Marijuana sales give Nevada a taste of the green rush, but high demand outstrips supply – Washington Post

By Amy Westervelt,

Melina Mara The Washington Post

RENO — Nevada’s fast-developing experiment with legal sales of recreational marijuana was an instant hit, and the July 4th weekend gave the Silver State a taste of the green rush.

In the first few days of sales, dispensaries reported more than 40,000 recreational transactions, a push that created two situations here: A rudimentary distribution system meant there wasn’t enough marijuana to stock the shelves, and high demand confirmed state officials’ sense that weed sales could help bolster state coffers.

The lack of product was due to a distribution problem the state discovered at the last minute and didn’t solve before sales were allowed July 1. Although state revenue projections estimated that the burgeoning marijuana industry could provide an extra $100 million to the budget during the next two years, the state rushed to get it on sale without entirely figuring out how to get it to customers.

The new state marijuana law gave exclusive distribution rights to wholesale alcohol distributors for 18 months, but when the first sales were allowed July 1, none had met the requirements for a license. Dispensaries, which had been handling medical marijuana sales for two years, stocked up. Sales were far greater — in some cases several times greater — than anyone expected.

So, worried that potential tax revenue could be at risk, the Nevada Department of Taxation declared a state of emergency, proposing regulations that would enable the expansion of distribution beyond the liquor industry.

Dionne Contine, executive director of the Department of Taxation, got to the heart of the matter on Thursday as officials considered emergency fixes: “Dispensaries will run out of product, they’re already running out of some products, and there will be a budget shortfall if that happens. Because if these businesses can’t

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