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HomeMy WebLinkAboutPC PACKET 12.12.2024If you need accommodations for the Planning Commission meeting please contact Rachel Juba at (651) 762-6304 or rjuba@ci.hugo.mn.us, thank you. Agenda Hugo Planning Commission Thursday, December 12, 2024 Hugo City Hall 7:00 PM A. ROLL CALL: Andress, Arcand, Derr, Granger, Kelly, Kleissler, Lessard, Petty B. PLEDGE OF ALLEGIANCE C. APPROVAL OF MINUTES 1. September 26, 2024 D. PUBLIC HEARING 1. Cannabis Ordinance – An ordinance adding to and amending Chapter 90, Article I, Section 90-1. – Definitions, Chapter 90, Article II. Section 90-37.2. – Special Event Permits, Chapter 90, Article IV – Zoning District Regulations, and Chapter 90, Article VI – Requirements for Specific Uses and Performance Standards to regulate cannabis businesses within the City of Hugo. E. NEW BUSINESS F. OLD BUSINESS G. ADJOURNMENT Minutes for the Planning Commission Meeting of Thursday, September 26, 2024 Acting Chair Derr called the meeting to order at 7:00 pm. PRESENT: Andress, Arcand, Derr, Granger, Kelly, Lessard, Petty ABSENT: Kleissler STAFF: Rachel Juba, Community Development Director Max Gort, Associate Planner Pledge of Allegiance. Approval of Minutes for the Planning Commission Meeting of August 8, 2024 Commissioner Petty made a motion, seconded by Commissioner Lessard, to approve the minutes for the Planning Commission meeting of August 8, 2024. All ayes. Motion carried. Public Hearing: Craig Anderson – Minor subdivision request to create two 10-acre parcels from a 20- acre parcel located on Jeffrey Avenue North. Associate Planner Max Gort presented background on the minor subdivision request. [FILL IN] The applicant, Craig Anderson, introduced himself to the Planning Commission. Acting Chair Derr opened the Public Hearing at 7:05 PM No one spoke. Acting Chair Derr closed the Public Hearing at 7:05 PM Commissioner Petty made a motion, seconded by Commissioner Granger, to approve the minor subdivision request subject to conditions in the resolution. All ayes. Motion carried. The Minor Subdivision request will be reviewed by the City Council at its October 7 th, 2024 meeting. September 26, 2024 PC Minutes Page 2 Public Hearing: Scott and LeAnn Neamy – Conditional Use Permit (CUP) request to construct a 900 square foot building addition to be used as an accessory apartment Gort presented background on the CUP request to construct a 900 square foot accessory apartment as building addition at 17220 Keystone Ave N. The applicant has stated that the purpose of the accessory apartment is to provide care for a family member. When reviewing the application, staff found that the request met the spirit and intent of the ordinance requirement, and the requirements necessary to approve a CUP. Staff recommended approval of the CUP request subject to conditions in the resolution. Commissioner Petty asked if the proposed building addition will be two stories, and if there was a requirement for an accessory apartment to be a single story. Juba responded that this would be two stories, and that accessory apartments are not required to be one story. Commissioner Arcand asked about the need for the accessory apartment to be owner -occupied, what would make the accessory apartment different from a regular building addition, and if there’s an inspection timeline attached to the CUP. Juba said that the intention of the accessory apartment is to prevent the single-family home property from being split through the building, and that there likely wouldn’t be a reason to re-inspect the CUP after the building permit is issued. Commissioner Petty stated that she thinks that Accessory Dwelling Units (ADUs) should not be limited to the Agricultural (AG) zoning district. Juba stated that this proposal is an accessory apartment, which is allowed in more zoning districts, rather than an ADU. Rebecca Neamy, a representative for the applicant, introduced herself to the Planning Commission. Acting Chair Derr opened the Public Hearing at 7:16 PM No one spoke. Acting Chair Derr closed the Public Hearing at 7:16 PM Commissioner Andress asked if the access was only through the garage, Juba said there would be access through an exterior door and through the garage. Commissioner Petty made a motion, seconded by Commissioner Arcand, to approve the CUP request subject to conditions in the draft CUP and resolution. All ayes. Motion carried. The CUP request will be reviewed by the City Council at its October 7 th, 2024 meeting. September 26, 2024 PC Minutes Page 3 Public Hearing: Ordinance Amendment – amending Sec. 90-103(b) to allow tobacco shops as a permitted use in the Central Business (C-1) zoning district Juba gave background on the request from an individual who purchased the former Premier Banks and Speedway gas station location, and found that tobacco shops are not technically allowed as a permitted use in the C-1 zoning district. Tobacco shops are allowed as a permitted use in the C-2 district, and the C-1 district already permits many comparable uses. Staff is of the opinion that it would be appropriate to amend the permitted uses in the C-1 zoning district to allow tobacco shops as a permitted use. Commissioner Granger asked if the omission of tobacco shops from the C-1 zoning district is considered by staff to be an oversight, Juba says that it likely was an oversight. Commissioner Petty asked if there would be enough parking for a tobacco shop at the proposed location. Juba said that there would be enough parking, and mentioned the shared parking and cross - access easements shared by surrounding businesses. Petty asked if vaping products could be sold at the tobacco shop, Juba said that they are subject to the terms of their tobacco license. Petty asked if the tobacco shop would have video surveillance, Juba said yes. Chair Kleissler opened the Public Hearing at 7:22 PM Rebecca Neamy, who stated she lives on Skillman Avenue in Maplewood, asked if the tobacco shop would sell CBD products. Juba stated that the owner would be suited to answer that question and that staff can provide contact information. Juba mentioned that there will be a separate discussion on cannabis items coming later. No one else spoke. Chair Kleissler closed the Public Hearing at 7:24 PM Commissioner Petty stated that she’d be reluctant to approve the text amendment because of the concern that minors could be able to purchase cannabis products at the store. Juba stated that the tobacco shop wouldn’t be permitted to sell cannabis products, and that there’s a separate licensing process coming from the state. Commissioner Lessard made a motion, seconded by Commissioner Arcand, to recommend approval of the text amendment to allow tobacco shops as a permitted use in the C-1 zoning district. All ayes. Motion carried. The text amendment will be considered by the City Council at their October 7, 2024 meeting. New Business – Citywide Bus Tour September 26, 2024 PC Minutes Page 4 Gort briefly reminded the Planning Commission of the citywide bus tour on Saturday, October 5 th, 2024 at 9:30 AM beginning at North Star Elementary, and invited the Planning Commission members to attend. Old Business None. Adjournment Commissioner Arcand made a motion, seconded by Commissioner Lessard, to adjourn at 7:27 PM. All ayes. Motion carried. Respectfully Submitted, Max Gort, Associate Planner Memorandum To: Hugo Planning Commission From: Max Gort, Associate Planner Date: December 9, 2024, for the Planning Commission Meeting of December 12, 2024 Re: Public Hearing – Creation of an ordinance relating to and regulating cannabis b usinesses 1. BACKGROUND AND MEETING UPDATES: By enacting Minnesota Statutes 2023, Chapter 342, the Minnesota Legislature has provided a regulatory framework for the sale and manufacturing of cannabis and hemp products, the licensing of cannabis and hemp businesses, and establishes a State Agency known as the Office of Cannabis Management (OCM). Section 342.13 of the act allows a local unit of government to adopt “reasonable restrictions on the time, place, and manner” of the operation of cannabis businesses. On July 10, 2023, the City Council enacted a 12-month moratorium on the sale, testing, manufacturing, and distribution of cannabinoid products within the city, that was extended on August 5th, 2024 until January 1, 2025. The City Council gave some high-level direction to staff at a workshop on April 22, 2024 which included not prohibiting use of cannabis in public places, not to consider a municipal cannabis store, and not to increase the limit of retail registrations beyond the minimum required by state statute. At that time, the OCM had not published any additional guidance for local governments. On September 3, 2024, the OCM released its most recent guide for local governments as well as a model cannabis ordinance. Staff began to draft an ordinance relating to and regulating cannabis businesses within the City of Hugo, which would include definitions of cannabis businesses, a procedure for registering cannabis businesses within the city, zoning and land use designations for cannabis businesses, performance standards for cannabis businesses, and processes related to temporary cannabis events. At its meeting of November 18, 2024, the City Council gave some high-level direction to staff on a number of items to be included within the draft ordinance. After some discussion, the City Council recommended that staff proceed to draft an ordinance with the zoning districts proposed, no buffers in place for cannabis businesses, and for temporary cannabis e vents to be included in the special event permitting process. At its meeting of November 19, 2024, the EDA heard a presentation f rom staff asking for similar comments on the direction of the cannabis ordinance. The EDA had some debate about whether to require buffers to limit the ability to advertise to minors, but they agreed that this concern could be addressed through regulating signage specifically for cannabis business. Generally, the EDA was comfortable with staff’s recommendation for zoning districts, buffers, and the inclusion of cannabis events within the special event permitting process. At its meeting of December 2, 2024, the Ordinance Review Committee (ORC) discussed the D.1 2 direction of the cannabis ordinance and some questions that were raised during the previous City Council and EDA meetings. In general, the ORC recommended that staff proceed with the proposed zoning districts, not requiring any buffers, an d including cannabis events under special event permits in the draft cannabis ordinance. 2. SUMMARY OF ORDINANCE: A. Cannabis Ordinance State statute allows local governments to adopt reasonable restrictions on the time, place, and manner in which cannabis businesses can operate. While drafting an ordinance, staff considered whether to recommend buffer requirements for cannabis businesses. Based on findings related to existing zoning and separation of noncompatible uses, staff is recommending buffers not be included in the ordinance. Staff has drafted proposed zoning districts where certain cannabis business types would be allowed. Generally, staff found that cannabis retailers, and other business types that include retail sales, were land uses comparable to those allowed in commercial zoning districts. Meanwhile, all other cannabis business types were found to be more compatible with land uses allowed in industrial zoning districts. Additionally, the city is required by state statute to allow temporary cannabis events in some form, and can place restrictions on their operation. Staff is recommending adding standards for cannabis events into the existing special event permit process. B. Types of Cannabis Businesses The Minnesota Office of Cannabis Management (OCM) is setting up to issue licenses to 13 cannabis business types: • Cannabis cultivators • Cannabis manufacturers • Cannabis retailers • Cannabis wholesalers • Cannabis transporters • Cannabis testing facilities • Cannabis event organizers • Cannabis delivery services • Cannabis microbusinesses • Cannabis mezzobusinesses • Lower-potency hemp edible manufacturers • Lower-potency hemp edible retailers • Medical cannabis combination businesses. Each of these represent a specific license issued by the OCM to business owners, and each have specific requirements for approval. The OCM requires that license applications receive a certificate of local compliance from the local government where the license is being proposed