Audit Finds California Bureau of Cannabis Control Lacks Funding

Recently, the California Bureau of Cannabis Control was audited by the Department of Finance. The findings, however, were more than a little troubling. The BCC has yet to fill almost two-thirds of its available job positions. Moreover, it is grossly underfunded, which makes it nearly impossible to enforce against a very prevalent illegal market.

BCC Understaffed

California regulators explain that “unlike most state government programs, the bureau was simultaneously starting from the ground up on multiple fronts.”

Only 15 of 68 enforcement agent positions were filled. As a result, the bureau has struggled to fund site inspections on cannabis businesses, handle complaints, and ensure that all testing laboratories maintain high standards.

A large part of the bureau being understaffed is due to the inability to afford new hires on such a strained budget. The California Bureau of Cannabis Control expected to bring in around $200 million from application and license fees before June 3rd. However, it had only brought in $2 million as of January.

Budget Restraints Causing Licensing Delays

Another issue the audit identifies is that communication channels have been difficult to establish between the three regulatory agencies in California – the BCC, CalCannabis Cultivation Licensing, and Manufactured Cannabis Safety Branch. “Enforcement unit staff stated a central contact from the other licensing authorities has not been established,” the audit reads.

Additionally, the audit reveals that the bureau has issued only nine annual cannabis licenses to dispensaries, while 915 retailers are still making sales under temporary permits. Moreover, it has granted just two annual distributor licenses, while 1,365 distributors operate on temporary licenses, and only nine annual event organizer licenses, with 92 applicants running on temporary licenses. The bureau has yet to issue any annual licenses for testing facilities or micro-businesses. As a result, 49 labs and 289 micro-businesses are still working with only their temporary permits.

Chief deputy director of the California Bureau of Cannabis Control, Christopher S. Schultz welcomed the Department of Finance’s audit recommendations and is confident that they will “strengthen its operations.” The audit did acknowledge that the bureau was responsible for developing a complex regulatory system “under challenging conditions.”

Editor’s note: In 2021, the Bureau of Cannabis Control was consolidated with CalCannabis and the Manufactured Cannabis Safety Branch into a single agency, the Department of Cannabis Control, which now oversees commercial cannabis licensing in California.

Therefore, as enforcement and licensing requirements continue to evolve, dispensaries operating in the state benefit from compliant cannabis POS software in California that helps them keep accurate records and stay audit-ready.