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A Tale of Two Cities
Dave A. is a local businessman with a booming young company. He sells a high-quality product to a growing loyal customer base. But Dave’s enterprise is in jeopardy. He faces the threat of being forced out of business; not due to competition; not due to floundering sales or mismanagement; but because in just under a year, his industry may be outlawed in Truckee.
In November, California residents voted to pass proposition 64, which permits the use of marijuana recreationally in the state. While people 21 and older can now consume marijuana without fear of prosecution, and can grow up to six plants in their home for personal use, the implications of the law are far from settled. The state left it up to localities to decide how to regulate all other aspects of the industry, including sale, cultivation, consumption in public places, and taxation.
In Truckee, these regulations have yet to be discussed. The decision-making process will begin early February (see story on preceding pages). So existing medical marijuana dispensaries that operate within town limits are now left in limbo about how their businesses will fare come Jan. 1, 2018. Meanwhile, on the other side of the border in Incline Village, things are status quo for medical dispensaries, and they are on track to continue operation with no disturbance.
What can this drastic discrepancy in experiences be attributed to? Those in the industry say it has to do with the regulations that are already in place in each state. California’s historically lax medical marijuana regulations have put the industry far behind Nevada, where stringent laws for medical marijuana sales have been in place since 2001. With the passage of legislation in California not only legalizing recreational marijuana, but also enforcing new standards and regulations on medical marijuana sales, Golden state dispensaries have much work to do in 2017.
Dave is president of Green Trees Wellness, a medical marijuana delivery dispensary that serves North Lake Tahoe, sells marijuana products like flower, extracts, edibles, and even topicals to patients with medical marijuana recommendations. The business is regulated by Proposition 215, Dave said, but the law, enacted in 1996, did not really provide a standardized protocol for running these businesses. Though Dave says he self-regulates his business to the extreme, not everyone is required to hold themselves to those standards.
“We’re proud to be the only dispensary in North Lake Tahoe, California, that lab-tests all of their flowers and carries a vast array of third-party lab-tested products,” Dave said. “That’s huge. Because right now there’s no required testing, there’s no regulation, there’s no outlawed pesticides in California. There is no benchmark of required quality in any way, shape, or form right now.”
He sees dispensaries as becoming a source of pride for the community. He patronizes local businesses because he wants to support the community, and he sees a lot of the same sentiment in Truckee. If the town allows the sale of marijuana within town limits, then the new law will allow him to hire locals for well-paying jobs and contribute significantly to the tax base because it’s expected that high taxes will be imposed.
“If the Town of Truckee will allow me to expand in the way I want, these jobs would be created and available for young people here, and that’s important,” Dave said. “We want to support locals; we want to support the local economy.”
But, if the Town says no to dispensaries, his business will likely shutter. He has no desire to relocate, and doesn’t see it as a viable option for himself, either. Even if the Town stalls on its legislation, it may take him out of the running if he has to temporarily close the store while waiting for final decisions. Every day that passes without him bringing in revenue, the likelihood of an outside company coming in and taking over the local industry becomes greater, Dave said.
Town of Truckee Senior Planner Jenna Endres, who is heading up the Town’s marijuana regulation efforts, said that the Town is aiming to stay within the state’s framework and get a comprehensive package of laws passed by the Jan. 1 deadline, but added that they will not “hastily” rush something just to stick to the state’s deadline.
“We’re not looking to drag our feet, but we’ve never embarked on something like this,” Endres stated. “I’d say it’s a pretty big undertaking for us.”
This is uncharted territory for Truckee. Endres recalled that in her 10 years working for the Town, there has been no comparison for the scope of this project. It’s an entirely new industry that does not have any regulatory framework in Truckee to build on. According to Endres, there are about seven or eight facets of the industry that will need to be discussed, like what types of industries will be allowed in town, where they will be zoned to operate, rules for public consumption, how much to tax these sales, and where that revenue will go. The Town is essentially tasked with creating a comprehensive set of regulations for a brand new industry from scratch.
“We’re really at the first step,” Endres said. “We don’t know at this point what people are interested in regulating. What we’re asking is, what does our community want to do.”
Eli Scislowicz, general manager of NuLeaf, a medical marijuana dispensary in Incline Village, seems much more relaxed about the transition. NuLeaf bills itself as the only Nevada state-approved medical cannabis provider in Lake Tahoe. The stylish storefront provides patients with cannabis medicine in a wide variety of forms. In November, Nevada voters passed Question 2, which legalized recreational marijuana use in the state. The medical cannabis industry in Nevada has always been more strictly regulated than in California, Scislowicz said, and the new recreation laws will likely reflect the existing medical laws. If NuLeaf decided to branch out into recreational sales, Scislowicz believes there should not be many regulatory changes the business would be forced to take on. Nevada dispensaries also will not face the same state versus local government struggles that Truckee is tasked with, he said.
“In Nevada, the legislation gave more power to the state to regulate cannabis businesses,” Scislowicz stated in an email to Moonshine Ink. “Localities could impose additional rules like taxes and operating hours, but, in terms of how they operate, the robust state laws made it so localities were not burdened with this task.”
Scislowicz said that the response in Incline Village to the marijuana industry has been “largely positive.” Because NuLeaf is an existing business in good standing, Scislowicz speculated that they may even be permitted to start recreational sales as early as July.
“We are happy with the direction the industry and the path regulators are on,” Scislowicz wrote via email. “There are small changes that are needed to improve the business like with any industry, but overall we are happy with the current legislation.”
While medical marijuana dispensaries in Nevada will be largely unchanged by new legislation, Truckee businesses will be left sweating it out as the clock ticks down to Jan. 1.
“We have a wonderful chance to have a very robust, positive process here in town where everybody is educated, everybody gets to have their voice heard, their opinion heard,” Dave said. “We can take that information and we can build something out of that, but we need them to allow us to do that.”
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