Pubdate: Fri, 04 Nov 2016
Source: Las Vegas Sun (NV)
Copyright: 2016 Las Vegas Sun, Inc
Author: Chris Kudialis


Next week, Nevada will have the chance to join four other states to
allow legalized recreational marijuana for adults.

Ballot Question 2 would not only allow Nevadans age 21 and older to
have easier access to pot, it could provide more than $1.1 billion in
tax revenue and economic activity over the course of the proposed
law's initial eight years, according to a study by Las Vegas-based RCG

Armen Yemenidjian, president and CEO of the three Essence Cannabis
Dispensaries in the Las Vegas Valley, is ready for the change.

Yemenidjian, whose dispensary chain was recently ranked first in
Nevada and included in the top 25 marijuana outlets nationwide by a
Business Insider report, currently boasts an inventory of over 100
products, ranging from flower strands to vaping products and
marijuana-infused body lotions. That inventory would double to about
200 products if Question 2 passes, he said, and customers would
increase by "three or four times."

"It'd be huge for us," Yemenidjian said. "No doubt about

With 53 percent of Nevadans in favor of the proposal, according to a
Oct. 26 KTNV-TV/Rasmussen Report poll, Question 2 will become law on
Jan. 1, 2018, if Yemenidjian and state legislators in favor of the
proposal have their way.

Current medical marijuana license holders will have the first
opportunity at the new recreational licenses. Yemenidjian said all
three of his valley dispensaries would turn into dual medical and
recreational cannabis dispensaries.

With one section of the store for displaying marijuana products for
medical customers and another section for recreational buyers,
Yemenidjian said inventory of products like Island Sweet Skunk flower,
edible cake pops and moisturizing body cream will be labeled
separately for recreational buyers and his current medical buyers.

"The quality of the product would be the exact same," Yemenidjian
explained. "The only thing different would be the taxes."

Andrew Jolley of The Source Dispensary also hopes to turn his two Las
Vegas Valley dispensaries into dual-medical and recreational
facilities. Now with over 150 current products, Jolley said he'll
continue expanding as early as January of next year.

"Many products serve both medical and recreational customers" Jolley
said. "So there won't be too much transition required in that regard."

Just south of the Strip, marijuana grower Kevin Biernacki of the Grove
has saved half of his 11,000 square-foot cultivation facility for the
possibility of recreational marijuana. If Ballot Question 2 passes,
Biernacki's current 4,000 marijuana plant facility will become 8,000
total plants, requiring an additional 500 color-coordinated LED lights
and several thousand more gallons of water purifying and storage tanks
to double his current marijuana output.

"All this is saved for recreational," Biernacki said this summer,
pointing to three empty rooms in his cultivation facility. "Business
would skyrocket if that passes."

The Las Vegas marijuana growers and distributors didn't divulge
financial figures for their own businesses. But Armenidjian said
passing recreational marijuana would be key for all of the state's 42
dispensaries to stay afloat. While the medical model is still
expanding and "somewhat stable," Armenidjian said he knows of "a
couple" medical dispensary owners who might not make the cut without
Question 2.

"Right now we just don't have enough in-state medical customers for
everyone to get by," he said.

Much will also depend on the Nevada Legislature.

With most of the provisions of the proposed law already outlined in
Ballot Question 2, the Legislature's main priority would be
consolidating Nevada's recreational and medical marijuana programs
under state bureaus and ensuring the new medical program is ready to
go by early 2018.

Among the Legislature's top priorities would be moving the medical
marijuana program from the Department of Health and Human Services to
the Department of Taxation, joining the proposed regulatory state body
for the recreational marijuana.

The move to the taxation department will mirror how alcohol is
regulated in Nevada, explained state Sen. Patricia Farley. The
department monitors alcohol sales and revenue while business
regulations and enforcements for violators are handled on the local

"The Department of Health and Human Services doesn't really have the
money or guidance to decides who does what," Farley said. "So rather
than reinvent the wheel, we just want to simplify things."

State Sen. Tick Segerblom said the Legislature's role is pivotal in
moving the recreational program forward on time. While Nevadans voted
on making medical marijuana legal in 2000, the first dispensary didn't
open until 2015.

Segerblom hopes a proactive state Legislature in 2017 will prevent the
same result with recreational marijuana.

"When there's uncertainty, everything takes longer," Segerblom said.
"We don't want that."

Yemenidjian said the sooner Question 2 passes, the more Essence and
other dispensaries would benefit in the long-term.

"We've come this far as a state and there's no turning back now," he
said. "So the question is whether we want to thrive or risk our

Keeping Nevada a medical marijuana-only state while others, like
California and Arizona attempt to go recreational, could detract
additional weed-seeking visitors from coming to Las Vegas, RCG
Economics Principal John Restrepo said.

While most of Las Vegas' more 42 million annual visitors come to the
valley for its variety of gaming and entertainment options, adult-use
marijuana would draw a "small yet notable" addition of weed-specific
tourists here, Restrepo said. His 88-page economic analysis didn't
include a number of estimated marijuana-specific tourists, but such
visitors would be "a certainty."

"If Question 2 doesn't pass, we'd lose out on the taxable revenues for
adult-use, and you'd potentially lose visitors that wouldn't come here
otherwise," Restrepo explained.

In Colorado, state officials say that since the recreational use model
went into effect in Sep. 2014, over $100 million in tax revenue has
been raised by state marijuana facilities.

That money went into a state research fund for marijuana studies,
Colorado Director of Marijuana Coordination Andrew Freedman told
cannabis website HighTimes in August, as well as substance abuse
treatment facilities in Colorado and after-school youth drug
prevention programs.

"I think a lot of people who don't normally use marijuana are taking
their vacation in Colorado and deciding to partake," Freedman said.

In Washington State, recreational marijuana has contributed more than
$65 million to state coffers since the program kicked off in July 2014.

State spokesman Mikhail Carpenter called the program "a success,"
adding that it continues to expand quickly as tourists and locals
alike move from black market sellers to regulated, licensed

"Above all, the recreational program has been very successful in
taking a black market and bringing into a regulated industry," said
Carpenter, spokesman for the Washington State Liquor and Cannabis
Board, which regulates alcohol and marijuana sales.

Travel Oregon spokeswoman Linea Gagliano estimated as many as five
percent of the state's 27 million annual tourists have come for
marijuana since the state enacted legalized recreational use last
year. Through July, the state had collected over $18 million in tax
revenue, translating to about $72 million in sales.

While Gagliano said Oregon's tourism industry doesn't focus its
advertising on its legal marijuana industry because the plant is still
federally illegal, it often resonates with visitors coming to explore
the Beaver State's popular food and outdoors scenes.

"People come here for great food and a beautiful outdoors scene,"
Gagliano said. "We just happen to also have recreational cannabis."

Editor's note: Brian Greenspun, the CEO, publisher and editor of the
Las Vegas Sun, has an ownership interest in Essence Cannabis
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