Council discusses cannabis compliance fees after state reallocated sales-tax share

Isanti City Council members discussed how to cover local costs associated with state‑mandated cannabis compliance checks after the state changed how cannabis sales tax revenue is allocated.

The chair opened the item noting the state removed the percentage of cannabis sales tax that previously went to the city, leaving the city without the expected revenue to cover compliance and regulatory work. Council discussed adding a new hourly ‘compliance and regulatory checks’ fee to recoup staff or police costs, or folding additional costs into existing registration or renewal fees.

Chief Myers provided an operational estimate: "I would just generically estimate of a $500 ... it would cost the city about $500 a year," he said, explaining that two officers at roughly three hours per check drove that order‑of‑magnitude number. Staff cautioned that whether the city can charge a separate compliance fee depends on state statute and that some city registration fees are capped relative to the state fee; staff noted certain application types could be increased within statutory limits while others are constrained by state law.

Council members debated whether to wait for actual implementation problems before raising fees. Several members argued for a 'wait‑and‑see' approach to collect data on enforcement time and frequency, while others suggested bringing fees up to statutory maxima where permitted. No fee change was approved at the meeting; staff was asked to research statutory authority and bring back options if the city needs to recoup costs.

Next steps: staff to research statutory limits and the workload required for compliance checks, and to return with fee options and legal guidance if changes are feasible.