SAGUACHE COUNTY — An independent researcher believes s/he has verified serious problems with at least eight different marijuana applications filed with the state and in Saguache County and has identified several irregularities in associated key licenses and other filings.
Bill Case, who has access to the research, took the applications matter up with Saguache County Commissioners at their Dec. 5 meeting. He is on the agenda again for Dec. 19 and Jan. 9 to reveal more findings to commissioners.
Primary licensees for marijuana operations must reside in Colorado, but associated key license holders may live out of state. The regulations published by the state regarding associated key licenses is listed below.
R 204.5 – Disclosure, Approval and Review of Business Interests (page 33):
Any other Person who exercises control or is positioned so as to enable the
exercise of control over the Retail Marijuana Establishment must hold an Associated Key
License. A natural person who exercises control or is positioned so as to enable the
exercise of control over a Retail Marijuana Establishment shall include but shall not be
limited to a natural person who:
The following rule shows where 50 percent of the money collected from each application is supposed to go. Associated Key licenses, especially for an out-of-state person, can be very expensive to obtain.
R 1401 – Instructions for Local Jurisdictions and Law Enforcement Officers (page 209)
Marijuana Establishment application to the relevant local jurisdiction.
It is not clear if Saguache County collects this 50 percent cut from the state or not. The paper trail for recording payments received by Land Use for marijuana revenues has not been produced for the public to view. Reportedly, cash payments from marijuana producers paying excise tax are taken to Land Use then turned over to the treasurer’s office. It is not clear how other marijuana related revenues are reported or documented by Saguache County administration.
Treasurer Connie Trujillo was not available for comment on Tuesday.
During the county’s audit in September, Wall, Smith and Bateman (WSB) did list several findings and commented that a lack of internal controls over financial reporting “is a repeat over several years.” Some date this back as long ago as 2009. This is cited in the audit findings as a non-compliance material to financial statements and a financial material weakness. She listed these as not reconciling various financial accounts.
Accounts are not reconciled to what the county clerk has, which has the potential to become a material misstatement, A WSB representative told commissioners and administration.