A problem and a dilemma:’ Nevada gaming committee tussles on marijuana’s future in casinos

Wade Vandervort

A convention goer jumps into a pool full of foam marijuana plant cutouts at the ShowGrow booth during the MJ Biz conference at the Las Vegas Convention Center on Wednesday, Nov. 15, 2017.

Gov. Brian Sandoval’s committee to determine marijuana’s future on Nevada gaming properties finished its meeting today without a formal decision.

But the group of gaming leaders, politicians and attorneys made their opinions clear during the nearly five-hour public session, painting a hopeful picture for the plant’s future in casinos before an official ruling is made in February.

“I don’t want to make a decision that puts one of our (gaming) licensees at risk,” Sandoval said.

The 12-member committee included: Sandoval, MGM Resorts International CEO Jim Murren, Nevada State Sen. Tick Segerblom, Assemblyman Steve Yeager and Nevada Gaming Control Board Chairman A.G. Burnett and Gaming Commission Chairman Tony Alamo, among others. It was the first time such a committee had met since November 2016.

Alamo reiterated comments he made in August during a Nevada Gaming Commission meeting, saying marijuana would be allowed in Nevada gaming facilities as long as federal law was not being violated.

But attorney Brian W. Barnes of D.C.-based Cooper and Kirk PLLC stated any marijuana business in casinos or gaming facilities would be considered racketeering or money laundering under U.S. regulations.

Barnes, who previously clerked for Supreme Court Justice Samuel Alito, said any sale, possession, or phone and email communication regarding marijuana commerce would be prohibited. That includes marijuana education conferences held in casino ballrooms and convention centers — even without the presence of pot products and paraphernalia.

“Marijuana business is illegal under virtually every aspect of federal law,” Barnes said.

Former Metro Police Sheriff Bill Young, who works as Red Rock Resort’s senior vice president of security, suggested casinos be “realistic” toward the plant’s popularity and growing number of users and investors. Young said casinos don’t have the resources to account for all avenues in which gaming and pot cross each other’s paths, such as if a marijuana dispensary employee visits a casino after work and still smells of pot.

“We need to look at scalability and to what extent we’re going to go after offenders,” he said. “In reality for someone who spends $25 on a meal that happens to be a marijuana dispensary employee, that’s a low level offense and they’re not going to be targeted.”

Both Barnes, Young and a third presenter, Las Vegas attorney Candace Carlyon, said marijuana must be reclassified on a federal level from a Schedule 1 drug before casinos should feel comfortable being associated in any way with the industry. Until then, pot is legally considered on the same level as heroin, LSD and ecstasy.

“Until federal law is changed, we have a problem and a dilemma with this,” Young said.

Marijuana facilities and operations that cause nuisance and injury to neighboring businesses or properties have also been subject to a growing number of Civil Racketeer Influenced and Corrupt Organizations Act of 1970 related lawsuits, Barnes said. He cited a June decision by the U.S. Court of Appeals which ruled in favor of families whose property was damaged by a neighboring cultivation facility as a result of “noxious odors.”

Despite recreational pot being legal in Nevada, casinos would have that same right if pot companies brought their product to gaming facilities or such fumes caused a nuisance on casino property, he said.

Segerblom and Yeager were two such proponents of the plant, who said they believed it had a role on casino property. Segerblom said cracking down on the industry’s ability to hold conventions and educational seminars on casino grounds would have an unnecessary “ripple effect” that would harm the marijuana industry. He urged fellow committee members to “know where to draw the line.”

That sentiment helped convince Alamo that conventions and educational seminars, as long as they didn’t include pot products or paraphernalia, could be allowed on casino grounds.

“I changed today because I think there is a way to allow conventions and business to business conferences to do this safely so a casino licensee is not put in harm’s way,” Alamo said.