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Council denies Smoke and Cloud’s application after payment, zoning and permit concerns
Summary
The Fergus Falls City Council voted against reinstating a tobacco license for Smoke and Cloud after hearing that a payment issue, building-permit deficiencies and a 1,000-foot youth-facility setback in the city’s licensing ordinance affected the application.
Trevor Oliver, attorney for Cloud Trading, told the Fergus Falls City Council the applicant paid a $100 tobacco-license fee online on Oct. 30 and asked the council to reinstate a 2026 license for his client, who Oliver said had invested heavily in build-out and inventory. Oliver argued the payment had been provided to the city and warned that removing a license after substantial investment raised due-process concerns.
Islam El Nai, the principal owner of Cloud Trading (Smoke and Cloud), addressed the council and said his bank account was open when the check was written but was closed by the bank before processing; he said he then paid through the city’s online portal and provided confirmation of that payment.
City staff and the city attorney outlined multiple problems the council considered: building-department staff said no required permits or certificate of occupancy had been completed for the proposed location; staff also reported the city’s licensing ordinance now contains a 1,000-foot setback from youth-oriented facilities and that Lincoln School fell within that zone. Staff advised the current 2026 application must be judged under the text of the current license ordinance, which they said applies to licenses and renewals. The city attorney cautioned the council and the applicant that some aspects of the matter remained under criminal investigation and advised caution about public statements concerning that inquiry.
Council members asked whether the Oct. 30 payment had been received and whether the previously approved item was for 2025 or 2026; staff clarified that the application before the council on Nov. 6, 2025, was a 2026 license application and that an earlier 2025 approval had been revoked because the applicant had not met building-code and permit requirements. Members debated whether a late payment, a check written on a now-closed account, or the subsequent ordinance change governing proximity to youth facilities should determine the outcome.
After discussion, the council took roll call on the motion to grant the 2026 tobacco license to Smoke and Cloud and the motion failed. The council did not reinstate the license.
