Gov. Brian Sandoval has decided to convene the Gaming Policy Committee to address topics basically around when gaming licensees can do business with parties involved in state-permitted marijuana. In particular the governor’s executive order directs the committee to consider the following four topics and prepare a recommendation for the Nevada Gaming Commission (NGC) by June 15, 2018:
The propriety of events on the premises of a licensed gaming establishment that cater to or promote the use, sale and cultivation or distribution of marijuana.
The propriety of a licensee contracting with or maintaining a business relationship with an individual or entity engaged in the sale and cultivation or distribution of marijuana.
The propriety of a licensee receiving financing or providing financing to an individual, entity or establishment that sells, cultivates or distributes marijuana.
Any other matter as directed and determined necessary by the Chair.
Since the passage and implementation of Nevada’s marijuana laws, the NGC has placed the gaming industry in a rather confused position. On one hand the state permits the acquisition for private consumption of medical and recreational marijuana, and on the other the appointed members of the Gaming Commission have declared effectively, citing the federal law against marijuana, any involvement by a licensee with marijuana in any form would be considered an unsuitable method of operation, which usually equates to severe fines and/or license revocation.
Arguments of if the NGC should over ride a law mandated by the people of the State of Nevada, or if issues such as gaming and marijuana, which are states’ rights issues, should even pay attention to federal considerations are for legal scholars and those who have the bankroll to take up such issues. But as the conflict has been created, the governor is wise in seeking to set boundaries so two Nevada legal activities do not clash, at least too much.
In considering some the real world issues casino operators will need to face, it occurs to me perhaps in the opening session of the committee they should invite representatives of the U.S. Attorney General’s Office (USAG) to speak about a few topics that could materially impact some of the committee’s recommendation.
For instance, as Nevada, in my opinion foolishly, surrendered its exemption from Title 31, which requires casinos to report transactions similarly as banks, it would be good to know if casinos will have to report every transaction associated with any person(s) or entities directly or indirectly involved with the business of marijuana under “suspicious activity” reporting rules as currently required of banks?
It would also be good to know from the USAG’s office if there would be any RICO Act implications for doing business with any known party breaking federal marijuana laws. The committee should also ask if the USAG has other issues the committee should be aware of related to any potential overlap in the worlds between gaming and marijuana; or if the USAG’s plans any forms of enforcement of federal drug laws related to marijuana within Nevada.
While it would be great if the committee collected and shared information on the potential impacts on employees and workplace safety from second-hand consumption of marijuana, as the committee seems to be called to help set bounds, perhaps if their recommendations could address the following questions each operator could take it from there:
Can guests use marijuana in their guest room and if not how far are casino operators expected to go to stop it? Keep in mind, something on the order of 85% of Baby Boomers and 33% of the Millennial Generation has tried/used marijuana.
Should concierges and/or casino hosts be barred from recommending dispensary locations to inquiring casino guests or accepting tips/kickbacks from those locations as is customarily done now for restaurants, night clubs, strip clubs and other off-property recreation/entertainment options? If these would be allowed, why should the property not get the referral fee itself then?
Should there be different tolerances granted to huge players?
Could the resorts provide cannabis consumption rooms similar to the smoking rooms at the airport?
Should there be different standards for smoked versus edible marijuana products?
While some of the above is suggested very much “tongue in cheek,” the reality is the gaming industry needs is to know where the lines are drawn that would invoke the wrath of the Nevada Gaming Commission and what the acceptable rules of operation related to marijuana will be. Financing questions and group booking questions are of nominal import to the day to day operators who simply want to know how they are expected to deal with and treat customers who are using a legally acquired product.