A new Pennsylvania government audit has found significant weaknesses in the state’s oversight of medical marijuana businesses, including missing inspection records, delayed enforcement actions and inadequate review of corrective plans.
The performance audit, released today by Auditor General Timothy DeFoor, examined how the Pennsylvania Department of Health monitors marijuana growers, processors and dispensaries. It is the first such audit of the program since it was established in 2016.
The audit primarily covered January through December 2024, with updates incorporated through the completion of audit procedures on August 19, 2026. Auditors examined inspections conducted by the Bureau of Medical Marijuana involving nine of the state’s 34 grower/processors and 30 of the 182 dispensaries operating during the audit period.
Among 103 inspection checklists reviewed, auditors found that 35 had not been retained and another two were only partially retained. That meant auditors were unable to determine whether all required inspection steps were completed or whether deficiencies were properly addressed for roughly one-third of the requested records.
Auditors also found no documented supervisory review of completed inspection checklists. The bureau told auditors that supervisors were expected to review inspections, but that expectation was not supported by written policy during the audit period.
Of the 35 missing checklists, 33 involved inspections conducted before an August 2024 standard operating procedure established formal requirements for storing inspection documentation. Two occurred afterward.
The audit identified even larger problems with enforcement following inspections. Twenty-six checklists contained deficiencies requiring a formal Notice of Deficiency. Fifteen of those notices were never issued, while nine were issued after the bureau’s approximately two-and-a-half-month timeline. Just one was sent within the established timeframe.
In one case, auditors found 14 deficiencies on a dispensary’s inspection checklists, but no Notice of Deficiency was ever issued.
The bureau attributed delayed or missing notices in part to staff shortages, a hiring freeze, employee training and transitions, medical leave and the absence of an automated system capable of managing the volume of work.
Auditors also examined Plans of Correction submitted by businesses after receiving deficiency notices. Businesses generally met their requirement to respond within 30 days, but the state was considerably slower in reviewing those plans.
Of 10 plans examined, only one was approved within 30 days. Five were approved after more than 30 days, while four had not been approved as of auditors’ inquiries in February and March 2026. For the plans that were approved, review times ranged from one to 168 days. Four still awaiting a decision had been pending for between 65 and 378 days.
The audit separately reviewed 10 of 36 complaints received by the Bureau of Medical Marijuana during 2024. Auditors found the bureau generally followed its complaint investigation process, including conducting on-site inspections when necessary, but identified shortcomings in how management documented its review and approval of investigation conclusions.
One of the complaints resulted in a cease-and-desist order against a dispensary after inspectors identified inventory, payroll, vendor payment, utility and security system issues. The order was issued 17 days after the inspection. Two other complaints were substantiated and resulted in deficiency notices, while seven were determined to be unfounded due to insufficient evidence of regulatory violations.
Although the two deficiency notices stemming from complaints were issued on time and the businesses submitted corrective plans within the required period, auditors found no documentation showing the bureau formally reviewed and approved either plan.
The audit issued nine recommendations, including establishing standardized inspection procedures, ensuring inspection records are retained, documenting supervisory reviews, sending deficiency notices on time, establishing timelines for reviewing corrective plans and formalizing the complaint review process.
The Department of Health agreed with all nine recommendations and said several corrective measures are already underway or in development. The bureau has added supervisory signoffs to inspection checklists and is working to update and finalize its standard operating procedures.
The state also plans to move the program to an Enterprise Licensing System that will automate inspection and document-management workflows. The system was initially expected to be operational in August 2024, but implementation has since been delayed until March 2027. In the meantime, the Department of Health said it will use interim measures to improve record retention and ensure deficiency notices and responses to corrective plans are handled in a timely manner.
