On March 5, 2018, Nevada’s Gaming Policy Committee convened briefly to pass a resolution that provides clarity for Nevada gaming licensees regarding the interactions they may and may not have with the state-legal marijuana industry.
This meeting followed from the discussion and testimony received at the last Gaming Policy Committee meeting in November 2017. As discussed in our article "Nevada’s Gaming Policy Committee Convenes to Discuss Marijuana and the Gaming Industry," at that meeting it was made clear that gaming licensees have a sometimes-tricky line to walk in order to remain in strict compliance with state and federal law in a state where both medical and recreational marijuana are legal.
The three key issues discussed in the November meeting and dealt with in the Resolution include:
- 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 or maintaining a business relationship with an individual or entity engaged in the sale, cultivation, or distribution of marijuana; and
- The propriety of a licensee receiving financing from or providing financing to an individual, entity or establishment that sells, cultivates, or distributes marijuana.
The resolutions adopted on March 5 include that Nevada gaming licensees:
- shall not directly "participate in the marijuana industry";
- shall not "contract with or maintain business relationships with or enter into landlord/tenant agreements with individuals or entities for the purpose of engaging in the sale, cultivation or distribution of marijuana";
- shall not "receive financing from or provide financing to individuals, entities or establishments that sell, cultivate or distribute marijuana";
- shall "continue to follow all federal direction regarding AML obligations and SAR reporting, in line with FINCEN guidance";
- shall be allowed to "host conventions, trade shows, or similar conferences that may be related to marijuana but whose focus is primarily networking between participants . . . and other trade or educational activities that do not facilitate the actual possession or consumption of marijuana on a licensed property";
- shall "take care to ensure that any events on the premises of a licensed gaming establishment do not promote illegal activities or foster incidents which might negatively impact the reputation of Nevada’s gaming industry"; and
- shall "conduct necessary due diligence and exercise discretion and sound judgment to prevent violations of Nevada or federal law in all business and financial activities."
Although these resolutions are not legally binding, they do serve as policy recommendations for the Nevada Gaming Control Board and Gaming Commission and provide some additional clarity for gaming licensees.
Some of these recommendations are not news – it’s long been the policy of Nevada’s gaming regulators that licensees cannot directly participate in or have business relationships with the marijuana industry, including that any individuals who hold a gaming license shall not also be a landlord to a marijuana business. The guidance that licensees may host marijuana-industry trade shows and conferences, however, is sure to be welcome news in a town where conferences are big business.