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<br /> <br /> STAFF REPORT <br /> <br /> <br />TO: Mayor Fischer and Members of the City Council <br /> <br />FROM: Heidi Heller, City Clerk/HR Manager <br /> <br />DATE: June 12, 2024 <br /> <br />RE: Draft City Code Chapter 826 Cannabinoid Products <br /> <br /> <br />ACTION TO BE CONSIDERED <br />Review draft of new City Code Chapter 826 relating to the sale and licensing of cannabinoid products. <br /> <br />BACKGROUND <br />In 2018, hemp and products of hemp were legalized in Minnesota. This was the beginning of many <br />stores selling cannabidiol, or CBD, products. CBD is derived directly from the hemp plant, a cousin of <br />marijuana, or manufactured in a laboratory. CBD does not contain THC and does not cause a high by <br />itself. On July 1, 2022, Minnesota legalized edibles and beverages containing small amounts of hemp- <br />derived THC. Delta-9-tetrahydrocannabinol (THC) is the main psychoactive molecule in the cannabis <br />plant. In August 2023, Minnesota legalized cannabis, with the anticipated date of January 2025 for <br />retail sales and manufacturing to begin. <br /> <br />Since THC is a product that gives a “high”, many cities consider THC to be in the same category as <br />tobacco and liquor, and are requiring licensing and regulations for businesses that sell products <br />containing THC. The State of Minnesota requires that businesses that sell hemp-derived cannabinoid <br />products directly to consumers register with the Minnesota Department of Health. There are currently <br />four businesses in Little Canada registered, but there may be others that have not registered. <br /> <br />At the May 8 Council Workshop, Council discussed adding licensing for THC and cannabis businesses <br />and directed staff to move forward with drafting an ordinance for licensing THC/cannabinoid products. <br />Staff has drafted new City Code Chapter 826, Cannabinoid Products, which adds licensing <br />requirements for any business that sells any cannabinoid/THC products. Staff reviewed several other <br />cities ordinances and they are all very similar and straightforward. <br /> <br />Specific items addressed in this new code chapter include: <br /> <br />- Licenses will only be issued for locations in commercial or industrial zoning districts. No <br />home-based businesses are allowed to sell any THC products <br />- Uses same or similar details as for tobacco licenses (this chapter refers to Chapter 802, Tobacco <br />for the violations, fines & suspension process) <br />- Exceptions to the code for lawfully recognized religious, spiritual or cultural ceremonies, or <br />registered medical cannabis manufacturers <br />- No advertising of cannabinoid products is allowed on billboards <br /> <br />