Over the past eight months, Amargosa resident John Bosta has been repeatedly blasting Nye County for “operating under the color of the law” and it appears that Bosta may just be right.
The dispute centers on the county’s collection of marijuana business license taxes and fees from establishments located within the boundaries of unincorporated towns. Bosta has staunchly asserted that the county does not have the authority to collect those taxes and fees, but to no avail. The county had reiterated multiple times that it did not accept Bosta’s interpretation of Senate Bill 487 and continued to follow its marijuana regulations as usual.
Now, Bosta has been vindicated with a letter of opinion from the Nevada Legislative Council Bureau that sides with his belief. The county is still in the process of analyzing the opinion and detailed information on the possible effects the opinion could have on the county’s budget and its processes going forward has yet to be announced.
“The county is still reviewing this opinion to determine what changes need to be made, if any. We will inform everyone once the county and the Nye County District Attorney’s Office has had time to evaluate the opinion,” Nye County Public Information Officer Arnold Knightly stated when reached for comment. He also noted, “The opinion conflicts with prior conversations the county had with the Nevada Department of Taxation when establishing the county’s processes regarding this new industry.”
The Legislative Council Bureau opinion came after Bosta, meeting with continued resistance from the county each time he attempted to convince the Nye County Commission of his viewpoint, turned to Nevada Senator Pete Goicoechea. As a state senator, Goicoechea was able to go to the Legislative Council Bureau for a legal opinion on the intent of Senate Bill 487.
Specifically, Goicoechea asked the bureau first, whether a county had the authority to impose business license fees and taxes on marijuana establishments, and second, whether a county is permitted to require such revenues to be deposited into the county’s general fund and be used for the sole benefit of that county.
In the 10-page document, the Legislative Council Bureau outlines the reasoning behind its opinion, focusing on the language contained in Senate Bill 487 and Nevada Revised Statute 269.
“Based on the plain language of sections 15 and 18.5 of SB 487 and well-established rules of statutory construction, it is the opinion of this office that section 18.5 of SB 487 governs the imposition of business license fees and taxes on marijuana establishments and medical marijuana establishments located in unincorporated towns,” the opinion conclusion reads.
“If a marijuana establishment or medical marijuana establishment is located in an unincorporated town for which a board of county commissioners is the governing body, it is the opinion of this office that the board of county commissioners of the county in which the unincorporated town is located is authorized to impose a business license fee or tax on such an establishment,” the opinion continues.
“However, if the town board form of government has been established for an unincorporated town pursuant to NRS 269.16 to 269.022, inclusive, it is the opinion of this office that the town board of the unincorporated town is the entity authorized to impose a business license fee or tax on a marijuana establishment or medical marijuana establishment located in the unincorporated town,” the opinion states.
This interpretation would mean that Nye County does not have the authority to impose license fees or taxes on marijuana establishments in locations such as Amargosa and Tonopah, both of which maintain an elected town board. For Pahrump, however, the county commission is the acting governing body and therefore, it is allowed to impose fees and taxes on pot businesses located within the town of Pahrump.
Despite this power, the commission does not have the legal authority to place those fees and taxes collected in Pahrump, or any other unincorporated town, into the county general fund, the opinion states.
“Finally, because any money collected or received from a business license fee or tax imposed on marijuana establishments or medical marijuana establishments located in an unincorporated town is money collected or received pursuant to chapter 269 of NRS, it is the opinion of this office that NRS 269.095 prohibits the deposit of the money in the county general fund and, instead, requires any such money to be kept separate from other money of the county and used for the sole benefit of the unincorporated town in which the money is collected.”
It is unknown at this time how much funding in Nye County and its various towns could be impacted by the opinion. Knightly also took the time to point out that the repercussions of the opinion could reverberate not just locally but throughout the Silver State as well. “It is also important to note that this opinion could have far-reaching impacts beyond Nye County,” Knightly stated.
An inquiry for information on this situation was sent to the Nevada Department of Taxation, particularly focusing on whether they agreed with the opinion and how many counties and total dollars would be affected. Department of Taxation Public Information Officer Stephanie Klapstein assured that the department was looking into the matter and would provide the requested information in the near future.
Follow up details on the Nevada Department of Taxation’s response to the opinion will be included in an upcoming edition of the Pahrump Valley Times.
Contact reporter Robin Hebrock at rhebrock@pvtimes.com