On a 2-1 vote, the Board of Examiners Tuesday approved $887,491 to enable the Department of Taxation to move forward on regulations to implement the voter-approved recreational marijuana law.
Deputy Taxation Director Rick Gimlin said without that money up front, the department wouldn’t be able to meet the statutory mandate that they get the program up and running by the end of this year.
“If this request is not approved, we really do not have the resources to meet the timeline of this program,” he told the board consisting of Gov. Brian Sandoval, Attorney General Adam Laxalt and Secretary of State Barbara Cegavske.
That includes regulations governing licensing of dispensaries, cultivators, test labs and distributors as well as the system for tracking and collecting tax revenues.
Gimlin said the funding from the Interim Finance Contingency Fund is a loan that will be paid back by tax revenues collected from the sale of marijuana once the program is in operation. But he said there won’t be any revenues until recreational pot dealers are licensed and operating.
Cegavske objected to the funding saying the issue should wait until the 2017 Legislature is in session and the whole program can be properly vetted.
“For me, doing this during the Legislature makes much more sense,” she said.
But Gimlin said that would put them three or four months behind and make it unlikely they could get the job done by year’s end.
Sandoval joined in saying he opposed the ballot question legalizing recreational marijuana but that the voters overwhelmingly approved it.
“The department has a massive amount of responsibilities and it’s been testified to that it doesn’t have resources to implement or take action on it,” he said.
“The majority of this cost is not personnel,” said Sandoval. “It’s software and the ability to set up a collection system.”
Finance Director Jim Wells said once revenue starts coming in from marijuana sales, the treasurer and his office will simply take part of the collections to pay back the loan.
Sandoval also pointed out this sort of loan has been done before — most prominently last year when the board loaned the Treasurer’s Office money from the contingency fund to get the school vouchers program started on the promise once the program was operating, the treasurer’s share of the education funding could pay it back and cover operating expenses for the so-called Educational Savings Accounts.
Cegavske voted against the funding. Sandoval and Laxalt voted for it. The appropriation must still pass muster at the legislative Interim Finance Committee this month. That body has the final say on appropriations from the contingency fund.
