Minnesota House Passes Cannabis Social Equity Rule Changes

Minnesota House lawmakers last week passed social equity cannabis licensing provisions and other adjustments to the state’s upcoming adult-use cannabis program.

Full story after the jump.

The Minnesota House of Representatives voted last week to adopt new social equity rules and other changes to the state’s adult-use cannabis program, according to a MinnPost report.

House Bill 4757 was approved on a mostly party-line vote but its sponsor Rep. Zack Stephenson (D) said he was open to additional changes.

“I look forward to the conference committee discussion and continued good work on this bill. Particularly on the provisions surrounding the proposed changes to the lottery, which I know a lot of people are working on and thinking about.” — Stephenson, via MinnPost

If passed into law, the proposal would establish an earlier cannabis business license lottery for social equity applicants, which include people living in high-poverty areas, people living in areas where cannabis enforcement has been more commonplace, and people with cannabis-related convictions on their record; additionally, the law would reduce the amount of up-front financing required for social equity applicants from 100% to 65%. The social equity lottery would come before a general licensing lottery and the earlier licensees would be able to open their businesses ahead of the competition. Under the House-approved rules, social equity license holders would be able to sell their license to a non-social equity entity after three years.

Other provisions from the bill include slight adjustments to the license applicant grading process, the earlier-than-anticipated lumping of medical cannabis and hemp-based edible and beverages regulators with the Office of Cannabis Management, and a medical cannabis caregiver system for patients who are unable to grow their own cannabis plants. Physicians would also be cleared to recommend medical cannabis for any patients who they believe would benefit from the program, a departure from the state’s previous qualifying conditions-based program.

Additionally, Minnesota municipalities would be allowed to launch their own adult-use dispensaries without having to enter the lotteries — the government-run shops, however, would still have to compete with other, state-licensed dispensaries.

Cannabis regulators said in January that the state will need at least 381 licensed dispensaries to properly serve its adult-use market. Minnesota legalized adult-use cannabis in 2023.

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