for. Cannabis microbusinesses and cannabis mezzobusinesses are businesses that can apply for endorsements on their state license 3 to perform multiple business activities, such as cultivation, manufacturing, and/or retail sales but on a smaller scale than general cultivators, manufacturers, and retail ers. C. General Standards for all Cannabis Businesses The OCM’s Guide for Local Governments on Adult-Use Cannabis provides some context for how different cannabis business types may fit into a city’s existing zoning framework. Based on this context, staff has developed some general standards for all cannabis businesses. These general standards must be met in addition to applicable performance standards for each business type. In general, cannabis businesses may conduct the operations of multiple cannabis business types, provided that they receive the required license from the OCM for each business type, which includes local zoning approval for each business type. The City shall conduct annual age-verification compliance checks for every cannabis business that conducts retail sales. Signage for cannabis businesses must remain minimal, with two on-site exterior signs permitted that can not advertise cannabis products, and can not be a temporary sign, portable sign, neon sign, window-mounted sign, or a sign lit with static LED, blinking, moving, or flashing lights. All interior signage must not be visible from the exterior of the business. Additionally, all cannabis businesses are required to register with the city after receiving state license approval. D. Registration of Cannabis Businesses State statute requires that cannabis businesses that operate retail sales to customers or patients register with the local government in which the retail establishment is located. Staff is proposing that the city require registration of all cannabis businesses, including retailers. Since the state issues and controls cannabis business licenses, requiring local registration allows the city to have an extra review of each business seeking to locate within the city. Section 90-280(c) of the draft ordinance outlines the procedure by which cannabis businesses will register with the city, including: the initial registration application and fees, process for city council review, approval, and basis for denial, the process for renewal of a registration, the process by which the city addresses violations and grounds for suspension of a registration. State statute sets a limit on how much local governments can charge for registration of cannabis businesses based on the business type. The proposed registration fees are: Business Type City Initial Fee City Renewal Fee Microbusiness $0 $1,000 Mezzobusiness $500 $1,000 Cultivator $500 $1,000 Manufacturer $500 $1,000 Retailer $500 $1,000 Wholesaler $500 $1,000 Transporter $250 $500 Testing Facility $500 $1,000 4 Delivery Service $250 $500 Event Organizer $375 N/A LPHE Mfr. $500 $500 LPHE Retailer $125 $125 Med. Comb. $500 $1,000 *The above fees are proposals and are subject to change. Registration applications may be denied by the City Council if the application does not meet ordinance requirements, or the applicant does not have a valid state-issued license. Additionally, registration applications for retailers are limited to one registration per 12,500 residents, which would allow a maximum of two retailers to locate and register within the City of Hugo. The City Council is not obligated to approve a retail registration application if the number of registered retailers across Washington County exceeds one registration per 12,500 residents. E. Proposed Zoning Staff reviewed the types of businesses for which OCM will be issuing licenses, and following OCM guidance, considered how each business type compares to existing uses within the zoning code. When considering cannabis cultivation, staff reviewed the state statute requirements and draft rules for cannabis cultivator operations, and determined that several factors will guide the type of land use and impact that cultivators will generate. Key factors include requirements for security and exterior lighting, the desire to control environmental factors within cultivation area, and the requirement to control odor, staff is recommending that cultivation activity be restricted to occur indoors. Staff found that cannabis cultivators will likely generate an impact that is more consistent with uses allowed in industrial zoning districts than those typically found in agricultural zoning districts. Staff is proposing that the zoning code be amended to add the following permitted (P), accessory (AC), and conditional (CUP) uses to each applicable zoning district: Neighborhood Service (NS) Central Business (C-1) General Business (C-2) Business Park (BP) General Industrial (I-3) Cannabis Cultivator P P Cannabis Manufacturer P P Cannabis Retailer P P P Cannabis Wholesaler P P Cannabis Transporter P P 5 Cannabis Testing Facilities P P Cannabis Delivery Services AC AC Lower-Potency Hemp Edible Manufacturers P P Lower-Potency Hemp Edible Retailers AC AC AC Medical Cannabis Combination Businesses CUP CUP Cannabis Microbusiness P P Retail Location of a Cannabis Microbusiness P P P AC AC Cannabis Mezzobusiness P P Retail Location of a Cannabis Mezzobusiness P P P AC AC F. Buffers While drafting an ordinance, staff considered whether to recommend adoption of buffer requirements for cannabis businesses. State statute allows local governments to require cannabis businesses be buffered up to 1,000 feet fro m a school, or up to 500 feet from a daycare, residential treatment facility, or an attraction within a public park frequently utilized by minors, such as playgrounds and athletic fields. Local governments are encouraged to follow precedent for comparable uses within existing city code. The City of Hugo requires that liquor stores to be 200 feet from schools and churches, and that sexually oriented businesses be 300 feet from several sensitive uses. Staff created maps of the city showing where cannabis businesses would be permitted and different buffer scenarios: the maximum buffer allowed by state statute, a 300-foot buffer from sensitive uses following city code precedent, and a scenario with no buffers in place. Staff found that the existing zoning districts separate noncompatible uses, and that problems were created where adjacent parcels within the same zoning district can suddenly have different permissions. Staff is currently recommending that the cannabis ordinance not include buffers. G. Performance Standards 6 The draft cannabis ordinance has performance standards in place for each cannabis business type, intended to ensure that any cannabis business application coming to the City of Hugo is compatible with the vision of the City Code and Comprehensive Plan. Performance standards are a tool that cities can use to restrict the time, place, and manner in which cannabis businesses may operate. In addition to the performance standards listed in the draft ordinance, each cannabis business shall be subject to applicable performance standards of the land use more generally, and zoning district regulations where the business is located. H. Cannabis Events While drafting the cannabis ordinance, staff has been finding ways to incorporate cannabis-related items into existing processes. Section 90-37.2 of City Code outlines requirements for special event permits, including standards for specific events and a process for review and approval at the administrative and City Council levels. Staff is proposing that the special event permit section of city code be amended to require that cannabis events be included as a special event that requires City Council approval. Cannabis events are proposed to be limited to operating between the hours of 10:00 AM and 10:00 PM, and may not permit on-site consumption of any cannabis products except lower-potency hemp edible products. Additionally, an applicant for a cannabis event special event permit will be required to obtain their state-issued cannabis event organizer license prior to the event taking place. 3. STAFF RECOMMENDATION Staff recommends the Planning Commission hold the public hearing and take all comments. Staff recommends that the Planning Commission have a discussion based on the public comments received. Staff recommends that the Planning Commission recommend approval of the draft cannabis, subject to any recommendations from the Planning Commission, to the City Council. Attachments: 1. Draft Cannabis Ordinance 2. Minnesota OCM Guide for Local Governments on Adult-Use Cannabis 3. Comments received from the public 1 CITY OF HUGO, COUNTY OF WASHINGTON ORDINANCE NO. 2024-___ AN ORDINANCE RELATING TO AND REGULATING CANNABIS AND CANNABIS BUSINESSES WITHIN THE CITY OF HUGO TITLE: An ordinance adding to and amending Chapter 90, Article I, Section 90-1. – Definitions, Chapter 90, Article II. Section 90-37.2. – Special Event Permits, Chapter 90, Article IV – Zoning District Regulations, and Chapter 90, Article VI – Requirements for Specific Uses and Performance Standards. NOW, THEREFORE, the City Council of the City of Hugo does ordain: The City Council of the City of Hugo does hereby amend Chapter 90, Article I In General for the addition of the following Sections: Chapter 90, Article I, Section 90-1. -- Definitions Cannabis Business means any business that receives a license from the Minnesota Office of Cannabis Management. Cannabis Cultivator means cannabis business licensed to grow cannabis plants within the approved amount of space from seed or immature plant to mature plant, harvest cannabis flower from mature plant, package and label immature plants and seedlings and cannabis flower for sale to other cannabis businesses, transport cannabis flower to a cannabis manufacturer located on the same premises, and perform other actions approved by the office. Cannabis Event means an event that serves, sells, or is otherwise related to cannabis or cannabis products, and conducts operations pursuant to Minn. Stat. 342.40. Cannabis Event Organizer means an individual or entity licensed to plan and host events featuring cannabis, and receives a license under Minn. Stat. 342.39. Cannabis Delivery Service means a cannabis business that can purchase cannabis and lower- potency hemp products from specific cannabis businesses, and sells and delivers those products directly to consumers, and is licensed under Minn. Stat. 342.41 and conducts operations pursuant to Minn. Stat. 342.42. Cannabis Manufacturer means a cannabis business that manufactures cannabis products and is licensed to conduct operations pursuant to Minn. Stat. 342.31. Cannabis Mezzobusiness means a cannabis business that conducts operations pursuant to Minn. Stat. 342.29. Cannabis Microbusiness means a cannabis business that conducts operations pursuant to Minn. Stat. 342.28. 2 Cannabis Retailer means any person, partnership, firm, corporation, or association, foreign or domestic, selling cannabis product to a consumer and not for the purpose of resale in any form, and conducts operations pursuant to Minn. Stat. 342.32. Cannabis Testing Facility means a cannabis business that receives cannabis products and lower-potency hemp products from manufacturers and cultivators, and tests them to ensure the products meet safety standards, and conducts operations pursuant to Minn. Stat. 342.37 and Minn. Stat. 342.38. Cannabis Transporter means a cannabis business that conducts operations pursuant to Minn. Stat. 342.35 and Minn. Stat. 342.36. Cannabis Wholesaler means a cannabis business that conducts operations pursuant to Minn. Stat. 342.33 and Minn. Stat. 342.34 Edible Cannabis Product means a product as defined under Minn. Stat. 342.01 Subd. 31. Lower-Potency Hemp Edible means a product as defined under Minn. Stat. 342.01 subd. 50. Lower-Potency Hemp Edible Manufacturer means a cannabis business that conducts operations pursuant to Minn. Stat. 342.45. Lower-Potency Hemp Edible Retailer means a retail business that receives a state-issued license pursuant to Minn. Stat. 342.46. Medical cannabis combination business means a cannabis business that can grow, manufacture, package, label, and sell cannabis products to both medical patients and adult consumers, and conducts operations pursuant to Minn. Stat. 342.515. Office of Cannabis Management means the state agency known as the Minnesota Office of Cannabis Management. Plant Canopy means the surface area within a cultivation facility that is used at any time to cultivate mature, flowering cannabis plants. For multiple tier cultivation, each tier of cultivation surface area contributes to the total plant canopy calculation, Calculation of the area of the plant canopy does not include the surface area within the cultivation facility that is used to cultivate immature cannabis plants and seedlings. Retail Registration means an approved registration issued by the City of Hugo to a state- licensed cannabis retail business. 