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Cannabis Business

Some Key Laws & Regulations

What you need to know about Minnesota's new marijuana legalization for businesses. These are items highlighted from House Bill HF 100 and Senate Bill SF 73. We highly recommend any individual or business looking to get into the cannabis market read both provisions. These laws and regulations that were passed for signature were a framework, there will be adjustments in the coming year, however we keep a list of the most notable laws here.

  • What kinds of cannabis products would the bill legalize?

  • How will retail cannabis sales be taxed? 

  • Can local governments collect additional taxes on marijuana sales?

  • Does the bill change Minnesota’s medical cannabis program?  

  • How will the new bill affect existing businesses making and selling legal hemp-derived THC products?

  • Would cannabis businesses be allowed to advertise? 

  • Will liquor stores be allowed to sell hemp-derived products?

  • What are the social equity provisions of the bill for business licenses?

  • What happens to pre-employment drug tests?

Canna Advisors

Current Timelines

  • Cannabis Legalization began August 1, 2023

  • Cannabis Seeds can be sold July 1, 2023

  • ​Criminal Forgiveness started on July 1, 2023

  • Business License(s) will begin Q4 of 2024 or early 2025

  • Operations and Retail Sales will begin Q2/Q3 of 2025

What kinds of cannabis products would the bill legalize?
The bill authorizes the production and retail sale of marijuana flower, concentrates, topicals and edible products, such as candy and beverages. It also permits the sale of immature cannabis plants and seeds, as well as hemp-derived THC products.

​How will retail cannabis sales be taxed?

The bill would impose a 10% tax rate on the sale of cannabis products. It would not apply to products purchased through the state’s medical cannabis program. The 10% tax rate would remain in place for four years, then the Department of Revenue commissioner would be charged with adjusting it if the tax revenue raised by marijuana sales exceeded state regulatory costs and appropriations for various state agencies and substance abuse programs. State and local sales taxes would also apply to retail cannabis sales.

 

Can local governments collect additional taxes on marijuana sales?

NO, the law explicitly prohibits local governments from imposing a sales tax solely on cannabis products.

 

​Does the bill change Minnesota’s medical cannabis program? 

NO, changes will be made until March 1, 2025, when the new Office of Cannabis Management’s Division of Medical Cannabis begins overseeing the state’s medical cannabis market.

  • Until then, the existing patient registry, retail locations, licensed businesses and qualifying conditions will remain the same and the Minnesota Department of Health will continue overseeing the program.

  • Starting in 2025, more businesses will be allowed to enter the medical marijuana market. State law previously allowed only two operators to grow, process and sell limited types of products at a small number of dispensaries around the state. And medical marijuana providers will be allowed to apply for a license to sell products to both recreational and medical customers (at one site per business per congressional district).

  • As noted above, medical marijuana will not be subject to the 10% gross receipts tax.

 

How will the new bill affect existing businesses making and selling legal hemp-derived THC products?

  • One immediate change would specifically outlaw THC-O, an extremely potent synthetic cannabinoid that has led to reports of illnesses nationwide. HHC and THC-P are also explicitly banned; only delta-8 and delta-9 THC derived from hemp are allowed.

  • The existing market for hemp-derived THC food and drink will be allowed to continue as long as businesses register with the Minnesota Department of Health by Oct. 1. The health department will regulate hemp-derived cannabis products until 2025. The Office of Cannabis Management would take over the licensing, regulation and enforcement of the low-dose hemp-derived market on March 1, 2025.

  • As is the case now, only food and beverages with hemp-derived THC in amounts up to 5 milligrams per dose are allowed – with a limit of 50 milligrams per package for edibles and a new 10 mg per-package limit for beverages. Vapes, flower and other products with hemp-derived THC remain illegal.

  • Also, the bill requires manufacturers and retailers of lower-potency hemp THC edibles and beverages, which were legalized in Minnesota last year, to be licensed and regulated by the Office of Cannabis Management starting in 2025.

Would cannabis businesses be allowed to advertise?

Yes, though the ways they could advertise would be strictly limited. Outdoor advertising would be banned for all cannabis businesses. Hemp businesses could advertise outdoors as long as it is unrelated to low-potency hemp edibles.

  • Cannabis and hemp businesses would not be allowed to advertise in print, television, radio or any other medium if 30% or more of the expected audience is under 21. They would also be prohibited from using online pop-up ads. Direct communication advertising, such as email marketing, would be allowed as long as the business first verifies the recipient is 21 or older. Verification methods could include user confirmation or birth date disclosure, similar to online alcohol and tobacco advertising. Similarly, location-based mobile advertising would require the business to first verify the device owner is 21 or older.

 

Could local governments ban cannabis businesses from operating within their borders?

No, they would not be able to ban cannabis businesses entirely. But they would have the option of limiting the number of cannabis retailers to one for every 12,500 residents. If a county meets the one retailer per 12,500 residents threshold, individual cities or towns within that county would not be required to allow a cannabis business. Minnesota tribal governments would largely be allowed to make their own rules for recreational and medical marijuana, though the bill sets up a process to negotiate jurisdictional issues with the state.

Will liquor stores be allowed to sell hemp-derived products? Yes, starting the day after Walz signs the bill into law. The bill adds lower-potency hemp edibles and beverages to the short list of items liquor stores are allowed to sell.

 

​What are the social equity provisions of the bill for business?

  • The bill creates a Division of Social Equity within the Office of Cannabis Management, which is charged with providing outreach and services to communities disproportionately affected by cannabis prohibition. It also gives "social equity applicants" a better shot at getting a cannabis business license. They are also eligible for special grants created by the legislation.

  • Those applicants include: people who were convicted of possessing or selling marijuana, family members of someone who was convicted of a marijuana offense, veterans or active military who lost honorable status due to a marijuana offense, residents of neighborhoods that "experienced a disproportionately large amount of cannabis enforcement," and farmers from underrepresented communities.

 

What happens to pre-employment drug tests?

  • Except where required by federal law or for jobs in education, law enforcement, medical caregiving and other positions identified in the bill, applicants for jobs cannot be screened for marijuana as a condition for employment. Ongoing or random cannabis tests for many employees would also be banned.

  • Companies can ban the possession and use of cannabis during work hours and when an employee is on-site or in a company vehicle. Businesses can also require cannabis testing if on-the-job cannabis use is suspected to be the cause of a violation of company policy or law.


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Want to Learn More or Need Help Navigating the Cannabis Business Process?

Cannabis license's will be hard to get as you will need to have complete business plans. Let Carpfish Creative's Midwest Cannabis Solutions Group guide you to easy approval & future wealth!

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