Legislation would create temporary licenses for cannabis businesses in Minnesota

Updated: 4:45 p.m.

Minnesota’s Office of Cannabis Management is proposing changes to the state’s marijuana law, including one that would allow the issuance of a set number of temporary licenses.

Those licenses would cover everything from cultivation to testing to retail and delivery operations.

The goal of issuing those temporary licenses, the office said, would be to give those businesses “the clarity they need to establish business operations and be prepared for market launch” once regulatory rules are finalized, likely in 2025.

The legislation proposed Thursday, if passed, would set the numbers of temporary licenses — including up to 50 retail licenses.

They’d only go to so-called “social equity” applicants — through a lottery, if there are more applicants than licenses available.

The legislation says social equity applicants would include people who were convicted of selling or possessing cannabis prior to May 2023; military veterans; long-standing residents of census areas with poverty rates of 20 percent or more; and farmers who face barriers to education or employment, among other qualifications.

Among other proposed changes, the legislation would:

• Create a single supply chain for both medical and adult-use cannabis in Minnesota. The Office of Cannabis Management said that would “help lower costs for both medical patients and adult-use consumers, streamline the licensing process, and prevent unnecessary future disruption to the industry as seen in other states where the supply chains merge post market launch.”

• Accelerate the transition of the existing Office of Medical Cannabis and enforcement functions into the Office of Cannabis Management.

Interim Director Charlene Briner said people could be able to apply for temporary licenses as early as July but would not be able to operate businesses that soon, as retail rules have not been finalized.

“They’re getting their buildings secured. They’re getting their capital in order. They’re getting ready to hire staff and putting together their safety plans, getting those local approvals,” she said. “And then when rules are in place, and OCM has that authority, they’re able to move quickly. So this is really a head start in particular for social equity applicants.”

She did not provide a timeline for when those licenses would be granted.

The proposed legislation also slashes other barriers for applicants who fit the social equity guidelines. No longer would applicants be required to secure a building before applying for a license and finding out if they get the greenlight.

Applicants also wouldn’t have to have 100 percent ownership with the proposed changes.

“They are still majority party owners or controlling interests at 65 percent. That is because it is incredibly hard to access capital in this industry,” Briner said. “By lowering those thresholds of ownership, we create opportunities to not only ensure that majority ownership, but also to unlock access to capital through creative partnerships for those applicants.”

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