3 The City Council of the City of Hugo does hereby amend Chapter 90, Article II Administration and Enforcement for the amendment of the following Sections: Section 90-37.2 Special Event Permits Amend subsection (2)(m) to read: m. Whether food, alcohol, or cannabis will be served or sold at the event. Amend subsection (5) Special events subject to City Council approval to add the following: f. Cannabis events, subject to the following additional standards: 1. On-site consumption during events receiving a special event permit is limited to lower-potency hemp edible cannabis products. 2. Cannabis events shall only take place between the hours of 10:00 AM and 10:00 PM. 3. Cannabis event operations shall be consistent with requirements listed in Minn. Stat. 342.40, as well as any other applicable rule or law. 4. Any special event permit for a cannabis event shall have a condition requiring that a copy of a state-issued cannabis event organizer license, as licensed under Minn. Stat. 342.39, be provided to the City Clerk prior to the event taking place. 5. Proof of insurance, and a cash escrow payment to the city for damages. Amend subsection (7) Basis for denial to add the following: h. A cannabis event application that does not meet the standards under section 90-37.2(5)(f) of this ordinance. Amend subsection (9) Suspension and revocation to add the following: b. An approved special event permit for a cannabis event that does not receive state approval of a cannabis event organizer license shall be revoked. The City Council of the City of Hugo does hereby amend Chapter 90, Article IV Zoning District Regulations to add of the following Sections: Sec. 90-102. - Neighborhood service district (NS). (b) Permitted uses. (11) Cannabis retailers (refer to section 90-280(h)). (c) Accessory uses. (6) Lower-potency hemp edible retailers (refer to section 90-280(m)). Sec. 90-103. - Central business district (C-1). (b) Permitted uses. (27) Cannabis retailers (refer to section 90-290(h)). 4 (c) Accessory uses. (6) Lower-potency hemp edible retailers (refer to section 90-280(m)). Sec. 90-104. – General business district (C-2). (b) Permitted uses. (20) Cannabis retailers (refer to section 90-280(h)). (c) Accessory uses. (6) Lower-potency hemp edible retailers (refer to section 90-280(m)). Sec. 90-106. – Business park (BP). (b) Permitted uses. (13) Cannabis microbusinesses (refer to section 90-280(d)). (14) Cannabis mezzobusinesses (refer to section 90-280(e)). (15) Cannabis cultivators (refer to section 90-280(f)). (16) Cannabis manufacturers refer to section 90-280(g)). (17) Cannabis wholesalers (refer to section 90-280(i)). (18) Cannabis transporters (refer to section 90-280(j)). (19) Cannabis testing facilities (refer to section 90-280(k)). (20) Lower-potency hemp edible manufacturers (refer to section 90-280(l)). (c) Accessory uses. (6) Retail sales of cannabis products within a cannabis microbusiness or cannabis mezzobusiness, subject to applicable performance standards under Section 90-280 of this ordinance, as well as any other applicable rule or law. (7) Cannabis delivery service (refer to section 90-280(o)). (d) Conditional uses. (15) Medical cannabis combination businesses (refer to section 90-280(n)). Sec. 90-107. – General industrial district (I-3). (b) Permitted uses. (16) Cannabis microbusinesses (refer to section 90-280(d)). (17) Cannabis mezzobusinesses (refer to section 90-280(e)). (18) Cannabis cultivators (refer to section 90-280(f)). (19) Cannabis manufacturers refer to section 90-280(g)). (20) Cannabis wholesalers (refer to section 90-280(i)). (21) Cannabis transporters (refer to section 90-280(j)). (22) Cannabis testing facilities (refer to section 90-280(k)). (23) Lower-potency hemp edible manufacturers (refer to section 90-280(l)). 5 (c) Accessory uses. (6) Retail sales of cannabis products within a cannabis microbusiness or cannabis mezzobusiness, subject to applicable performance standards under section 90-280 of this ordinance, as well as any other applicable rule or law. (7) Cannabis delivery service (refer to section 90-280(o)). (d) Conditional uses. (23) Medical cannabis combination businesses (refer to section 90-280(n)). The City Council of the City of Hugo does hereby amend Chapter 90, Article VI Requirements for Specific Uses and Performance Standards for the addition of the following Section: Sec. 90-280. – Cannabis businesses. (a) Findings and purpose – The purpose of this ordinance is to implement the provisions of Minnesota Statutes, Chapter 342, which authorizes the City of Hugo to protect the health, safety, and welfare of residents by regulating cannabis businesses within the boundaries of the city. 1. Authority and Jurisdiction -- The City of Hugo has the authority to adopt this ordinance applicable to the legal boundaries of the city, pursuant to: a) Minn. Stat. 342.13(c) regarding the authority of a local unit of government to adopt reasonable restrictions of the time, place, and manner of the operation of a cannabis business provided that such restrictions do not prohibit the establishment or operation of cannabis businesses. b) Minn. Stat. 342.22, regarding the local registration and enforcement requirements of state-licensed cannabis retail cannabis businesses and lower-potency hemp edible retail businesses. c) Minn. Stat. 152.0263, Subd. 5, regarding the use of cannabis in public places. d) Minn. Stat. 462.357, regarding the authority of a local authority to adopt zoning ordinances. 2. Severability – If any section, clause, provision, or portion of this ordinance is adjudged unconstitutional or invalid by a court of competent jurisdiction, the remainder of this ordinance shall not be affected thereby. 3. Enforcement – The City of Hugo is responsible for the administration and enforcement of this ordinance. Any violation of the provisions of this ordinance or failure to comply with any of its requirements constitutes a misdemeanor and is punishable as defined by law. Violations of this ordinance can occur regardless of whether or not a permit is required for a regulated activity listed in this ordinance. (b) Unlawful unless conditions met. It shall be unlawful for any person or entity to operate a cannabis business within the city, except in conformance with this section. 6 (c) General standards for all cannabis businesses. 1. Compliance verification prior to state license approval - Pursuant to Minn. Stat. 342.13 (g), within 30 days of receiving a copy of a state license application from the state office of cannabis management, the City of Hugo shall certify whether a proposed cannabis business complies with local zoning ordinances and, if applicable, whether the proposed business complies with the state fire code and building code. 2. Registration of Cannabis Businesses a) Consent to registering of cannabis businesses – No person or entity may operate a state-licensed cannabis business within the City of Hugo without first registering with the city. Any state-licensed cannabis business that operates within the city without a valid municipal registration shall incur a civil penalty of up to $2,000 for each violation. b) Registration Application Procedure 1. Registration terms and fees – The City of Hugo shall charge a registration fee to applicants depending on the type of cannabis business, as established in the city fee schedule. a. Each cannabis business registration shall be issued for a period of one calendar year. b. The first fee payment shall include the initial registration fee and first renewal fee. c. Any registration renewal fee shall be charged at the time of the second renewal, and each subsequent annual renewal thereafter. 2. Application Submittal – An applicant for a cannabis business registration shall submit: a. A completed application form provided by the city. b. The required registration fee(s). c. A copy of a valid state license. d. A written statement of approval from the property owner. e. Any additional materials requested at the discretion of city staff. 3. City Council Review and Approval: a. City staff shall accept applications for cannabis business registrations on a first-come, first-served basis. b. City staff will review cannabis business registration applications for completeness and respond to the applicant within 30 calendar days. If an application is considered incomplete, staff shall promptly notify the applicant of the incomplete status and the remaining items needed to make the application complete. c. Once a registration application is considered complete, city staff shall inform the applicant as such, and forward 7 the application to the City Council for approval or denial. 4. Basis for Denial – the City Council may deny an application for a cannabis business registration if the city finds that: a. The application does not meet the requirements of this ordinance or any other applicable rule or law. b. The applicant does not have a valid state-issued cannabis business license. c. The registration application is for a cannabis retailer, the retail location of a cannabis microbusiness with a retail operations endorsement, or a retail location of a cannabis mezzobusiness with a retail operations endorsement, and: 1. The registration of the retail business would exceed the maximum number of cannabis retail business registrations permitted under Section 90- 280(c)(2)(f) of this ordinance. 2. The total number of registered cannabis retailers, retail locations of cannabis microbusinesses with a retail operations endorsement, and retail locations of cannabis mezzobusinesses with a retail operations endorsement within Washington County meets or exceeds one registration per 12,500 residents within the county, pursuant to Minn. Stat. 342.13 Subd. j. c) Location Change – If a state-licensed cannabis business registered with the city seeks to move to a new location still within the legal boundaries of the City of Hugo, the license holder must receive an updated certification of zoning approval and apply for a new cannabis business registration. d) Renewal of Registration – the City of Hugo shall renew an annual registration of a state-licensed cannabis business at the same time the state renews the cannabis business’ license. A cannabis business registration issued under this ordinance shall not be transferred. 1. An applicant for renewal of a cannabis business registration sha ll submit a renewal fee annually, beginning at the application for the second renewal. 2. The application for a cannabis business registration renewal shall include all items for an initial registration as required under section 90-280(c)(2)(b) of this ordinance. 3. Basis for denial – an application for renewal of a cannabis business registration may be denied if: a. Any of the conditions for basis of denial of an initial registration listed under section 90-280(c)(2)(b)(4) of this ordinance are met. b. The registration is currently suspended by the city. c. The cannabis business no longer holds a valid license issued by the state office of cannabis management. 8 d. The renewal application does not meet the requirements of this ordinance, or any other applicable rule or law. e) Suspension of Registration 1. Violations – Any violation of this ordinance, or any applicable rule or law, shall be deemed to be an administrative offense of the registration holder, and the registration holder shall be subject to the administrative penalties set forth in the city fee schedule for cannabis businesses. 2. When Suspension is Warranted – The City of Hugo may suspend a cannabis business registration, after notice and an opportunity for hearing where reasonably available, if it violates a city ordinance or poses an immediate threat to the health or safety of the public. The city shall promptly notify the cannabis business in writing the grounds for the suspension. 