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A deeper look at AMCC’s troubled medical marijuana licensing process

The process for awarding medical cannabis licenses in Alabama was plagued with issues from start to finish.

Alabama Medical Cannabis Commission

Four days after awarding the state’s first ever medical cannabis licenses, the Alabama Medical Cannabis Commission made a surprise announcement – it was placing a hold on those licenses while it investigated “inconsistencies” within its application review process. 

To many on the outside looking in, it was a stunning turn of events and another example of government bureaucracy run amok. To those close to the process, including applicants, AMCC employees, attorneys and lobbyists, it was simply the latest – albeit the biggest – flaw in a process that has been filled with them. Flaws that seemingly cost some applicants a license; flaws that gave some applicants an advantage; flaws that kept the general public mostly in the dark. 

APR has spoken to more than a dozen people who were involved in the AMCC’s medical marijuana licensing application process in an effort to understand just what went wrong, who is to blame and how the process of awarding licenses to sell medical weed has resulted in, essentially, a do-over, complete with lawsuits and more lawsuits. 

“It’s pretty safe to say that you couldn’t really screw up a government operation worse than this one has been screwed up,” said an attorney who has been involved in the application process. “It seemed like every single time they decided to do something it was the wrong decision.” 

The attorney, like several others who were interviewed for this story, asked not to be identified out of fear that speaking out would cost his clients. Other sources asked not to be identified because they were not authorized to share information about the application process and the ongoing investigation into the inconsistencies. 

However, all of them combined to describe a process that was plagued by bad decisions, a bad law and a little bad luck. 

The problems started almost immediately, when applicants began experiencing issues with the application portal. The problems continued to the very end, when errors in the process of grading the applicants led the AMCC to scrap the whole thing. 

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A New Review

The AMCC is currently conducting an independent review of the process, and an attorney working for the AMCC said it is progressing. Montgomery attorney William Webster said the investigation will likely show that the errors that forced the AMCC to issue the stay – which has since been backed up by a stay issued by a Montgomery County Circuit Court – were related to the collation of scores from a variety of different graders who were working quickly to meet a deadline imposed by the legislature. 

Webster also said that the AMCC has engaged an accounting firm to review the scores and will re-award the licenses based on those new, “accurate” scores. 

“This is an effort to go back and award based on accurate information,” Webster said. “I think the Commission should be commended for being willing to do that – to make sure it was done properly. I’m not sure it will change who receives the licenses – that will be determined by the process – but it’s an opportunity to get it right.”  

So far, Webster said, the investigation has shown that it was not necessarily the graders working with the University of South Alabama who were to blame for the “inconsistencies” that forced the re-do. Instead, it appears to have more to do with a convoluted and confusing grading process that involved multiple steps, multiple graders scoring each application and a collation of grades. 

USA recruited a number of different graders from various professions, including accountants and bankers and businessmen. Those graders were assigned the tasks of scoring each application in their areas of expertise, according to Webster. That meant that each application was scored multiple times by different graders, after which those scores had to be tabulated and an overall score established. 

But in addition to all of that scoring, the Commission itself also scored some applicants prior to sending the applications to USA. Then, after the scores were returned, Webster said, the AMCC applied a certain number of “pass/fail” tests to the applications – meaning the Commission judged the applicants on whether they could meet certain requirements of the law passed by the legislature. 

Somewhere in the midst of all of that, mistakes were made. 

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“I think what the investigation has shown to this point is that it wasn’t that the graders did something nefarious or intentionally worked against an applicant or that they even made mistakes in the grading, but it was in the collating of those scores where the mistakes were,” Webster said. “I believe, and this is my opinion, that the mistakes were due to time constraints because of the deadlines imposed by the law. When you get in a hurry, that’s when you mess up, and I think that’s what happened here.”

The deadline referenced by Webster is a 60-day time limit between the AMCC receiving applications and issuing licenses. That deadline was put in place by the Alabama Legislature in the medical cannabis law. 

The problems at the end of the application process, however, were by no means the first problems. Those started at the very beginning, when applicants tried to simply submit their applications.  

Problems From The Start

According to three applicants who spoke with APR, the portal was plagued with issues, with the biggest being a 10 megabyte cap on file attachments that went with applications. 

The reason that was such a problem is that applicants were required to submit all paperwork, designs and other materials related to the facilities they would build, the growing processes they would use and/or the shipping methods they planned to use. Those plans were detailed and intricate, and according to a lawsuit filed by one applicant, Alabama Always LLC., were required to be viewable without a loss of resolution even when enlarged. 

But to meet the file-size limitations, applicants were forced to repeatedly compress the files, reducing the quality of the images. According to its lawsuit, Alabama Always said the “degrading” of the images in the files negatively impacted its application. 

Making matters much worse, however, is the fact that some applicants were afforded an opportunity to circumvent the file-size limitations. It’s unclear who at the Alabama Medical Cannabis Commission made the decision to provide some applicants a “workaround,” but Webster acknowledged on Wednesday that it happened. 

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“I can’t tell you for certain who made that decision, but I remember hearing about it sometime in January,” Webster said. “If I had to guess, I would say it was a decision made as a collaboration among the AMCC staff, but that is speculation.”

According to two sources familiar with the decision to grant some applicants a workaround, that call was made by in-house counsel Justin Aday, who was appointed to the position after being fired by the Alabama Bar Association, according to an attorney familiar with the situation. Attempts to reach Aday on Wednesday were unsuccessful. 

Webster insisted, however, that the decision to grant the workarounds didn’t negatively impact any applicants – an assertion directly refuted by three applicants – and that it was handled “fairly.” Webster said the AMCC determined that it was appropriate to provide applicants who asked with a means to submit the required documents. 

However, when other applicants discovered that some competitors had been given workarounds, they also asked for a means to submit their documents. They were denied by the AMCC, because, according to Webster, it was after the deadline and would have been unfair. 

“These applicants who were given that opportunity were given it because they contacted the Commission and raised the issues, just as any applicant could,” Webster said. “Asking for it after the fact is completely different. It’s like showing up after you’ve missed the test in school and asking to take it. It’s too late.” 

The lawsuit filed by Alabama Always, along with sources who worked with two other applicants, paint a different picture, however. They say that they raised the issue of the 10-megabyte file limitation on numerous occasions prior to the Dec. 31, 2022, deadline but were never informed by staff that there were available options outside of that limitation. 

They also pointed out that file-size limitation wasn’t the only portal issue. Among other issues, the sources said they were repeatedly kicked out of the portal during the submission process. They raised questions about the vendor contracted for the portal, Tyler Technologies. 

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Tyler has, itself, been plagued with issues. A quick Google search shows that Tyler has been sued multiple times in states all across the country, has faced numerous class action lawsuits and is currently facing a class action suit in North Carolina after its software improperly kept some people in that state in jail. It faced similar allegations in California and Tennessee. 

In Alabama, Tyler currently handles software management for the Securities Commission, Public Service Commission and the Alabama Real Estate Appraisers. Those contracts were enough to win it the job for the AMCC’s portal work. 

“I can’t tell you for certain why they were chosen, because I was not involved in that decision, but I believe that they were contracted with other state agencies and that played a role,” Webster said. 

Josh Moon is an investigative reporter and featured columnist at the Alabama Political Reporter with years of political reporting experience in Alabama. You can email him at [email protected] or follow him on Twitter.

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