Last month, along with streamlined licensing, the Oregon Liquor Control Commission (OLCC) announced a significant (and welcome) change to its compliance function by instituting a new Verification of Compliance program (VOC) that will focus on education rather than penalties for certain types of marijuana rule violations. The VOC launched in early October and arose from meetings with the industry this past summer. The OLCC is in the process of formal permanent rulemaking for the VOC program, which I expect will take several months.
The VOC program allows OLCC inspectors to issue VOC paperwork (the “ticket”) to licensees for a select number of violations. Where the licensee is able to fix the problem within the required timeframe, the OLCC will not commence further proceedings against the licensee. This is great news! But beware– the OLCC reserves discretion to pursue “ticket” violations if a licensee shows a general disregard for rules and laws. So licensees should not treat cavalierly rule violations which may qualify for a “fix-it ticket.”
What kinds rule violations may qualify for the VOC? The OLCC identified four criteria relevant to this determination.
- The violation must be potentially fixable, i.e. the licensee has the capability of fixing or correcting the problem. (Not an example: selling marijuana to a minor.)
- The corrective action must be measurable by the OLCC. This means licensees and regulatory specialists must be able to point to tangible/concrete action to demonstrate compliance. (Example: fixing camera coverage).
- The violations eligible for VOC should be teachable, learnable, and executable. (Example: issues with METRC). This narrows the list of eligible violations considerably and reflects that the VOC is designed to address relatively common violations with a low probability of recurrence.
- The VOC should provide a positive impact for both licensees by educating licensees and for OLCC staff by reducing the workload volume of enforcement cases presently routed through the administrative hearing division.
Has the OLCC identified violations that qualify for VOC? Yes, the OLCC’s compliance education bulletin identifies five violations that meet the above criteria. These are video recording, Seed-to-Sale tracking with METRC, inventory reconciliation with METRC, security requirements, and UID tags. But note this list may change as the OLCC implements the program and develops permanent rules.
This is excellent work by the OLCC, which continues to demonstrate its desire to work with, rather than against, Oregon’s marijuana industry. The VOC program reflects the maturation of the industry on the West Coast—last year Washington State took steps to shift from adversarial enforcement to compliance for its marijuana licensees— and aligns with statements by the OLCC that it seeks “willing partners” in the cannabis industry.
You can find the OLCC’s news release on the VOC here and its Compliance Education Bulletin here. And for more information concerning the OLCC’s enforcement of the marijuana rules and regulations and what to do if your marijuana business find itself in trouble with the OLCC, see: