Nevada accumulated over $500 million in its first year of recreational sales. It isn’t hyperbole to say that the nascent recreational industry in the Silver State is flourishing.
There’s just one problem.
There isn’t a legal place for people to smoke the weed they purchase. Cannabis cannot be consumed on the street, or in hotels, restaurants, bars, or vehicles. The only authorized location to consume pot is a private residence, and that isn’t even guaranteed. If your landlord prohibits cannabis use, the law falls on their side.
This problem isn’t really about Nevada residents, though. It’s about the 50 million tourists who visit the state each year.
Nowhere to Smoke in Las Vegas
Most Nevada visitors aren’t there for the desert—they’re there for Las Vegas, the oasis of debauchery known for offering racy experiences and keeping secrets in return. It should come as no surprise that cannabis entrepreneurs capitalized on the city’s reputation, and many tourists arrive fully expecting to indulge in a little recreational weed.
So they do.
It might be illegal to consume cannabis publicly, on the premises of a cannabis retailer, and in most lodging facilities, but that doesn’t stop consumers from finding discreet ways to get high. Be it vaping or ingesting a cannabis-infused snack, people have been finding ways to smoke around the law since the dawn of prohibition.
Law enforcement isn’t particularly interested in pursuing public consumption violations, though, and government officials are willing to admit the situation is less than ideal. Tourists spend large amounts of money on cannabis products only to be told that there’s nowhere for them to use them. They can’t even travel home with their goods because that would violate federal trafficking laws. For now, the practical approach has been to turn a blind eye. What happens in Vegas, stays in Vegas, right?
The Fight for Pot Lounges is a Fight for Legitimacy
For Nevada’s Clark County Commissioner-elect Tick Segerblom (D), the legally gray status quo misses the point of legalization. Formerly a state senator, Segerblom was a champion of cannabis regulation. As the newly elected commissioner for District E on the Clark County Commission, he plans to advance legalization by making Las Vegas home to pot lounges.
In an interview with Nevada Public Radio, Segerblom describes the dilemma the current situation presents tourists, residents, and lawmakers.
“The reality is you can’t have tourists coming here, encourage them to buy marijuana, promoting sales tax revenue from that for schools, and then say, ‘Oh yeah, by the way, you can’t use it anywhere.’ We just have to figure out a solution, and ultimately, that’s going to have to be—at least initially—some type of a pot lounge.”
States have been reticent to authorize cannabis lounges because regulating such an establishment is complicated. Some fear that it will draw unwanted attention from the Federal government. Others are concerned about safety as well as the potential for black market activity.
“There are two things to deal with,” Segerblom said, admitting that pot lounges come with risks.
“Number one is safety. We don’t want people driving up and going inside, so we have to figure out a way to get there.”
This isn’t a small issue. An October 2018 report released by the Insurance Institute for Highway Safety found that cannabis legalization was associated with a nearly 6% increase in insurance collision claims in Colorado, Washington, and Oregon when compared to control states.
Opening a cannabis café is arguably an invitation to drive while under the influence. Offering shuttle services or partnering with transportation companies like Uber have been suggested as potential solutions, but it’s not clear how to ensure that no one attempts to drive while under the influence.
The second area of concern Segerblom identified is even more complicated than the first. “We have to make sure that there are no illicit drug sales going on inside there,” he said.
Regulators will have to find a way to prevent black market operators from conducting sales inside the building. This will be tough since opening a cannabis lounge apart from a dispensary will require people to bring their own product. It wouldn’t take much effort for someone to make a quick exchange of money. And even though cannabis is legal for purchase in Nevada, tax rates make black market weed competitive.
Despite these challenges, there is a higher incentive for creating a legal space for folks to consume the products they have the right to purchase, and that is the legitimacy of the industry.
“One of the great things about legalizing marijuana is we got rid of the hypocrisy because people have been using marijuana for forever. Now that it’s legal, let’s just find a place where you can legally use it,” Segerblom explained.
“You can’t just say ‘buy it and we’ll look the other way. Use it on the street, use it in a hotel room, or whatever.’ To me, that’s not acceptable.”
The status quo presents tourists with a compelling temptation to break the law. It isn’t reasonable to expect every tourist to know before getting to Nevada that finding a place to legally consume cannabis will be exceedingly difficult. It isn’t even reasonable to expect that these tourists would realize the law’s limitations while there. The most logical conclusion most travelers to Nevada will make is this: if buying cannabis is legal, it’s probably okay to smoke it too.
San Francisco as a Model
In late November, Segerblom and six other colleagues headed to San Francisco to see how a local jurisprudence could manage to build a cannabis lounge industry without its state’s explicit authorization. As in California, the state of Nevada does not currently have a mechanism through which cannabis lounges can be legalized. That leaves any progress in that arena up to local legislators.
One difference between the two states is that California does not explicitly prohibit the existence of lounges in the same space as a dispensary while Nevada does. But that condition in Nevada’s law will expire in 2020. In March 2017, Segerblom introduced a bill into the state legislature that would have relegated this power from the state to the local government, but it stalled out. Segerblom plans to take part in drafting similar legislation during the 2019 legislative session.