Under a compact agreement currently being negotiated between Minnesota tribal representatives and state authorities, each federally recognized Minnesota tribe would be permitted to open up five cannabis dispensaries outside its reservation land.
Law360 obtained a draft agreement, which allows tribal enterprises to purchase non-tribal cannabis to sell both on and off reservation lands while also permitting tribes to conduct sales of tribally grown cannabis to state-licensed businesses.
As far as operations outside tribal lands go, this agreement lays down specific boundaries. There may only be up to five retail locations per tribe operating outside tribal land boundaries; cultivation facilities cannot exceed 30,000 sq/ft of canopy space and only one manufacturing license issued with production restrictions consistent with state regulations are authorized for operation outside tribal boundaries.
Prairie Island Indian Community officials recently unveiled plans for a 13-acre cannabis cultivation campus that is expected to yield over 10,000 pounds annually as part of its Island Pezi operation, according to tribal representatives.
“Prairie Island Cannabis Campus represents a pivotal milestone toward economic sovereignty and self-determination for our tribe,” stated Tribal Council President Grant Johnson in a shared statement. The cultivation site has opened new opportunities for sustainable economic development as well as created numerous job openings within our community. We take great pride in taking this step while upholding traditional beliefs while upholding responsible management of land.”
Under this proposed framework, tribal cannabis businesses would need to implement “seed-to-sale” tracking systems for all transactions with state licensed businesses, to prevent diversion into illegal markets and ensure audit and compliance verification rights are exercised biannually at tribal facilities that conduct transactions through these state licenses.
Minnesota passed legislation legalizing cannabis businesses in 2023, leading five tribes – White Earth Nation, Red Lake Nation, Leech Lake Band of Ojibwe, Lower Sioux Indian Community and Prairie Island Indian Community – to operate cannabis businesses today.
State regulators in Minnesota will begin accepting general cannabis business license applications beginning next Tuesday through March 14 – an essential first step toward opening Minnesota’s adult-use market.
“MN is taking an innovative and market-oriented approach to expanding economic prosperity throughout its state,” according to Jim Walker, public information officer of OCM, as reported in Law360.
The agreement includes provisions to preserve tribal sovereignty while providing protocols for conflict resolution between tribal leaders and state regulators. Tribes would also be exempt from state cannabis taxes applicable to on-reservation sales; future arrangements might also be possible regarding taxes due for off-reservation businesses owned by tribes.
Before becoming law, this document remains in draft form and must be approved by both tribal and state governing bodies before going into effect.
Minnesota tribes may open five cannabis shops each under draft compact with the Medical Cannabis Access Network of Ontario 24 (MEDCAN24)