3. Notification to the state – The City of Hugo shall immediately notify the state office of cannabis management in writing the grounds for the suspension, who shall in turn provide the city and cannabis business a response to the complaint within seven calendar days, and perform any necessary inspections within 30 calendar days. 4. Length of suspension – The suspension of a cannabis business registration may be up to 30 calendar days, unless the state office of cannabis management suspends the license for a longer period. The business may not make sales to customers if their registration is suspended. The city may reinstate a registration if it determines that the violation(s) have been resolved. The city shall reinstate a registration if the state office of cannabis management determines that the violation(s) have been resolved. 5. Subject to Minn. Stat. 342.22 Subd. 5(e), the city may impose a civil penalty, as specified in the city fee schedule, for registration violations. The penalty shall not exceed $2,000. f) Limiting of Retail Registrations -- the City of Hugo shall limit the number of cannabis retail business registrations to one registration for every 12,500 residents. This limit shall include registrations for cannabis retail businesses as licensed under Minn. Stat. 342.32, cannabis microbusinesses with a retail operations endorsement as licensed under Minn. Stat. 342.28, and cannabis mezzobusinesses with a retail operations endorsement as licensed under Minn. Stat. 342.29. This limit shall not extend to lower- potency hemp edible retailers, as licensed under Minn. Stat. 342.46, and medical cannabis retailers, as licensed under Minn. Stat. 342.51. 3. Annual Compliance Checks – The City of Hugo shall complete at minimum one compliance check per calendar year of every registered cannabis business that conducts retail sales of products to customers or patients, to assess if the business meets age verification requirements, as required under Minn. Stat. 342.22 Subd. 4(b) and Minn. Stat. 342.24. 4. Multiple license types – Subject to all applicable state law, and cannabis licensing rules under Minn. Stat. Chapter 342, a cannabis business that holds more than one license type can perform all activities for which they are granted a state - 9 issued license, provided that the business meets all applicable conditions in this ordinance and any other applicable rule or law. 5. Signs a) Cannabis businesses are limited to two exterior, on-site signs with the name and logo of the business only. b) Signage for cannabis business shall not be a temporary sign, portable sign, neon sign, window-mounted sign, or a sign lit with static LED, blinking, moving, or flashing lights. c) Exterior advertisement of cannabis products is prohibited. d) Interior signs shall not be visible from the exterior of the building. e) Special event signs are prohibited for cannabis business. (d) Cannabis microbusinesses. 1. Performance Standards a) All cultivation activity shall be consistent with the standards for cannabis cultivation under section 90-280(f) of this ordinance section, except that cultivation area shall be limited to 5,000 square feet of plant canopy. b) All manufacturing activity shall be consistent with the standards for cannabis manufacturing under section 90-280(g) of this ordinance section. c) Cannabis microbusinesses with a retail operations endorsement may operate a retail location within the city that meets the performance standards for cannabis retailers under section 90-280(h) of this ordinance. A cannabis microbusiness may operate a retail location within a building that also has spaces for cultivation and manufacturing of cannabis products, provided that the retail location does not exceed more than 2,500 square feet of gross floor area. d) The registration of the retail location of a cannabis microbusiness in the City of Hugo shall count towards the limit of cannabis retail registrations under section 90-280(c)(2)(f) of this ordinance. e) City staff shall review applications for cannabis microbusiness licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. Demonstration that all light and glare from interior lighting will be confined to the interior of the building. 4. An exterior lighting plan that includes all lighting be downcast, and is otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 10 5. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (e) Cannabis mezzobusinesses. 1. Performance Standards a) All cultivation activity shall be consistent with the standards for cannabis cultivation under section 90-280(f) of this ordinance section, except that cultivation area shall be limited to 15,000 square feet of plant canopy. b) Cannabis mezzobusinesses with a production of customer products endorsement, pursuant to Minn. Stat. 342.29 Subd. 7, may manufacture cannabis products indoors subject to performance standards for cannabis manufacturers under section 90-280(g) of this ordinance. c) Cannabis mezzobusinesses with a retail operations endorsement may operate a retail location within the city that meets the performance standards for cannabis retailers under section 90-280(h) of this ordinance. A cannabis mezzobusiness may operate a retail location within a building that also has spaces for cultivation and manufacturing of cannabis products, provided that the retail location does not exceed more than 2,500 square feet of gross floor area. d) The registration of the retail location of a cannabis microbusiness in the City of Hugo shall count towards the limit of cannabis retail registrations under section 90-280(c)(2)(f) of this ordinance. e) City staff shall review applications for cannabis mezzobusiness licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. Demonstration that all light and glare from interior lighting will be confined to the interior of the building. 4. An exterior lighting plan that includes all lighting be downcast, and is otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 5. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (f) Cannabis cultivators. 1. Performance Standards a) All cultivation of cannabis must occur indoors and may not occur in greenhouses, hoop houses, tents, or similar mixed-light structures. The building(s) for a cannabis cultivator must be constructed to the standards for commercial and industrial construction under Section 90-272 of City Code. 11 b) Cannabis cultivators are limited to a gross plant canopy area of 30,000 square feet. c) Cannabis cultivators may utilize a portion of their building area for post-harvest processing and packaging for transportation. d) City staff shall review applications for cannabis cultivator licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. An interior floor plan with dimensions of each room, and a description of the stage of cannabis cultivation taking place in each room. 4. Demonstration that all light and glare from interior lighting will be confined to the interior of the building. 5. An exterior lighting plan that includes all lighting be downcast, and is otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 6. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (g) Cannabis manufacturers. 1. Performance Standards. a) All manufacturing of cannabis products must occur in an enclosed building that is constructed to the standards for commercial and industrial construction under Section 90-272 of City Code, and the standards for light manufacturing under Section 90-240 of City Code. b) City staff shall review applications for cannabis manufacturer licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. Demonstration that all light and glare from interior lighting will be confined to the interior of the building. 4. An exterior lighting plan that includes all lighting be downcast, and is otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 5. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. 12 (h) Cannabis retailers. 1. Performance Standards a) Hours of Operation – No cannabis retail business with a retail registration issued by the city shall operate retail sales of cannabis products, except between the hours of 10:00 AM and 10:00 PM. b) City staff shall review applications for cannabis retailer licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. Plans for signage. (i) Cannabis wholesalers. 1. Performance Standards a) A cannabis wholesaler shall be subject to the performance standards for warehousing and distribution under Section 90-269 of city code, except that retail sales of cannabis products stored on site is prohibited. b) A cannabis wholesaler that operates a motor freight terminal shall be subject to all applicable performance standards under Section 90-248 of city code, and shall require approval of a conditional use permit. c) City staff shall review applications for cannabis wholesaler licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. An exterior lighting plan that includes all lighting be downcast, and otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 4. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (j) Cannabis transporters. 1. Performance Standards a) A cannabis transporter that operates a motor freight terminal shall be subject to all applicable performance standards under Section 90-248 of city code, and shall require approval of a conditional use permit. b) City staff shall review applications for cannabis transporter licenses and verify that the application meets local ordinance requirements prior to 13 state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. A plan for fleet management and storage, as applicable. 4. An exterior lighting plan that includes all lighting be downcast, and otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 5. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (k) Cannabis testing facilities. 1. Performance Standards a) Cannabis testing facilities shall meet the standards for cannabis manufacturers under Section 90-280(g) of this ordinance, as well as any other applicable rule or law. b) City staff shall review applications for cannabis testing facility licenses and verify that the application meets local ordinance requirements prior to state license approval. In order to verify that an application meets local ordinance requirements, the application must include the following to be reviewed and approved by staff: 1. A security plan consistent with all state requirements. 2. A waste management plan consistent with all state requirements. 3. An exterior lighting plan that includes all lighting be downcast, and otherwise consistent with outdoor lighting requirements under Section 90-239 of City Code. 4. An odor control plan that is consistent with all standards adopted by the state office of cannabis management and the state pollution control agency. (l) Lower-potency hemp edible manufacturers. 1. Performance Standards a) Lower-potency hemp edible manufacturers shall meet the standards for cannabis manufacturers under section 90-280(g) of this ordinance, as well as any other applicable rule or law. (m) Lower potency hemp edible retailers. 1. Performance Standards a) Retail sales of lower-potency hemp edibles, in conjunction with a state-issued license under Minn. Stat. 342.46, may only occur in an establishment that: 14 1. Holds an alcohol license under Chapter 6, Article II of City Code, except that the license shall not be a one-day permit. 2. Holds a tobacco license under Chapter 38, Article III, Division 2 of City Code. 3. Operates a cannabis retail location, subject to performance standards under section 90-280(h) of this ordinance. b) The registration of the retail location of a medical cannabis combination business in the City of Hugo shall not count towards the limit of cannabis retail registrations under section 90-280(c)(2)(f) of this ordinance. (n) Medical cannabis combination businesses. 1. Performance Standards a) Medical cannabis combination businesses shall be conditional uses within the I-3 and BP zoning districts b) All cultivation of cannabis must occur indoors and may not occur in greenhouses, hoop houses, tents, or similar mixed-light structures. The building(s) for a cannabis cultivator must be constructed to the standards for commercial and industrial construction under Section 90-272 of City Code. c) All manufacturing of cannabis products must occur in an enclosed building that is constructed to the standards for commercial and industrial construction under Section 90-272 of City Code. d) A medical cannabis combination business with appropriate endorsements may operate a retail location within a building that also has spaces for cultivation and manufacturing of cannabis products, provided that the retail location does not exceed more than 2,500 square feet of gross floor area. e) The registration of the retail location of a medical cannabis combination business in the City of Hugo shall not count towards the limit of cannabis retail registrations under section 90-280(c)(2)(f) of this ordinance. f) A medical cannabis combination business that operates a warehouse shall be subject to the performance standards for warehousing and distribution under Section 90-269 of city code, except that retail sales of cannabis products stored on site is prohibited. If the medical cannabis combination business operates a motor freight terminal shall be subject to all applicable performance standards under Section 90-248 of city code, and include the motor freight terminal request in their conditional use permit request. 