We set the standard for good government. Colorado’s Medical Marijuana Regulatory System (Part 1) 1

We set the standard for good government. Rise of MMJ in Colorado 2 Voters pass Amendment 20 Feds issue Ogden Memo Major legislation to regulate industry License moratorium from August 2010 until June 2012

We set the standard for good government. Timeline of Audit 3 Spring 2012August 2012November 2012March 2013 Financial compliance testing finds numerous problems with MMED Performance audit begins Voters pass Amendment 64 Governor's Office forms Task Force to create legislation for Amendment 64 March 13: Task Force Releases Report March 25: Audit Released

We set the standard for good government. Roles and Responsibilities in Regulating MMJ: Department of Public Health and Environment Patients Doctors Caregivers 4

We set the standard for good government. Roles and Responsibilities in Regulating MMJ: Department of Revenue 5 Businesses (about 1500) Caregivers Law Enforcement

We set the standard for good government. What We Found Licensing o Average of 23 months to issue license (shortest – 436 days; longest 807 days) o 37% of license we reviewed had potentially disqualifying information  Within 1,000 feet of school  Past criminal history  Tax delinquencies o No new occupational licensing appointments in the previous 6 months 6

We set the standard for good government. What We Found Monitoring o “Seed-to-sale” model does not exist o Database for plant tracking never completed o No audits performed to verify inventories o No video surveillance systems 7

We set the standard for good government. What we Found Disposition of Unauthorized Marijuana o Taking marijuana from businesses 40 times in 2012  As much as 15 pounds of finished marijuana product o Division does not follow statutes in voluntary surrender process o Unclear how staff determine unauthorized plants 8

We set the standard for good government. What We Found Risk to State Employees o Potential legal liability in an industry that violates the federal Controlled Substances Act. 9 “The voters have spoken and we have to respect their will. This will be a complicated process, but we intend to follow through. That said, federal law still says marijuana is an illegal drug so don’t break out the Cheetos or gold fish too quickly.” –John Hickenlooper, Governor of Colorado, responding to passage of Amendment 64, November 2012

We set the standard for good government. Results 13 recommendations; 42 subparts As of December 2013 o 22 subparts implemented o 16 subparts partially implemented o 4 subparts not implemented or no longer applicable 10

We set the standard for good government. Questions? Download the report: o State.co.us/auditor  Department of Revenue – Medical Marijuana Regulatory System Part I 11