Ohio has legalized recreational cannabis. Click HERE to learn more about cannabis business opportunities in Ohio.

How To Open A Dispensary In Minnesota (2024)

Overview

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. 

Minnesota joined the ranks of states legalizing recreational marijuana, with Minnesota Governor Tim Walz signing the bill into law on May 30, 2023. This move, making Minnesota the 23rd state to do so, allows adults aged 21 and older to possess and use marijuana. The law also includes provisions for expunging low-level convictions and establishes regulations for its sale. 

As of August 1, 2023, adults aged 21 and older can now possess and use cannabis. However, the establishment of dispensaries is pending until a licensing system is put in place, expected by early 2025. In the meantime, tribal governments, including Minnesota’s 11 Native American tribal nations, have the autonomy to operate their own dispensaries. Notably, the Red Lake Nation has already opened the first recreational marijuana dispensary, called NativeCare, offering cannabis access to individuals aged 21 and older.

Furthermore, on December 4th, 2023, the Minnesota Department of Agriculture (MDA) opened online applications for the 2024 Industrial Hemp Program. Individuals and businesses interested in growing or processing hemp in Minnesota must apply by April 30, 2024. The license, valid for the calendar year 2024, requires first-time applicants and authorized representatives to undergo a criminal background check and submit fingerprints. The program focuses exclusively on industrial hemp, distinct from adult-use or medical cannabis, and is not for hemp-derived cannabinoid products. The MDA will conduct pre-harvest THC testing for each hemp lot, and continue random inspections of processor locations. The grower license costs a minimum of $400, and a processing license starts at $500. Those growing hemp indoors past December 31, 2023, must renew their license before year-end. 

On January 17th, 2024, Minnesota’s cannabis regulators proposed legislative changes to streamline the state’s marijuana licensing process and ensure the opening of at least 381 retail stores. These recommendations, from the Minnesota Office of Cannabis Management (OCM), aim to address the ongoing issue of unregulated marijuana sources by facilitating a smoother transition to a regulated market. Despite the legalization law’s passage last year, many provisions remain unimplemented, prompting the OCM to suggest removing certain application requirements and introducing temporary licenses, especially for social equity applicants, to expedite market entry. This move is seen as crucial for aligning with Minnesota’s goal of launching commercial sales by 2025 and contrasts with the broader trend of states moving towards more accessible cannabis regulations. The success of these proposals hinges on legislative approval in the upcoming session. 

On May 10th, 2024, the Minnesota Supreme Court ruled that the Legal Marijuana Now Party does not meet the state requirements for major political party status. This decision prevents the party’s candidates from automatically appearing on the ballot for the 2024 elections. The court found that the party failed to comply with new legislative rules, which mandate a state central committee supervised by a state convention. Despite the party’s argument that these requirements violate their First Amendment rights, the court rejected these claims.

Minnesota Marijuana Legalization Efforts

In Minnesota, the journey towards legalizing recreational marijuana has seen significant developments over the years, reflecting a growing public and political shift. In 2019, a study indicated a 56% approval rate for adult-use cannabis legalization, which increased to 58% by 2021, according to the House of Representatives State Fair Poll. On May 13, 2021, the Minnesota House of Representatives passed HF600, a bill aimed at legalizing recreational cannabis, by a 72-61 vote. This bill, spearheaded by Rep. Ryan Winkler and others, proposed allowing adults 21 and older to purchase and possess up to 1.5 ounces of cannabis and grow up to eight plants. Despite this initial success, the bill did not become law as of May 23, 2022.

For the 2022 legislative session, efforts to amend HF600 continued, with a focus on licensing structures, public safety, and substance abuse. Ryan Winkler and Melisa Franzen, during a Minnesota Hemp Growers Cooperative event on January 19, 2022, discussed these legislative strategies. Additionally, Governor Tim Walz showcased his support for the movement by including funding for marijuana legalization in his supplementary budget proposal on January 26, 2022. A notable advancement came on July 1, 2022, when Minnesota legalized THC edibles and beverages with up to 5 milligrams of THC per serving under HF 3595. Furthermore, on December 29, 2022, MN is Ready campaign began lobbying for revised marijuana reform.

