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CBD sales top Ely council agenda, with retailer in waiting

Catie Clark
Posted 1/18/23

The topic of businesses potentially selling CBD and other legalized cannabinoid product lit up the Ely City Council chambers on Tuesday for the second time less than two months. In mid-December, the …

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CBD sales top Ely council agenda, with retailer in waiting

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The topic of businesses potentially selling CBD and other legalized cannabinoid product lit up the Ely City Council chambers on Tuesday for the second time less than two months.
In mid-December, the council backed a three-month moratorium on the issuance of any more permits allowing the retail sale of edible cannabinoid products inside city limits. At their meeting on Jan. 17, the council not only heard from a businessman wanting to open an edible cannabinoid lounge in Ely, council members shot down a proposed cannabinoid ordinance at its first reading so they could have more time to study the issue.
Smoke shop and lounge
John and Heather Chaulklin of Cook want to open a new business named the “Northern Lights Smoke Shop and Lounge” to sell cannabinoid edibles in Ely. John Chaulklin presented his business proposal at the city council meeting to encourage Ely to grant his new business a license to sell CBD products.
The Chaulklins currently have an accepted offer on a store location on Sheridan Street contingent on “the licensing that we need to get from the city to open up our store, and that licensing is going to require us to get a tobacco license, a food license and CBD license.”
Since Ely currently has a moratorium in force on any new retail cannabinoid businesses, Chaulklin’s presentation is moot until Ely passes a cannabinoid ordinance or decides not to allow any further cannabinoid sales.
Chaulklins’ businesses
John and Heather Chaulklin have an establish e-commerce business “selling health and wellness products” through a virtual storefront on Amazon. They also opened a smoke shop selling legalized cannabinoid edibles in Cook in June, as reported in the Oct. 29, 2022, issue of the Timberjay.
Chaulklin remarked that for their edible cannabinoids, “Our clientele base is not the younger generation, it’s the over 50 crowd. (They are) people that are using it for alternative medicine, a way for them to help with their pain.” He emphasized that the business in Ely, like the one already established in Cook, was completely legal under Minnesota law.
His business model was a retail store and lounge where customers could consume their legal cannabinoid foods or beverage in a relaxing and safe lounge setting.
“What we plan on doing to the building itself is in three parts,” Chaulklin told the council. “There’s a front, middle and a back section. The front and middle, we’re going to open up and that will be retail part of our store. We plan on adding a second bathroom, making it all handicap accessible. In the back, we plan on a lounge, like a chill-out place for people to just have a beverage, consume, and relax.”
Though the words “smoke shop” is in the business name, Chaulklin stated, “There will be no smoking whatsoever, not tobacco, not THC, not (cannabis) flower, although I think Minnesota is going to pass the flower law this year.”
While Chaulklin answered several questions from the council members, he also had questions for the council about the sale of beverages.
“The only thing was mentioned (in the ordinance proposal) was the edibles, and nothing about the beverages.”
Chaulklin currently sells the edibles like gummies and the beverages in Cook to go. The proposal for the Ely business would be to sell products to take home or to consume in the lounge. He also noted there was nothing in the proposed ordinance that would cover the lounge or what hours it could be open.
City Attorney Kelly Klun answered the question for Chaulklin on beverages, “Edibles as defined by that state statute includes beverages.”
All the council members present had questions for Chaulklin. Mayor Heidi Omerza urged the council members to move on since there would be more discussion later in the meeting: “We’re going to be discussing this later on in the agenda and probably a few more times over the next few weeks. Just for clarity, this would be the first reading the ordinance tonight. And then there’ll be a second reading at the first meeting in February. There also could be consideration to bring this up at our study session (on)the last Tuesday of January.”
Failed first reading
When the council members considered the first reading of the proposed CBD ordinance, number 367, Klun explained that the draft ordinance followed the tobacco ordinances and state law.
“We’re regulating what’s legalized edible cannabis products to date, as if they were cigarettes. That’s probably the easiest way to frame this … We did work with the chief in in creating this language.”
Klun stated that the proposed ordinance would work in two ways: “So the function (of the ordinance) is not only to balance the owners desire to sell the legal products in Ely, but also the city’s desire to ensure that no business activity strays into illegal activities or substances that would not be allowed in our community.”
Klun also pointed out that any ordinance adopted by the city would need to morph as Minnesota considered new legislation on cannabis and cannabinoid products.
Though all the council members voiced concerns over the proposed ordinance, Al Forsman was the most vocal. “I remember within the last couple of months reading an article about stores that were selling a product that was much stronger than what was legally allowed … there were hospitalizations that were actually followed because of that.”
Forsman queried Police Chief Chad Houde about the police department’s ability to police the amount of cannabinoid in an edible product and Houde said that it was currently not possible.
Earlier in the meeting, Forsman also expressed concern over retail cannabinoid getting into the hands of minors, “According to the Minnesota Poison Control System, there were 94 children under age six who accidentally ingested edibles in 2022. That’s a 334 percent increase compared to 2021.” Those 94 children were hospitalized because of eating cannabinoid gummies or drinking cannabinoid beverages.”
Since the proposed ordinance was a late addition to the agenda, Forsman remarked that he did not feel like he had enough time to study the ordinance and the issues it raised. He also said that he could not be at the first council meeting in February, so he would not have opportunity to hear citizen opinions at the proposed public hearing.
The other councilors present shared most of Forsman’s concerns. The council voted to reject the first reading of the proposed ordinance, with five votes to send the ordinance language back to be redrafted. Mayor Heidi Omerza voted to approve the first reading. Councilor Paul Kess was absent.
The council will still hold a study session to consider edible cannabinoids on the last Tuesday of January. Because of this action by the council, the earliest that a public hearing could be held on a revised ordinance would be March, which is still before the expiration of the current moratorium.

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