How To Open A Dispensary In Minnesota (2023)

Are you looking for information on how to open a cannabis dispensary in Minnesota?

This page will keep you up to date on the most recent news and important developments on starting a marijuana business in Minnesota, including information pertaining to the future of cannabis in the state. 

Overview

Minnesota continues its efforts to legalize cannabis, with advocates making multiple attempts to advance marijuana legalization. 

Previous Legalization Attempts

On May 13, 2021, with a 72-61 vote, the state House of Representatives approved a bill sponsored by Rep. Ryan Winkler, Rep. Melissa Hortman, and other lawmakers, to legalize the use of recreational cannabis in Minnesota. The proposed bill, HF600, would permit adults 21 years of age and older to purchase and possess up to 1.5 ounces of cannabis as well as cultivate up to eight plants. Unfortunately, the bill did not pass into law as of May 23, 2022.

For the 2022 session, Ryan Winkler (D) planned to change the legislation in order to get more people to support the House-passed reform bill. Licensing structures, public safety, and substance abuse issues are some of the things that lawmakers will be looking at to improve the bill. When the Minnesota Hemp Growers Cooperative put on a roundtable event on January 19, 2022, Ryan Winkler (D) and Melisa Franzen (D) talked about legislative strategies. 

On January 26, 2022, Minnesota Gov. Tim Walz (D) showed support for legalizing marijuana as part of his huge supplementary budget. Walz included funding to execute marijuana legalization in his yearly budget proposal to legislators. 

On July 1st, 2022, legislation that legalizes edibles in Minnesota that contain trace levels of THC entered into effect. HF 3595 allows for the sale of edibles and beverages that contain up to 5 milligrams of THC generated from hemp in each serving. The state Board of Pharmacy issued a FAQ document that explains what kinds of edible and non-edible hemp products are permitted and prohibited under the law. 

On December 29th, 2022, MN is Ready, a group of Minnesota activists, announced the beginning of the next stage of their campaign to legalize marijuana in the state. This stage includes grassroots advocacy and lobbying lawmakers to adopt a revised reform measure that advanced through the House last year. In a press release, MN is Ready announced that outgoing House Majority Leader Ryan Winkler (D) has signed on as the coalition’s campaign chairman after having sponsored the aforementioned legislation. 

2023 Cannabis Legalization Efforts

On January 24th, 2023, Governor Tim Walz of Minnesota revealed his budget proposal for the 2024-2025 biennium that includes funds for different state agencies to carry out the legalization of marijuana. The proposal also outlines the projections for cannabis revenue as state lawmakers work towards advancing reform. 

Minnesota Democratic-Farmer-Labor Party (DFL), an affiliate of the democratic party, pushed to legalize cannabis for adult use in the state.  HF 100 would allow adults over the age of 21 to legally possess and transport up to two ounces of cannabis flower in public. On January 6th, 2023, Minnesota Governor Tim Walz tweeted his continued support for the state’s cannabis legalization initiative, saying it’s time to legalize adult-use cannabis and erase cannabis convictions in Minnesota and added that he is prepared to sign the bill into law. 

On April 19th, 2023, SF 73, a companion bill to legalize marijuana in Minnesota was approved by another Senate committee, signaling progress towards being considered by the full chamber. 

On April 28th, 2023, the Minnesota Senate passed HF 100 to legalize marijuana, setting the stage for negotiations with the House to reconcile differences. The bill has been amended multiple times and added proposals to increase funding for the State Patrol and substance use treatment. The session ends on May 22nd, leaving lawmakers with just a few weeks to get the bill to the governor’s desk.

On May 20th, 2023, Minnesota took a significant step towards legalizing recreational marijuana as the state legislature passed HF 100. The bill received approval from the House on May 18th with a vote of 73-57, followed by the Senate’s endorsement on May 20th with a vote of 34-32. Democratic Governor Tim Walz, committed to supporting the legalization of cannabis for adults, will soon receive the bill for his signature. Assuming Walz signs the bill as anticipated, Minnesota will join the ranks of the 23 states in the nation that have legalized recreational marijuana. 

A growing number of Minnesotans are expressing support for the legalization of marijuana. Legalizing recreational marijuana would provide tens of thousands of jobs and hundreds of millions in tax revenue. 58% of respondents to the 2021 House of Representatives State Fair Poll said they favor adult-use cannabis legalization. This shows an increase in approval when compared to the chamber’s 2019 study, when support stood at 56%. 

The Opportunity Size

Numbers from a Denver-based Marijuana Policy Group project that cannabis sales in Minnesota would reach $426 million in year one of adult-use cannabis legalization and would grow to $1.2 billion by year five. 

Additionally, it is estimated that legalization will have a significant impact on the state’s projected tax revenue. The group projected $112 million in tax revenue in the first year and $300 million by the fifth year. Legalization will reportedly generate an annual economic impact of $2.6 billion and 20,000 jobs. 

Local Cannabis Restrictions & Laws

After HF 3595 legalized sale and consumption of hemp THC edibles in Minnesota on July 1st, 2022, municipalities have placed moratoriums on the production and sale of edibles derived from hemp, and other municipalities are contemplating doing the same. 

Waite Park and Prior Lake are debating whether to enact their prohibitions, while the restrictions are already in place in St. Joseph and Marshall. Stillwater enacted its one-year moratorium in November of last year.

If HF100 becomes law, local governments would be prohibited from banning marijuana businesses in their jurisdictions. However, they would have the authority to establish “reasonable” regulations regarding operating hours and locations, as well as limit the number of cannabis business licenses based on the population size. On this page, we will keep you informed of any changes in Minnesota towns’ stances and restrictions on recreational cannabis.

