State audit finds vague cannabis packaging rules; lawmakers press DCC for clearer standards to keep products from appealing to children

A state audit released this year found that the Department of Cannabis Control’s (DCC) rules on packaging and labeling are sometimes vague and unevenly enforced, and lawmakers on the Joint Legislative Audit Committee urged the department and industry to adopt clearer, enforceable standards to reduce the risk that products will attract children.

The audit, presented to the committee by State Auditor Parks, reported that auditors reviewed 120 products, 29 public complaints and 51 inspector referrals and noted disagreements with DCC’s conclusions in about 13 of 80 product reviews the audit examined. “The department’s regulations on prohibited design elements are not always well defined or commonly understood, leading to subjectivity and at times inconsistent enforcement,” Parks told the panel, summarizing why the office recommended clearer statutory and regulatory language.

Lawmakers cited rising poison control calls as the core public‑health concern behind the hearing. Committee members cited audit figures and legislative staff notes showing calls to poison control for cannabis ingestion among children under 5 increased sharply since 2016; the audit's presentation cited roughly 148 calls in 2016 and 842 calls in 2023.

Auditors illustrated the problem with images of packaging that used cartoon faces, candy‑style fonts, and dessert‑like imagery. The audit recommended the legislature consider more specific prohibitions — for example, on bubble or cartoon‑style fonts, bright colors or images implying flavors such as candy or desserts — and to consider models used in other states that require preapproved packaging. It also recommended limits or clearer serving‑size rules for cannabis beverages and suggested DCC improve its rubric for staff evaluations and better identify repeat violators to support escalated sanctions.

DCC officials told the committee the department has already taken operational steps in response to the audit. “We have strengthened our centralized review structure to ensure that determinations about whether packaging may be attractive to children are made uniformly across the state,” said Christina Dempsey, Deputy Director of Government Affairs. Dempsey and Zahra Ruiz, head of the department’s inspection branch, said DCC has formed a dedicated labeling review team, deployed image‑analysis tools, enhanced its compliance database and adjusted investigative file standards so prior violations inform enforcement decisions.

DCC witnesses acknowledged both regulatory ambiguity and resource constraints. John Lewis, the audit principal, said part of the enforcement challenge stemmed from integrating data and processes when the department was formed from three separate legacy programs. “DCC came together from three different entities, different data systems. They are still in the process of putting all of that together,” Lewis said, noting that the audit recommended consolidating records and creating inspection templates to track licensee histories.

Members pressed DCC on enforcement escalation beyond “notice to comply,” asking whether citations, embargoes or license actions are being used. Dempsey and Ruiz confirmed the department has those tools and said it has begun using escalated responses where warranted; they also described budget requests seeking more legal and field staff and systems consolidation to speed citations and recalls.

The hearing included a third panel of public‑health researchers and industry representatives. Pediatrician and public‑health researcher Lynn Silver said regulators have not faithfully pursued an appropriate balance between eliminating illicit markets and protecting youth, and urged stronger, evidence‑based limits including plain packaging and restrictions on added flavors. “Enforcing existing regulation prohibiting products attractive to children and strengthening those regulations with clear evidence‑based criteria” was among her recommendations.

Industry representatives said they share the goal of keeping cannabis away from children but argued that clearer, objective definitions would produce better compliance without broad, blunt bans. Amy O’Gorman Jenkins of the California Cannabis Operators Association said the audit’s finding — that vague rules cause inconsistent enforcement — supports defining observable design features and aligning DCC guidance with regulation. An industry review presented to the committee found roughly 68% of evaluated products clearly compliant, 10% clearly problematic, and the rest in a gray zone.

Public commenters and school‑based advocates described classroom disruption and student possession problems. Dr. Alisa Paden, a research scientist at the Public Health Institute, testified that food and flavor references and depictions of psychoactive effects increase youth interest in cannabis products, and youth advocates described school officials regularly collecting these items from students.

Where the committee stands next: lawmakers said they want clearer statutory language and will work with the department and stakeholders. The auditor suggested options ranging from tighter statutory prohibitions to a premarket packaging review system like Oregon’s; DCC said it will publish its rubric tool and is developing policies to better escalate enforcement for repeat violators. Several chairs warned they expect measurable improvements in the coming year or they will return to consider further legislative action.

The committee adjourned after closing statements reaffirming the shared objective of protecting children and giving the department and industry a path to implement the auditor’s recommendations.