Pubdate: Thu, 25 Jul 2013
Source: Tucson Weekly (AZ)
Copyright: 2013 Tucson Weekly
Contact:  http://www.tucsonweekly.com/
Details: http://www.mapinc.org/media/462
Author: J.M. Smith

TEPID TEMPEST

A 'Devastating' Audit of Denver's Medical Marijuana Regulation Isn't 
The Big Deal Opponents Claim It Is

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.
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MAP posted-by: Jay Bergstrom