Nevada Department of Public SafetyState drug agents destroyed this plant along with thousands of others Thursday found in a remote area of Esmeralda County. In the past week drug officers in the region have seized more than $80 million in marijuana crops.
The head of Nevada’s Cannabis Compliance Board says he agrees with a Canadian university study that legalization of recreational marijuana use didn’t eliminate the illegal dealers.
And Tyler Klimas says that study in the Journal of Studies of Alcohol and Drugs is correct that the primary driver is price. Legal marijuana is more expensive.
An illegal dealer, he said, “doesn’t have to go through the kind of testing and compliance the legal market has to go through.”
Study author Professor David Hammond at the University of Waterloo in Ontario said his investigators found that more than a more than a third of buyers in Canada, which has legalized recreational pot, cited higher prices for their decision to buy from a street dealer. The number in the United States, the study says, was lower but still significant at about 27 percent.
But Klimas said more people might look to legal dispensaries if they realized how many contaminants are in a lot of the street pot including mold and heavy metals. The stringent standards legal pot growers have to go through in Nevada, he said, ensure that the product is clean and safe.
The taxes Nevada imposes on marijuana are the driver behind the higher prices. There’s a 15 percent levy on the product coming out of the farms and a 10 percent excise tax when the product is sold at a dispensary. On top of that, the buyer has to pay whatever sales tax the county or city imposes, over 7 percent in every county and over 8 percent in Clark and Washoe counties. That pushes the total tax above 30 percent. Illegal dealers, obviously, don’t pay those taxes.
Klimas said that’s unlikely to change since revenue was one reason for legalizing recreational marijuana in the first place. Marijuana taxes now pump about $100 million into Nevada’s budget.
Asked about claims that some better connected dealers are actually getting their marijuana from legal and licensed “grows,” he said the Cannabis Compliance Board is doing its best to crack down on that. A key component is that every plant in a licensed pot farm is “tagged” — It has a barcode attached that stays with the plant, “from seed all the way to until it is sold out of the dispensary.”
He said that enables CCB regulators to know precisely how many plants a grow has and what state of development they’re at.
“We still see untagged plants when we go in there,” he said. “We have a zero tolerance policy. If they have untagged plants, that product needs to be destroyed. We have to assume it’s going out on the illegal market.”
Klimas said CCB has gotten more aggressive in doing that.
“We’re starting to weed out those operators who have no business being in this industry,” he said. “I think, I know, we’re making a lot of progress.”
His investigators, four of which are now POST law enforcement officers, are also hunting down illegal grow houses. But as California cracks down on those operations, he said some illegal growers are moving out and, he said, “they’re not moving west out of California.”
He said CCB will be talking with lawmakers and the governor’s staff about expanding the number of “badged” investigators to give CCB, “a little more enforcement muscle.”
Hammond’s study says that as the industry matures, it will change.
“Regulators will need to balance public health and criminal justice priorities in order to establish a competitive market for legal cannabis that encourages legal purchasing,” the study concludes.
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