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REQUEST FOR COUNCIL ACTION Date: August 8, 2022 Item No.: 7.c Department Approval City Manager Approval Item Description: Hold a Public Hearing to consider adopting a temporary moratorium on the sale, manufacturing and distribution of Tetrahydrocannabinol (THC) Products 1 B ACKGROUND 2 A new law (Minnestoa Statutes 151.72) was enacted at the end of the 2022 Minnesota legislative 3 session that allows certain edible and beverage products infused with tetrahydrocannabinol (THC) to 4 be sold. The new law amends the scope of sale of any product that contains cannabinoids (CBD) 5 extracted from hemp and that is an edible cannabinoid product or is intended for human or animal 6 consumption. Previous law authorized a product containing nonintoxicating cannabinoids to be sold, 7 but the authority to sell edible CBD products was unclear. The new law expands the authoity to 8 include nonintoxicating cannabinoids, including edible cannabinoid products, provided they do not 9 contain more than 0.3% of any THC. An edible cannabinoid product also cannot exceed more than 10 five milligrams of any THC in a single serving, or more than a total of 50 milligrams of any THC 11 per package. 12 13 This new law does not limit where edible cannabinoid products may be sold. However, certain 14 businesses by their nature may be limited on their ability to sell the products. Liquor stores, for 15 example, are limited to selling specific items set by Minnesota Statute, section 340A.412, subd. 16 14. The Alcohol and Gambling Enforcement Division (AGE) of the Minnesota Department of Public 17 Safety has advised that products containing CBD, hemp, or THC are not allowed for sale at an 18 exclusive liquor store. In addition, AGE has stated that a liquor store’s ability to sell food pursuant to 19 state statute does not include edible cannabinoid products. 20 21 In addition, the new law limits the sale of CBD and THC products to persons over the age of 21. The 22 sale of CBD and THC products to a person under the age of 21 is a misdemeanor-level crime which 23 is to be prosecuted by the county attorney where the offense took place. 24 25 According to the League of Minnesota Cities, in most states that have adopted adult use cannabis 26 legislation, local governments are given the option to either opt-in or opt-out of cannabis in their 27 communities. This framework helps maintain local control of the cannabis issue. The new Minnesota 28 law does not provide such an option. Therefore, the new law makes the new cannabinoid products 29 legal in every city throughtout the state. Without a clear opt-out option, the quest as to whether a city 30 could completely prohibit the sale of edible cannabinoids is an open question. 31 32 The new law does not require cities to take action regulating the new products. If a city chooses not 33 to adopt additional regulations, the sale and production of these new products will be goverened by 34 the city’s existing zoning and other regulations. 35 36 As Council deliberates on any potential actions related to regulating THC and/or CBD products, Page 1 of 3