Mankato is on the verge of welcoming its first recreational cannabis shops, though opening dates and locations remain unknown. According to City Manager Susan Arntz, the city has now met its “four-applicant threshold,” meaning that Mankato residents could soon have four competitors vying for their business once state licensing is complete.
State law set a minimum of four retail cannabis locations for Mankato based on population, and the City Council chose to stick with that minimum during the initial phase of Minnesota’s legalization of recreational marijuana. All four applicants have received preliminary zoning approval, with two nearly through the regulatory process and two more still completing bureaucratic steps.
At least two additional entrepreneurs have expressed interest in opening cannabis shops in Mankato, but they’ve been placed on a waiting list in case one of the initial four fails to move forward. Arntz said it’s unclear whether any of the shops will open before the end of 2025: “It’s moving at a very slow pace this year.”
Meanwhile, Mankato is preparing to finalize its local cannabis ordinance and licensing fees at Monday night’s council meeting. The revisions reflect changes made by the state Legislature and the Minnesota Office of Cannabis Management. Initially, the state was expected to vet applications first, but now local governments like Mankato must review zoning compliance upfront, with applicants returning for a final round of inspections after state background checks and preliminary licensing. This two-step process adds administrative expense for Mankato, on top of the ongoing compliance checks required to ensure no sales to minors.
When Mankato wrote its original cannabis ordinance a year ago, it set license fees at about one-third of the maximum allowed by law to better match actual regulatory costs. However, after lawmakers increased the state cannabis sales tax from 10% to 15% and diverted all proceeds to the state’s general fund, Mankato raised its local fees to the maximum. Annual licenses for retail cannabis shops are now $1,000 instead of $350, while fees for lower-potency hemp retailers selling THC-infused edibles and beverages will rise to $125 from $100.
Although these higher fees won’t fully make up for the lost revenue-sharing, Mankato officials believe they’re closer to covering costs. The City Council is expected to adopt the new fees and ordinance changes following a public hearing Monday at 6 p.m., marking another milestone in Mankato’s transition to a regulated recreational cannabis market.
