WA’s cannabis tracking system faces major flaws, state audit finds

Washington, the first state to approve marijuana use recreationally in the U.S. alongside Colorado, still lacks a system that properly tracks cannabis from production through processing to retail sale, the Office of the Washington State Auditor confirmed in a follow-up performance audit.

In approximately six weeks, recreational use of cannabis will have been legal for 12 years despite the state lacking a sufficient tracking system.

According to the audit, the current cannabis tracking system doesn’t efficiently track how cannabis is produced, processed or sold. The Office of the Washington State Auditor claimed the system is intended to help identify risks of illegal or unsafe practices within the cannabis business from farm to store.

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“A ‘seed-to-sale’ tracking system has been under development for 12 years, but has yet to be fully realized,” State Auditor Pat McCarthy said. “This report is an important update for state leaders, who can now engage with the Liquor and Cannabis Board to establish clear goals for ensuring accountability in our modern recreational cannabis system.”

The Washington State Liquor and Cannabis Board (LCB) system helps report data from cannabis businesses and licenses, but the system still faces a multitude of challenges.

“Today, several other states operate such full-service, ‘seed-to-sale’ tracking systems to help them identify risks of illegal or unsafe practices,” the Office of the Washington State Auditor wrote in a press release. “However, when auditors followed up on earlier recommendations to LCB, they found its project had failed.”

Among the challenges the tracking system faces include inaccurate real-time tracking that is reported to law enforcement and mismanagement from leadership as the project has been overseen by three different sponsors and three different deputy directors in just three years.

The system is also prone to other errors, including misplaced decimals in the reported sales price of individual cannabis products. For example, the errors caused the annual sales report for 2022 to be nearly $8 billion when the Department of Revenue estimated sales for the same period to be about $1.3 billion, according to the press release.

Cannabis businesses have to input data about the products they’re growing, buying and selling — from the process of cultivation all the way to retail — into a unified data tracking system.

“It gives the state the ability to have visibility throughout the entire supply chain and, at any moment, they can trace backwards or forwards through time to investigate a piece of inventory,” BioTrack Vice President Moe Afaneh told NYUp.

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BioTrack is the company Washington employs to create its tracking system for cannabis.

While the LCB is focused on replacing the aging information technology systems, it does not expect to be able to launch a more robust tracking system until 2031, according to The Office of the Washington State Auditor.

Frank Sumrall is a content editor at MyNorthwest. You can read his stories here and you can email him here.