15 (o) Cannabis delivery services. 1. Performance Standards a) Cannabis delivery services licensed under Minn. Stat. 342.41 are allowed as accessory uses if the primary use of the property is a cannabis wholesaler, cannabis transporter, or medical cannabis combination business operating a retail location, subject to all applicable performance standards under section 90-280 of this ordinance. b) Cannabis delivery services may operate between the hours of 10:00 AM and 10:00 PM, seven days per week. EFFECTIVE DATE. This Ordinance shall be in full force and effect from and after its passage by the City Council. ADOPTED by the City Council this ____________________. ______________________________ Tom Weidt, Mayor ATTEST: _____________________________ Michele Lindau, City Clerk A Guide for Local Governments on Adult-Use Cannabis Version 2.0 | Updated November 21, 2024 Page 2 Table of Contents Introduction ................................................................................................ 3 About OCM ................................................................................................. 4 Cannabis License Types ................................................................................ 5 Adult-Use Cannabis Law .............................................................................. 7 Cannabis Licensing Process .......................................................................... 8 General Authorities ................................................................................... 13 Zoning and Land Use .................................................................................. 15 Local Approval Process .............................................................................. 18 Inspections and Compliance Checks ........................................................... 23 Municipal Cannabis Stores ......................................................................... 24 Creating Your Local Ordinance ................................................................... 25 Additional Information – Tobacco Sales ....................................................... 26 Additional Resources ................................................................................. 27 Page 3 Introduction This guide serves as a general overview of Minnesota’s new adult-use cannabis law, and how local governments can expect to be involved. The guide also provides important information about Minnesota’s new Office of Cannabis Management (OCM), and the office’s structure, roles, and responsibilities. While medical cannabis continues to play an important role in the state’s cannabis environment, this guide is primarily focused on the adult-use cannabis law and marketplace. The following pages outline the variety of cannabis business licenses that will be issued, provide a broad summary of important aspects of the adult-use cannabis law, and cover a wide range of expectations and authorities that relate to local governments. This guide also provides best practices and important requirements for developing a local cannabis ordinance. Chapter 342 of Minnesota law was established by the State Legislature in 2023 and was updated in 2024. Mentions of “adult-use cannabis law” or “the law” throughout this guide refer to Chapter 342 and the changes made to it. As of this guide's date of publication, final state regulations governing the adult-use cannabis market have not yet been published. A draft of the rules is available on our Rulemaking webpage (https://mn.gov/ocm/laws/rulemaking.jsp). The first draft of rules is based on substantial input OCM has received through surveys, meetings, and conversations that took place since fall 2023, as well as OCM’s review of Minnesota’s cannabis statute and cannabis rules in other states. OCM will publish in the State Register a notice of intent to adopt rules, which will prompt a 30-day formal comment period. Watch the OCM website for updates. This guide is not a substitute for legal advice, nor does it seek to provide legal advice. Local governments and municipal officials seeking legal advice should consult an attorney. Page 4 About OCM Minnesota’s Office of Cannabis Management is the state regulatory office created to oversee the implementation and regulation of the adult-use cannabis market, the medical cannabis market, and the consumer hemp industry. Housed within OCM are the Division of Medical Cannabis (effective July 1, 2024), which operates the medical cannabis program, and the Division of Social Equity, which promotes development, stability, and safety in communities that have experienced a disproportionate, negative impact from cannabis prohibition and usage. OCM, through Chapter 342, is tasked with establishing rules and policy and exercising its regulatory authority over the Minnesota cannabis industry. In its duties, OCM is mandated to: • Promote public health and welfare. • Protect public safety. • Eliminate the illicit market for cannabis flower and cannabis products. • Meet the market demand for cannabis flower and cannabis products. • Promote a craft industry for cannabis flower and cannabis products. • Prioritize growth and recovery in communities that have experienced a disproportionate, negative impact from cannabis prohibition. OCM governs the application and licensing process for cannabis and hemp businesses, specific requirements for each type of license and their respective business activities and conducts enforcement and inspection activities across the Minnesota cannabis and hemp industries. Page 5 License Types Minnesota law allows for 13 different types of business licenses, each fulfilling a unique role in the cannabis and hemp supply chain. In addition to license types below, OCM will also issue endorsements to license holders to engage in specific activities, including producing, manufacturing, and sale of medical cannabis for patients. Microbusiness Microbusinesses may cultivate cannabis and manufacture cannabis products and hemp products, and package such products for sale to customers or another licensed cannabis business. Microbusiness may also operate a single retail location. Mezzobusiness Mezzobusinesses may cultivate cannabis and manufacture cannabis products and hemp products, and package such products for sale to customers or another licensed cannabis business. Mezzobusiness may also operate up to three retail locations. Cultivator Cultivators may cultivate cannabis and package such cannabis for sale to another licensed cannabis business. Manufacturer Manufacturers may manufacture cannabis products and hemp products, and package such products for sale to a licensed cannabis retailer. Retailer Retailers may sell immature cannabis plants and seedlings, cannabis, cannabis products, hemp products, and other products authorized by law to customers and patients. Wholesaler Wholesalers may purchase and/or sell immature cannabis plants and seedlings, cannabis, cannabis products, and hemp products from another licensed cannabis business. Wholesalers may also import hemp-derived consumer products and lower- potency hemp edibles. Page 6 License Types (continued) Transporter Transporters may transport immature cannabis plants and seedlings, cannabis, cannabis products, and hemp products to licensed cannabis businesses. Testing Facility Testing facilities may obtain and test immature cannabis plants and seedlings, cannabis, cannabis products, and hemp products from licensed cannabis businesses. Event Organizer Event organizers may organize a temporary cannabis event lasting no more than four days. Delivery Service Delivery services may purchase cannabis, cannabis products, and hemp products from retailers or cannabis business with retail endorsements for transport and delivery to customers. Medical Cannabis Combination Business Medical cannabis combination businesses may cultivate cannabis and manufacture cannabis and hemp products, and package such products for sale to customers, patients, or another licensed cannabis business. Medical cannabis combination businesses may operate up to one retail location in each congressional district. Lower-Potency Hemp Edible Manufacturer Lower-potency hemp edible manufacturers may manufacture and package lower-potency hemp edibles for consumer sale, and sell hemp concentrate and lower-potency hemp edibles to other cannabis and hemp businesses. Lower-Potency Hemp Edible Retailer Lower-potency hemp edible retailers may sell lower-potency hemp edibles to customers. Each license is subject to further restrictions on allowable activities. Maximum cultivation area and manufacturing allowances vary by license type. Allowable product purchase, transfer, and sale between licensees are subject to restrictions in the law. Page 7 The Adult-Use Cannabis Law Minnesota’s new adult-use cannabis law permits the personal use, possession, and transportation of cannabis by those 21 years of age and older, and allows licensed businesses to conduct cultivation, manufacturing, transport, delivery, and sale of cannabis and cannabis products. For Individuals • Possession limits: o Flower - 2 oz. in public, 2 lbs. in private residence o Concentrate - 8 g o Edibles (including lower-potency hemp) - 800 mg THC • Consumption only allowed on private property or at licensed businesses with on-site consumption endorsements. Consumption not allowed in public. • Gifting cannabis to another individual over 21 years old is allowed, subject to possession limits. • Home cultivation is limited to four mature and four immature plants (eight total) in a single residence. Plants must be in an enclosed and locked space. • Home extraction using volatile substances (e.g., butane, ethanol) is not allowed. • Unlicensed sales are not allowed. For Businesses • Advertising: o May not include or appeal to those under 21 years old. o Must include proper warning statements. o May not include misleading claims or false statements. o Billboards are not allowed. • The flow of all products through the supply chain must be tracked by the state-authorized tracking system. • All products sold to consumers and patients must be tested for contaminants. • Home delivery is allowed by licensed businesses. Page 8 The Cannabis Licensing Process An applicant will take the following steps to proceed from application to active licensure. As described, processes vary depending on social equity status and/or whether the type of license being sought is capped or uncapped in the general licensing process. License Preapproval: Early Mover Process for Social Equity Applicants The license preapproval process is a one-time application process available for verified social equity applicants. State law required OCM to open the application window on July 24, 2024, and close the window on August 12, 2024. The preapproval process was available for the following license types, and all are capped in this process: microbusiness, mezzobusiness, cultivator, manufacturer, retailer, wholesaler, transporter, testing facility, and delivery service. High-Level Pathway to License Preapproval and Conversion to Business Licensure 1. Applicant’s social equity applicant (SEA) status verified. 2. Applicant completes license preapproval application and submits application fees. 3. Application vetted for minimum requirements by OCM. 4. Application (if qualified) entered into lottery drawing. 5. If selected in lottery, applicant completes background check process and submits attestation of labor-peace agreement. 6. If applicant successfully completes Step 5, OCM issues license preapproval to applicant. 7. Applicants with license preapproval work with local governments to discuss zoning compliance, secure property, raise capital, etc., pursuant to Minnesota Session Laws 2024, Chapter 121, Article 2, section 148.