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The Albert Lea City Council on Monday approved the first reading of an ordinance that would place a moratorium on the creation of new tobacco, off-sale liquor, sexually-oriented business and cannabis licenses for up to six months as the city studies how to regulate these businesses equitably.

City Manager Ian Rigg said in recent attempts at drafting zoning changes for cannabis businesses, city staff noticed that comparative businesses would be treated differently.

To create parity with those businesses, the city wanted to place a pause on any new, expanded or relocated businesses in these categories, which all are businesses that work with people ages 21 and over, as it studies how to proceed.

The moratorium is in response to Minnesota legalizing recreational use of marijuana in 2023 and allowing new types of cannabis businesses to open in 2025 or earlier.

The city council is concerned about the placement of cannabis businesses and regulating them with parity in regards to tobacco product shops, off-sale liquor sales and sexually-oriented businesses. The council is also concerned that these businesses will be concentrated in areas of Albert Lea where the community has invested in maintaining a historic nature, or where and how minors would be exposed to products they are prohibited from buying.

Rigg said the city wants to create uniformity in topics such as locations, designs and other questions and determine it there are other limitations they wish to put forward on the licenses.

The city will be required by the state to have a minimum of two cannabis businesses in the city, he said.

Joel Holstad said while the state is substantially controlling the licensing process, the city will still have authority on placement of these buildings and presentation.

Holstad said it is his impression in many communities that there are many more people who believe they are going to be licensed than who actually will be able to be licensed.

“The public service that I think the council can execute with this type of moratorium is keeping people from spending money, establishing an operation that ultimately they aren’t going to be licensed to operate,” he said.

He said the moratorium protects potential license applicants by saying they can’t make an application until the issue is thoughtfully put together.

During the moratorium, the city’s Development Services Department will study how best to regulate these businesses with the goals of protecting:

• Public health
• Safety
• Neighboring properties
• Economic viability
• Public assets
• General welfare of the city

The department will also study possible changes to official controls of these businesses, including the zoning code, related policy and how to improve the regulatory process.

The city will host an open house on the issue from 4:30 to 6:30 p.m. May 22, with a presentation at 5:15 p.m. At that time city staff will present a draft ordinance on zoning off-sale alcohol, cannabis, tobacco and sexually-oriented businesses. The public may also provide input at the open house or by emailing Wayne Sorensen, building and zoning official, at wsorensen@ci.albertlea.mn.us.

After the study is complete, city staff will report back to the council with recommendations on how to proceed. While the council set a maximum time period of six months for the moratorium, the Development Services Department expects to make recommendations to the City Council before then.

The recommendations may include changes in zoning laws and licensing requirements. The department will seek input from a wide spectrum of interested parties for determining its final proposals.

The moratorium does not alter licenses already in place for existing license holders in these areas. Existing businesses may continue to operate. They may also apply for renewal of their licenses, or transferring them to new owners as long as the business space remains the same.

The council will hold a second reading and final vote on May 28. The council must also approve new or transfer of licenses for these businesses. The soonest that could happen would also be May 28.