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Massachusetts Inspector General Jeffrey Shapiro called on the Cannabis Control Commission to conduct an audit following the commission’s failure to collect approximately $550,000 in licensing fees since August 2022.
In a letter to Travis Ahern, the newly appointed executive director, and Bruce Stebbins, the acting commission chair, Shapiro wrote that the agency’s failure to collect fees is an “egregious operational breakdown” that suggests “poor business practices and oversight.”
In August 2024, the commission publicly admitted to failing to collect $555,671 in license renewal extension fees. The commissioners began to allow license extensions of up to 120 days in August 2022 and directed the staff to collect prorated license fees to cover the extension. The commission failed to collect those extension fees.
Shapiro also found that the commission staff was granting extensions prior to the commission’s August 2022 vote without having the authority to do so.
“The inability of CCC staff to implement a key commission initiative should have been readily apparent to supervisors and commissioners in real time,” Shapiro said in a press release.
The commission has since corrected its mistake by recouping previously uncollected fees and updating the agency’s payment systems. Ahern said in an email statement that only $170,000 fees from the $550,000 remain uncollected as of this week.
Shapiro said in his letter that the commission still needed to conduct an audit “to ensure that all current licensees have paid all applicable fees and fully understand what revenue went uncollected, as businesses ceased operations.”
Ahern said that the commission is continuing to meet with the Inspector General’s office about the issues outlined in the letter and that the agency will provide a “more robust response” to the letter within the required 30 days.
In August 2024, soon after the issue of uncollected fees became widely-known, one commissioner, Kimberly Roy called for a “forensic audit” of the agency. Forensic audits typically examine an organization’s financial records and look for fraud, misconduct, or irregularities. Roy pitched it as a way for the commission to modernize.
In addition to those uncollected fees, Shapiro flagged that the commission had failed to collect up to $1.2 million in potential provisional licensing fees. Technically, no provisional licensee was able to move forward in the licensing process or become operational without paying the fees, but the commission’s policy does require that those fees be paid within 90 days of initial approval.
Ahern said that “uncollected provisional application fees referenced in the OIG’s letter is subject to misinterpretation” and that “fees from provisionally approved applicants are only due if the applicants choose to proceed to final licensure.”
Kevin Gilnack, president of the cannabis advocacy group Equitable Opportunities Now, said that $1.2 million claim seems “pretty sensational,” but it doesn’t seem like “any harm was caused by not enforcing it.”
“No one can advance without paying the provisional fee [so] it doesn't sound like the CCC was missing out of any fees,” said Gilnack.
Last summer, Shapiro called on the Legislature to appoint a receiver and restructure the agency to clarify the leadership roles of the executive director and commission chair. Treasurer Deb Goldberg suspended and subsequently fired the commission’s previous chair, Shannon O’Brien, due to accusations of “racially, ethnically and culturally insensitive statements.” Goldberg is the appointing authority for the commission chair role.
O’Brien has alleged that she was fired for trying to rectify the dysfunction at the agency and is still actively fighting her dismissal in court. The commission has had internal conflict, allegations of misconduct, and a slow-moving regulatory process that has frustrated many within the cannabis industry.
Shapiro said the time for a receiver has passed but that reform at the embattled agency is still necessary. The commission, he said, needs to work out the roles and responsibilities of the chair and executive director. “Until that issue is addressed, I fear that responsibility and accountability will continue to be elusive, and the Commission will struggle to gain its footing to chart a proper path forward,” Shapiro added.
The commission has asked the Legislature for an increased amount – $30.8 million – in the state’s budget for the fiscal year 2026. This year, the commission operated with a $19.8 million budget.
Ahern said that the increased budget will be crucial to helping the commission update its “outdated IT infrastructure” and “would address updates to the software that tracks and accounts for license and application fee payments.”
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