It seems the Mile High City is a mile off target when it comes to medical marijuana business regulation, but the situation might not be as bad as an auditor’s report (http://www.denvergov.org/Portals/741/documents/Audits%202013/Medical_Marijuana_Licensing_Audit_Report_07-18-13.pdf) and subsequent media attention make it sound.
Denver, where competition is thriving among hundreds of medical cannabis shops, recently gained a new ass when the elected city auditor ripped it one over cannabis business regulation. Dennis Gallagher and his colleagues snooped around in the city’s books for a while, then in a report issued July 18 excoriated the Department of Excise and Licenses for poor record keeping, unenforced or nonexistent deadlines, poor management and insufficient staffing in the medical marijuana licensing program, all of which leave the city at “high risk” in some areas.
“The audit found that the Department’s medical marijuana licensing practices are inefficient and ineffective,” Kip Memmott, the director of audit services, wrote in the July 18 report.
The media have been jumping all over this story for a week, arming cannabis naysayers for I Told You So verbal attacks on a system that much of the nation has looked toward as a model. The Denver Post’s headline over the story was, “Denver reels from ‘devastating’ audit of medical marijuana program.” Other news outlets were also quick to jump on the criticism bandwagon.
But I’m not so sure it’s a big deal. There is a tempest in this teapot, methinks. Let’s take a look at what they actually found.
The audit is rife with harsh language, referring to the department’s “ineffective governance” and lack of a “basic control framework.” Some records were hard to find, there was confusion over how to apply for licenses (no report that anyone was prevented from applying, just that it’s confusing) and there were no deadlines for things like fire and zoning inspections (no mention that they didn’t happen, just that there are no deadlines). The worst result of all these inefficiencies is that some dispensaries are operating without city licenses, although most probably have state licenses.
The department let the record keeping and procedural problems slide for three years, the report says, and the problems are the result of “intentional decisions made by Department management.” Well, I hope they make decisions intentionally. Just sayin’.
The audit revealed conflicting information on the city website concerning what forms are required for licensing, poor coordination between the city and state MMJ systems, arbitrary fees (not based on the cost to administer the program) and a lack of standard licensing procedures. The situation especially worried auditors, because cannabis licensing is a significant revenue generator, they said.
The city program brings in about $16 million annually. Yes, get a handle on that, please, but don’t make it sound like medical marijuana centers (the city’s new term for dispensaries) are selling crack to children.
The report notes that the poor oversight is largely the result of the city assigning one person to manage the program. One person for hundreds of licenses. OK, so that means there will be problems, duh, but the city knew that going in.
Ultimately, what does all this add up to? Is it really devastating? No, it isn’t. All the audit did was basically expose what I will assume everyone there already knew—that bureaucrats let things slide, because they had to. The city, as cities often do, slashed budgets.
The auditor’s report notes that the problems exist because the city managers prioritized. In other words, they decided—presumably intentionally and with honest, genuine good intentions—that medical cannabis licensing wasn’t a high priority. They decided that other things were more important than making sure medical cannabis businesses got their fire inspections on schedule, like maybe police and fire department staffing and budget. They decided the cannabis licenses were a low priority.
I think we should believe them.
This article appears in Jul 25-31, 2013.
Blah, blah, blah really Mr. Smith is this what you are reduced to writing about? What about the whole story about our Medical Marijuana program being stagnant? We only have 36,000 registered patients and a measly 700 caregivers (ridiculously low numbers). There are 40 CHAAs that don’t even have one registered caregiver to take care of the folks that have cards but no one to grow medicine for them. What about the over 80 crowd (there are close to 100 patients in Arizona that are over 80 years old) and why is there no caregiver over the age of 80 to take care of the greatest generation folks that have Alzheimer’s, Multiple Sclerosis, and Cancer? You just are living in your own little world of writing about stuff that the average person living in Tucson could care less about. Why aren’t you talking about the Pima County Narcotics Alliance and their running buck wild and shredding our rights? Guess that’s just asking too much of you Mr. Smith and do you even like writing a weekly column? You just seem so joyless to me and I wish we could have another viewpoint about the medical marijuana program than a stoner guy that’s in his thirties.
I for one am indeed anxious to see Arizona’a first book audit. Our regulating Agency who is suppose to oversea everything from production to final sale will have many voids to go through. Also the fact that I have not been given a single receipt for any purchase that I have made at a Tucson Dispensary should be a good indicator of what is going on. If the Dispensary owners are able to prove every single transaction is a non profit one, than the Department of Health Services are indeed in need of some servicing themselves. Any news when the ADHS will start on the folks here in AZ? Now that would be newsworthy indeed?
The good news is I weathered the storm in Colorado with buds for sale at a farmers market.