Feb. 21 UPDATE: In a letter today, Ohio State Auditor Dave Yost responded to concerns from the Department of Commerce, ultimately deciding not to "pause" the state's medical marijuana licensing program.
Read the original Feb. 16 story below.
In short, Yost argued that it is simply too late in the game to halt the program. Companies that were awarded cultivation licenses in December "have undertaken substantial investments" on their grow sites. As far as the fact that at least one company should have scored high enough to earn a license (absent the security flaws detailed below), Yost said that such matters will now head to the courts and to any state appeals process.
He urged Commerce Director Jacqueline Williams to seek the advice of State Attorney General Mike DeWine, who will be defending the state in litigation that has already begun.
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Originally published Feb. 16:
A letter from the Ohio Department of Commerce today invites State Auditor Dave Yost to pause the state’s medical marijuana program while concerns over the digital security of license applications is vetted.
Yost's press secretary told Cannabis Business Times that the office is “formulating a response.” (Yost was out of the office this afternoon, attending a funeral for fallen police officers. A full response to the letter is expected sometime next week.
As part of its oversight responsibility, the Ohio Department of Commerce is now sifting through license applications for medical marijuana processors and testing facilities, but it’s the 24 cultivation licenses awarded late last year that have drawn intense scrutiny and prompted today’s letter.
Earlier this week, Yost identified what he called a “critical flaw” in the state’s cultivation license scoring system—namely, that administrators could, in theory, access and manipulate applicants’ results. The security gap was enough for Yost to call into question the integrity of the state Department of Commerce license distribution.
In working to correct that error, the Department of Commerce stumbled on “inadvertent data input errors in the financial data plan scoring of the cultivator applications,” according to Director Jacqueline Williams. The department confirmed that the error was significant enough to push at least one company (PharmaCann, LLC) out of the 12 winning slots for large-scale growers and deny it a license that it should have rightfully earned.
PharmaCann’s owners have already filed a separate lawsuit against the state of Ohio, alleging that diversity requirements in the cultivation license scoring process distorted the results and forced PharmaCann out of a license.
Given the uncertainty surrounding Ohio’s licensing process, the Department of Commerce will follow Yost’s lead, sometime next week, in either pausing the program or pushing forward.
Elsewhere, Jimmy Gould, chairman and CEO of CannAscend, is moving forward on a proposed constitutional amendment that would allow adults 21 and older to grow and use marijuana. (CannAscend was unsuccessful in its own bid for a large-scale cultivation license in Ohio.)
Top photo courtesy of Adobe Stock
