Adult Use and Lower-potency Hemp Edible Moratorium Discussion

On May 23, 2023, the City Council adopted Ordinance #23-09, An Interim Ordinance Prohibiting the Establishment of New Uses or the Expansion of Existing Uses Related to Sales, Testing, Manufacturing and Distribution of Real Tetrahydrocannabinol (THC) Products and Chemically Related Products. The interim ordinance is set to expire on May 24, 2024. The interim ordinance pertaining to lower potency edible retailers cannot be extended. However, staff suggests City Council consider extending the interim ordinance for adult-use cannabis effective until the earlier of the following events: (a) until January 1, 2025 or (b) the date upon which the City Council adopts an ordinance repealing the interm ordinance. During the Interim Ordinance, staff will be working closely with the Office of Cannabis Management (the Office) to develop model ordinances for reasonable restrictions on the time, place, and manner of a cannabis business, develop standardized forms and procedures for the issuance of retail registration, and develop policies and procedures for the performance of compliance checks.  Staff has been closely monitoring and engaging in webinars with the League of Minnesota Cities regarding Office updates. At this time, the Office is slated to start working on developing the legal forms and working with cities in May-June 2024. 

The League of Minnesota Cities (LMC) has a page with frequently asked questions (FAQS) aimed at providing information to local governments related to the new law on adult-use cannabis.  The link to the FAQS and the full bill is located at www.lmc.org/adult-use-cannabis-what-cities-need-to-know. There is great information in the FAQ's sheet to assist in the understanding of the new laws. Attached is the FAQ sheet for your review.

Lower-potency Hemp Edibles

The LMC's FAQ's page Questions 61 - 68 pertain to Edible Cannabinoid Products (Lower Potency Hemp Edibles). Lower-potency retailers are required to be registered with the state of Minnesota by October 1, 2023.  To date, the City of Ramsey has twelve (12) retailers registered with the state. The bill also requires the retailers to register with the City; staff have been working with individual businesses and, so far, eight (8) have registered with the City. We will continue to work with the remaining business owners to ensure compliance. A map of the lower potency retail locations is attached for your review.

Chapter 63 of MN Laws regulates adult-use cannabis and the licensing of the hemp industry. The retail of lower-potency hemp edibles and artificially derived cannabinoids (known as delta-9) requires registration with the State of MN and the city in which the business resides. The state law does not give local units of government the authority to regulate the location or the number of hemp-derived retailers within its locality.

Adult-Use Cannabis
Chapter 63 of MN Laws heavily regulates adult-use cannabis. State law requires a city to allow no fewer than one (1) business registration for every 12,500 residents. In terms of Ramsey, the City is required to have a minimum of two (2) cannabis retailers. A cannabis retailer means licensed cannabis retailers, cannabis mezzobusinesses with a retail operation's endorsement, and cannabis microbusinesses with a retail operation's endorsement. Essentially, a licensed cannabis retailer is a retail storefront, while a mezzo/micro business with a retail operations endorsement is a growing facility with retail. Local units of government must permit these uses within its locality. 

According to the law, the local unit of government does have the authority to adopt ordinances addressing the following:

1. A local unit of government may prohibit the operation of a cannabis business within 1,000 feet of a school, or 500 feet of a day care, residential treatment facility, or an attraction within a public park that is regularly used by minors, including a playground or athletic field;
2. A local unit of government may restrict hours of operation. State law requires no cannabis sales or sales of lower-potency edibles or hemp-derived products between 2:00 am - 8:00 am on the days Monday - Saturday and 2:00 am - 10:00 am on Sundays. The city can adopt an ordinance to prohibit sales restrictions between the hours of 9:00 pm - 2:00 am the following day or between 8:00 am - 10:00 am on the days Monday through Saturday. 
3. The local unit of government can regulate the location of cannabis retailers, provided the location is reasonable and does not prohibit cannabis retailers from locating within the locality.
4. Cannabis retailers will be licensed through the state of MN; however, local unit of government can collect an annual registration fee, The fees are set through the law and the state will be working with the city to develop standardized forms.
5. The local unit of government is required to perform compliance checks on all hemp-based and cannabis retailers in the locality.

Tonight's meeting is more about getting information to the City Council and starting discussions. Staff is looking for feedback in terms of what City Council supports for locations, hours of operations and distances from schools and daycares. I will take the information gathered this evening and start the ordinance process this spring when the Office begins creating the ordinance templates and working with staff to ensure compliance with state law.

The time frame is ongoing. Throughout 2024, staff will be working closely with the Office of Cannabis Management and the City Council to ensure compliance with the requirements of MN Law Chapter 63--H.F. No. 100

Not Applicable

Community Development Department

Staff is seeking direction for the following:

1.Amend the interim ordinance, extending the moratorium for the establishment of cannabis retailers until January 1, 2025; and
2. Begin discussions on the location and hours of operation.