Minnesota’s 11 federally recognized tribes would each be allowed to operate up to five cannabis dispensaries outside their reservation lands under a proposed compact agreement being negotiated with state officials.
The draft agreement, obtained by Law360, would let tribal enterprises purchase non-tribal cannabis to sell both on and off reservation lands, while also allowing tribes to conduct sales of tribally-grown cannabis to state-licensed businesses.
For operations outside tribal lands, the agreement sets specific limits: Up to five retail locations per tribe, cultivation facilities capped at 30,000 square feet of canopy space, and one manufacturing license with production limits aligned to state regulations.
The Prairie Island Indian Community is already moving ahead, announcing plans for a 13-acre cannabis cultivation campus that would yield over 10,000 pounds of cannabis and extracts annually through its Island Peži operation, according to tribal officials.
“Prairie Island Cannabis Campus is a significant step toward economic sovereignty and self-determination for our tribe,” Tribal Council President Grant Johnson said in a shared statement. “The cultivation site has provided new opportunities for sustainable economic growth and has created numerous job opportunities within our community. We are proud to take this step while respecting our traditions and ensuring responsible stewardship of our land.”
Under the proposed framework, tribal cannabis businesses have to implement “seed-to-sale” tracking systems to prevent diversion into illegal markets. The state’s Office of Cannabis Management would have audit and compliance verification rights, with bi-annual inspections of tribal facilities that conduct transactions with state-licensed businesses.
The compact stems from Minnesota’s 2023 legalization law. Five tribes currently operate cannabis businesses: the White Earth Nation, Red Lake Nation, Leech Lake Band of Ojibwe, Lower Sioux Indian Community and Prairie Island Indian Community.
State regulators will begin accepting general cannabis business license applications on Tuesday through March 14 – a key step in launching Minnesota’s adult-use market.
“As envisioned by the Legislature, Minnesota is taking a nation-leading approach to develop a robust marketplace that brings the opportunity for prosperity to communities across the state,” Jim Walker, public information officer for the OCM, told Law360.
The agreement includes provisions protecting tribal sovereignty while establishing protocols for dispute resolution between tribal and state regulators. Tribes would be exempt from state cannabis taxes for on-reservation sales, though future tax agreements could be negotiated for off-reservation tribal businesses.
The document remains in draft form and must be ratified by both tribal and state governing bodies before taking effect.
2297000-2297762-2025-01-10redline-of-state-compact-working-w-state-redline Tribes could operate up to five off-reservation adult-use dispensaries each under a proposal that would expand Indigenous participation. Read More
