Cannabis regulatory agency pushes back about leaked information, aims to collect from 161 licensees
The July 19 meeting of the Massachusetts Cannabis Control Commission kicked off with a vague but pointed and full-throated defense of the agency by acting Executive Director Debbie Hilton-Creek. Recognizing that she’s usually much more “quiet and soft-spoken,” she put on her chief people officer “hat”—her initial position at the agency before also becoming interim ED—to condemn “the unconscionable treatment of our staff at the commission,” presumably by members of the media and the chattering cannabis community.
“I can no longer remain silent,” Hilton-Creek said. “The latest egregious allegation that employees are stealing is unconscionable. It’s unacceptable.”
Though few if any specs were given, the acting ED was likely excoriating blogger Grant Smith Ellis, who the day before reported that in excess of $2 million in “missing” CCC licensing fees “may have been stolen,” per his sources. It’s not the first time that Smith Ellis has elicited dramatic odd behavior from the agency; last year, the CCC took the rare step of singling the blogger out in a public statement and banning him from press conferences and all agency communications. Those actions caught the attention of state Sen. Michael Moore, who wrote in a letter to the CCC last September …
“It is bewildering that an agency with a troubled governance structure, vacancies in several leadership positions, and issues in the licensing, investigation, and public records process would decide that an independent journalist doesn’t meet certain media standards rather than first addressing its own internal issues.”
State Inspector General Jeffrey Shapiro also noted those actions in his call for the commission to be put into receivership. As one Mass cannabis business owner once joked to me, Smith Ellis lives in the CCC’s head, rent-free. And so before a lengthy meeting about multiple important regulatory changes, Hilton-Creek responded to the allegations—not in a way that would normally happen, with a media relations person emailing or calling a journalist, but rather with a top official flexing like a boxer at a weigh-in. She continued …
“The commission continually reports its due diligence to review and ensure any entities that are participating in the state’s licensing process or are currently operating in the industry are current on all required payments. Furthermore, in all matters of non-compliance with its regulations… the commission continues to take the necessary steps to bring licensees back into compliance.”
Further deriding the “unrelenting effort to negate or minimize the accomplishments of this agency,” Hilton-Creek added: “Our employees are the backbone of this operation. … We need people to understand that our leaders and our employees are human. They work extremely hard for the people of the commonwealth and they deserve to be treated with respect.”
That was more than 10 days ago. In the time since, last week Boston Globe reporter Frank Phillips tweeted: “Good source: Inspector General Jeff Shapiro looking at reports of $3M ‘lost’ licensing fees.” So this Tuesday, the CCC responded to so much negative news with a “Notice of Outstanding Fees and Expiration of Provisional Approvals” issued by its Investigations and Enforcement Department, along with an accompanying statement. Emphasized in the first official comment on the situation: “Concerning unsupported allegations of misconduct, there is currently no evidence that suggests staff have stolen state funds.”
As for whether some fees are actually “missing”—it turns out that’s basically true, though regulators are rejecting that particular phrase to describe the phenomenon of money that’s supposed to be in a place not in fact being there. As Chief of Investigations and Enforcement Nomxolisi Khumalo explained at the May 23 CCC meeting, the agency realized on an unspecified date that some licensing fees related to renewal extensions had not been collected.
This week, the CCC followed up Khumalo’s report and Hilton-Creek’s defense of staff and operations with some details regarding these rumored uncollected fees. According to the commission, the total amount is about $555,000, owed from 161 licensees. The agency also clarified that there have been 120 provisional applicants who failed to pay their initial fees, but that’s okay since they never opened for business.
Per a CCC spokesperson: “The Cannabis Control Commission is in the process of bringing applicants and licensees with unpaid prorated fees into compliance with state regulations and closing out expired applications according to the normal course and similar to the fee collection processes of many other state agencies. Notices will be sent to entities that are not current on their fee payments and staff work is ongoing to enhance Standard Operating Procedures and existing technology platforms, such as incorporating automated reminders to industry about their payment obligations. It is the responsibility of licensees to comply with the Commission’s regulations including, but not limited to, the payment of fees, per the linked announcement.”
And the drama continues, with the spokesperson also saying that the “agency is alarmed to see that private information regarding Commission personnel is once again in the public domain.” It would be nice if the agency was more forthcoming about this kind of stuff before flame wars broke out, but if information is going to surface through the odd process of having bloggers smoke out trouble followed by the CCC saying that things are bad but not as bad as you’re seeing on social media, then I’m happy to interpret the saga for stakeholders and anyone else scratching their heads.
