumption lounges: to provide “for the licensure and regulation by the Cannabis Compliance Board of cannabis consumption lounges”; to set “forth certain requirements for the licensure of cannabis consumption lounges”; and to set “forth certain requirements for the operation of retail cannabis consumption lounges and independent cannabis consumption lounges.”

Consumption Lounges Won’t Be the Only Positive Change for the Industry

The bill also requires the Cannabis Compliance Board to “adopt regulations establishing criteria to determine whether an applicant for the issuance or renewal of an adult-use cannabis establishment license for an independent cannabis consumption lounge qualifies as a social equity applicant,” defined as “an applicant that has been adversely affected by previous laws that criminalized activity relating to cannabis.”

Moreover, the bill “authorizes the Board to reduce certain fees associated with an adult-use cannabis establishment license for an independent cannabis consumption lounge for social equity applicants,” and “requires that at least 10 of the first 20 adult-use cannabis establishment licenses for an independent cannabis consumption lounge issued by the Board be issued to social equity applicants.”

A report issued by the Cannabis Compliance Board earlier this year found that the state’s marijuana industry lacked diversity, with around 65 percent of owners and managers identifying as white.

Steve Yeager, a Democratic assemblyman from Las Vegas, sponsored the legislation, which he hailed as a boon for the state’s recreational pot industry.

“It’s been a long journey from where we started, really, in the 2013 session and then launching dispensaries, so it’s really nice to see how the industry has matured,” said Yeager, as quoted by the Nevada Independent. “The legislation that we see this session is really in recognition that we’ve primarily done things right and to try to take that next step.”

The bill also provides funding from the cannabis sales to the state’s K-12 education. Yeager said Wednesday that Nevada’s marijuana business is “going to be an industry that is going to pay for itself, and then hopefully be able to fund education in a way that I think we’d all like to do here in the Legislature.”

Recreational marijuana was officially made legal in Nevada in 2017, after voters there passed a ballot measure the year before. According to CannaCon, Nevada is now one of seven states to have legislation on the books permitting cannabis lounges.

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