Inspector General Jeffrey S. Shapiro called for an audit of the Cannabis Control Commission on Thursday after his office discovered that the beleaguered agency had failed to collect up to $1.75 million in licensing fees from marijuana establishments and applicants over a two-year period.
Describing the lapse as “an egregious operational breakdown,” Shapiro recommended that the CCC be audited to ensure that outstanding fees are collected, that the agency’s technology is able to charge the fees moving forward, that no CCC employees improperly waived or discounted fees, and that the agency’s financial procedures are in line with state regulations.
“The failure to have collected fees is a significant problem, whatever its underlying causes, and should be a call for action,” Shapiro said in a letter to CCC executive director Travis Ahern and acting chair Bruce Stebbins, the acting chair.
He asked Ahern and Stebbins to notify his office of how it planned to implement his recommendations within 30 days.
In a statement shared with the Globe, Ahern, who was tapped for the top job in December, said in a statement that the CCC “takes its responsibility to collect licensing fees and fines seriously,” noting that the agency collected almost $34.5 million in licensing and application fees across fiscal years 2023 and 2024.
He added that the agency “continues to meet” with Shapiro’s office about the issues raised in his investigation.
“A more robust response will be provided to the [Office of the Inspector General] within the required 30 days to detail the steps we have already taken to remedy these concerns, and the Commission will continue to work collaboratively with the Legislature on the agency’s financial needs identified in the [Office of the Inspector General’s] letter,” he said.
The money that went uncollected between August 2022 and August 2024, Shapiro’s office said, fell into two buckets. One was fees for 159 license extension requests from marijuana establishments, totaling about $550,000. As of last month, the CCC had recouped about $320,000 of those fees, the letter said. “Some of these fees might be uncollectible as some businesses have ceased to operate,” Ahern said.
The other category was “potential fees” for provisional license applicants. After the commission approves an application for a provisional license, a prospective marijuana establishment must pay a fee within 90 days before they can secure their license, or else have to start the application process over. But the investigation found that 121 applicants did not pay those fees, “which at one point [were] invoiced at $1.2 million,” and yet were able to keep their provisional license approvals past the 90-day deadline.
Ahern, however, took issue with how these uncollected provisional license fees were characterized.
“These fees never could have been invoiced since these applicants were not under any obligation to pay the Commission unless they intended to move forward with the licensing process towards opening a cannabis business. Only a very small number of provisionally approved applicants actually continued with their license applications,” Ahern said in his statement. “All fees due from the provisionally approved applicants were properly paid, collected, and accounted for.”
Shapiro also criticized the lack of oversight and accountability among CCC leadership and staff that contributed to these financial lapses, calling for better defined roles and stronger communication practices. Ahern said in his statement that the CCC “does not comment on personnel matters.”
The findings are just the latest sign of dysfunction at the agency, which has been beset by frequent staff turnover and vacancies, allegations of a toxic workplace, and concerns over product safety regulations.
Shapiro, who last June pushed lawmakers to place the agency into receivership, “believes the time for a receiver has passed, but the need for reform has not,” his office said in a statement.
The findings are just the latest sign of dysfunction at the agency. Read More
