GRAND RAPIDS — Grand Rapids has been considering a municipal dispensary for over a year, but now, it's becoming a reality.
The city is hiring a dispensary manager. It's bought a lot next to Thousand Lakes Sporting Goods and signed an agreement with an architect to design and build the store. The goal is to open by July 2027.
That may sound like an ambitious timeline, but City Administrator Tom Pagel didn't think so.
"A lot of things have to line up to be open July 1, 2027," he said in an interview in May. "Now, we are on schedule."
In an update Monday, July 27, Pagel said the City Council is set to approve construction plans on Aug. 24, with construction beginning in mid-October.
Pagel has put a lot of thought into the municipal dispensary. The city of Anoka opened one in February, the first and only city in the United States to do so. Pagel has been down to visit twice. Grand Rapids is working with the same consultant and architect that Anoka did.
Pagel demonstrated the extensive modeling and projections that have been developed. He said they've stayed very conservative in their estimates, though he notes Anoka was, too, and it has blown the projections out of the water so far.
After an initial ramp-up period, Grand Rapids stands to make about half a million dollars a year, with 1,800 customers a month and each customer spending about $100 a month.
At 2,000 customers a month, each spending about $120, the revenue projection jumps to nearly $1 million.
Pagel and the city are so interested in a municipal dispensary for this reason. The city would be free to use that money for whatever the Council wanted. It would help prevent future tax levy increases and comes as the city is in the middle of a stretch of hard budget years.
"And it helps us get to things that we just can't afford," Pagel said. "And maybe it's helping supplement the library. Maybe it's, you know, TBD, to be determined. What's nice is 100% of the profits stay in the community."
Municipal dispensary quick facts
WHERE: A new building in the empty lot next to Thousand Lakes Sporting Goods
WHEN: Targeted opening date is July 1, 2027
JOBS: Two full-time managers, six part-time budtenders and three part-time clerks
REVENUE: Minimum of $500,000 a year, according to the city
Another reason the dispensary is appealing to Pagel is that Grand Rapids is in a cannabis desert. Eleven other cities have applied for municipal licenses, according to the state Office of Cannabis Management, but they're all in the southern third of the state. And Pagel noted the city has an inherent advantage over private businesses, because it won't pay income taxes.
"We don't want to fail at this business," he said. "But we just feel like because we're a government entity, we're well positioned to be successful."
Angel Bursch and her son Hunter opened Loonatixz Genetixz inside Central Square Mall at the end of November. The next nearest dispensaries are in Cass Lake, Walker and Aitkin.
Bursch said they have people coming from all around. Customers are driving from the Twin Cities for Loonatixz's cannabis clones or plants.
They're still struggling through all the regulatory hurdles of Minnesota's legal cannabis rollout, but despite it all, Bursch sounds optimistic when she talks about the business and how they've bred cannabis strains to help people manage pain as they age.
But she was still irritated when she learned about the municipal dispensary.
"At first I was like, 'Can you guys really come in any closer?'" she said. "It's like, going right across the street from us."
After her initial irritation, Bursch realized that Loonatixz and the municipal dispensary won't be competitors.
"Anybody can actually walk in here, and we can tell you everything about our strains because we make it," she said.
As far as how the municipal dispensary will be safe and accountable, Pagel pointed to the same extensive regulations that have slowed the growth of Minnesota's cannabis industry. But Pagel said the most critical piece to opening by next summer will be approval from the Office of Cannabis Management, which has gained a reputation for being slow amid Minnesota’s sluggish rollout.
"I'm hoping the building is physically complete around April 1, which gives us two to three months to iron out any issues they may have," he said. " ... I look at it this way: Every day we're not open, we're losing $2,000 in profit."
