Tracking Marijuana from Seed to Sale

[Sombeech]

Cheyenne Fox attaches radio frequency tracking tags, required by law, to maturing pot plants inside a grow house at 3D Cannabis Center in Denver, Tuesday Dec. 31, 2013. The sale of recreational marijuana in Colorado began Wednesday Jan. 1, 2014.IMAGE: BRENNAN LINSLEY/ASSOCIATED PRESS
BY REBECCA HISCOTT4 HOURS AGO

On New Years Day, Colorado became the first state to legalize the sale of recreational marijuana. The new legislation has provoked a Denver-bound flood of "Ganjapreneurs" and kickstarted what is sure to be a very profitable pot tourism trade.
Yet the business is far less hippie and far more button-down than it appears.
The Colorado state government enforces the sale of marijuana with a set of regulations (500 pages in all) designed to shut out the black market. For one, it stipulates digital tracking of marijuana plants from seed to sale, using radio frequency identification (RFID) technology.
The cannabis industry is generally eager to comply with even the most stringent government regulations, thereby proving the marijuana market can be both lucrative and legitimate. However, implementation problems have slowed the retail pot business's anticipated boom.
SEE ALSO: The Legal Stoner's Guide to Colorado's New Marijuana Law

Mike Elliott, executive director of the Medical Marijuana Industry Group, a trade association that promotes and protects Colorado's medical marijuana industry, explains that business owners who want to continue using their current sales software still need to input data into the state-operated system manually. This leads to a doubling of information, wasted man-hours and the potential for human error in recording sales transactions.
"We have to use MITS (Marijuana Inventory Tracking Solutions) and that's fine," says Elliott. "But if we want to keep using our own point of sale systems, which has been such an integral part of making the business work, it's a problem. The state system has taken over and suddenly we're not as able keep track of things internally."



Cheyenne Fox attaches newly arrived RFID tags to pot plants maturing inside a grow house in Colorado.
IMAGE: BRENNAN LINSLEY/ASSOCIATED PRESS

Since 2010, Colorado's medical marijuana growers and dispensaries have been required to report their plants' whereabouts to the Colorado Department of Revenue's Marijuana Enforcement Division. Earlier methods were analog and a little sloppy. The technology-reliant MITS was instituted in late 2013.
"People like MITS because it cuts down on the amount of paperwork they do," says Julie Postlethwait, a spokesperson for the MED. "The electronic manifests are automatically in our system. On the paper system, they would either email them in or fax them in, but we didn't acknowledge if we received them."

MITS was written into Colorado law before the sale of recreational marijuana was legalized.

"It's an enforcement tool so that the MED knows how much marijuana is grown in the state of Colorado and where it is in the facilities,"

"It's an enforcement tool so that the MED knows how much marijuana is grown in the state of Colorado and where it is in the facilities," says Postlethwait. Its original goal was to digitize and facilitate the laws already on the books; the timing of the retail marijuana legalization was a happy accident.In the medical and retail marijuana industry, marijuana plants are propagated by clipping a stem from one plant to create a new one. The new plant is issued an RFID tag with a unique 24-digit ID number, which is entered into the government's online system. When the plant is harvested, its leaves and buds are shipped to a marijuana retailer with a new RFID tag and a printed label detailing the plant's origins. The system is updated at every step of the production process.
The regulatory framework also requires 24-hour video surveillance of facilities, as well as routine compliance checks.
MITS's goal is to ensure that marijuana plants are coming from state-authorized grow facilities and being transported to state-authorized retailers, cutting off the black market. The system can also be reverse-engineered in case of contamination or illness