Last week the Nevada Senate Committee on Finance unanimously voted to approve SB276 to reallocate dispensary licenses initially meant for rural counties, but never claimed. In total, there are eight licenses potentially up for grabs in Las Vegas and Three in the Reno area.
Although not previously reported, the bill also includes a provision that will allow for the transfer of dispensary licenses. Nevada previously did not permit transferring a cannabis license, so this is a major development that happened to be added to the bill by amendment — and partially only by oral amendment. Further, a licensee will be permitted to move their location so long as it stays within the same local governing authority, and after a public hearing. These amendments allow dispensary owners to sell their businesses and even allow the purchasers to move those businesses. This creates a substantial value for licenses which were previously worthless to anyone other than the holder.
Contrary to some reports and to what so many in the industry are saying here in Nevada, there will be no new application window for those who did not previously apply for licenses. Instead, the bill will utilize the rankings from 2014’s application process to determine who the lucky new 11 licensees will be. The determination may be complicated by pending litigation regarding whether companies who got state approval, but not local approval, should be granted licenses at all. But generally, we should expect these new licensees to come from the list of those who previously applied for a Nevada cannabis license, but were not chosen to receive one.
The Nevada legislature will only be meeting until June 1, 2015, so expect some news on this bill in the coming days. SB276 must still make it through the full Nevada Senate, Assembly Committee and full Nevada Assembly before it can be signed into law. That’s a lot to do in a couple weeks, but Nevada moves quickly, and we are optimistic that the bill will make it through. If it does, we expect to be seeing a number of buy-sell transactions involving Nevada marijuana licenses, just as we have seen in other states that allow this.