The Maryland Statehouse in Annapolis.


Audit of Maryland MMJ Commission Finds Regulators Overpaid for Application Evaluations

Maryland’s Department of Legislative Audits criticized the state’s Medical Cannabis Commission for using Towson University’s Regional Economic Studies Institute to evaluate medical cannabis applications in an audit outlined by City Paper. The reports concluded that the deal between the MMCC and the Institute circumvented “competitive procurement” standards, resulting “in a lack of assurance that these services were obtained at the most advantageous cost to the State.”

The audit focused on the application review process, and did not investigate some of the purported equity issues that have led to Gov. Larry Hogan ordering a diversity study of the medical cannabis program and lawsuits against the commission by companies who claim they were unfairly denied licenses.    

“MMCC significantly understated the number of applications to be evaluated, resulting in an increase in the value of the agreements from $545,000 to $2.4 million,” the auditors write, noting the contracts increased by a factor of four; “MMCC relied on Towson University’s Regional Economic Studies Institute to renegotiate prices with the hired evaluators without ensuring the cost increases were reasonable.”

According to City Paper, the auditors believe an independent accountant working with state agencies could have saved the state money on the deal.

The commission contends that the lawful “use of interagency agreements here does not reflect any intent to circumvent state law” and that they are reviewing their application procedures “for a more cost effective and timely system.”

“The Commission has renewed its commitment to the competitive procurement process,” the agency said.

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