The proposal, presented by city planner John Nisley, aims to regulate adult-use cannabis businesses through zoning ordinances that categorize them similarly to other regulated businesses, such as breweries and distilleries. The ordinance proposes that cannabis retail would be allowed as a permitted use in the B2 General Business, B3 Community Business, and B4 Central Business districts, while in I1 Planned Industrial and I2 General Industrial districts, a conditional use permit would be required. However, cannabis retail would not be permitted in the AOS Agricultural Open Space zoning district. Other activities like delivery, manufacturing, testing facilities, and transportation would primarily be restricted to industrial districts, with cultivation allowed only in AOS.

A point of debate during the meeting was the treatment of the B1 district, which serves as a transitional area between the downtown and residential neighborhoods. The exclusion of cannabis businesses from this district, due to its residential proximity, prompted concerns from a council member, who suggested that similar caution should apply to the B2 district along Seventh Street North, surrounded by residential areas. Discussion included whether conditional use permits should also apply to the B2 district to ensure community safety.

The council also addressed questions about the longevity of the proposed regulations, considering potential future changes in state law. Nisley clarified that municipalities would need to update their local ordinances to reflect any state law changes. Further discussion revolved around the process and timeline for businesses seeking state licenses, with insights shared on how other municipalities are managing the pace of these developments.

Public comments highlighted concerns about accessory uses within industrial districts, where cannabis-related activities must not become the primary operation. The need for local licensing in addition to state licensing was emphasized, drawing parallels to the city’s existing liquor licensing process.

Delving into the regulatory framework, the council considered comparisons between cannabis and alcohol-related businesses. Questions were raised about whether cannabis businesses face stricter regulations than bars, despite both potentially sharing similar consumption policies. The council discussed the use of conditional use permits, which are limited to certain districts for cannabis, unlike the broader allowances for alcohol sales.

The council noted that many communities have opted to permit cannabis retail sales without the conditional use permit requirement. The alignment of the proposal with the city’s comprehensive plan was affirmed.

A public hearing was conducted, allowing the Planning Commission to present findings of fact related to the proposed amendment. There was consensus that the amendment did not correct any errors in the original zoning text but was necessary to address the changes following the legalization of adult-use cannabis in Minnesota. The Planning Commission supported the amendment, aligning with the city’s comprehensive plan goals.