The Mille Lacs Band of Ojibwe signed a compact agreement Wednesday morning with Gov. Tim Walz at the state’s Capitol.
The agreement recognizes the Mille Lacs Band’s authority to regulate and sell cannabis outside its land in central Minnesota.
News came early Wednesday when Aarik Robertson, general manager of Lake Leaf, the tribe’s cannabis company, made a brief announcement at the Minnesota Cannabis Real Estate Conference taking place in Golden Valley.
A spokesperson for the Office of Cannabis Management confirmed the signing of the agreement. In an interview with MPR News, OCM director Eric Taubel said that the timing of the new compact could help meet the growing demand for cannabis flower from retailers licensed by the state.
“This compact paves the way for those unique partnerships that we haven’t seen in other states where a small family-owned business can be selling cannabis grown on a tribal reservation in the state market to state citizens,” Taubel said.
Taubel said that as of Wednesday the state has issued more than 30 licenses to cannabis retailers.
Virgil Wind, chief executive of the Mille Lacs Band, signed the agreement on behalf of the tribe.
The band currently owns and operates two dispensaries at temporary locations within the boundaries of the Mille Lacs reservation. Another dispensary on tribal land is in the planning stage. Wind says the band will work toward building brick and mortar stores for those businesses. He believes Mille Lacs Band’s growing operation is poised to supply its own dispensaries and supply cannabis wholesale to state-licensed retailers.
The band currently operates a 50,000-square-foot cannabis grow facility near Onamia. The agreement includes a provision that allows the band to sell cannabis flower wholesale.
“When looking at the entire cannabis market within Minnesota, I don’t think our intent was ever to own the market, but we really wanted to be a key player within it,” said Wind. “We’re still in the growing phase, but we’re doing good things over there. A lot of [cannabis] flower is being produced.”
Taubel said the agreement is comparable to the compact signed in May between White Earth Nation and the state. Taubel said the differences between the two agreements are “more style than substance.” Taubel described the agreement as one that “captures the general principles that the two parties intend to adhere to.”
The Mille Lacs compact will allow the band's regulatory agency to issue as many as eight licenses to off-reservation dispensaries.
Like the White Earth agreement, the Mille Lacs Band must also set rules for sales outside tribal lands that “meet or exceed” the state regulations. The Mille Lacs Band has opted to use the same “seed-to-sale" software used by the state to track regulatory compliance.
Wind said that Mille Lacs does not have a current plan to open a dispensary outside the reservation. Instead, he says the band plans to focus on its cultivation business.
The agreement:
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Recognizes tribal sovereignty and immunity, affirming cannabis activity on tribal land remains outside state jurisdiction
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Contains language that allows Mille Lacs Band to amend the compact if more favorable terms are offered to other tribal nations in the future
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Allows the tribe and OCM to negotiate a Memorandum of Understanding to address OCM licensing of a tribally owned testing facility
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Allows the Mille Lacs tribal cannabis enterprise to purchase cannabis from state-licensed wholesalers
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Provides potency limitations on cannabis products
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Provides a license for Mille Lacs cannabis enterprise to transport cannabis on state land and provides guidelines for advertising
Wind said he was excited to sign the compact.
“It really felt like we were entering into, you know, a partnership, right? We both have a shared goal,” said Wind.
Wind says he sees the compact as another opportunity for the band to expand its footprint in the industry — a strategy that he said has already created jobs for tribal members. Wind estimated the tribe has created as many as 75 new jobs.
Under the terms of the compact, the Mille Lacs Band and the state will negotiate a tax agreement for sharing sales and taxes collected from tribally owned cannabis businesses operating outside the reservation.
Tax agreements are expected in the coming months.
