NV lawmakers delay creation of $4 million marijuana regulation board to 2020

CARSON CITY, Nev. — After realizing they were facing a possible constitutional violation, members of the money committees voted Wednesday, May 15, to delay creation of the governor's Cannabis Compliance Board.

Gov. Steve Sisolak wants to create a new agency to handle regulatory and other issues surrounding recreational and medical use of marijuana, removing those responsibilities from the Department of Taxation.

Taxation would still, however, collect the taxes imposed on growing and dispensing marijuana and marijuana products.

Voters OK'd recreational use of cannabis in November 2016, meaning lawmakers and the governor can't change any of the initiative's provisions for three years after those election results were certified — including the language that states the Department of Taxation is responsible for regulating and collecting taxes on pot.

In this case, that date is Nov. 22, 2019. Staff advised members of the Senate Finance, Assembly Ways and Means subcommittee they can't use any pot funding to support the Cannabis Compliance Board until after that date.

Their only other option would be to build the new agency with several million dollars worth of General Fund cash. So the subcommittee voted to create the new agency effective in January 2020.

Two Republican members of the subcommittee questioned the need for the compliance board altogether.

Assemblyman Al Kramer, R-Carson City, said the Taxation department already regulates alcohol distributors and retailers and he doesn't see that regulating marijuana is much different.

“I don't see the need for this new department,” he said.

Pete Goicoechea, R-Eureka, also questioned the proposed agency, describing it as just another layer of bureaucracy.

Meanwhile, Assemblywoman Daniele Monroe-Moreno, D-Las Vegas, said having a stand-alone agency to control the pot industry would provide more transparency and better oversight as well as freeing up Taxation, “to do what their job is, which is taxation.”

Goicoechea said after the meeting the new agency would cost a minimum of $4 million to operate. The proposal would require two new unclassified positions and six classified positions, five board members and eight advisory board members.

The subcommittee also recommended hiring two, two-person teams of law enforcement officers to investigate possible illegal activities and a total of nine other positions including health inspectors, auditors and investigators to keep tabs on the industry.

“You're making it awful hard for me to get comfortable with this new board,” Goicoechea said.

The recommendations will be presented to the full money committees next week.