Minnesota Marijuana Legalization Bill Clears Final Senate Committee, Heads To The Floor After House Passes Companion Version

One day after the Minnesota House approved a marijuana legalization bill, the Senate companion version cleared its final committee in that chamber, sending it to the floor.

The Senate Finance Committee passed the legislation from Sen. Lindsey Port (D) in a voice vote on Wednesday.

That marked the 13th and final panel in the body to advance the measure. The House bill went through 15 committees before being approved on the floor on Monday.

“It’s a very complex bill,” Port told members of the panel. “Its entire goal is to legalize, regulate and expunge.”

“I’ve held over 100 meetings on this bill and have been willing to work with anyone who’s brought amendments to me to make sure that we are building the strongest bill for Minnesotans, to have a process that is unique to Minnesota and that addresses the needs of Minnesota communities,” she said.

The committee took a procedural step to use the now House-passed bill as the vehicle to consider legalization in the Senate from this point forward, rather than sending the original bill to the floor of the body—though the legislation has now been amended with the Senate’s language.

Both bills have been amended numerous times throughout this process, with lawmakers working to incorporate public feedback, revise policies around issues like tax structures for the market and tighten up language.

For example, a Senate panel adopted a comprehensive substitute from the sponsor at a committee stop in March that is primarily meant to address concerns from industry stakeholders who are operating under a cannabis law enacted last year that legalized low-THC edibles in the state. The House bill also went through a similar major revisions in committee.

It’s likely that a bicameral conference committee will need to convene to address outstanding differences if the Senate passes its version of the legislation. The legislative session ends on May 22, giving lawmakers a few weeks to pass a finalized product.

With majorities in both the House and Senate and control over the governorship this session, Democratic-Farmer-Labor party officials have been expressing confidence that legalization will be enacted this year.

Gov. Tim Walz (D) released his biennial budget request in January, which included proposed funding to implement marijuana legalization and expungements, and made projections about the millions of dollars in cannabis tax revenue that his office estimates the state will earn after the reform is enacted.

The legislation that’s advancing is an iteration of the 2021 House-passed bill from former Majority Leader Ryan Winkler (D), who now serves as campaign chairman of the advocacy coalition MN is Ready.

The governor has called on supporters to join lawmakers and the administration in their push legalize marijuana this session, and he circulated an email blast in January that encourages people to sign a petition backing the reform.

During Tuesday’s hearing, members of the Senate Finance Committee approved two amendments from the sponsor.

One of the amendments largely focuses on making changes related to hemp businesses. For example, it lets marijuana businesses purchase products from hemp edibles manufacturers and processors, allows hemp edibles to have up to 20 mg of THC rather than 10 mg and up to 200 mg THC per package instead of 100 mg. It also limits hemp beverages to two servings per container, clarifies that hemp businesses can import and sell products from other states subject to certain requirements and permits on-site consumption of hemp-derived products.

Beyond hemp-focused changes, the amendment also removes a requirements that marijuana business license holders reside in the state and that business entities that hold cannabis licenses be at least 75 percent owned by Minnesota residents.

Additionally, the amendment bars people convicted of illegally selling marijuana on the premise of a business that sells liquor from being eligible to get a cannabis business license, requires the commissioner of public safety to produce a statewide baseline high intensity drug trafficking area report on marijuana and makes it so people who illegally sell cannabis products can be sued for injuries caused by intoxication.

Furthermore, it adds guidance on transitioning some duties from the commissioner of agriculture to the Office of Cannabis Management, inserts additional requirements for awarding of grants created by the bill, requires regulators to include recommendations in an annual report on streamlining cannabis licensing systems and changes how funds are allocated from the substance use grant account created by the bill.

A second amendment approved by the committee specifies appropriations to various state agencies to support their role in implementing legalization.

The bill is expected to be taken up on the Senate floor later this week, though it has not yet been formally scheduled.

Here are the main components of the revised marijuana legalization bills, HF 100 and SF 73:

Adults 21 and older could purchase and possess in public up to two ounces of cannabis and they would be allowed to cultivate up to eight plants at home, four of which could be mature.

