Pot growers, sellers see lost cash and more worries as software systems hiccup
SEATTLE -- A new system meant to track marijuana from seed to sale in Washington is hiccuping, many in the pot industry say, costing some licensees thousands.
MJ Freeway, a new hub for tracing legal pot from grower to seller in the state, rolled out Feb. 1.
The system allows state officials to watch the movement of all pot, marking transactions between growers, producers and retailers. Producers and processors are supposed to assign numbers to all merchandise so it can be tracked through to sale, eliminating the potential for nefarious activity.
But the rollout of MJ Freeway has been anything but smooth, said Jason McKee, the general Manager of Ganja Goddess in Seattle.
"The implementation (of MJ Freeway) left a lot to be desired," McKee said. "From every type of licensee involved."
Hurting small growers
McKee is clear: He and others like the state's traceability system. It monitors all pot, and keeps a record for retailers working in a "legal grey area" as laws are different between the federal and state governments. It helps him manage the store, McKee said, and keep track of other facets of the business.
Problems arose in the traceability system when the state's contract with the previous systems administrator ran out on Oct. 31. According to the Seattle Times, the administrator the state had set up to run the new system backed out at the last minute, leaving MJ Freeway to fill the void. The state implemented an interim system until MJ Freeway launched in the state Feb. 1.
"Right now we're right in the middle of this changeover from the new system to the old system," McKee said.
McKee said the bumpy changeover is hurting smaller manufacturers. Retailers are hesitant to buy pot until it has been thoroughly tracked, relying on back-stock until system bugs are flushed out.
Joseph Sewell, the owner of Seattle Bubbleworks, a pot processing company, estimates he's lost about $21,000 dollars this week between stores not being able to buy product and him still needing to pay employees.
"For small businesses just trying to survive, it's kind of tough," Sewell said.
Sewell is working with Ganja Goddess to make up lost sales next week, he said. Washington State Liquor and Cannabais Board spokesperson Mikhail Carpenter said a webinar was held Wednesday to help pot licensees navigate the new system. Officials also said a team was working "on a 24 hour cycle" to identify emerging issues and prioritize them as they pop up in the software.
Problems with the interim system, too?
From November to February, the tracing system used was little more than Excel spreadsheets, McKee said, as the state was between systems.
Carpentes said reporting during this time period was more "time consuming on both ends."
Since receiving the reports, the state has noticed amore than 100 discrepancies, with about five percent of the state's pot licensees misreporting during the interim system.
"As of Jan. 23," Carpenter wrote, "there were 113 licensees who had not followed reporting procedure and enforcement is following up with each of them."
McKee and others said the interim system was confusing, and some worried it could increase federal scrutiny on an already heavily monitored industry.
"The longer the contingency plan goes on," Logan Bowers of Hashtag Cannabis told MJbizdaily.com, "the more that bad actors will be able to find the loopholes, because they're under less scrutiny and do things like export product out of state."
McKee said bad actors could exploit a weak system, but that's not the mentality he's seen in the marijuana industry. Everyone follows laws closely, he said, because they know scrutiny abounds.
"As far as Ganja Goddess and the vendors we do business with, everyone has just been doing everything by the letter of the law," McKee said. "Wait if you can't sell, and when you can, start doing business again."