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A report from the Missouri state auditor released last week found that combined medical and adult-use sales in the state generated more than $255 million in tax revenues last year, but that there were significant flaws with the business application process, issues with dispensaries keeping customer data, and potential over-selling by dispensaries.
The report from State Auditor Scott Fitzpatrick suggests that the problems with the licensing process – summarized as not ensuring consistency or transparency – cost the state more than $12.5 million in costs associated with litigation and administrative appeals from 2020 to 2023. During that period, a total of 1,909 appeals were filed against the Division of Cannabis Regulation (DCR). Of those appeals, 849 were denied (a rate of 44%), according to the audit.
The audit also found that cannabis-derived tax revenues “have not been distributed in accordance with the constitution,” finding an $82.4 million balance remaining in the Veteran Health and Care Fund, and an $89.2 million balance in the Veterans, Health, and Community Reinvestment Fund. The voter-approved constitutional amendment requires equal transfers of cannabis taxes and fees to the Missouri Veterans Commission (MVC), the Department of Health and Senior Services (DHSS) for drug programs, and the public defender system.
“Both the MVC and the public defender system have communicated the need for additional resources, but the full amount of the funds available have not been appropriated in the approved budgets.” — Missouri State Auditor Report, Marijuana Program, February 2026
The report shows cannabis sales in the state have made massive gains since 2020, from about $5.5 million that year to about $215 million in 2021, about $605.3 million in 2022, about $1.9 billion in 2023, and about $3.4 billion in 2024.
Despite the issues raised in the report, Fitzpatrick gave the program a “fair” rating due to the scope of implementing a cannabis program from the ground up.
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