Audit - City and County of Denver

of Local Licensing Authority.” However, Department personnel informed auditors thatbased on a verbal understanding between the Department and MMED, theDepartment’s completion of the form only confirms that the business has submitted acomplete application and supporting documentation; it does not confirm that theapplicant has been approved for licensure with the City. To provide this confirmation, theDepartment completes the part of the form confirming that the City has adopted rulesregarding MM licensing, leaving the “Report and Approval of Local Licensing Authority”section blank. Department personnel and the Director sign and date the form beforereturning it to MMED.The current design of the LVF is clearly meant to verify whether a local license wasapproved or denied. If the Department’s only criterion for completion of the LVF isreceipt of an application and required documents, the risk exists that some applicantsmay fail the subsequent City inspections and be denied a City MM license when the LVFfor the business has already been submitted to the state. If the state uses the LVF as proofof the local authority’s approval of an MM application, as the form’s current layoutindicates, it may approve an MM license when such a license was subsequently deniedby a local licensing authority.Furthermore, we found that the LVFs are not kept in their respective businesses’ paperfiles and they are not recorded in Production. Therefore, we question how theDepartment can determine whether the state has sent an LVF for a business.Additionally, we found duplicate LVFs in the folder where all LVFs are filed, indicating thatthere may be confusion at the City or state level about whether the state has sent theCity the form, or whether the City has returned it to the state.To address the issues related to the LVF step in the licensing process, the Departmentshould work with MMED to clarify the purpose of the LVF to avoid inconsistency in MMbusiness licensing decisions based on completion of these forms. Additionally, theDepartment should keep the copy of all completed LVFs in their associated businessapplication files and make a note of them in the pertinent business record in Production.License RenewalAudit work found that MM license renewalprocesses need significant enhancement. • Application ProcessFirst, the Department has not developedformal processes for renewing MM licenses, • Licensing Processeven as some licenses have been renewed.Second, the Department does not require a• Renewal Processrenewal application or conduct aninspection to support its MM license renewaldecisions, and does not follow up withlicensees to ensure that they pursue MM license renewal. Finally, the City’s MedicalMarijuana Code grants a two-year MM license renewal while allowing MM businesses topay for only one year at a time.City and County of DenverP a g e 24