The momentum continued into 2023. On January 6th, Governor Walz reiterated his support for HF 100, a bill allowing adults over 21 to possess up to two ounces of cannabis. His budget proposal, revealed on January 24th, included plans for implementing legalization and projected cannabis revenue. Progress was evident as SF 73, a companion bill to HF 100, advanced in the Senate on April 19th. On April 28th, the Minnesota Senate passed HF 100, which included amendments for increased funding for State Patrol and substance use treatment. The final legislative success came on May 20th, 2023, when the Minnesota legislature passed HF 100; the House approved it on May 18th with a 73-57 vote, followed by the Senate’s 34-32 vote on May 20th. Culminating these efforts, Governor Walz signed the bill into law on May 30, 2023, officially legalizing recreational marijuana in Minnesota.

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

A few cities have opted to temporarily pause cannabis-related businesses. With the recent legislation allowing the use of marijuana for adults, cities have the authority to establish temporary regulations that prevent the operation of cannabis establishments until January 1, 2025.

On August 15, 2023, the East Grand Forks City Council unanimously prohibited cannabis use in public areas. Similar decisions have been made recently by Brooklyn Center, Mankato, West St. Paul, Ramsey, East Grand Forks, Detroit Lakes, Alexandria, and Dilworth, all disallowing cannabis use in public spaces. 

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 46,841 active patients with approved enrollment as of May 9, 2024. 

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.

Here are the key provisions outlined in the final marijuana legalization bill HF100:

  • Starting from August 1, 2023, individuals who are 21 years old or above are 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

Under HF 100, 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.

Marijuana License Types and Fees 

Cannabis Business Type

Application Fee

Initial License Fee

Renewal License Fee

Microbusiness

$500

$2,000

Mezzobusiness

$5,000

$5,000

$10,000

Cultivator

$10,000

$20,000

$30,000

Manufacturer

$10,000

$10,000

$20,000

Retailer

$2,500

$2,500

$5,000

Wholesaler

$5,000

$5,000

$10,000

Transporter

$250

$500

$1,000

Testing Facility

$10,000

$10,000

$20,000

Event Organizer

$750

$750

Delivery Service

$250

$500

$1,000

Lower-Potency Hemp Edible Manufacturer

$250

$1,000

$1,000

Lower-Potency Hemp Edible Retailer

$250 per location

$250 per location

$250 per location

Medical Cannabis Cultivator

$250

Medical Cannabis Processor

$250

Medical Cannabis Retailer

$250

Medical Cannabis Combination Business

$10,000

$20,000

$70,000

Key Considerations in Opening a Dispensary in Minnesota

Starting from March 1, 2025, medical cannabis businesses will have the opportunity to obtain combination licenses, enabling their seamless involvement in the burgeoning adult-use market. This significant shift not only broadens the operational horizon for existing medical dispensaries but also introduces a new landscape for entrepreneurs looking to enter the cannabis industry. With this evolving regulatory environment in mind, particularly for those considering opening a dispensary in Minnesota, it’s crucial to navigate this journey with a strategic approach. We at Cannaspire are here to guide you through this process, focusing on key areas essential for your success. Each of these pivotal aspects is supported by our in-depth expert resources and services, designed to streamline your entry and growth in the cannabis market.

  • Comprehensive Understanding of State Cannabis Laws
    • It’s advisable to thoroughly understand and keep up-to-date with Minnesota’s cannabis regulations, focusing on the differences between medical and recreational marijuana laws.
  • Strategic Business Planning
    • We recommend developing a detailed business plan. Our Cannabis Business Plans service can provide you with the necessary tools and guidance.
  • Careful Navigation of the Licensing Process
  • Securing Adequate Funding
  • Choosing an Optimal Location
    • Ensure compliance with local zoning laws. Our team can assist with location scouting and compliance checks.

Network Design and Implementation for the Dispensary. 

  • Create a compliant and customer-focused network infrastructure. Our Cannabis IT Solutions offer network design and implementation services that adhere to regulatory standards, ensuring secure and efficient operations. 
  • Implementation of Security Measures
  • Effective Staff Recruitment and Training
  • Inventory Management
    • Selecting the right products is crucial. We can guide you in establishing supplier relationships and inventory selection.
  • Marketing and Community Outreach
  • Planning for the Dispensary Launch
    • A soft opening can provide valuable feedback. We can assist in planning your launch strategy.
  • Ongoing Operations and Regulatory Compliance

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

 

To gain access, simply enter your contact details in the form below.

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