HomeMy WebLinkAbout123-08 Ordinance Requiring Sales of Hemp Derived THC Edibles to be Licensed with the City
4646 Dakota Street SE
Prior Lake, MN 55372
CITY OF PRIOR LAKE
ORDINANCE NO. 123-08
AN ORDINANCE ESTABLISHING A MUNICIPAL LICENSING AND REGULATORY SYSTEM FOR
CERTAIN CANNABINOID PRODUCTS
THE CITY COUNCIL OF PRIOR LAKE ORDAINS:
Section 1: Part 3: Business Regulations, of the Prior Lake City Code is amended to include the
following;
SECTION 317. - SALE OF CERTAIN CANNABINOID PRODUCTS; LICENSING
Subsection. 317.100. – Purpose.
The City Council finds that current state law regarding certain cannabinoid products legalized
under Minn. Stat. §151.72 creates a rapid introduction of products into our community which can
impact health and public safety and there is a need for a licensing or compliance check process.
The U.S. Surgeon General has offered guidance that products that contain the cannabinoid
tetrahydrocannabinol (THC) present a significant potential threat to public health, safety, and
welfare, and particularly to youth and adolescents and their brain development.
In 2023 the state legislature passed legislation relating to cannabis and hemp products in 2023
Session Laws Chapter 63. This law includes the legalization of production, distribution, sale,
possession and use of other cannabis and hemp products under Minn. Stat. ch. 342. This new
law also created the Office of Cannabis Management, which will license cannabis and hemp
product retailer. However, certain cannabinoid products offered for sale under Minn. Stat.
§151.72 can be sold without a state license until March 1, 2025 when Minn. Stat. §151.72 is
repealed.
The Council finds that there is a public health necessity for regulation related to the retail sale of
these certain cannabinoid products regulated by Minn. Stat. §151.72 within the City. To balance
the interests of effectively regulating such products while not placing an undue burden upon
businesses, the City Council finds that a licensing model is most appropriate to ensure
compliance with the laws and business standards of City and state.
This moratorium does not apply to the selling products related to the Medical Cannabis Program
as administered by the Minnesota Department of Health, provided that such activity is done in
accordance with the regulations and laws of Minnesota regarding medical cannabis.
This section does not apply to any product dispensed pursuant to the state’s medical cannabis
program or products which are licensed by the Minnesota Office of Cannabis Management.
Subsection. 317.200. - Definitions.
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The following words, terms and phrases, when used in this article, shall have the meanings
ascribed to them in this section, except where the context clearly indicates a different meaning:
Certain cannabinoid products means products legalized under Minn. Stat. §151.72.
Minor means any natural person who has not yet reached the age of 21 years.
Movable place of business means any form of business operated out of a truck, van,
automobile, or other type of vehicle or transportable shelter and not a fixed address storefront
or other permanent type of structure authorized for sales transactions.
Retail sale means any transfer of goods for money, trade, barter, or other consideration.
THC is the chemical compound tetrahydrocannabinol whether derived naturally or synthetically
from the cannabis plant.
Vending machine means any mechanical, electric or electronic, or other type of device which
dispenses certain cannabinoid products upon the insertion of money, tokens or other form of
payment directly into the machine by the person seeking to purchase the certain cannabinoid
product.
Subsection. 317.300. – License Required.
No person shall keep certain cannabinoid products for retail sale or sell such products at retail
in the city without first obtaining a license from the city. No license shall be issued for the sale of
certain cannabinoid products:
(1) at a movable place of business;
(2) from a vending machine; or
(3) to a person under the age of 21.
Subsection. 317.400. – Application
An application for a license to sell licensed products must be made on a form provided by the
City. The application must contain the full name of the applicant, the applicant’s residential and
business addresses and telephone numbers, the name of the business for which the license is
sought, the educational materials the applicant intends to use to educate employees and any
additional information the City deems necessary. Upon receipt of a completed application and
license fee, the City Clerk will forward the application to the City Council for action. If the City
Clerk determines that an application is incomplete, it will be returned to the applicant with notice
of the information necessary to make the application complete.
