On Monday, August 30, the Garretson City Council met in special session to go over the first reading of the cannabis ordinances, which will cover zoning and licensing of dispensaries allowed within city limits. The second reading and vote is scheduled for next Monday, September 13, at 6:30 p.m. at the Legion.
At this time, cannabis is only allowed for medical marijuana in the state of South Dakota, despite South Dakotans voting in favor of both medical and recreational cannabis in the 2020 election. The amendment for recreational cannabis was challenged in court and initially ruled unconstitutional; a decision from the South Dakota Supreme Court still has not been given despite initial expectations that it would be issued in early July.
Medical cannabis cards are not yet being issued for anyone except members of the Flandreau Sioux Santee tribe, though the Minnehaha County attorney is on the record as stating that people would not be prosecuted for possession after the medical cannabis law went into effect on July 1. The final deadline for the state to have all measures and regulations implemented is October 29.
The Garretson city council is utilizing the documentation sent to them by the state and by the municipal league with very few changes. At the last regular meeting, the council decided only one dispensary would be allowed within city limits, though the ordinance does include a line that the maximum number allowed may be changed at the discretion of the council.
The second change within the licensing ordinance stated that hours of operation would be limited to 7:00 a.m. to 10:00 p.m. Monday through Saturday. No holiday or Sunday sales will be allowed under this ordinance.
State regulations of requiring establishments to be at least 1000 feet from school property reduced the allowable space for a dispensary within city limits substantially, as the school district owns property in several areas. According to Uhl, state law will not be allowing a shared entrance with businesses that sell alcohol or tobacco, which further reduces likely spaces for a dispensary, since the two gas stations would also be eliminated. This information was found by the Gazette within the recommended ordinance wording released by the SD Municipal League but not in the statutes, except for the statement "No medical cannabis
establishment may share premises with or permit access directly from any residence or business unless permitted by § 44:90:04:04" (which prohibits shared access with a cultivator).
Meeting attendee Bruce Brown inquired whether that left any areas for an establishment, since nearly all of downtown and the two gas stations were eliminated as possibilities (due to not allowing a shared entrance). The council pointed out that while there may not necessarily be any standing buildings except the old Wooden Tees building, there is land space. Mainly, a dispensary would be relegated to Highway 11.
The licensing fee was heavily debated, both at the last regular meeting and at the special meeting. During the initial discussion, licensing rates proposed had been as high as $46,000, but were more likely to be closer to $7,500. Part of this was due to the admonition from the state codified law that restrictions should not be excessive in order to prevent the establishment of a dispensary, and the recommendation that the fee be around $5,000 for the initial license and $5,000 for the yearly renewal fee.
Since that time, other municipalities have voted on or proposed their licensing fees. City Finance Officer Anna Uhl provided a list to the council with those amounts. Brandon and Dell Rapids have proposed a $1 per resident fee, which would make Brandon's license cost over $11,000, and Dells cost anywhere from $3500 to $5000. Sioux Falls' mayor Paul TenHaken proposed a $100,000 licensing fee. However, the vast majority of municipalities have been utilizing the recommendation for $5,000. Garretson's council appeared more amenable to following the lead of other small towns upon that discovery.
The council also debated whether some or all of the initial application fee would be refunded if the state, for whatever reason, rejected a license approval.
While the council initially seemed disposed toward making the full fee non-refundable, they began to reconsider after Council member Dave Bonte suggested a full refund. After Uhl stated there was going to be administrative time spent on submitting the license and the costs of having it published, council member Bill Hoskins compromised, saying if it was going to be refundable, then it should be closer to 80% refund, with 20% held for administrative costs.
After those line items were decided, the council moved on to other business and adjourned. The meeting where the ordinances will be voted on will be held Monday, September 13 at 6:30 p.m. at the Legion.
