The Minnesota Office of Cannabis Management (OCM) announced that an administrative law judge has approved draft rules governing the state's adult-use cannabis market. The rules, which the judge approved without changes, will publish in the State Register and go into effect later this month. This milestone sets up the final step in launching Minnesota’s cannabis market.
There are currently more than a thousand qualified applicants for social equity licenses – many of whom applied for license types that are not capped in statute and will not be subject to lotteries, including microbusiness, wholesaler, transporter, testing facility, and delivery service. More than 600 of these qualified applicants advanced from last fall’s license pre-approval process and are first in line to receive business licenses after completing application requirements, which include completing background checks, submitting signed labor peace agreements with bona fide labor organizations, and securing local government approvals.
Qualified applicants in the four license types whose numbers are capped in state statute (cultivator, mezzobusiness, manufacturer, and retailer) will be subject to a series of lottery drawings for the distribution of these licenses. Lotteries for each license type will be conducted this summer for both social equity applicants and general applicants. If not selected in the first social equity dedicated lottery, qualified social equity applicants will have another opportunity to be entered into a second lottery along with the general applicants for the remaining licenses available.
While one judge has signed off on the rulemaking process, another Minnesota judge has ordered the state’s cannabis regulator to hold a lottery license for social equity applicants that the agency had previously canceled.
Last year, Ramsey County District Court Judge Stephen Smith delayed the lottery, seemingly in support of applicants who had sued the OCM after being denied a spot in the lottery. In response, the Minnesota Office of Cannabis Management (OCM) elected to cancel the pre-approval lottery and move forward with a standard licensing cycle for both social equity and general applicants.
But now Smith has ruled that the OCM must conduct the social equity license lottery as originally planned.
