Lottery could decide if Minnesota dispensaries open in 2025

The big picture: Minnesota legalized recreational pot in 2023, but state-licensed stores and grow operations have yet to launch.

Catch up fast: Hopes of an early 2025 debut were dashed after the state scrapped plans for an earlier preapproval process for social equity applicants amid a court challenge.

• Gov. Tim Walz said last week that he believes the state is still on target for opening stores sometime this year.

What to expect: State officials expect to issue the licenses sometime in May or June, following lotteries for eligible applicants run by the Office of Cannabis Management.

• Proposed businesses, which include cultivators, retailers and testing facilities, have until March 14 to get their applications in.

Yes, but: It could take a few more months for cannabis retailers to actually open, as licenses are also needed to grow the crop for state-approved dispensaries.

• Leili Fatehi, a cannabis consultant who helped draft the legalization law, tells Axios any retail launch this year would likely be at a "very small scale because there's just not going to be enough supply."

Threat level: Expected litigation over this application process could further delay the timeline, Fatehi cautioned.

Reality check: More dispensaries will open across the state soon regardless of how the state licensing process shakes out, thanks to compacts allowing tribal nations in Minnesota to launch their own off-reservation stores.

• That head start — which follows the creation of four existing dispensaries on tribal land — may discourage some non-tribal businesses from applying for state licenses over fear that they'd be at a competitive disadvantage, Fatehi said.