Medical Marijuana Program Opportunities

On May 29, 2014, Minnesota joined 21 other states in considering marijuana to be a legal medicine after Gov. Mark Dayton signed into law the Minnesota Medical Cannabis Act (SF2470), a medical marijuana program that is among one of the nation’s most restrictive. 

The use of medical cannabis in Minnesota is limited to patients who are Minnesota residents, who have been diagnosed with one of the qualifying diseases, and who have been certified as such. Cancer, HIV/AIDS, and Alzheimer’s disease are among the conditions that qualify. Sickle cell illness and chronic motor disorder will be eligible for the program starting in August 2021. You can see the comprehensive list of qualifying conditions by visiting the Department of Health’s website. On May 25, 2021, Gov. Tim Walz signed a bill (HF 2128) into law allowing the use of raw/flower cannabis by adults 21 and older.

According to the Office of Medical Cannabis’ Minnesota Medical Cannabis Patient Registry, there are 26,556 active patients with approved enrollment and 52,621 total approved patient enrollments as of September 23, 2021. 

Medical Marijuana License Types and Fees

Medical Cannabis Manufacturer 

A licensed manufacturer is allowed to cultivate, produce, and distribute medical cannabis. There are two medical cannabis manufacturers registered with the Minnesota Department of Health. Currently, no new manufacturer license applications are being accepted.

The application fee costs $20,000 and the annual license fee is estimated to be in the region of $75,000 to $100,000.

Medical Cannabis Laboratory

According to state law, medicinal cannabis must be tested for content, contaminants, and consistency by third-party laboratories that have been approved by the state’s commissioner. Applications for laboratory licenses are currently open.

To thoroughly evaluate applying laboratories, the testing process is divided into three parts:

• The application and required documentation must be submitted.
• Laboratories that match the criteria will be notified for a site visit.
• Approval is received from the Department of Health.

Visit Medical Cannabis Laboratory Application Process and Forms for additional information.

Recreational Use/Adult Use Legalization 

As previously stated, HF600, a bill to legalize marijuana in the state of Minnesota was passed by the Minnesota House of Representatives. Although the bill is dead, here’s what it would have accomplished: 

• HF600 would create a responsible regulatory framework for recreational cannabis, improve the medical cannabis program, establish taxes, address racial disparities, provide better access to veterans, and expand opportunities for small and medium-sized businesses while also providing a way for social equity applicants to participate in the growing market. 
• The Cannabis Management Board would be in charge of overseeing the regulation of the production and sale of adult-use marijuana, specifying cannabis business licensing categories, requirements, and procedures, and handing over the medical marijuana program initially handled by the Department of Health to the Cannabis Management Board.
• The board would evaluate applications on a variety of criteria, including the applicant’s social equity status. A social equity applicant includes veterans who lost their honorable status due to cannabis-related offenses, residents of areas with disproportionately high cannabis enforcement, and residents of low-income areas.

HF100, a bill waiting for the Governor’s signature, holds the potential to legalize cannabis in Minnesota. Here are the key provisions outlined in the final marijuana legalization bill:

• Starting from August 1, individuals who are 21 years old or above would be legally permitted to purchase and carry up to two ounces of cannabis in public. 
• The bill would also allow individuals to cultivate a maximum of eight plants at home, with four of them being mature plants. Moreover, individuals would be able to possess up to two pounds of marijuana within their residences. 
• Another noteworthy aspect of the bill is the allowance of gifting up to two ounces of marijuana between adults without any monetary exchange. 
• Furthermore, the bill proposes the establishment of licensed cannabis businesses, with the provision that municipalities and counties could also own and operate government dispensaries. 
• Additionally, the bill permits on-site consumption permits for events and allows for the operation of cannabis delivery services.

Recreational Use/Adult Use Program Opportunities

If HF 100 is enacted, the establishment of the Office of Cannabis Management (OCM) will occur to regulate the market and grant cannabis business licenses. The issuance of licenses and commencement of sales are anticipated to take 12-18 months. 

To obtain a cannabis business license, the applicant must meet the following requirements:

• The applicant must be at least 21 years old and a resident of the state.
• The applicant must have paid the required fees and have a clean record, with no previous license revocations.
• The applicant must not be a licensed peace officer or employed by a cannabis business regulatory agency.
• The applicant must complete the application materials accurately and truthfully.

Recreational Marijuana License Types

If passed, HF100 will establish 16 license categories, encompassing a wide range of operations including:

• Cannabis Cultivator
• Cannabis Delivery Service
• Cannabis Event Organizer
• Cannabis Manufacturer
• Cannabis Mezzobusiness
• Cannabis Microbusiness
• Cannabis Retailer
• Cannabis Testing Facility
• Cannabis Transporter
• Cannabis Wholesaler
• Lower-Potency Hemp Edible Manufacturer
• Lower-Potency Hemp Edible Retailer
• Medical Cannabis Cultivator
• Medical Cannabis Processor
• Medical Cannabis Retailer

Starting from March 1, 2025, medical cannabis businesses will have the opportunity to obtain combination licenses, enabling their involvement in the adult-use market.

As the state’s cannabis program, particularly the recreational program, grows in scope, we will keep you informed about all relevant news and legislation pertaining to the opening of a dispensary in Minnesota. You can stay up to date on all relevant news and comments based on Minnesota Legalization by signing up for our Minnesota Cannabis Mailing List (see below).

This includes, but is not limited to, the following:

• How much does it cost to open a dispensary in Minnesota?
• What are the requirements to get a marijuana business license and open a dispensary in Minnesota?
• What special programs will be available?
• And more

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