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Audit Finds Problems with Denver Pot Shops

In what might be called an, “I told you so,” opponents of marijuana legalization in Denver are citing an audit conducted by the city which shows violations of regulations and lax enforcement of ordinances. Anti-legalization elements in the state are pointing to this report as a fulfillment of their “wild west” scenario – where a poorly regulated marijuana industry simply does whatever it likes.

The report, which came out July 18th, says there has been insufficient record keeping in the Department of Excise and Licenses, which is tasked to keep track of marijuana sellers and collect taxes and fees. “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 report.

But according to reporting in the Tucson Weekly, the report might be best described as a “tempest in a teapot” because the relatively minor flaws in Colorado’s new law point up just how well things are actually working. For example, businesses that do not have a city license in Denver are listed, even though they have a state license to operate. The problems in filing paperwork are mentioned, but not because paperwork isn’t being filed, just that it’s difficult to do so using the web-based forms. And while some of the poor oversight is blamed on a lack of supervision (one person to oversee a hundred licensees), that hasn’t led to gross infractions. It seems businesses really do want to comply, they are just confused about how to do so.

All this is fixable and not the dire circumstances some would claim. Meanwhile, the taxes and fees are bringing an estimated $16 million into city and state coffers. Quite a sum. It seems, in the end, that the problems are management problems and not something intrinsic to the new law. More inspectors will have to be hired and the procedures for proper licensing will have to be more clearly laid out – but that’s exactly what an audit is supposed to reveal so it can be fixed.


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