* 8. Once rules are adopted and applicant is ready to move to next step in conversion, applicant with license preapproval* submits business location to OCM and updates application accordingly. 9. OCM forwards completed application to local government. Page 9 The Cannabis Licensing Process (cont.) 10. Local government completes zoning certification of whether a proposed cannabis business complies with local zoning ordinances, and if applicable, whether the proposed business complies with state fire code and building code. (This is distinct from the retail registration approval process.) 11. OCM conducts site inspection. 12. If applicant successfully passes site inspection, OCM issues license, operations may commence except for retail activity. Continued High-Level Pathway for Licensees Seeking to Conduct Retail Sales: Process for Required Local Retail Registration from Local Governments (Retailer, Microbusiness, Mezzobusiness) 13. Licensed business seeks local retail registration from local government. 14. Local government approves applicant for retail registration through means determined by ordinance (see page 19 for more information about the retail registration process). 15. Applicant pays retail registration fee to the local government (see appendix for relevant fees in accordance with Minn. Stat., section 342.22). 16. Local government conducts compliance check for any applicable local ordinance established pursuant to Minn. Stat., section 342.13, if desired. 17. Local government ensures tax compliance, if applicable. 18. Local government issues retail registration to licensee. 19. Licensee is able to conduct retail sales now that they have received a state license and a local retail registration. *Social equity applicants with license preapproval for microbusiness, mezzobusiness, or cultivator licenses may begin growing cannabis plants prior to the adoption of rules if OCM receives both a signed and completed Local Approval of Early Cultivation Form from the local government, and also a signed and completed Applicant Notice of Intent for Early Cultivation Form. “The Local Approval of Early Cultivation" form is available now and linked in the appendix. This is only applicable to cultivation and does not authorize retail sales or other endorsed activities of the licenses prior to the adoption of rules. OCM will share additional guidance related to the early cultivation opportunity and local governments’ role in this distinct process. Page 10 The Cannabis Licensing Process (cont.) The general licensing process will align with the adoption of rules and OCM will share more information about the timing of general licensing process. The general licensing process includes social equity applicants and non-social equity applicants. General Licensing: Cultivator, Manufacturer, Retailer, Mezzobusiness 1. Applicant completes application and submit application fees. If applicable, an applicant’s social equity applicant status may be verified. 2. Application vetted for minimum requirements by OCM. 3. Application (if qualified) entered into lottery drawing. 4. If selected in lottery, applicant completes background check process and submits attestation of labor-peace agreement. 5. If applicant successfully completes Step 5, OCM issues preliminary approval to applicant. 6. Once prepared for final licensure, applicant with preliminary approval submits business location and updates application accordingly. 7. OCM forwards completed application to local government. 8. Local government completes zoning certification of whether a proposed cannabis business complies with local zoning ordinances, and if applicable, whether the proposed business complies with state fire code and building code. (This is distinct from the retail registration approval process.) 9. OCM conducts site inspection. 10. If applicant successfully passes site inspection, OCM issues license, operations may commence except for retail activity.* Continued High-Level Pathway for Licensees Seeking to Conduct Retail Sales: Process for Required Local Retail Registration from Local Governments (Retailer, Mezzobusiness) 11. Licensed business seeks local retail registration from local government. 12. Local government approves applicant for retail registration through means determined by ordinance (see Page 19 for more information about the retail registration process). Page 11 The Cannabis Licensing Process (cont.) 13. Applicant pays retail registration fee to the local government (see appendix for relevant fees in accordance with Minn. Stat., section 342.22). 14. Local government conducts compliance check for any applicable local ordinance established pursuant to Minn. Stat., section 342.13, if desired. 15. Local government ensures tax compliance, if applicable. 16. Local government issues retail registration to licensee. 17. Licensee is able to conduct retail sales now that they have received a state license and a local retail registration. *For businesses seeking a retail endorsement (microbusiness, mezzobusiness, and retailer), a valid local retail registration is required prior to the business commencing any retail sales. See Page 19 for information on the local retail registration process. General Licensing: Microbusiness, Wholesaler, Transporter, Testing Facility, Medical Cannabis Combination Business 1. Applicant complete application and submit application fees. If applicable, an applicant’s social equity applicant status may be verified. 2. Application vetted for minimum requirements by OCM. 3. For qualified applicants, applicant completes background check process and submits attestation of labor-peace agreement. 4. If applicant successfully completes Step 3, OCM issues preliminary approval to applicant. 5. Once prepared for final licensure, selected applicant submits business location and amends application accordingly. 6. OCM forwards completed application to local government. 7. Local government completes zoning certification of whether a proposed cannabis business complies with local zoning ordinances, and if applicable, whether the proposed business complies with state fire code and building code. (This is distinct from the retail registration approval process.) 8. OCM conducts site inspection. 9. If applicant successfully passes site inspection, OCM issues license, operations may commence except for retail activity.* Page 12 The Cannabis Licensing Process (cont.) Continued High-Level Pathway for Licensees Seeking to Conduct Retail Sales: Process for Required Local Retail Registration from Local Governments (Microbusiness, Medical Cannabis Combination Businesses) 10. Licensed business seeks local retail registration from local government. 11. Local government approves applicant for retail registration through means determined by ordinance (see Page 19 for more information about the retail registration process). 12. Applicant pays retail registration fee to the local government (see appendix for relevant fees in accordance with Minn. Stat., section 342.22). 13. Local government conducts compliance check for any applicable local ordinance established pursuant to Minn. Stat., section 342.13, if desired. 14. Local government ensures tax compliance, if applicable. 15. Local government issues retail registration to licensee. 16. Licensee is able to conduct retail sales now that they have received a state license and a local retail registration. *For businesses seeking a retail endorsement (microbusiness, mezzobusiness, and retailer), a valid local retail registration is required prior to the business commencing any retail sales. See Page 19 for information on the local retail registration process. Applicant Responsibility All applicants and licensees are responsible for working with their local government to ensure their success in the zoning certification and, if applicable based on license type, the local retail registration process. This includes reviewing local ordinances and understanding how the local government will be selecting applicants for a retail registration (including if retail registrations will be limited). Local units of government have the statutory authority to limit retail registrations if they desire, and applicants should understand this prior to making decisions about site locations. OCM will not facilitate communication between applicants and units of local government, nor can it mediate disputes as they relate to local zoning compliance or retail registration. OCM is required to ask each local unit of government where an applicant intends to locate a business if that business has met all zoning and use requirements. Page 13 General Authorities Local governments in Minnesota have various means of oversight over the cannabis market, as provided by the adult-use cannabis law. Local governments may not issue outright bans on cannabis business, or limit operations in a manner beyond what is provided by state law. Cannabis Retail Restrictions (342.13) Local governments may limit the number of retailers and microbusiness/mezzobusinesses with retail endorsements allowed within their locality, as long as there is at least one retail location per 12,500 residents. Local units of government are not obligated to seek out a business to register as cannabis business if they have not been approached by any potential applicants but cannot prohibit the establishment of a business if this population requirement is not met. Local units of government may also issue more than the minimum number of registrations. Per statutory direction, a municipal cannabis store (Page 24) cannot be included in the minimum number of registrations required. For population counts, the state demographer estimates will likely be utilized. Tribal Governments (342.13) OCM is prohibited from and will not issue state licenses to businesses in Indian Country without consent from a tribal nation. Tribal nations hold the authority to license tribal cannabis businesses on tribal lands – this process is separate than OCM’s licensing process and authority. Subject to compacting, Tribal nations may operate cannabis businesses off tribal lands. There will be more information available once the compacting processes are complete. Taxes (295.81; 295.82) Retail sales of taxable cannabis products are subject to the state and local sales and use tax and a 10% gross receipts tax. Cannabis gross receipts tax proceeds are allocated as follows: 20% to the local government cannabis aid account and 80% to the state general fund. Local taxes imposed solely on sale of cannabis products are prohibited. Cannabis retailers will be subject to the same real property tax classification as all other retail businesses. Real property used for raising, cultivating, processing, or storing cannabis plants, cannabis flower, or cannabis products for sale will be classified as commercial and industrial property. Page 14 General Authorities (cont.) Retail Timing Restrictions (342.13) Local governments may prohibit retail sales of cannabis between the hours of 8 a.m. and 10 a.m. Monday-Saturday, and 9 p.m. and 2 a.m. the following day. Operating Multiple Locations with One License Certain cannabis licenses allow for multiple retail locations to be operated under a single license, with the following limitations: • Retailers: up to five retail locations. • Mezzobusinesses: up to three retail locations. • Microbusinesses: up to one retail location. • Medical cannabis combination businesses: one retail location per congressional district. Additionally, medical cannabis combination businesses may cultivate at more than one location within other limitations on cultivation. For all other license types, one license permits the operation of one location. Each retail location requires local certification and/or registration. Page 15 Zoning and Land Use Buffer Guidelines (342.13) State law does not restrict how a local government conducts its zoning designations for cannabis businesses, except that they 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 playgrounds and athletic fields. Zoning Guidelines While each locality conducts its zoning differently, a few themes have emerged across the country. For example, cannabis manufacturing facilities are often placed in industrial zones, while cannabis retailers are typically found in commercial/retail zones. Cannabis retail facilities align with general retail establishments and are prohibited from allowing consumption or use onsite and are also required to have plans to prevent the visibility