Alcohol, Tobacco and Cannabis Commission expands enforcement of unlicensed THC products and upgrades licensing systems

The Alcohol, Tobacco and Cannabis Commission (ATC) told a legislative subcommittee it will use FY26 resources to continue licensing, upgrade enforcement and modernize licensing and records systems while stepping up inspections of unlicensed cannabis (THC) products sold in tobacco and convenience stores.

David Pervert (DLS analyst) summarized the commission’s FY26 allowance, which DLS reported would decrease by about 1.3% to roughly $12 million. He noted that 29% of the commission’s FY26 allowance is reimbursable funds tied to a memorandum of understanding with the Maryland Cannabis Administration that funds enforcement of unlicensed cannabis operations.

ATC Executive Director Jeff Kelly told the panel the commission has used prior appropriations to move into new office space, expand IT capabilities, and contract for a licensing platform that will integrate with Maryland’s one‑stop business portal. “You’re gonna be able to go online, you’re gonna be able to complete your application,” Kelly said, describing an online system that will validate applications before submission and streamline payments and document uploads.

Kelly and Thomas Akers, director of legal and legislative affairs, described other IT investments: an automated wholesaler credit‑control reporting system, a records management system (used by Maryland State Police and other agencies) to improve data sharing across law‑enforcement partners, and a Lexipol contract to produce an agency policy and training manual for the commission’s law‑enforcement operations.

DLS urged the commission to add measures in its Managing for Results submission to track cannabis violations and seized contraband; the commission agreed to include additional reporting beginning with the FY27 MFR submission. Akers told the panel that the agency’s FY24 data included far more THC inspections than DLS initially recorded and said the ATC had mistakenly reported incorrect data to DBM earlier in the year (ATC reported 2,953 THC inspections in FY24, not the 156 figure cited in the draft DLS submission).

Akers and Kelly described enforcement priorities: many illicit THC products are being sold through retail tobacco outlets and convenience stores rather than stand‑alone cannabis shops, often in brightly colored packaging and flavored products that could appeal to young people. The commission reported an increase in seizures of “other tobacco products” and more in‑state inspections as enforcement capacity expanded. Akers said the commission had cross‑trained agents to address overlapping tobacco and illicit THC sales.

On product testing, Kelly said testing capacity to quantify THC potency was limited: “There is only one lab we could find that can test the quantity,” he said, describing sample limits (about 10 samples a month) and a 45‑day turnaround for the private laboratory used for prosecutions. He said the Maryland Cannabis Administration is building lab capacity that the commission expects to use in coming months, which should reduce turnaround time.

Kelly noted the commission’s FY26 request contained no new funding beyond the governor’s allowance and said the agency had reduced its overall ask from the prior year. The ATC asked the committee to support the governor’s allocation.

Ending: DLS recommended committee narrative requiring the ATC to add measures tracking cannabis violations and confiscated contraband; the commission agreed and said it will improve its MFR reporting beginning in FY27 and continue expanding inspections and IT modernization to support enforcement.