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Business Dec 01, 2022
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City Controller Ron Galperin called for Los Angeles to do more to enforce regulation of cannabis businesses, in a report released Thursday.
Galperin’s report found the city should improve preventing unlicensed cannabis businesses from opening, though the number of known unlicensed businesses has decreased from 300 to 100 since 2018, according to the Los Angeles Police Department.
More than 5,000 complaints related to cannabis have not been processed by the city’s Department of Cannabis Regulation, according to Galperin. Galperin said his auditors found a “range of violations” when visiting six cannabis retail stores that had been licensed.
Additionally, Galperin claimed that the city’s Office of Finance has not met its goal of conducting audits of cannabis businesses every two years, “resulting in a potential loss of millions of dollars in tax revenues.”
“The right to legally purchase cannabis in Los Angeles must be paired with stronger oversight to ensure that businesses engaged in commercial sales understand and are compliant with the health, safety and financial policies of the city,” Galperin said. “Although this is a relatively new market, it is critical for Los Angeles to do a far better job monitoring cannabis businesses, eliminating tax evasion and preventing unlicensed shops from opening and operating in our neighborhoods.”
Galperin’s recommendations included that the city expand its enforcement strategy, implement a comprehensive regulatory compliance plan and revise cannabis license and application fees.
The full audit can be viewed at: lacontroller.org/cannabis-audit.
