Denver, Alaska and Nevada Lead the Way with Social Cannabis Lounges

Last Updated on Feb 6, 2018

Although cannabis is legal for adult use in eight states visitors face the challenge of finding a place that legally allows cannabis consumption. As of October, 2017 there are no cannabis lounges (similar to the plethora of coffeeshops in Amsterdam) or any other venues in the U.S. which legally allow the social or public use of cannabis. Most hotel and rental accommodations also prohibit smoking of any kind, including smoking marijuana. Even local residents may not be able to consume cannabis in their own homes if their landlords will not allow it. A few states and municipalities however are on the verge of implementing social cannabis consumption regulations.

Denver is well on its way to providing special licenses to businesses that wish to allow cannabis consumption. Voters approved Initiative 300 last November which set the framework for a four year pilot program for social use cannabis businesses. Since its passing a social consumption advisory committee has worked to develop the final regulations. With final rules in place Denver began accepting applications from businesses interested in the social use pilot program in August 2017. Interested parties have included yoga studios, coffee shops with outdoor patios, restaurants and bars. It should be noted that businesses with liquor licenses will have to follow strict protocols as liquor laws prohibit the mixing of cannabis and alcohol. Currently no licenses have been awarded.

Alaska has experienced on-again off-again support for allowing the on-site consumption of cannabis at dispensaries. The Alaska Marijuana Control Board began discussing the potential of on-site cannabis consumption in 2015. Retailers were optimistic that social use regulations would be passed by the board earlier this year. But in February, the Board announced that it would not support on-site use as they were unsure how the Trump administration would approach the issue. Yet the debate has been recently revived as the draft rules have been made public and the board is accepting public comment through October 27th, 2017. Alaska could be the first state to allow cannabis use and sales in the same location.

Nevada has seen a flood of recreational cannabis sales since their programs roll out on July 1st, 2017. The Las Vegas tourist industry has contributed greatly to the state’s recreational cannabis sales. Yet most of the cities tourists that purchase cannabis products don’t have access to a legal place to consume them. Hotels and casinos have been adamant about not allowing cannabis consumption on their premises. Casinos were given direct guidance by the Nevada Gaming Commission this August as they voted to disallow all cannabis consumption and products as long as they are federally illegal. In September, 2017 the Legislative Counsel Bureau offered their opinion on the state’s cannabis law stating that local governments have the authority to license cannabis consumption lounges and grant special use permits for cannabis. The state has since asked for Attorney General Adam Laxalt’s formal opinion on the law as the Legislative Counsel opinion may not hold in court. Depending on the AG’s opinion social cannabis lounges may be permitted in Nevada in the near future.

Recently at the ICBC in San Francisco, Lori Ajax, the Chief of the Bureau of Cannabis Control in the state of California, weighed in on the issue of granting licenses and special permits for events centered around cannabis consumption. She said that current regulations only allow for public consumption in a fairgrounds but there is a lot of interest from entrepreneurs who would like to offer cannabis consumption on a smaller level. Ms. Ajax mentioned that there has been interest from yoga studios, coffee shops, even people who want to host cannabis dinner parties. She said that she and her staff have been working tirelessly to draft regulations and process applications for licensing all types of cannabis businesses, from cultivation to distribution to manufacturing to dispensaries. She continued to say that she is open to all ideas and that it makes sense to have places where people can consume cannabis, given that it is now legal for recreational use. Based on her statements it would appear that cannabis lounges and small events centered around cannabis consumption are in California’s future.

While these states and cities are gaining traction with allowing the social use of cannabis, many hurdles remain before cannabis lounges become widespread in the United States. The uncertainty around the enforcement of federal marijuana laws is one such hurdle. Other states have elected to approach social cannabis use with caution at this time.

Are you considering opening a cannabis lounge or hosting cannabis consumption events?

If so, contact 3C to ensure that you are prepared to apply for a cannabis business license.