ROCHESTER — Olmsted County commissioners moved forward with plans to hold lotteries this summer to determine which potential cannabis retailers will be registered for local operations.

“This has been a long process,” County Board Chairman Mark Thein said Tuesday evening as commissioners unanimously approved lottery-related updates to the county’s cannabis ordinance.

The decision came after more than a month of tweaks to the proposed process, which continued Tuesday afternoon.

Among recent changes was a clarification of retail categories the county can limit.

The county has capped potential retailers in three state-licensed categories at 14, leaving the potential for additional medical cannabis combination businesses to sell marijuana for both medical and recreational uses from a single storefront.

With the Minnesota Office of Cannabis Management reportedly seeing six applications for the combination licenses, county staff had proposed reserving a single registration for the category but later determined the category fell outside the local limit.

“The medical cannabis combination businesses are not subject to our cap, but they are subject to our registration,” Olmsted County Public Health Associate Director Sagar Chowdhury said.

As a result, the county plans to issue eight microbusiness registrations, which would allow a business to grow, buy and sell cannabis from a single site. A lottery for those registrations is targeted for July, with state license holders expected to have at least two week’s notice when applications are due.

Another eight retail cannabis registrations within the county will be reserved for businesses able to sell cannabis from up to five locations statewide. The state licenses don’t allow the businesses to grow cannabis for sale.

Two county registrations are also planned for mezzobusinesses, which are licensed to grow, buy and sell cannabis from up to three outlets statewide.

Chowdhury has said the county anticipates more than 14 businesses to seek local registration, but if applications fall short in any category, the remaining slots are expected to be available for the category with the most demand.

Since retail cannabis and mezzobusiness licenses are capped at the state level and subject to
Minnesota Office of Cannabis Management lotteries this summer,
the county lotteries for those registrations are expected after the state licenses are issued. Chowdhury said the local drawings could occur in late July or early August.

Once the county issues a registration, businesses are expected to open within six months, but will be allowed a 90-day extension, if requested.

The original plan called for allowing a one-year extension, but commissioners opted to reduce the time to ensure a potential registration isn’t tied up for more than nine months.

“It’s really unfair to the businesses that might be waiting for one,” commissioner Bob Hopkins said.

If a business fails to open or gives up its registration, the county plans for reserves to be drawn during the lotteries, which will provide the alternate business a chance to secure the vacated registration. Reserve slots will be held for up to 18 months.

With county commissioners approving lottery plans, Chowdhury said more changes to the local cannabis guidelines are expected to be discussed in the wake of discussions with potential retailers and changing state-level guidelines.

He said input from eight potential business owners was largely supportive of steps being taken, but the retailers voiced some concerns regarding the lack of a social equity component in the county lotteries and zoning restrictions related to cannabis businesses.

At the state level, Chowdhury said legislative changes could point to a need for county review of existing local policies for low-potency hemp products and temporary cannabis events as it continues to update and tweak the local ordinance.

“We may have to come back here and amend a few things in the near future,” he said.