The Anoka City Council voted 4-1 Nov. 2 to approve a letter of intent to partner with Blaine on a municipal cannabis dispensary there.
The next step would be a joint powers agreement spelling out how the partnership would work, Anoka City Attorney Scott Baumgartner said.
Anoka opened its own dispensary, Anoka Cannabis Company, in February.
“Shortly after our grand opening, several cities reached out to our team to tour the dispensary and learn more about our operations,” said Anoka Enterprise Director Kevin Morelli, who oversees the city’s liquor and cannabis stores. “One of those cities was Blaine.”
Blaine was in talks with a private company about a possible dispensary at the time, Morelli said.
“However, after their city officials and elected leaders toured Anoka Cannabis Company, they were immediately impressed by our approach and began exploring a partnership with us,” Morelli said. “They expressed that our mission, vision and core values aligned closely with what they hoped to bring to their community through a municipal cannabis dispensary.”
A letter of intent is “an agreement to agree,” Baumgartner said. “It’s an agreement to enter into a more binding agreement into the future.”
Baumgartner said he worked with Blaine staff to cover the main points that “would be going into a joint powers agreement.” Both cities made changes through several revisions. They drafted the letter from scratch without a template, he said.
Baumgartner compared the joint powers agreement to the city’s development agreements.
“That’s where the meat and substance of a development is contained,” Baumgartner said. “It’s the same way with this joint powers agreement, while a letter of intent kind of spells out, ‘Here’s what we anticipate and here’s what we expect can be contained in the joint powers agreement.’”
Baumgartner said he has represented cities for years.
“This is really unique,” Baumgartner said. “You can do contracts. You can do eminent domain, but to do a joint powers agreement between two cities to sell cannabis is not something I ever envisioned I’d be doing here.”
Council reaction
Council Member Jeff Weaver cast the lone no vote. He said he opposed government-run dispensaries on moral grounds and believed private businesses should run them.
“I’m not a fan of government being the largest drug dealer in the state of Minnesota,” Weaver said. “I just am not.”
Council Member Heather Rostad said she visited Anoka Cannabis Company “for the first time as a customer recently.”
“No one knew I was a council member going in, and one of the things that makes me very confident that this is going to be successful is the user experience from a customer’s perspective,” Rostad said.
She described the employees as “extremely professional” and said they paid close attention to security and safety.
“Just a fantastic experience,” Rostad said. “So the brand itself has an incredible value.”
Council Member Sam Scott also supported exploring the partnership and said the city has run its dispensary well.
“Exploring this option helps with the long-term viability of the overall project and enterprise,” Scott said.
Scott said the ability to expand into other cities sets the cannabis business apart from the city’s liquor store.
“This is one thing that is unique among cities is that this enterprise fund can expand to other cities,” he said.
Other cities have also asked about tours and possible partnerships, Morelli said.
“Once Blaine becomes a reality, we’d like to reach out to other cities to pursue other partnerships,” Morelli said.
Anoka Cannabis Company so far
Anoka Cannabis Company became Minnesota’s first municipally owned recreational cannabis dispensary when it opened in February, Anoka Enterprise Director Kevin Morelli told the City Council Nov. 2.
Morelli said St. Anthony had opened a municipal dispensary a few weeks before the meeting, “but we’re still the first.”
“Since we’ve opened, there’s been tremendous success and mostly positive feedback from the community,” Morelli said.
As of Nov. 2, the dispensary had recorded 45,008 transactions and served 13,160 customers, Morelli said. Its loyalty club had 6,831 members.
A donation jar at the dispensary had raised $22,000 for nonprofits.