The House bill would allow people to possess up to 1.5 pounds in a private dwelling, while the Senate bill would let people have up to five pounds of self-cultivated cannabis at home and up to two pounds derived from any other source.

Gifting up to two ounces of marijuana without remuneration between adults would be permitted.

Prior marijuana records would also be automatically expunged. The Bureau of Criminal Apprehension would be responsible for identifying people who are eligible for relief and process the expungements.

In addition to creating a system of licensed cannabis businesses, municipalities and counties could own and operate government dispensaries.

On-site consumption permits could be approved for events, and cannabis delivery services would be permitted under the bill.

Local municipalities would be banned from prohibiting marijuana businesses from operating in their areas, though they could set “reasonable” regulations on the time of operation and location of those businesses.

Under the House bill, cannabis sales would be taxed at eight percent—and thereafter, the commissioner of management and budget would adjust the rate every two years so that revenues equal, or do not significantly exceed, the costs of implementing legalization incurred by various agencies. The Senate bill calls for a 10 percent tax rate on marijuana sales that would not change over time.

Part of the tax revenue would fund substance misuse treatment programs, as well as grants to support farmers.

A new Office of Cannabis Management would be established, and it would be responsible for regulating the market and issuing cannabis business licenses. There would be a designated Division of Social Equity.

The legislation would promote social equity, in part by ensuring diverse licensing by scoring equity applicants higher. People living in low-income neighborhoods and military veterans who lost honorable status due to a cannabis-related offense would be considered social equity applicants eligible for priority licensing, and the House bill says that people convicted of cannabis offenses, or who have an immediate family member with such a conviction, would also qualify.

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The House bill was vetted by numerous committees before reaching the floor. It passed the Ways and Means Committee, Taxes Committee, Transportation Finance and Policy Committee, Economic Development Finance and Policy Committee, Public Safety Finance and Policy Committee, Health Finance and Policy Committee, Education Finance Committee, Human Services Policy Committee, Workforce Development Finance and Policy Committee, Agriculture Finance and Policy Committee, State and Local Government Finance and Policy Committee, Labor and Industry Finance and Policy Committee, Environment and Natural Resources Finance and Policy Committee, Judiciary Finance and Civil Law Committee and Commerce Finance and Policy Committee (twice).

The Senate committees that have signed off so far are the Finance Committee, Taxes Committee, Rules and Administration Committee, State and Local Government and Veterans Committee, Labor Committee, Human Services Committee, Health and Human Services Committee, Transportation Committee, Environment, Climate, and Legacy Committee, Agriculture, Broadband, and Rural Development Committee, Jobs and Economic Development Committee, Commerce and Consumer Protection Committee and Judiciary and Public Safety Committee (twice).

Marijuana legalization now seems imminent in Minnesota, pending final passage in the Senate and the resolution of outstanding differences, including key tax provisions.

These Minnesota developments come days after Delaware’s governor announced that he would allow a pair of cannabis legalization and sales bill to become law without his signature.

In Minnesota, lawmakers and the governor have expressed optimism about the prospects of legalization this session, especially with Democrats newly in control of both chambers, whereas last session they only had a House majority.

Following their election win in November, Democrats internally agreed to discuss the issue imminently.

It appears that House Speaker Melissa Hortman’s (D) prediction at the beginning of the session that it would take “a long time,” potentially up until next year, to enact legalization., did not come to pass.

Walz’s timeline is proving more on-point, as he said late last year that it would be done “by May.”

Winkler, who recently launched a THC beverage company, previously told Marijuana Moment that he agreed with the governor, saying “it is likely that [passing legalization] will be done by May.”

Two polls released in September found that the majority of Minnesota residents support adult-use marijuana legalization—and one survey showed that even more Minnesotans approve of the state’s move to legalize THC-infused edibles that was enacted last year.

A survey conducted by officials with the House at the annual State Fair that was released in September also found majority support for legalization. That legislature-run poll found that 61 percent of Minnesotans back legalizing cannabis for adult use.

Support was up this year from 58 percent when the House Public Information Services polled fair goers on the issue in 2021. In 2019, the House poll found 56 percent support for legalization.

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Photo courtesy of Brian Shamblen.