Hugo council extends interim moratorium on cannabis operations, directs staff to draft zoning rules

The Hugo City Council on Aug. 5 approved an interim ordinance extending local restrictions on the sale, testing, manufacturing and distribution of cannabis-related products through Jan. 1, 2025, and directed city staff to prepare ordinance text amendments on zoning and the time, place and manner of cannabis businesses.

Community Development Director Rachel Schubert told the council the state Office of Cannabis Management (OCM) has issued guidance and a model ordinance and “predicts that...these procedures will be completed by 01/01/2025,” making a local moratorium an appropriate interim step while the city crafts its rules. Schubert said staff plans to complete text amendments and publish required notices before taking them through the planning commission and back to the council for final action.

Members of the public, including prospective operators, addressed the council during the public hearing. Dean Bell said he and partners had purchased a 20-acre parcel and were interested in siting cultivation there; he described experience operating shops and participation in a social-equity group and urged the city to provide clear local guidance for small businesses. “Cannabis really changed my life and pulled me out of a really dark place,” Bell said. Bill Ryan of Solace Farms said his group bought land in Hugo in anticipation of licensing and said they want to be part of community conversations about cultivation and safe consumption.

Council Member Murrell moved approval of Ordinance 2024-532, described in the staff report as an interim ordinance prohibiting the sale, testing, manufacturing and distribution of cannabis products; a second was given, a roll call was conducted and the mayor declared the ordinance adopted. The council also authorized staff to begin ordinance text amendments to define zoning districts and operational rules for production, processing and retail activity.

Schubert said the local text-amendment process will allow the city to decide how to regulate cultivation (including whether it will be treated as an agricultural use in specific zones), manufacturing and retail and will include public hearings where residents and businesses can comment. She told the council staff hopes to complete the text amendments before the end of the year.

The council’s approval does not itself issue any licenses; the Office of Cannabis Management at the state level will oversee licensing. The ordinance’s effective steps are interim measures to pause new local approvals while Hugo develops its code changes and publication of a summary ordinance for the public record.

The council did not provide an itemized roll-call tally in the public minutes beyond the mayor’s announcement that the ayes carried and the ordinance was approved. Staff confirmed they understood the council’s direction to proceed with drafting the text amendments.