High Rollers: UNLV Panel Wants Casinos, Gaming Regulators to Get Real about Pot

Drs. Riana Durrett (right) and Brett Abarbanel (left) are leading conversations about cannabis and casino gaming in Nevada, which some are saying have been kept apart for too long. (Image: Dan Michalski / Casinos.com) 

Nevada has held itself as the “gold standard” in gaming regulation for more than three score. And now, for nearly a decade, the state has used that model to claim its stake as a leader in cannabis regulation, too. But bringing those two together has been more like oil and water than chocolate and peanut butter. 

Last week, UNLV’s Cannabis Policy Institute (CPI) and International Gaming Institute (IGI) hosted a first-of-its-kind panel discussion about cannabis and gaming at the William S. Boyd School of Law. 

“What better way to talk about this sexy combination of topics than by starting with something that screams excitement,” IGI Executive Director Brett Abarbanel said. “Academic research.”

Abarbanel and CPI Director Riana Durrett led the two-hour session before a crowd of about 50 – with another 30 tuned in to a livestream of the event. In attendance were members of Nevada’s Cannabis Compliance Board, a representative from the governor's office, an assemblyman exploring a bill to update rules about cannabis on the Strip, several law students, and Casinos.com among other press.

After a brief presentation on the state of current research on gaming and cannabis (particularly the 29% of adults who like to engage in both), and one about the ethics of marketing cannabis, Abarbanol and Durrett asked questions of a three-expert panel:

• Jen Roberts – a Las Vegas-based gaming attorney, adjunct professor at UNLV Law, and former director of UNLV’s International Center for Gaming Regulation.
• Bob Hoban – a Denver-based attorney who has worked with more than 30 governments to help  develop cannabis laws, policies and regulations; also a contributor to Forbes.
• Tick Segerblom – current Clark County Commission Chairman who previously served six years in the Nevada assembly and six years in the state senate, where he helped sponsor bills that led to marijuana legalization.

These experts shared their insights on where matters currently stand, and began to conceptualize what a world might look like with well-regulated casino operators and  marijuana merchants allowed to work together. 

Casinos.com was there, and here’s our condensed version of the conversation. (Some answers have been edited for length and clarity.)

Durrett: What’s the status quo, and why are these two industries separate?

Roberts: What the regulators tell you to do you’re gonna do. And the regulators have long told us in the gaming world that cannabis and gaming should not mix. You have to pick one. 

Hoban: There are three places where the need to keep these two industries separate  comes up: First, we have no [cannabis] deliveries to the Strip. Second, gaming licensees can’t invest nor engage in cannabis businesses – this keeps the finances separate. And last, the location of a cannabis-related business in relation to a casino matters. If you keep those things separate, in theory, it maintains the integrity of two distinct "gold standard" regulatory programs.

Durrett: Does rescheduling marijuana from Schedule I to Schedule III change anything?

Hoban: “It doesn't automatically open the door for the sale of schedule 3 medicinal compounds in a casino that has to be federally compliant. That would require descheduling, not rescheduling.”

Abarbanel: Theoretically, if someone placed bets on their phone in a cannabis location, would that be OK?

Segerblom: Gaming and marijuana are already happening together, separately, and all over everywhere, so we’re talking about an imaginary line. It’s just a question of whether the casinos can make money on it.

Planet 13, a Las Vegas dispensary and consumption lounge, is trying to serve the needs of Las Vegas visitors who want to consume marijuana. But without the ability to do business with casinos there's only so much they can provide. (Image: John Locher / Associated Press)

Durrett: With federal agencies issuing guidance for cannabis financial transactions, is the gaming industry going to be the last holdout waiting for it to be 100% descheduled before they can even think about what comes next?

Roberts: I don’t see much movement until they change the law. Even if nothing’s being enforced, the regulators would have a hard time saying ‘there’s a law on the books, but we’ll let it slide.’

Segerblom: The history of casinos in Nevada around the country is if they want something to happen, they make it happen. The more people start leaving to go to [cannabis consumption lounges], the sooner they’ll act to allow cannabis in some way to be consumed in casinos, because they don’t want to see that money leaving the gaming properties.  

