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June 4, 2025
Hello Local Government Partners,
We are reaching out to update you on several important topics regarding the cannabis business application and licensing process.
New Law Change Impacting Retail Registrations
Previously under this section of the statute, local retail registration could be issued only after a business received its cannabis business license from OCM. With this change, local governments with retail registration authority can now issue a local retail registration to applicants with preliminary approval status, which occurs before full licensure.
This is an important change, especially for local governments that have chosen to limit the number of retail registrations in their jurisdiction per Minnesota Statutes, section 342.13. This change is intended to minimize the tension in the process that previously existed as applicants navigate the risk of having to invest and fully build out a business at a specific location to receive the license with no assurance of being able to operate at that location due to a local government’s limitation on retail registrations. To prevent the significant risk and potential harm to applicants making critical business decisions, local governments that have chosen to limit the number of retail registrations should consider making determinations on the issuance of retail registrations before applicants receive full licensure.
Please see the linked bulletin we have previously issued on this topic for additional context.
Additional Clarifications on Retail Registrations
In accordance with Minnesota Statutes, section 342.13(h), local governments may limit the availability of local retail registrations for cannabis retailers, cannabis microbusinesses with retail endorsements, and cannabis mezzobusinesses with retail endorsements. If a city or county has a population between 1-12,500, they would be required to allow at least one (1) retail registration. If their population is between 12,501-25,000, they would be required to allow at least two (2) retail registrations, and so on.
As a reminder, local governments are not required to limit the availability of retail registrations and instead may issue more than the minimum required.
Local governments choosing to limit the issuance of retail registration must do so through ordinance, and it is highly recommended that local governments consult legal counsel to determine their specific process and to ensure that the process is fair, transparent, and communicated thoroughly with prospective applicants.
A Note on Zoning Compliance Certification Order of Operations
OCM has encouraged applicants with preliminary approval to engage early with local governments before submitting site registration information – so local governments should anticipate early outreach from applicants before any official notifications in Accela. Early conversations can inform applicants what may be required to obtain local zoning compliance approval as well as compliance with state and fire building code prior to the applicant’s decisions on a final location. For example, does the local government certify fire and building code? Are there different permits required by the local government? Are there different building materials required? Early conversations can also inform local governments who may be interested in locations in their jurisdiction – whether they are prospective applicants, applicants in qualified applicant status, or applicants with preliminary approval.
As a reminder, applicants with preliminary approval are not yet tied to a location – so OCM will not be notifying any local governments directly that a prospective or qualified applicant has advanced to preliminary approval status. Local governments should view applicants with preliminary approval status as serious, ready applicants who have cleared several hurdles in the application and licensing process, including passage of a background check. The final steps for applicants with preliminary approval status include securing a location, obtaining compliance with local ordinances, and passing OCM’s prelicensure site inspection.
We really encourage applicants to not take the site registration step until they have worked out issues with their local government. Ultimately, that means, a preliminarily approved business should not complete site registration until they have received all local zoning approvals, are compliant with state fire and building codes, and are less than 90 days from being able to open their doors. If an applicant submits a site registration before they have worked with their local government to ensure compliance with all local ordinances, the applicant can withdraw their site registration and resubmit it when they have worked to come into compliance for local approval.
A local unit of government’s determination that it cannot certify the applicant’s site does not mean the applicant will be denied and lose their preliminary approval status. To obtain final authorization and receive a license, the applicant must either continue to work with the local unit of government to become compliant with local zoning and land use ordinances, or, alternatively, may find a new location for their business in a different jurisdiction. Irrespective of which path an applicant chooses, the applicant must obtain final authorization from OCM within 18 months of receiving preliminary approval status in accordance with Minnesota Statutes, section 342.14 subdivision 6(a), b(1).
OCM is actively working to update all guidance materials for both local governments and applicants to reflect this change, as well as the dozens of other cannabis policy changes made during the legislative session. Please watch for additional updates to the Guide for Local Governments on Adult-Use Cannabis and Lower Potency Hemp Edible Licenses as well as other resources in the coming weeks and check dates to ensure you are utilizing the most up-to-date materials.
Please do not hesitate to reach out to OCM as you continue to engage with potential businesses interested in operating within your jurisdiction. OCM will continue to support all local partners as we work together to establish a safe, equitable, and sustainable cannabis industry.
We are all navigating cannabis licensing for the first time, and we are grateful for your continued coordination as we work together to launch and regulate this industry.
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