Minnesota cities slap temporary bans on THC products

(FOX 9) - At least four Minnesota cities, including two in the Twin Cities suburbs, have temporarily banned THC products as they scramble to adjust to a new statewide law that legalized edibles and beverages, to the surprise of many.

Stillwater, Robbinsdale, St. Joseph and Marshall have already enacted moratoriums, and several other cities are considering doing the same. The cities need time to develop local regulations, including zoning restrictions and licensing fees, said Patricia Beety, general counsel for the League of Minnesota Cities.

"Can they outright ban it? I don’t know. That’s an open question in the law. I don’t hear cities contemplating that right now," Beety said in an interview. She said moratoriums allow cities to say, "Let’s take a step back, study this in our community, and then decide what regulations – or if we have regulations at the local level – what they should be."

The Legislature passed the THC provision as part of a massive health and human services omnibus bill this spring. Democrats including Gov. Tim Walz have said they moved ahead quietly on purpose to avoid negative attention about the change.

When the law took effect July 1, hemp stores in the Twin Cities were overwhelmed with customer demand.

Robbinsdale Mayor Bill Blonigan said his city needed to enact a moratorium so officials can decide where hemp stores should be allowed and how they can get a license. The process will take four to six months, Blonigan said.

It's not a tactic to delay implementation, he said, adding that legalization "is something the public wants."

On Friday, the Minnesota Board of Pharmacy sent a checklist to cities advising them on how to inspect hemp stores. Cities should be checking to ensure stores aren't selling to anyone under age 21 and that packaging is child resistant, state officials said.

The law allows stores to sell products with up to 5 milligrams of THC per serving, which is enough to get someone high who hasn't tried edibles before. Packages can have up to 50 milligrams of THC.

The law may evolve in future legislative sessions. Cities are likely to ask for additional clarity on how local and state law enforcement and regulators can work together, Beety said.

Businesses are raising concerns about what happens if a worker gets high from consuming gummies, then suffers a workplace accident. That was the topic at a Minnesota Chamber of Commerce forum this week.

Minnesota law says employers aren't liable to pay benefits if a worker is intoxicated and the company can prove the intoxication caused the injury. But the 70-year-old law was written for alcohol and doesn't contemplate THC, said John Hollick, chief defense counsel at SFM Mutual Insurance, the largest workers compensation insurer in Minnesota.

"The way Minnesota law is structured right now, it’s very difficult for an employer to deny those benefits," Hollick said in an interview. "The main thing is that Minnesota law goes back to 1953 on the workers compensation side. It does need to be updated."

In other states where recreational marijuana has been legalized in some form, lawmakers have clarified their workers compensation laws, Hollick said.

While some see uncertainty in the new law, hemp industry businesses view it as an opportunity. Hemp Acres, a Waconia-based hemp processor, is strategizing how it can benefit from the new demand.

The company just opened a new facility for grain and fiber, making Hemp Acres one of the country's biggest hemp processors, said its chief executive, Charlie Levine. Hemp for edibles and beverages will eventually be part of the mix.

"It opens a lot of doors. This new bill that passed is basically tapping into one more ingredient of the hemp plant," Levine told reporters at a ribbon cutting this week. "It’s a great opportunity and chance to educate more people on the different uses of it."

Minnesota has 300 licensed hemp farmers growing more than 2,000 acres this year. The state can triple its production to have 7,000 to 10,000 acres soon, said Anthony Cortilet, the state Department of Agriculture's industrial hemp program supervisor.

State agriculture officials blamed a nationwide decline in production on supply chain issues and a lack of processing facilities.

"We have to have infrastructure. Farmers like to grow crops, but they also like to have a place to sell and make money," Cortilet said.