Menahga City Council narrowly agrees to carry THC products at muni

The Menahga City Council was split about allowing the municipal liquor store to sell low-potency, THC products.

They debated the issue at the Monday, March 4 meeting.

The motion ultimately passed 3-2, with councilors Mike Netland and Bill Hodge opposed.

In accordance with Minnesota law, Mayor Jody Bjornson said Northbound Spirits would offer gummies and THC-infused drinks, only in the on-sale portion of the store.

Twenty percent of the collected tax is returned to the city, he noted.

The city’s insurance costs only rise $115 per year, as a result. “That’s it,” Bjornson said.

Netland opposed the motion, saying his online research found that THC is highly addictive.

While the city is looking for revenue, Netland said, “I don’t feel this is the right thing for a city to do. … I absolutely can’t support this.”

Bjornson asked Netland if he researched the ill effects of alcohol. He pointed out that some people find health benefits from marijuana.

Netland countered that medicinal marijuana is taken under a doctor’s control.

Hodge said it was hard to argue with Netland. Alcohol is “just as bad,” he agreed, but Northbound Spirits would be adding two more addictive products to the shelves.

“As a city, are we aiding in the process of supporting families in growing a healthy community or are we aiding in the culture that is supporting more addictive habits and profiting on their lack of self-control?” Hodge asked.

Councilor Keith Waaraniemi said he doesn’t drink or smoke, but he doesn’t stop others from doing it.

“Whether I agree with it or not,” Waaraniemi said, there’s a demand for it in the community.

“If you look at it from a business perspective, people are going to get it,” said councilor Durwin Tomperi.

Northbound Spirits Manager Heather Shepersky pointed out that dispensaries can only sell cannabis plant products, not gummies or drinks, which are in the 5 to 10 mg range.

Bjornson said there are currently two applications for cannabis dispensaries in Menahga.

Tomperi said the city would be collecting “a sin tax.”

“I think, at the end of the day, when you look at revenues coming in to offset taxes, I’d say, this thing is coming. It’s available,” he said.

When asked about potential revenue, Shepersky said she spoke to an insurance agent who reported a store is generating nearly $100,000.

According to Shepersky, about 23 municipal liquor stores around Minnesota are selling THC products.

Bjornson said neighboring, private liquor stores are offering them as well.

Tomperi noted there a host of addictions – gambling, nicotine, alcohol. “From a business perspective – and that’s where I come from – if it’s going to benefit the city financially and reduce taxes for the citizens, I don’t think we should miss the opportunity."

“The city is a business. That’s what we do,” agreed Bjornson. “The municipal liquor store is our cash cow.”

The city’s elderly and low-income residents need taxes to be kept lower, Bjornson said.

“This is going to happen in this town, whether we let the liquor store sell it or not,” he continued. “I’m not here to be the moral police. … I’m here to run a business. On the business side of it, it’s an absolute no-brainer.”

“It goes deeper than just money,” Netland replied.

In related business, the council discussed a draft ordinance regulating cannabis retail businesses. The ordinance is based on one by the city of Emily, Minn., said City Clerk-Treasurer Brett Gagnonpalick.

It sets a minimum setback of 1,000 feet from schools and 500 feet from day cares, residential treatment facilities, public parks and athletic fields.

“So that really limits where we can put this, and we have to put it somewhere,” Gagnonpalick said, noting the ordinance restricts locations to the commercial C-2 or Industrial 1 zoning districts, along U.S. Hwy. 71.

The ordinance prohibits the use of cannabis flowers or products, low-potency hemp edibles or hemp-derived products in a public place.

State-licensed businesses must register with the city or face a civil penalty.

The number of businesses is limited to one per 12,500 city residents.

“We’ll never have more than one in this town,” Bjornson said, adding, “We can’t say ‘no’ on cannabis. It was passed by the state, so we have to control it.”

The city planning commission reviewed both the cannabis and THC proposals. “They had no issues with it,” Bjornson said.

He also reported the Menahga Police Chief Amy Lane had no problems. “Alcohol causes more problems than anything else,” Bjornson said.

Gagnonpalick said a public hearing will be scheduled in the future.

Contributed/Herzog

The council also authorized a full replacement of the roof by Herzog of Detroit Lakes, estimated at $45,000.