Lawmakers Wade Into CCC “Trainwreck,” Mull Possible Action

Upheaval At Commission Continues

JULY 9, 2024…..Lawmakers from both parties signaled Tuesday they share a government watchdog’s concerns about upheaval at the Cannabis Control Commission, but Democrats who wield decision-making power stopped short of indicating what kind of response they might marshal.

Weeks after Inspector General Jeffrey Shapiro penned an urgent warning to legislative leaders about the “rudderless” CCC, members of the Legislature’s Cannabis Policy Committee dove into his findings, and some lawmakers used the hearing to make their own jabs at the regulatory agency.

“I don’t know what the legal or legislative parlance is, but it’s a trainwreck,” said Rep. Aaron Saunders, a Belchertown Democrat. “What’s going on right now is not fair to the public, it’s not fair to the members of the industry, it’s not fair to the employees of the commission.”

Republican Rep. Michael Soter of Bellingham put his frustrations in similarly colorful language.

“We’ve worked very diligently on putting laws in place, things in place, wanting things implemented on time, doing our due diligence, having multiple hearings, long hearings, reading testimony. It just seems to me when everything gets down to that level, the CCC, your report is dead on,” Soter told Shapiro during the hearing. “I don’t want to say ‘spit in the eye of the Legislature,’ but it almost seems to me like they don’t care about what we say.”

Lawmakers created the CCC when they rewrote the recreational marijuana law voters initially approved at the ballot in 2016, and the agency has long been mired in discord. The current chair is suspended, the longtime executive director resigned while out on parental leave, and the search for a new non-interim top administrative official appears to be months behind schedule.

Shapiro described a long list of concerns at Tuesday’s hearing, telling lawmakers about sudden resignations and staff turnover at the CCC, the inadvertent release of sensitive data, a delay changing a two-driver policy months after commissioners voted to change it, and more.

The “root of the problems,” he said, is the law that created the CCC. Shapiro said the statute is “self-contradictory and provides no clear guidance on who is responsible for leading the agency,” especially because it assigns similar powers to both the commission chair and its executive director.

“This letter, though its timing may have been surprising, is not a shock and echoes concerns that we have heard from other avenues,” Rep. Daniel Donahue, who co-chairs the Cannabis Policy Committee, said about Shapiro’s letter at the hearing’s start.

The inspector general called on lawmakers to place the CCC into receivership before the July 31 end of formal sessions, then circle back next term to overhaul the governing statute.

While several lawmakers aired their own concerns about the status quo, Democrats on the committee neither embraced nor outright opposed Shapiro’s suggestions, leaving an open question about next steps with just about three weeks remaining before Beacon Hill downshifts for the remainder of the year.

Sen. Michael Moore of Millbury filed an amendment (#163) to the economic development bill up for consideration Thursday that would direct the governor to appoint someone “with a demonstrated record of success in improving the operations and management functions of public or private entities” as receiver for the CCC within 30 days, to serve a term of one year. They would be tasked with developing and executing on a turnaround plan, and reporting monthly to the governor, lawmakers and inspector general.

Donahue said establishing a receiver for the CCC would be a “unique” step that lawmakers have never done for a state agency. (Shapiro noted that the state placed the Chelsea Housing Authority into receivership in 2011.)

“As someone who’s been in government a long time, receivership is a really big deal. I would argue it’s the nuclear option, hence why we heard today that it’s never been done on a state agency,” said Rep. Rob Consalvo of Hyde Park, the committee’s House vice chair. “I’ve been part of the discussions in the city of Boston about bringing the Boston Public Schools into receivership, which I will say for the record as a BPS parent and Boston legislator, I am completely against.”

“I know these are apples and chainsaws, but I want to underscore how big of a deal putting an agency into receivership is,” he added.

Several lawmakers asked Shapiro how he landed on the idea of receivership rather than other reforms, such as asking the executive branch to perform more CCC oversight, installing an auditor at the agency, or pressing the governor, attorney general and treasurer to replace commissioners.

Shapiro on several occasions said he believes the statute itself is the chief problem, not the individuals currently at the CCC, arguing that similar problems have recurred across the tenures of several commissioners and staff.

“Not making this personal, but I didn’t feel that the agency, when there was another chair who was there for a long time, that it was better,” he said. “If there was clarity on somebody else being the chair, I was not convinced that would ultimately be the solution that was necessary.”

Ava Callender Concepcion, the acting chair of the CCC, wrote to lawmakers on June 20 with her own response to Shapiro’s warnings, criticizing his team’s process and its call for creation of a receiver.

“The challenges at the Commission are far from secret. We are committed to resolving them. In fact, we have a blueprint for a governance structure that is in its final stages of legal review and will be taken up at a public meeting,” Callender Concepcion wrote. “Going back to the drawing boards with the OIG’s proposal of receivership (a concept undefined and with no statutory basis provided) is ill-advised. And increasing government secrecy by removing the Commission from the purview of the Open Meeting Law is hardly a solution.”

She referred to private mediation the CCC sought to help craft a new governance charter, which agency officials appear poised to introduce and discuss Thursday.

The agency posted the agenda for that meeting on Tuesday morning, about 90 minutes before Shaprio’s testimony before the Cannabis Policy Committee, and it includes time for the acting chair’s “Governance Charter Introduction.”

Saunders said the Massachusetts Gaming Commission has a “nearly identical” governing statute as the CCC, and that agency has “been able to successfully operate under this structure.”

He asked Shapiro if the CCC cooperated with the inspector general’s probe to the level expected from a state agency, to which Shapiro replied, “I would say no.”

“Any of the appointing authorities can remove a commissioner for substantial neglect of their duties. When I hear that there is not clear cooperation, unambiguous, unimpeded cooperation, that’s neglecting the duty of a commissioner,” Saunders said. “I know we’re not here to speak to personalities, to me, it suggests strong evidence that we need the right team because we know this structure works in other forums.”

CCC spokesperson Tara Smith said Tuesday that the agency “appreciates the Joint Committee on Cannabis Policy for holding today’s hearing and is proud of its track record of standing up and regulating a safe, effective, and equitable medical- and adult-use cannabis industry that has generated more than $7 billion in sales for the Commonwealth.”

“In furtherance of those efforts, the agency is slated to discuss several timely matters at its public meeting on Thursday, including updates on various regulatory topics, federal rescheduling, and the hiring process for a permanent Executive Director,” Smith said. “In addition, Commissioners intend to introduce its draft governance charter as a critical tool used by other state agencies that will help clarify many of the questions that have been raised about employee roles and responsibilities. The Commission takes seriously the concerns that have been identified and will continue to work with the Inspector General and legislators to provide additional information about our operations and structure as needed.”