LAS VEGAS, NV. 24 May, 2015 — Nevada’s first licensed medical marijuana dispensaries have been ready to open their doors for months. What’s the hold up?
Pesticide, according to Shane Terry, CEO of NuVeda, a company licensed to open dispensaries and grow operations. His operation has not been able to open because a state advisory committee could not settle on pesticide rules. “Nobody can start growing until it’s resolved,” Terry said in an April statement.
A state health official said on 5 May that the rules are finally in place for labs to commence testing marijuana. For Cindy Orser, chief science officer of DigiPath, whose lab has been waiting to test cannabis since January, the news came as a surprise. Confusion and red-tape surrounding pesticide and contaminant standards has kept Nevada canna-businesses in a limbo for months.
THE PESTICIDE ISSUE
Before cannabis can be sold by licensed dispensaries, it must be tested for contaminants, heavy metals and pesticide residue, using standards set by the seven-member Independent Laboratory Advisory Committee. However, although Nevada passed its new medical marijuana laws in 2013 and dispensaries were supposed to open at the beginning of this year, the advisory committee only met for the first time in January. They’ve been grappling with the pesticide issue ever since.
Committee chairman Ed Alexander says marijuana must meet stringent standards and the committee is “very, very close” to recommending rules. Meanwhile Vegas dispensary Euphoria Wellness had a ribbon-cutting and open house back on 31 March, anticipating a decision on 1 April. As community bigwigs and media fawned over the upscale designer décor, display cases, clothing, paraphernalia and impressive security, the advisory committee pondered over whether to adopt the pesticide limits used for lettuce.
In the end, they referred the matter to the Division of Public and Behavioral Health, which said a regulation would have to be changed to enable the lettuce-linkage, which could not happen until after the Legislature adjourns on 1 June. In an attempt to move the process ahead, the committee took a vote on April 16 and issued a formal state policy, but even then no one seemed clear on exactly how testing would work.
THE PESTICIDE TUSSLE IMPACTS SUPPLY
Because large scale cultivation and testing is not yet fully underway in the state, dispensaries do not yet have access to a steady and reliable supply of bud. It’s a Catch-22, since growers can’t get crops underway until they know which pesticides they are and are not allowed to use. In the meantime dispensaries can bridge the gap by purchasing from medical cardholders who have been growing for personal use under the existing legal framework. Ironically, they will be selling weed that does not comply with the as-yet undetermined pesticide standards, anyway.
BANKING PROBLEMS ARE NOT HELPING
Companies were thrown an extra curveball in April when banks suddenly reversed decisions to work with the industry in Nevada. First Security and Oreg0n-based MBank backed off, closing cannabis businesses accounts, citing compliance costs and continuing concerns about federal regulations. A Colorado-based startup, Fourth Corner Credit Union is still bogged down in red-tape, awaiting regulatory approval to provide services.
HOPE AT LAST?
Opening a medical marijuana dispensary is not like setting up a food cart. Companies like Euphoria Wellness, Serenity Wellness, and Life Gardens have gone through a lengthy and expensive process to prepare for doing business, including inspection by state and county officials, and laboratory certification of their cannabis. Euphoria Wellness co-owner Joe Lamarca estimates that his company has spent about $1 million on consultancy and licensing fees and the cost of renovating their premises to meet stringent requirements.
Built like Fort Knox, Euphoria has bulletproof glass, barred windows, metal barriers, security cameras, a key-code vault and other high-tech systems. A staff of 16 will be ready to help patients when the doors finally open (over 1,000 applications were received for the available positions, the company says), but delays have cost a fortune. Businesses cannot recoup start-up costs until they open. Lamarca said he and his partners had to hire and train employees before they could could even get their state license. “Now I’ve trained them, I’m paying them, and I still can’t open,” he said in a recent statement to Las Vegas Review Journal. That may change in the coming week, if testing is completed.
Pam Graber, a spokeswoman for the state’s Medical Marijuana Program, said officials are working to get businesses open as fast as possible. “There are a lot of moving parts here.”
Nevada legalized medical marijuana use in 2000, allowing medical marijuana cardholders to grow their own plants or acquire them from other cardholders. However, the state did not authorize a system for in-state access until 2013, when it approved licensing and regulation of medical marijuana dispensaries and related businesses. So far Nevada has awarded 55 dispensary licenses and over 300 permits to growers, testing laboratories and edibles producers since applications closed in April 2014.