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Inspector General, Senator Double Down On Calls For CCC Receivership

Inspector General Jeffrey Shapiro (lt) and state Sen. Michael Moore called for CCC receivership during an interview with NBC 10 that aired this weekend

“Day-to-day operations need to be controlled and there needs to be clarity as to who is running the operation.”

The mistrial and looming retrial of Karen Read aside, tension within and directed at the Cannabis Control Commission is contending for a spot as the top 2024 story in Mass.

For more than a year, tussles at the commission have made headlines, with additional attention on the agency following the suspension of CCC Chair Shannon O’Brien last September.

In the months since, commissioners have caught heat on several fronts, all while managing to process applications in a relatively timely manner and make progress in updating some regulations and requirements.

Small and large accomplishments aside, so much tension came to a head last month, when the Massachusetts Office of the Inspector General sent a letter to Beacon Hill leaders urging them to “take immediate action to statutorily authorize the appointment of, and appoint, a receiver with the authority to manage the day-to-day operations of the CCC,” among other things.

“In sum, I believe the CCC needs immediate clear direction with an accountable hierarchy,” Inspector General Jeffrey Shapiro wrote in his letter. “In its present state, the CCC lacks such direction. I urge the Legislature to take short-term action by authorizing the appointment of a receiver before the completion of the current formal legislative session on July 31, and long-term action by revisiting the commission structure. This authority should remain in effect until such time as the Legislature is able to revise the overall governance structure of the agency.”

Two days later, CCC acting Chair Ava Callender Concepcion responded to the OIG, writing, “I was surprised to read that the OIG is calling for the Legislature to urgently appoint a receiver for an organization that is effectively regulating 634 open and operational adult-use licensees, including 28 Economic Empowerment Applicants, 51 Social Equity Program Participants, 79 Disadvantaged Business Enterprises, with hundreds more applicants in our licensing queue, and 15,161 registered Marijuana Establishment agents, as well as 87,335 certified active patients and 6,690 active caregivers, and to do so in the final weeks of this legislative session.”

But Shapiro was hardly dissuaded. Over the weekend, the inspector general appeared on NBC 10 Boston with state Sen. Mike Moore, who has also been openly critical of the commission.

“I think it’s a two-part solution,” Shapiro said. “The first part is immediately the day-to-day operations need to be controlled and there needs to be clarity as to who is running the operation. This is a $7 billion industry at this point and it’s a new business entity and a new stream of business that we need to be mindful of. So there needs to be day-to-day clarity and I believe that needs to be a receiver. Second of all, I believe next legislative session we will have time to look at the overall governance structure. But I don’t believe that with the time that’s left in the formal sessions that we have enough time to do both of those things. … Immediate action requires the appointment of a receiver.”

[Days later, the IG testified at an informational hearing held by the Joint Committee on Cannabis Policy on Tuesday, July 9]. He continued, “Who is in charge? Right now some things are done by the acting executive director, some are done by the commission as a whole, some appear to be done by the acting chair. If I’m an employee that works there, it’s very unclear to whom I report. With the lack of clarity, in my opinion, it’s the dream of any sixth grader that doesn’t like what’s going on at home, and they ask another parent or another adult in their life.”

Moore added, “I am surprised that it’s really deteriorated this far from where we were about a year ago. We’ve had issues from every aspect of the commission—from operational, to control of it day-to-day, treatment of staff, treatment of retailers and people who are investing in this industry. I think we need an overhaul of the agency and the operations and to make sure that we are setting up a new industry in Massachusetts for the future.”

The senator said he plans on filing an amendment to an economic development bill to “try to implement the recommendations [of] the inspector general.”

Shapiro noted that while his office was already watching the CCC closely due to the aforementioned revelations among other reasons, his hand was forced on pushing for receivership after commissioners voted to strip acting Executive Director Debbie Hilton-Creek of most of her interim powers during a meeting last month.

“In my opinion, based on our work, they were going in the opposite direction [than the CCC should be going], and I had no choice with my responsibility under Massachusetts General Law … to prevent and detect fraud, waste, and abuse … but to take action,” Shapiro said.