Subsection. 317.500. – Background Check
In order to protect the health, safety and welfare of the public, the Prior Lake Police Department
is authorized to conduct a criminal history background investigation and/or driver’s license check
on all persons who have applied for, or who will sell a licensed product. The results of the criminal
history background investigation and/or driver's license check may be cause for denial of the
license at the sole discretion of the City Council.
Subsection. 317.600 – Action
The City Council may approve or deny the application for a license, or it may delay action for a
reasonable period of time to complete an investigation of the application or the applicant deemed
necessary. If the City Council approves the application, the City Clerk will issue the license to
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the applicant. If the City Council denies the application, notice of the denial will be given to the
applicant along with notice of the applicant’s right to appeal the decision.
Subsection. 317.700. - Term of license.
Each license issued pursuant to this article shall expire on December 31st of each calendar year.
Subsection. 317.800. – Licensee Violations.
It shall be a violation of this article for any person to sell or offer to sell any certain cannabinoid
products:
(1) To any person under the age of 21 years;
(2) By means of any type of vending machine;
(3) From a movable place of business;
(4) By means of self-service merchandising whereby the customer does not need to make
a verbal or written request to an employee of the licensed premises in order to receive
the certain cannabinoid products. All such products shall be stored behind a counter
or other area not freely accessible to customers;
(5) Containing any chemical compound or drug that is otherwise a controlled substance
under Minnesota law;
(6) By any other means or to any other person prohibited by state or other local laws,
ordinances or other regulations;
(7) That fails to meet the labelling requirements as established in Minn. Stat. §151.72
subds. 5 and 5a;
(8) That fails to meet the testing requirements as established in Minn. Stat. §151.72 subd.
4; or
(9) Any other violation of Minn. Stat. §151.72 including but not limited to failing to register
with the Minnesota Department of Health by October 1, 2023 as required by Minn.
Stat. §151.72 subd. 5b.
Subsection. 317.900. Responsibility for sales.
The license holder is responsible for all actions occurring on the licensed premises. Actions of
employees at the licensed establishment regarding the sale of any certain cannabinoid products
shall be considered a sale by the licensed owner.
Subsection. 317.1000. – Sampling and On-Site Consumption.
Sampling or consumption of certain cannabinoid products within a licensed establishment is
prohibited. On-site consumption of purchased products is prohibited unless the conditions of
Minn. Stat. §151.72 subd. 3(f) are met. If the conditions of Minn. Stat. §151.72 subd. 3(f) are not
met then all products must remain sealed while on the licensed premises.
Subsection. 317.1100. - Use of false identification.
No person under the age of 21 shall attempt to disguise his or her true age by the use of a false
form of identification, whether the identification is that of another person or one on which the age
of the person has been modified or tampered with to represent an age older than the actual age
of the person.
Subsection. 317.1200. - Compliance checks and inspections.
(a)All licensed premises shall be open to inspection by the city and other authorized officials
during regular business hours.
(b)From time to time, but at least once per year, the city shall conduct compliance checks by
engaging, with persons over 15 years but less than 21 years, to enter the licensed premises to
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attempt to purchase certain cannabinoid products. The following shall control how compliance
checks are conducted:
(1)Prior written parental consent is required for any minor who participates in a
compliance check;
(2)Persons used for the purpose of compliance checks shall be supervised by designated
law enforcement officers or other designated city personnel;
(3)Persons used for compliance checks shall not be guilty of the unlawful purchase or
attempted purchase, nor unlawful possession of certain cannabinoid products when such
items are obtained or attempted to be obtained as part of the compliance check; and
(4)No person used in the compliance checks shall attempt to use a false identification
misrepresenting the person's age, and all persons lawfully engaged in a compliance
check shall answer all questions about the person's age for which he or she is asked.
(c)Nothing in this article shall prohibit compliance checks authorized by state or federal laws for
educational, research or training purposes, or required for the enforcement of a particular state
or federal law.
