Minneapolis marijuana business, growing restrictions approved by leaders

Marijuana dispensary licenses seeing delays

A backlog in verifying social equity applications for retail recreational marijuana sales has created a delay in dispensaries opening throughout the state until potentially 2026.

MINNEAPOLIS (FOX 9) - As Minneapolis seeks to implement rules that will regulate marijuana sales throughout the city, the city council has passed its first set of wide-ranging ordinances that would govern retailers.

What we know

During the Oct. 31 Minneapolis City Council meeting, members approved a cannabis business regulations ordinance aimed at the use of recreational marijuana in the city, as well as, its production and other aspects related to business sales.

According to the ordinance, the policy approach to cannabis legalization in Minneapolis emphasizes "safety, equity and accessibility, with a goal of creating a framework that is permissive but safety conscious."

"We should not be more restrictive with cannabis than we are with tobacco and liquor stores," said council member Katie Cashman, who said she plans to propose new spacing requirements for tobacco shops in the future. "This will also help fill vacant storefronts, and I know that’s an existing goal for a lot of us."

Minnesota marijuana sale legality questioned

When it comes to supplying other patients, the new law says you can give away up to two ounces of homegrown cannabis, but you can’t sell anything without a retail license. But a state law change in 1906 is calling the rules into question.

In July, the Office of Cannabis Management (OCM) outlined its first draft of regulatory proposals that will govern how businesses operate within the state. The OCM will be the governing body to regulate recreational marijuana as retail licenses are doled out.

The 111-page document is the OCM’s first proposal, and will be used to seek public input on how the industry should run as businesses receive licenses to operate adult-use cannabis, medical cannabis and lower-potency hemp edible businesses within the state.

Minnesota requires all cities to allow cannabis retailers, but with the option to institute a cap on the number of cannabis retailers at one per 12,500 residents. Communities throughout the state will be able to decide whether to institute a cap in their area.

Each city and municipality throughout Minnesota will have the ability to draft its own regulations within the overarching guideline structure.

Business, production restrictions

The use standards and zoning regulations proposed include spacing requirements for cannabis retailers that are designed to ensure that businesses, "do not negatively impact their surrounding neighbors or create nuisances."

A dispensary will not be allowed to operate within 300 feet from a school – grades K-12. The same distance applies to any childcare center.
State law currently allows cities to prohibit the operation of a cannabis business within 1,000 feet of a school.

Prior to approval, council member Aurin Chowdhury offered an amendment that would ease the restrictions on cannabis businesses not operating within at least 300 feet away from each other.

"Social equity applicants have been pre-approved at the state level to get the first full bite of the cannabis apple, Chowdhury said. "This change ensures that existing hemp retailers we already know within our communities will be protected in the future. This is about ensuring that retailers in the city of Minneapolis are successful… We want to promote them over large, multi-state companies."

Chowdhurry noted the other restrictions already in place to avoid "cannabis hot zones."

MN tribal nations look to expand marijuana sales

As Minnesota marijuana businesses close in on licensed legal sales, most tribal nations are negotiating with the state on expanding their retail operations beyond reservations. FOX 9 reporter Corin Hoggard has the full story.

Prior to the vote, council member Linea Palmisano took issue with reducing the restrictive distance from a school from 500 feet to 300 feet, against the recommendation of the Minneapolis Public Schools district. Palmisano said that Seattle has a requirement of 1,000 feet, San Francisco's restriction is 600 feet, and Chicago's is 500 feet.

Other restrictions include that a dispensary must be located at least 1,000 feet away from all existing pawnshops, alternative financial establishments and missions, and not share a common entrance with any use that is not cannabis-related. Trash bins will also be required to be located at public entrances.

Production and processing facilities will be limited to 5,000 square feet within the city, while shipping and warehousing activities could not exceed 5,000 square feet of any facilities gross floor plan. All processing, sorting and storage will be required to take place entirely within a completely enclosed building.

Portable and temporary signs, backlit signs and freestanding signs will be prohibited for all cannabis businesses.

In residential mixed-use districts, drive-through facilities will be prohibited.

Minnesota marijuana supply questioned by lawmakers

A couple of token changes in Minnesota’s new marijuana bills are highlighting concerns about whether a legal supply will be available when retailers launch sometime next year.

Growing, cultivation

The city will create a commercial cannabis cultivation district, similar to existing urban agricultural uses.

The growing and cultivation of cannabis would require an approved structure, and be prohibited from makeshift greenhouses, hoop houses, tents, or similarly temporary enclosed areas.

Light and glare from interior lighting will need to be confined to the interior of the structure where indoor growing occurs, and overhead lighting will be prohibited.

Cannabis cultivation businesses will be required to submit an odor control and air filtration plan that will be implemented prior to the issuance of final building inspection, as well as, throughout its operation.

License limit

The proposed regulations for Minneapolis do not impose a cap on licenses for dispensaries.

Minnesota state law requires the city to allow a minimum of 34 licenses for dispensaries, based on a requirement of one cannabis retailer for every 12,500 people.

The ordinance says that not limiting licenses "will increase social equity applicants and those transitioning to the legal market ample time to enter the industry."

The ordnance also says that imposing a cap could create a competitive rush, potentially disadvantaging individuals who need time to secure funding and access business technical assistance."

Marijuana usage concerns increase among teens

Despite increased legalization throughout the country, concerns remain about the growing use of marijuana among teens.

Usage

Throughout downtown, the use of marijuana in public will be limited to rooftop space, unless the site is in compliance with minimum height and floor area ratio standards.

Smoking marijuana, including for the purpose of sampling products, is prohibited indoors.

However, the city acknowledged that its zoning regulations can’t control where a product is consumed once a customer has left a business.

Over time, the city acknowledges that code revisions could change as the result of state or federal laws, as well as additional research.