Hennepin County town gets a jump on cannabis business

Officials in Osseo want to open a city-run dispensary when recreational cannabis sales start in Minnesota next year.

“Our goal is to be the first facility to open in the Twin Cities, municipal or otherwise,” City Council Member Mark Schulz said at a council work session in late January. “We are way further along than anybody else, which is a really good thing.”

An ad-hoc committee has been exploring the idea for months. In January, the council passed a resolution paving the way to join the Minnesota Marijuana Association. Tougher decisions loom as the council starts assembling a plan for how such a store would operate, and where it would be located.

Multiple Minnesota cities run retail outlets for liquor, though Osseo is not among them. Still, said City Administrator Riley Grams, “We want to be ready when the state opens the application window. We want to submit.”

The state’s newly formed Office of Cannabis Management, which will oversee licenses, is still working to finalize rules and regulations for the state’s fledgling cannabis industry. Part of that will be presenting a path for cities to obtain a municipal dispensary license, Grams said.

Wedged between the much larger cities of Brooklyn Park and Maple Grove, Osseo had a population of just over 2,500 people in the last census.

Among the bigger decisions city leaders would face by opening a cannabis store is where to put it. One idea is incorporating it into the building that houses City Hall and the Police Department, but Riley said that could be tricky because customers might shy away from an establishment in proximity to law enforcement even though the product will be legal to buy.

A second option would be to house it in the former Osseo Press building. It’s spacious enough, but “it needs a lot of love,” Grams said. An unidentified building in the city’s industrial area is also under consideration.

Any site would need to be heavily fortified with security features, including a multitude of cameras, alarms, and possibly license-plate readers. Any site would also need a special entry for trucks delivering product and armored vehicles picking up cash receipts.

“We want to make it as safe as possible,” Schulz said. A new city department would oversee operations, Grams said.

“Having a detailed business plan and well-thought-out security plan, we think that will be the key to getting a successful municipal license,” Grams said.

Schulz said he studied how Missouri oversees cannabis operations after legalizing it two years ago. He suggested council members take a field trip there to see how municipal outlets operate there.

City officials said they don’t yet know how much would be needed in startup costs, nor what kind of revenue they might eventually expect. Some cities use profits from liquor stores to cover things like park maintenance or street repairs.

But the idea of extra revenue at a time when city services are getting more expensive to deliver — and having control that cities wouldn’t get with private dispensaries — would be a “win-win for the city,” Grams said.

Schulz said that’s why he’s on board.

“Taking the burden of the city budget off the backs of the taxpayers; if that was not a huge priority, I don’t know that I’d be as excited and adamant about this moving ahead,” Schulz said.