Updated May 30, 2023 - Business

Minnesota governor signs law legalizing recreational marijuana

Illustration of a clock with cannabis leaves for hands.

Illustration: Brendan Lynch/Axios

Under a new state law, Minnesotans 21 and older will be able to legally consume and grow cannabis for personal use as of Aug. 1.

The big picture: The law, which Gov. Tim Walz signed Tuesday, makes Minnesota the 23rd state in the U.S. to legalize recreational cannabis.

Yes, but: It'll be a while before people can buy cannabis from a dispensary-style store. First, state officials need to launch a new state cannabis office and licensing system.

What to expect: Leili Fatehi, a leader of a coalition that pushed for legalization, told Axios she expects cannabis business licenses to be issued beginning in late 2024, with doors opening in 2025.

  • That timeline aligns with the target dates listed in the state's recent request for bids from software vendors that could build the licensing system.

Zoom in: Under the bill, which passed the DFL-majority Legislature in the final days of the session, adults can legally possess up to 2 pounds of cannabis flower for personal use at home and up to 2 ounces in public.

  • Home growers are allowed up to eight plants, though only four can be flowering at a time.

What we're watching: When commercial business does start, cannabis products will be taxed at a lower rate than in many other states with legal pot.

  • A 10% excise tax will be applied on top of state and local sales taxes.
  • Bill sponsors have said they hope that keeping those costs down will result in fewer people buying marijuana off the black market once the legal industry is up and running.

Of note: Food and beverages containing up to 5mg of hemp-derived THC will remain legal, though new language adds label requirements and limits drinks to two "servings" per container.

  • The "low potency" products, which can be sold at a wider range of retailers and restaurants, will also be subject to the added 10% tax as of June 30. Retailers will need a license once the state regulatory office launches.

What we're watching: The bill also fixes a glitch in state statute that made it technically illegal for liquor stores to sell THC seltzers.

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