The Washington Liquor and Cannabis Board has announced that it does not anticipate launching an improved tracking system for the cannabis industry until 2031, nearly two decades after voters legalized recreational marijuana sales. In light of a recent audit, the agency emphasized its commitment to overseeing the industry, despite the limitations of its current tracking software.
According to the performance audit conducted by the Office of the Washington State Auditor, the state still struggles to effectively track cannabis from production through processing to retail sale. The audit pointed out that the board has yet to implement the digital tracking system it initiated in 2018, instead relying on a “stopgap” solution that has significant shortcomings.
The 2018 system, known as LEAF, was intended to be advanced enough to identify risk areas for enforcement investigations. However, the project, which saw oversight from three different sponsors and deputy directors over three years, encountered serious glitches shortly after launch, hampering businesses’ ability to report sales.
By 2021, the board abandoned the LEAF system and repurposed an existing backup database, now referred to as the Cannabis Central Reporting System. Initially expected to be a temporary solution, agency managers believed a new system would be in place within a year. Unfortunately, this system remains operational today.
The current system lacks the capability to provide enforcement officers with real-time tracking data, and errors—such as misplaced decimals in sales reports—are frequent. For instance, the system recorded annual cannabis sales of $7.7 billion in 2022, while the Department of Revenue estimated sales at only $1.3 billion for the same year.
The board heavily relies on cannabis businesses to submit accurate and comprehensive data; however, once uploaded, businesses face challenges in accessing or correcting their information. Additionally, products lack unique identification numbers, complicating efforts to track them for recalls.
The audit uncovered troubling records, including nearly 60,000 products with dates predating cannabis legalization, as well as about 600,000 reported dates set in the future.
In response to the audit, the Liquor and Cannabis Board acknowledged that the Cannabis Central Reporting System is not a viable long-term solution. Nevertheless, the agency has committed to ongoing updates to meet its needs and began developing a new tracking system in November 2023.
The auditor’s office noted that full-service “seed-to-sale” tracking systems are operational in other states, which help identify risks of illegal or unsafe practices. In Washington, this type of system has yet to be fully implemented, despite 12 years of development, as stated by State Auditor Pat McCarthy.