Hoban: Yes, but if there were a casino room for people to consume their cannabis, would consumers want to use that facility? We don’t really know. 

Segerblom: I talk to operators all the time. They have rooms set up to do this. They’re ready to go, just waiting for the first person to jump in. But everybody’s there.

Roberts: Still, the regulators cannot sanction a violation of federal law.

Segerblom: You’re going to see things happen very fast If the Democrats win in November. Cannabis will be in casinos in two years if Democrats win.

Hoban: If you provide a venue within the casino, would that keep people in the casinos spending money? If Nevada’s gaming law is the gold standard, then why not allow that framework to accommodate dispensaries on the Strip? Whether you put the gaming into cannabis facilities or slowly bring cannabis into a casino, that’s ultimately the next step. And I think it starts with cross-ownership.

Segerblom: Right now a lot of casino restaurants are small businesses that lease space in the casino or a thousand feet away from the casino, where the profits from that stay with the small business. There’s really no philosophical difference. So we could rent one of those restaurant spaces and put a dispensary in there.

Durrett: Current law forbids legal cannabis delivery to gaming establishments, and anywhere on the resort corridor. Why don’t we have legal delivery to non-gaming establishments on the Strip?

Hoban: It’s not just gaming. It’s anywhere where there’s large gatherings of people for entertainment. Entertainment and cannabis go together. They always have, they always will. So it’s not just gaming.

Segerblom: Most of the business of casinos is not gaming any more. It’s such a perfect integration with entertainment.

Abarbanel: Is this an opportunity for Nevada to gain a first-mover advantage?

Segerblom: The first mover for bringing marijuana and casinos together will probably be a tribe somewhere. But why don’t we do it? We’re Sin City. We’re the place that does all this stuff. If we do it right now, we can be the new Amsterdam. How stupid are we to not just jump into this and take it over?

Signs like these can be found in tobacco smoking areas throughout the Las Vegas Strip, where marijuana consumption technically isn't allowed, but the smell in the air can convince anyone it's certainly not being stopped. (Image: Michael Bihlmayer / Imago)

Cannabis and Casino Gaming in Nevada: A Timeline of Regulatory Tension

The evolution of cannabis in Nevada highlights an ongoing tension between state-level legalization and federal law – particularly as it pertains to restrictions in a highly regulated casino gaming industry. 

2000

Medical marijuana legalized by constitutional amendment with 65% voter approval. While use is now allowed, the ballot referendum did not provide a legal way to obtain it.

2013

Republican Gov. Brian Sandoval signs a law that provides a framework for legal sale of medical marijuana at dispensaries. The law establishes a regulated system for cultivation, testing and distribution. 

2014

New law goes into effect. NGCB issues a notice that says despite the legalization of medical marijuana, casinos and their employees are not allowed to invest or participate in marijuana businesses, host marijuana-related events or allow marijuana use on casino property. 

2016

Recreational marijuana legalized for adults aged 21 and over by ballot referendum, with 55% support. To go into effect Jan. 1, 2017.

2017

NGCB notice informs the gaming industry that casinos must still comply with federal law, which classifies marijuana as illegal. 

Clark County bans legal cannabis delivery to the entire Strip corridor. 

Nevada Dept. of Taxation bans delivery to any gaming establishment in the state.

2018

NGCB and the Nevada Gaming Commission issue multiple regulatory notices reiterating that there can be no involvement with cannabis on gaming properties and financing any part of the cannabis industry could jeopardize a casino's gaming license.

2019

New law establishes the Cannabis Compliance Board to oversee the regulation of the cannabis industry in Nevada.

New regulation sets 1500-foot distance requirement between cannabis establishments and non-restricted (casino) gaming licensees.

2021

Democratic Gov. Steve Sisolak signs a law that allows for the establishment of cannabis consumption lounges in Nevada. The NGCB and NGC are quick to notify licensees that these lounges should not be located within or affiliated with casinos.

2022

NGCB and NGC reiterate that any association with marijuana could result in disciplinary action against gaming licensees.