of cannabis and hemp-derived products to individuals outside the retail location. Industrial hemp is an agricultural product and should be zoned as such. Cannabis businesses should be zoned under existing zoning ordinances in accordance with the license type or endorsed activities held by the cannabis business. Note that certain types of licenses may be able to perform multiple activities which may have different zoning analogues. In the same way municipalities may zone a microbrewery that predominately sells directly to onsite consumers differently than a microbrewery that sells packaged beer to retailers and restaurants, so too might a municipality wish to zone two microbusinesses based on the actual activities that each business is undertaking. Table 1, included on Pages 16 and 17, explains the types of activities that cannabis businesses might undertake, as well as some recommended existing zoning categories. Page 16 Zoning and Land Use (cont.) Table 1: Cannabis and Hemp Business Activities Endorsed Activity License Type Eligible to Do Endorsed Activity Description of Activity Comparable Districts Municipal Considerations Cultivation • Cultivator • Mezzobusiness • Microbusiness • Medical Cannabis • Combination “Cultivation” means any activity involving the planting, growing, harvesting, drying, curing, grading, or trimming of cannabis plants, cannabis flower, hemp plants, or hemp plant parts. Indoor: Industrial, Commercial, Production Outdoor: Agricultural • Odor • Potential need for transportation from facility • Waste, water, and energy usage • Security Cannabis Manufacturing, Processing, Extraction • Manufacturer • Mezzobusiness • Medical Cannabis • Combination This group of endorsed activities turn raw, dried cannabis and cannabis parts into other types of cannabis products, e.g. edibles or topicals. Indoor: Industrial, Commercial, Production • Odor • Potential need for transportation from facility • Waste, water, and energy usage • Security Hemp Manufacturing • Lower-Potency Hemp Edible (LPHE) Manufacturing These businesses convert hemp into LPHE edible products. Indoor: Industrial, Commercial, Production • Odor • Waste, water, and energy Wholesale • Wholesale • Cultivator • Manufacturer • Mezzobusiness • Microbusiness • Medical Cannabis • Combination This activity and license type allows a business to purchase from a business growing or manufacturing cannabis or cannabis products and sell to a cannabis business engaged in retail. Indoor: Industrial, Commercial, Production • Need for transportation from facility • Security Page 17 Zoning and Land Use (cont.) Table 1: Cannabis and Hemp Business Activities (continued) Endorsed Activity License Type Eligible to Do Endorsed Activity Description of Activity Comparable Districts Municipal Considerations Cannabis Retail • Retailer • Mezzobusiness • Microbusiness • Medical Cannabis • Combination This endorsed activity and license type allow a business to sell cannabis products directly to consumers. Indoor: Retail, Neighborhood Shopping Districts, Light Industrial, Existing districts where off-sale liquor or tobacco sales are allowed. • Micros may offer onsite consumption, similar to breweries. • Micros and Mezzos may include multiple activities: cultivation, manufacture, and/or retail. Transportation • Cannabis Transporter This license type allows a company to transport products from one license type to another. - • Fleet based businesses that will own multiple vehicles, but not necessarily hold a substantial amount of cannabis or cannabis products. Delivery • Cannabis Delivery This license type allows for transportation to the end consumer. - • Fleet based business that will own multiple vehicles, but not necessarily hold a substantial amount of cannabis or cannabis products. Events • Event Organizer This license entitles license holder to organize a temporary event lasting no more than four days. Anywhere that the city permits events to occur, subject to other restrictions related to cannabis use. • On site consumption. • Retail sales by a licensed or endorsed retail business possible. Page 18 Local Approval Process Local governments play a critical role in the licensing process, serving as a near-final approval check on cannabis businesses nearing the awarding of a state license for operations. Once an applicant has been vetted by OCM and is selected for proceeding in the verification process, they are then required to receive the local government’s certification of zoning compliance and/or local retail registration before operations may commence. Local Certification of Zoning Compliance (342.13; 342.14) Following OCM’s vetting process, local governments must certify that the applicant with preliminary approval has achieved compliance with local zoning ordinances prior to the licensee receiving final approval from OCM to commence operations. During the application and licensing process for cannabis businesses, OCM will notify a local government when an applicant intends to operate within their jurisdiction and request a certification as to whether a proposed cannabis business complies with local zoning ordinances, and if applicable, whether the proposed business complies with state fire code and building code. According to Minnesota’s cannabis law, a local unit of government has 30 days to respond to this request for certification of compliance. If a local government does not respond to OCM’s request for certification of compliance within the 30 days, the cannabis law allows OCM to issue a license. OCM may not issue the final approval for a license if the local government has indicated they are not in compliance. OCM will work with local governments to access the licensing software system to complete this zoning certification process. Page 19 Local Approval Process (cont.) Local Retail Registration Process (342.22) Once the licensing process begins, local government registration applies to licensed cannabis retailers or other cannabis/hemp businesses seeking to conduct retail sales. Several license types are authorized to conduct retail sales if they receive a retail endorsement from OCM. Prior to conducting retail sales under their business license, state law also requires the business receive a local retail registration. There are five license types that are eligible to conduct cannabis retail activity and will seek a retail registration from local governments: • Cannabis retailers • Microbusinesses • Mezzobusinesses • Medical cannabis combination businesses • Lower-potency hemp edible retailers Local governments must issue a retail registration after verifying that: • The business has a valid license or license preapproval issued by OCM. • The business has paid a registration fee or renewal fee to the local government. o Initial registration fees collected by a local government may be $500 or half the amount of the applicable initial license fee, whichever is less, and renewal registration fees may be $1,000 or half the amount of the applicable renewal license fee, whichever is less. • The business is found to be in compliance with Chapter 342 and local ordinances. • If applicable, the business is current on all property taxes and assessments for the proposed retail location. Local registrations may also be issued by counties if the respective local government transfers such authorities to the county. Page 20 Local Approval Process (cont.) Option to Limit Retail Registrations for Cannabis Businesses: Determining a Process State law allows the option for a local government to place a limitation on the number of cannabis retailers, microbusiness, and mezzobusinesses with retail endorsements allowed within their locality via ordinance, as long as there is at least one retail location per 12,500 residents. Please see Page 13. Retail registrations for lower-potency hemp edible retailers and medical cannabis combination businesses are required but may NOT be limited in number by a local government. If a local government wishes to limit the number of cannabis retailers, microbusinesses, or mezzobusinesses via ordinance, state law does not define the process for a local government’s selection if there are more applicants than registrations available. Local units of government issuing retail registrations should consider how they will issue retail registrations. Local units of government may wish to consider whether they will accept applications during a specified application window or on a rolling basis. Local governments may wish to consider how to accommodate to the timing of accepting applications for retail registration as to not allocate all registrations at once. This may also include timelines that coincide with state licensing timelines as to limit bottlenecks. Additionally, local units of government should consider the process by which they will determine who gets a registration, e.g., through the use of a lottery, on a first-come/first- serve model, through a merit-based scoring system, etc. It is highly recommended that local governments work with an attorney to determine their specific process for selection if they wish to limit the number of retail registrations per section 342.13. It is also important to note that local governments are not required to limit the number of licensed cannabis retailers, microbusinesses, or mezzobusinesses, and instead local governments can determine a process that reviews requests/applications for retail registrations as they are received. Page 21 Local Approval Process (cont.) Other Considerations Existing retail locations. Retailers in Minnesota’s medical cannabis program and lower- potency hemp edible program may currently be operating in a local government’s jurisdiction under active registrations. In the future, these active businesses will be required to obtain a license from OCM and will need a local retail registration to continue their operations. Local governments may wish to consider how businesses currently operating will be issued retail registrations when determining if and how to limit retail registrations. Local zoning approval does not guarantee retail registration. Zoning certification from local governments does not guarantee a local retail registration. This is a distinctly separate approval process. All applicants seeking retail activity will be required to obtain a zoning certification from the local government to be issued a state license. Local governments may wish to monitor the number of zoning certifications they provide to OCM to inform the likely volume of retail registration applicants. Page 22 Local Approval Process (cont.) Local governments are permitted specific authorities for registration refusal and registration suspension, in addition to—and not in conflict with—OCM authorities. Registration and Renewal Refusals Local governments may refuse the registration and/or certification of a license renewal if the license is associated with an individual or business who no longer holds a valid license, has failed to pay the local registration or renewal fee, or has been found in noncompliance in connection with a preliminary or renewal compliance check. Local Registration Suspension (342.22) Local governments may suspend the local retail registration of a cannabis business or hemp business if the business is determined to not be operating in compliance with a local ordinance authorized by section 342.13 or if the operation of the business poses an immediate threat to the health and safety of the public. The local government must immediately notify OCM of the suspension if it occurs. OCM will review the suspension and may reinstate the registration or take enforcement action. Expedited Complaint Process (342.13) Per state law, OCM will establish an expedited complaint process during the rulemaking process to receive, review, read, and respond to complaints made by a local unit of government about a cannabis business. Upon promulgation of rules, OCM will publish the complaint process. At a minimum, the expedited complaint process shall require the office to provide an initial response to the complaint within seven days and perform any necessary inspections within 30 days. Within this process, if a local government notifies OCM that a cannabis business poses an immediate threat to the health or safety of the public, the office must respond within one business day. Page 23 Inspections & Compliance Checks Local governments are permitted specific business inspection and compliance check authorities, in addition to—and not in conflict