Albert Lea rejects Minnesota's first cannabis business dispensary off tribal land

Albert Lea City Council blocks dispensary opening

The opening of Minnesota's first retail cannabis business off tribal land was blocked by the Albert Lea City Council. FOX 9's Karen Scullin has the full report.

ALBERT LEA, Minn. (FOX 9) - The Albert Lea City Council voted on Monday to block the state's first retail cannabis business off tribal land from moving forward.

Council vote

What we know:

The council failed to approve the registration for The Smoking Tree on a 3 to 4 vote on Monday night.

The business owner, Jacob Schlichter, was one of the first in Minnesota to receive his cannabis license.

Dig deeper:

A bill approved in 2023 set the framework for legalizing recreational cannabis in Minnesota. So far, only tribes have been able to open dispensaries as the state worked to set up the licensing process, which has faced delays.

This summer, the state held two lotteries for some business licenses and began issuing licenses for uncapped categories – like small retailers.

It's unclear if the Albert Lea vote followed state law. Under the cannabis law, cities have little power to restrict cannabis businesses. For the most part, cities can only restrict where a cannabis business can operate.

What they're saying:

Speaking at the meeting, city leaders blasted the cannabis law for failing to give local governments more control over cannabis businesses.

"When we had looked at this, we looked at what ways we could maintain local control," explained Albert Lea City Manager Ian Rigg. "We have always looked at whenever the state passes something ways in which we maintain local control. I've been a very big proponent of local control just for the fact that I feel that local government knows its citizenry best and can adapt and make changes as necessary to to meet the needs of its citizens. However, this process did not involve local control or people speaking on behalf or for local control. I think overall the legislature's problem –  this is conjecture – hey were assuming that they were afraid of local control in this matter."

Rigg continued: "Our only option is to defy the state and see lawsuits, which they asked, ‘Well, what could the penalty be?’ Well, there are a number of penalties that they can impose. One of their favorite ones is to withhold local government aid for not meeting certain other requirements."

Rigg said state aid is one-third of the city's general fund revenue. Rigg's also acknowledged the city could face lawsuits.

"I've not been a fan of this since the subject first came up a year ago," added Mayor Rich Murray. "It seems like just two years ago, we were locking people up for this very thing, smoking cannabis. And now we're promoting it. I do not like the way that the state legislature and the governor has rammed this down our throats without very little say in the whole process, all because they're hungry for more revenue. Not only are they hungry for more revenue. But in those last days of the legislature, I believe they increased the amount of revenue they're gonna take out of this by 50%… I don't think two is the right number. As I've said before, I believe zero is the number."

The other side:

Council member Brian Anderson made it clear the city doesn't have a choice in the matter.

"The fact that this is on the agenda tonight is giving a lot of people the illusion that we have a choice in this matter," said Anderson. "Sixmillion [in state aid] is on the line, basically, if we think we're going to defy that. I would love to say no, too, just simply to appease the people with the emails that I've gotten. But I think it's up to me sitting up here to do the responsible thing and actually say that this is going to happen, whether we want it to or not. And I think we have to just embrace it… Maybe it isn't going to be as bad as some people think it is."

The city attorney also pointed out that even if the city were to reject registration, tribes have the authority to approve themselves.

"So, in theory, we could have – even if the council said we're I'm not going to take action on any – we could still have 10 retail operations here as dictated by the state by the state legislature," the attorney explained.