Taxation officials are warning unless the dispute over who gets to distribute recreational marijuana is settled and fast, stores across the state will run out of product and have to shut down.
Gov. Brian Sandoval on Friday authorized the department to present an emergency regulation to the Tax Commission on July 13 in order to “provide the structure to allow the department to determine whether there are enough liquor wholesalers to serve the marijuana distribution market.”
Carson District Judge James Wilson on June 20 agreed with a small group of alcohol distributors the voter-approved legalization of recreational marijuana specifically allows only licensed alcohol distributors to move recreational pot from producers to the retail stores.
The problem, according to taxation spokesman Stephanie Klapstein, is most of the liquor distributors who have applied don’t meet the requirements that would allow them to be licensed.
“Even as we attempted to schedule the final facility inspection for one of the applicants this week, they told us their facility was not ready and declined the inspection,” according to the statement issued Friday.
Department officials say they’ve been unable to issue even one license.
As a result, Klapstein said, a number of stores are running out of inventory because of demand that has greatly exceeded what anyone expected. While recreational sales licensing is on hold in Carson City, stores in Reno continued to have lines of people wanting to buy pot Friday afternoon, a full week after sales began.
Department officials point out marijuana business owners have invested huge amounts of money to build facilities in Nevada, hiring and training thousands of employees.
“Unless the issue with distributor licensing is resolved quickly, the inability to deliver product to retail stores will result in many of these people losing their jobs and will bring this nascent market to a grinding halt,” Taxation officials said.
Adoption of the emergency regulation, Klapstein said, will comply with the court order requiring Taxation to go through the process of determining whether there are enough liquor distributors to serve the market.
In the meantime, Taxation has appealed Wilson’s June 20 order and was this week granted an expedited schedule by the Nevada Supreme Court.