with—OCM authorities. Inspections and Compliance Checks (342.22) Local governments must conduct compliance checks for cannabis and hemp businesses holding retail registration at least once per calendar year. These compliance checks must verify compliance with age verification procedures and compliance with any applicable local ordinance established pursuant to section 342.13. OCM maintains inspection authorities for all cannabis licenses to verify compliance with operation requirements, product limits, and other applicable requirements of Chapter 342. Page 24 Municipal Cannabis Stores As authorized in section 342.32, local governments are permitted to apply for a cannabis retail license to establish and operate a municipal cannabis store. State law requires OCM issue a license to a city or county seeking to operate a single municipal cannabis store if the city or county: • Submits required application information to OCM, • Meets minimum requirements for licensure, and • Pays applicable application and license fee. A municipal cannabis store will not be included in the total count of retail licenses issued by the state under Chapter 342. A municipal cannabis store cannot be counted as retail registration for purposes of determining whether a municipality’s cap on retail registrations imposed by ordinance. Page 25 Creating Your Local Ordinance As authorized in section 342.13, a local government may adopt a local ordinance regarding cannabis businesses. Establishing local governments’ ordinances on cannabis businesses in a timely manner is critical for the ability for local cities or towns to establish local control as described in the law and is necessary for the success of the statewide industry and the ability of local governments to protect public health and safety. The cannabis market’s potential to create jobs, generate revenue, and contribute to economic development at the local and state level is supported through local ordinance work. The issuance of local certifications and registrations to prospective cannabis businesses is also dependent on local ordinances. • Local governments may not prohibit the possession, transportation, or use of cannabis, or the establishment or operation of a cannabis business licensed under state law. • Local governments may adopt reasonable restrictions on the time, place, and manner of cannabis business operations (see Page 14). • Local governments may adopt interim ordinances to protect public safety and welfare, as any studies and/or further considerations on local cannabis activities are being conducted, until January 1, 2025. A public hearing must be held prior to adoption of an interim ordinance. • If your local government wishes to operate a municipal cannabis store, the establishment and operation of such a facility must be considered in a local ordinance. Model Ordinance For additional guidance regarding the creation of a cannabis related ordinance, please reference the additional resources on page 27. Page 26 Additional Information – Tobacco Sales Penalties Related to a Revocation or Suspension of Tobacco License A cannabis or hemp business license holder may also hold a tobacco license under Minnesota Statutes Chapter 461. However, tobacco cannot be sold in the cannabis retail location. Under section 461.12, Minnesota law allows a licensee’s authority to sell tobacco and related products under the section to be suspended and possibly revoked if the licensee also holds a cannabis or hemp business license under Chapter 342 or is a registrant under section 151.72 and that license or registration is revoked. This penalty also applies if the license holder is convicted of an offense under section 151.72 or has been convicted under any other statute for illegal sale of cannabis products. Clarifying Cannabis Businesses Authority Cannabis businesses will be able to sell vaporizers without a tobacco license. Under Minnesota Statutes, section 342.27, subd. 3(a), retail licensees are permitted to sell cannabis paraphernalia. Cannabis paraphernalia includes “all equipment, products, and materials of any kind that are knowingly or intentionally used primarily in ... ingesting, inhaling, or otherwise introducing cannabis products into the human body” [Minnesota Statutes, section 342.01, subd. 18(2)]. Therefore, Minnesota Statutes, section 342.27, subd. 3(a) specifically authorizes retail licensees to sell cannabis paraphernalia, which in this instance includes vaporizers. Page 27 Additional Resources OCM Toolkit for Local Partners Please visit the OCM webpage (mn.gov/ocm/local-governments/) for additional information, including a toolkit of resources developed specifically for local government partners. The webpage will be updated as additional information becomes available and as state regulations are adopted. Toolkit resources include: • Appendix A: Cannabis Model Ordinance (mn.gov/ocm/lgg-appendix-a) • Appendix B: Retail Registration Form and Checklist (mn.gov/ocm/lgg-appendix-b) • Appendix C: Cannabis Flower and Hemp-Derived Cannabinoid Products Inspection Checklist (mn.gov/ocm/lgg-appendix-c) • Appendix D: Enforcement Notice from the Office of Cannabis Management (mn.gov/ocm/lgg-appendix-d) • Appendix E: Notice to Unlawful Cannabis Sellers (mn.gov/ocm/lgg-appendix-e) • Appendix F: Model Guidelines on Age Verification Compliance Checks Policy and Procedures (mn.gov/ocm/lgg-appendix-f) • Appendix G: Cannabis and Hemp Age Compliance Check Form (mn.gov/ocm/lgg- appendix-g) • Appendix H: Local Unit of Government Cannabis Licensing Contact, Delegation Form, and Accela Registration Instructions Guide (mn.gov/ocm/local- governments/contactform.jsp) • Appendix J: Local Approval for Early Cultivation (mn.gov/ocm/lgg-appendix-j) Local Organizations There are several organizations who also have developed resources to support local governments regarding the cannabis industry. Please feel free to contact the following for additional resources: • League of Minnesota Cities • Association of Minnesota Counties • Minnesota Public Health Law Center From:Dean Anderson To:Tom Weidt; Becky Petryk; Phil Klein; Dave Strub; Mike Miron; Michele Lindau; Bryan Bear; Max Gort; Rachel Juba Cc:Reece Geel; Isabeau Ryan Subject:Hugo"s Future - Cannabis Zoning Date:Monday, December 2, 2024 11:08:38 AM You don't often get email from dean@uffda.cc. Learn why this is important Caution: This email originated outside our organization; please use caution. The decisions you are about to make over the next few weeks on where and how cannabis cultivation can occur are not just policy—they are a defining moment for Hugo’s future. These choices will ripple through our community, affecting not only businesses like ours but also the very character and legacy of our city. This is an opportunity to lead, to shape Hugo into a place where tradition and innovation coexist, and where small farms and new ideas thrive together. It is imperative that cannabis cultivation be considered an agricultural activity. The world around us is changing, and farming as we know it is under threat. Small farms are disappearing, swallowed up by corporations that prioritize profit over stewardship. Traditional crops like corn, soybeans, and dairy have become increasingly difficult to grow and sell profitably, especially for independent farmers. The dream of owning a farm and being a full-time farmer is slipping away for many, unless they can operate at an industrial scale. We can see the writing on the wall. The aging hands that have tilled Hugo’s soil for decades are slowly retiring, and their farms—those patches of land that hold generations of blood, sweat, and dreams—are at a crossroads. What will become of them? Without innovation, their futures are bleak. These small, family-owned farms will either be swallowed whole by faceless Big Ag corporations, stripping them of their soul and connection to the community, or flattened and sold off to developers, paving over the legacy of Hugo’s agricultural roots. But it doesn’t have to be this way. We have an opportunity—a responsibility—to ensure that these farms not only survive but thrive. By embracing innovation, like incorporating cannabis cultivation as a modern cash crop, we can give the next generation of farmers the tools to succeed. We can preserve the heart of Hugo while paving the way for a future where farming is once again a livelihood to aspire to. Cannabis offers an opportunity to revitalize farming. As a cash crop, it has the potential to make homesteading and small- scale farming tangible again, giving new farmers a viable path to succeed without relying on massive volumes. We moved to Hugo with a vision of escaping the city, purchasing land, and building a homestead where we could grow cannabis. We were drawn to Hugo for its vibrant community of modern farmers—people like Niemczyk Gardens, T and Nae’s Flower Farm, and Applecrest Orchard—just to name a few who exemplify the harmony of agriculture and community. Restricting cannabis cultivation to industrial zones would miss the chance to treat this crop as part of our agricultural heritage and risks framing a vibrant opportunity as something disconnected from the land. Cannabis is not just a crop; it is a symbol of innovation and resilience in farming. It has the power to preserve Hugo’s agricultural roots while supporting sustainable growth. The choice of how to zone cannabis cultivation belongs to this council and this community—not distant bureaucrats who don’t know the heart of Hugo. This is your moment to lead, to protect the values and character of our city, and to ensure that the decisions made today honor the legacy of those who built Hugo while securing a future where the next generation can thrive and the promise of the American Dream endures. Thank you for your time and thoughtful consideration. Dean, Beau, and Reece Some people who received this message don't often get email from lyndabarry760@gmail.com. Learn why this is important From:Michele Lindau To:Max Gort; Rachel Juba Subject:FW: Hugo Cannabis - Important Distinction in the Population Rule Date:Thursday, December 5, 2024 10:25:55 AM Attachments:image001.png Michele Lindau Hugo City Clerk 651-762-6315 From: Lynda Barry <lyndabarry760@gmail.com> Sent: Thursday, December 5, 2024 10:13 AM To: Tom Weidt <mayortom@ci.hugo.mn.us>; Becky Petryk <jdpetryk@gmail.com>; Phil Klein <philklein7@msn.com>; Dave Strub <dstrub@ci.hugo.mn.us>; Mike Miron <mmiron@ci.hugo.mn.us> Cc: Hugo Info <info@ci.hugo.mn.us>; Bryan Bear <bbear@ci.hugo.mn.us>; Michele Lindau <mlindau@ci.hugo.mn.us> Subject: Hugo Cannabis - Important Distinction in the Population Rule Caution: This email originated outside our organization; please use caution. Dear Mayor Weidt and City Council Members ~ In reading the Nov 27 news article titled Hugo City Council sets public hearing for cannabis, I noticed that a very important nuance is missing in the following quote: " ...Per state statute, the city of Hugo would be required to allow a minimum of two cannabis businesses due to its population of 17,000. (One retail license is required per 12,500 residents.)" ... "Mayor Tom Weidt said that was a “big roundup,” but Gort explained that is the way the law is written." Having not attended the meeting, I don't know if Mr. Gort failed to mention - or if the reporter failed to include in the article - that under section 342.13 subsection (j) If a county has one active registration for every 12,500 residents, a city or town within the county is not obligated to register a cannabis business. In other words, if other cities within Washington county wish to exceed their population requirement, Hugo may not be required to issue any cannabis licenses at all ... or possibly issue just one license. [(k) Nothing in this section shall prohibit a local government unit from allowing licensed cannabis retailers in excess of the minimums set in paragraph (i).] I do not personally have a strong position on this topic one way or another - except for the fact that as 7-year residents of Hugo, my husband and I are both STRONG proponents of Hugo keeping the "small town/rural" feel we fell in love with (and the reason we happily left our St. Paul home of 30 years). Sadly, over the past 3 or 4 years we feel this rapidly slipping away and caution against any further actions (cannabis or otherwise) which might further deteriorate the unique treasure that is Hugo, MN. Thank you for your time and for your service to our beautiful community. Lynda (and Jeff) Barry 165th Street N, Hugo