Medical marijuana retail licenses will be a hot commodity in Sioux Falls.
The Sioux Falls City Council Tuesday night signed off on a proposal coming from Mayor Paul TenHaken’s office that will cap the number of retail stores that can operate in the city at five. And though councilors halved the $100,000 license fee that City Hall wanted, another late change allowing the sale of the licenses on the secondary market is expected to drive the value of a license up even hirer.
“The Sioux Falls City Council, by making a license worth $50,000 and transferrable, has just made dispensary licenses into liquor licenses,” said Drew Duncan, a Sioux Falls attorney and lobbyist for clients in South Dakota’s gambling and alcohol industry, via social media following the 7-1 vote.
To his point, a new liquor license from the city goes for about $200,000, but a state-set cap on the number of them the city can sell has driven the price they go for on the secondary market up to $300,000 or higher.
TenHaken and supporters of his provision barring the transfer of dispensary licenses worry that allowing them to be sold on the secondary market will give them an artificial value, just like has happened with liquor licenses. But Councilor Janet Brekke and the rest of the Council decided without allowing a license to be owned outright, the city’s medical marijuana rules would unduly restrict a cannabis retailer’s ability to grow their business.
“We’re not allowing a business owner to develop…
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Medical marijuana retail licenses will be a hot commodity in Sioux Falls.
The Sioux Falls City Council Tuesday night signed off on a proposal coming from Mayor Paul TenHaken’s office that will cap the number of retail stores that can operate in the city at five. And though councilors halved the $100,000 license fee that City Hall wanted, another late change allowing the sale of the licenses on the secondary market is expected to drive the value of a license up even hirer.
“The Sioux Falls City Council, by making a license worth $50,000 and transferrable, has just made dispensary licenses into liquor licenses,” said Drew Duncan, a Sioux Falls attorney and lobbyist for clients in South Dakota’s gambling and alcohol industry, via social media following the 7-1 vote.
To his point, a new liquor license from the city goes for about $200,000, but a state-set cap on the number of them the city can sell has driven the price they go for on the secondary market up to $300,000 or higher.
TenHaken and supporters of his provision barring the transfer of dispensary licenses worry that allowing them to be sold on the secondary market will give them an artificial value, just like has happened with liquor licenses. But Councilor Janet Brekke and the rest of the Council decided without allowing a license to be owned outright, the city’s medical marijuana rules would unduly restrict a cannabis retailer’s ability to grow their business.
“We’re not allowing a business owner to develop…
