By Anne Holzman
In a process rushed by shifting state rules, the Lauderdale City Council recently decided to apply for a municipal cannabis license.
Preliminary approval will give the city 18 months to set up a cannabis business or decline the license.
At meetings in January and February, the City Council discussed three options: building and owning a cannabis dispensary; building one and then leasing it to a business in exchange for rent; or negotiating a profit-sharing agreement with a lessee.
Not building anything at all remains an option as well. The rushed application came because city officials learned in early January that municipalities would have to apply at the same time as private businesses and faced a March 14 deadline to keep that option open.
At Lauderdale’s direction, planning consultant Jennifer Haskamp last fall started viability research for a municipal cannabis business. The city owns a small commercial lot at 2430 Larpenteur Ave., just west of Eustis, formerly the Roseville Service Garage. City leaders realized last summer that it might be an attractive spot for a cannabis business and began mulling whether they wanted to rent or sell that property.
At least two neighboring businesses have expressed interest in buying the lot for their expansion.
State law requires cities to allow one cannabis business for every 5,000 residents, so Lauderdale and Falcon Heights need to allow one.
Separately, Minnesota is among the first states to allow municipalities to host or run their own cannabis businesses; those do not count toward their allotments but can compete in the same markets.
Haskamp presented the market study from consultant Point7 at the Jan. 28 City Council meeting. She said the location and demographics of the area, including proximity to a large university and high commuter traffic, will likely attract a dispensary. The study proposed a “kiosk” model with a small building offering a walk-up window and one for pickup and delivery.
Based on that design, the study compared the ownership and rental business models. At the meeting, Haskamp also elaborated on the possibilities for profit sharing, which she said “reduces risk while creating revenue potential.”
The council discussed the matter briefly on Feb. 11 and directed staff to prepare a resolution to apply for the license. Council members on Feb. 25 unanimously adopted that resolution.
Council members noted the city is experiencing rising costs to provide public safety and should find other sources of revenue beyond property taxes. They also hope that if the city opens a dispensary, it will absorb the area market.
Anne Holzman is a freelance writer covering Falcon Heights and Lauderdale government news for the Bugle.