Subsection. 317.1300. - Violations.
The notification and hearing process set forth in this division will apply to violations of this article.
Subsection. 317.1301. - Notice.
Upon discovery of a suspected violation, the City Manager shall send written notice of a
license denial, administrative penalty, suspension and/or revocation to the licensee. The
notice shall identify the basis for the decision, any applicable penalty and the person’ right
to request a hearing as described below
Subsection. 317.1302. – Hearing Request.
Upon issuance of a notice, a person denied a license or accused of violating this Section
may request in writing a hearing on the matter before the City Council. Hearing requests
must be made within ten (10) business days of the issuance of the notice and delivered
to the City Clerk or other designated City officer. Failure to properly request a hearing
within ten (10) business days of the issuance of the notice will terminate the person’s right
to a hearing.
Subsection. 317.1303. – Hearing.
The City Clerk or other designated City officer will set the time and place for the hearing.
Written notice of the hearing time and place will be mailed or delivered to the person who
requested a hearing at least ten (10) business days prior to the hearing.
Subsection. 317.1304. - Decision.
A decision will be issued by the City Council within 15 business days of the hearing. If the
City Council determines that a license denial is appropriate or that a violation of this
Section did occur, that decision, along with the City Council’s reasons for the finding and
the penalty to be imposed, will be recorded in writing, a copy of which will be provided to
the person who requested the hearing by in-person delivery or mail as soon as
practicable. If the City Council finds that license denial is not appropriate or that no
violation occurred or finds grounds for imposing a different penalty or not imposing any
penalty, those findings will be recorded and a copy will be provided to the person who
requested the hearing by in-person delivery or mail as soon as practicable. The decision
of the City Council is final subject to appeal to the District Court as set forth below.
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Subsection. 317.1305. - Appeals.
Appeals of any decision made by the hearing officer shall be filed in Scott County District
Court within ten (10) days of the date of decision.
Subsection. 317.1400. - Severability.
If any subsection or provision of this Section is held invalid, such invalidity will not affect other
subsections or provisions that can be given force and effect without the invalidated section or
provision.
Subsection. 317.1500. - Continued violation.
Each violation, and every day in which a violation occurs or continues, shall constitute a separate
offense.
Subsection. 317.1600. - Penalties.
(1)Licensees. Any licensee found to have violated this article, or whose employee shall have
violated this article, shall be charged an administrative fine of:
a.$500.00 for the first violation of this article;
b.$1,000.00 for the second offense at the same licensed premises within a 36-month
period;
c.$1200.00 for a third offense at the same location within a 36-month period and the
license shall be suspended for not less than seven days; and
d.$1500.00 for a fourth offense at the same location within a 36-month period. In addition,
after the fourth offense, the license shall be revoked.
(2) Other individuals. Other individuals, other than minors regulated by subsection (3) of this
section, found to be in violation of this article shall be charged an administrative fine of $50.00.
(3) Underage persons. Persons under 21 years of age who use false identification to purchase
or attempt to purchase, certain cannabinoid products shall be guilty of a misdemeanor.
(4) Misdemeanor and other penalties. Nothing in this article shall prohibit the city from seeking
prosecution as a misdemeanor for any violation of this article. If the city elects to seek
misdemeanor prosecution, an administrative penalty may also be imposed. A violation of this
Ordinance is also subject to the City’s general penalty in City Code § 104.100 et seq.
(5) Denial, Revocation, Suspension. Any violation of this Section shall be grounds to deny,
revoke, or suspend a license.
Section 2: Part 2– Fee Schedule is amended to include license fee for certain cannabinoid
products. License fee is set at $700.00.
Section 3: Effective Date. This ordinance shall be effective immediately upon its passage and
publication.
ADOPTED this 17th day of July, 2023 by the City Council for the City of Prior Lake.
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CITY OF PRIOR LAKE
BY:__________________________
Kirt Briggs, Mayor
ATTEST:
_______________________________
Jason Wedel, City Manager