Olmsted County, Minnesota, is preparing to implement its own lottery system for cannabis retail licenses in response to the state’s rollout of cannabis business regulations. The Olmsted County Board approved changes to local cannabis ordinances on Tuesday, allowing for a lottery that could register up to 14 retailers in the region, with the first lottery expected as early as July.
This decision follows a lengthy deliberation period of over two months by county officials, who aimed to create a fair registration process for potential cannabis retailers. Currently, more than 120 businesses in the county already sell low-dose, hemp-derived THC products, which will remain unaffected.
Under state law, counties must issue at least one retail cannabis license for every 12,500 residents. With a population exceeding 160,000, including around 130,000 in Rochester, Olmsted County’s local plan includes a cap of 14 licenses, meeting the state’s minimum requirement.
Critics of the county’s lottery system argue that it complicates an already lengthy registration process, which includes a state lottery for cannabis licenses. However, county officials maintain that this method offers a more equitable approach compared to a first-come, first-served model. Sagar Chowdhury, an associate director at Olmsted County Public Health, reported that a recent meeting with eight potential licensees revealed broad support for the lottery system, although he anticipates further adjustments may be necessary before implementation.
The county’s plan includes holding two lotteries for different categories of businesses, with public meetings scheduled to provide at least two weeks’ notice to applicants. These lotteries will also create a reserve list of applicants to fill any vacancies that may arise if a registered business does not open or relinquishes its license.
Some local business owners, such as Mitch Daniels, co-owner of a microbusiness, advocate for an expedited lottery process. Daniels emphasized that an early lottery for small retailers would enable them to prepare for retail operations in time for anticipated market openings by early 2026. The county plans to award eight licenses specifically for microbusinesses, allowing them to cultivate, process, and sell cannabis products from a single location.
Commissioner Michelle Rossman highlighted the urgency of launching the registration process, stating, ‘That’s a lot of registrations that are ready right now. Let them start down the process.’ Once registered, businesses will have six months to commence operations, with an option for a 90-day extension if needed.
In addition to licensing, county officials are also working on enforcement mechanisms similar to those used in local tobacco and alcohol sales. Municipalities are expected to take on age-compliance enforcement from state authorities. Olmsted County adopted enforcement guidelines in March, while Rochester, Minnesota’s third-largest city, has opted to delegate cannabis regulations to the county. In contrast, smaller cities like Byron and Pine Island have chosen to manage their own enforcement processes. Byron has also applied for a state license to operate a municipal cannabis dispensary, indicating a proactive stance towards preparing for the evolving cannabis market in the region.
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