Missouri Audit Finds Flaws in Marijuana Licensing Process Cost State Millions

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A new state audit from Missouri Auditor Scott Fitzpatrick has found major flaws in the state's marijuana licensing program that led to unfair scoring, costly lawsuits, and over $12.5 million in legal expenses from 2020 to 2023. The audit cites issues with the Missouri Department of Health and Senior Services, the Division of Cannabis Regulation, and contractor Wise Health Solutions, including inconsistent scoring, poor documentation, and guidance that limited written records.

Why it matters

The findings raise concerns about the transparency and fairness of Missouri's marijuana licensing process, which has been a key part of the state's multi-billion-dollar cannabis industry. The audit also highlights ongoing challenges around data security, oversight, and coordination between state agencies as the industry continues to evolve.

The details

According to the audit, applicants were able to reveal their identities through application materials, and those applicants received licenses at a much higher rate than those who followed anonymity rules. The report also raised concerns about customer data retention by dispensaries and limitations in the state's marijuana tracking system, Metrc, which it says cannot currently flag illegal purchase amounts in real time.

• The audit covers the period from 2020 through 2023.
• The state incurred more than $12.5 million in legal costs tied to licensing disputes during this time.

What’s next

The audit recommends improvements to oversight, inspections, data security, and coordination between state agencies to address the issues identified.