LAS VEGAS (KTNV) — Casino companies should be allowed to offer marijuana on their premises, although doing so would require a change in state gaming regulations and laws, some experts argued on Friday.
During the third annual Cannabis and Gaming policy discussion — jointly sponsored by the UNLV International Gaming Institute and the Cannabis Policy Institute — state lawmakers and gaming industry experts discussed changes to current state policy.
That policy, set by the Nevada Gaming Commission after Nevada legalized medical marijuana use in 2013, is that licensed casinos may not permit marijuana in any form on their properties.
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Not only that, but businesses such as marijuana lounges must not be closer than 1,500 feet to a licensed casino, and casino companies may not also be investors in marijuana businesses.
The regulation springs from the fact that marijuana is still considered a controlled substance. And since casinos are regulated as financial institutions, they could be accused of facilitating a federal crime by allowing cannabis use. Even worse, the state could revoke a casino's gaming license.
(The government recently reclassified state-licensed medical marijuana from a Schedule I drug — for which there's supposedly no medical benefit — to a Scheduled III drug, which allows for more research. But marijuana is still considered a controlled substance.)
But that doesn't mean everyone in the industry agrees.
A study conducted by University of California Davis Professor Robin Goldstein showed that tourists have trouble getting legal marijuana in Nevada, since deliveries are prohibited to casinos. And that's costing the retail businesses about $750 million annually, with the state losing out on about $80 million in annual tax revenue, he said.
Seth Schorr, CEO of Fifth Street Gaming, says not every casino would offer marijuana to customers, but that those that want to should be able.
But it won't solve Las Vegas's most recent visitor decline, he said.
"This is a tool in the toolbox. I don't believe in silver bullets," he said. "I don't think there's one solution that's going to put Las Vegas and Nevada back on the trajectory."
Added Schorr: "I heard Robin just describe a lot of reasons why there should be a marriage between the gaming and cannabis industry. I've yet to hear anybody say why there shouldn't be."
The voters who ultimately legalized recreational marijuana in 2016 didn't consider whether tourists would have a place to buy or use marijuana, Schorr said. Now, they'd likely approve of sales to visitors to gain the additional tax money.
State Sen. Rochelle Nguyen, D-Las Vegas, called the current regulations "ridiculous." People are still getting the drug delivered to them near casinos, and often use it along the Strip.
"We're an industry that sells vice," she said.
And Assemblyman Max Carter, D-Clark County, said he had a bill that would have allowed marijuana delivers to non-gaming businesses on the Strip, but the measure died after the casino industry came out against having marijuana anywhere near their properties.
Alan Feldman, a longtime Las Vegas gaming industry executive who now is the director of strategic initiatives at the International Gaming Institute, said the industry has worried about plenty of things in the past, including Indian gaming and especially online gambling.
But casinos have survived and thrived, mostly by catering to the changing needs of their customers.
"Meeting the customer's needs," he said. "And by the way, in the hospitality industry, let's remember that's kind of the core practice. Being hospitable. Meeting someone's needs. Providing for what they're asking for."
His suggestion: Work with existing regulatory bodies. Cannabis companies could get access to the Strip, but only by operating inside a casino licensed by the Gaming Control Board and Gaming Commission. And casinos could get access to cannabis businesses, but only by contracting with companies regulated by the Cannabis Compliance Board, he said.
"The fear here has never been about money," he said. "It's about licensure."
But how the federal government will respond is an open question. With marijuana still a controlled substance — irrespective of its outright legalization in several states — what the U.S. government will do is still a concern.
Nguyen said a sweeping bill likely won't come immediately, but that each session of the Legislature works to fix errors made in the past. The next session won't take place until 2027.
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