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Regulatory snags have resulted in a scramble as Nevada dispensaries become dangerously close to having no product to sell, just two weeks after legal recreational cannabis became available in the state. As a result, the Governor has declared a state of emergency in an attempt to quickly amend the issue and keep the budding industry afloat.

How Nevada came to have dwindling stocks of legal cannabis revolves primarily around regulations and a lack of permits, so let’s break things down.

Liquor distributors were promised that they would have sole rights for distributing cannabis to dispensaries in the first 18 months of recreational legality, but despite many applying for permits, none have been approved because they do not yet meet regulatory requirements. Dispensaries were able to serve as their own middleman before legality went into effect on July 1st, allowing them to stockpile product, and many of the 47 dispensaries in the state are reporting twice as many sales as had been expected. Unexpectedly robust sales coupled with no alcohol distributors yet completing the licensing process has resulted in fast-depleting stores that some say could be gone by August, in contrast with the 60 day supply that had been forecast before legality went into effect.

Dwindling stocks of the product, high demand, and no distributors yet licensed puts Nevada’s recreational industry in grave danger: if nothing is done fast enough, many people could lose their livelihoods. “The business owners in this industry have invested hundreds of millions of dollars to build facilities across the state,” said Nevada’s Department of Taxation in a statement. “They have hired and trained thousands of additional employees to meet the demands of the market.” If this stall continues, that investment could be lost.

In response, Gov. Brian Sandoval declared a state of emergency, now signed into law, which is expected to allow state officials to decide on emergency regulations that would help usher liquor distributors through the licensing process at a clip that will hopefully keep up with demand, in a move that could affect the livelihood of thousands in the state.