On June 18, 2024, the Massachusetts Office of the Inspector General (“OIG”) addressed a letter to the Massachusetts state legislature (“Legislature”) urging it to take action to correct the poor governance structure of the Cannabis Control Commission (“CCC”) (click here to see the full letter).

The letter states that the CCC’s enabling statute lacks clarity in establishing the leadership hierarchy and defining the duties and responsibilities of its staff and leadership. Despite apparent efforts over the past two years by the CCC, including its commissioners, to establish a clear governing structure, the OIG posits that it is no closer to solving the issue than it was two years ago.

Many in Massachusetts, including the OIG, feel that the CCC’s leadership today is in disarray. The commissioners disagree on who held the appropriate authority to appoint the chairperson following the Treasurer’s suspension of Chair Shannon O’Brien, with O’Brien appointing Kimberly Roy and the commissioners appointing Ava Callender Concepcion. At last week’s CCC meeting, the commissioners voted to relieve the acting interim executive director of her day-to-day responsibilities, leaving the CCC without a duly appointed and clear leader. The OIG views this decentralization of leadership and uncertainty on where certain authority lies as contrary to the best interests of the CCC, the cannabis industry, and its consumers.

The OIG requests that the Legislature immediately appoint a receiver to run the day-to-day operations of the CCC, while it concurrently reviews and corrects the deficiencies and ambiguities in the CCC’s enabling statute. The receiver would have authority unchallenged by the current leadership and commissioners until such time as the governing structure of the CCC is addressed via legislative action. The fact that the CCC is responsible for incredible sums of tax and non-tax revenue (e.g., $322 million in 2023), the issue is rendered all the more urgent.

While an unprecedented action, a receivership could result in a better functioning and more efficient regulatory body at a time when the Massachusetts cannabis industry (as in other states) is facing daily challenges. We will continue to monitor and update this development.