How the lottery for marijuana dispensary licenses will work

Megan Raposa -

Simplified: People who want to open a medical marijuana dispensary in Sioux Falls will soon be able to do so. But first, they have to be one of five to win a license through the city's new lottery process.

Why it matters

  • South Dakota's voter-approved measure legalizing medical marijuana took affect July 1, but the rollout for necessary licensing has been slower at the state and city level as officials figure out how to manage new cannabis programs.
  • Sioux Falls City Council spent months talking about possible time, place and manner restrictions for medical marijuana dispensaries. They landed on a set of rules in early September.
  • Those rules cap the number of licenses for medical cannabis dispensaries at five, to be determined through a lottery.  
  • On Friday, the city released the guidelines for what that lottery will look like.

So, how will it work?

Here's a breakdown with information from the City Attorney's Office:

  • Applications for a medical marijuana dispensary will be available online and in the Licensing Office at City Hall.
  • They can be turned in starting 2 p.m. Oct. 29. and must be received by 5 p.m. Nov. 15.
  • The application fee is $25,000. Fees will be refunded to applicants who aren't selected in the lottery. Licensing fees are $50,000 for those who are selected.
  • The lottery will take place at 10 a.m. Nov. 17 in the commission room on the first floor of City Hall.

Will we know who applied?

Yes. All applicants will be made public, and the lottery drawing itself will happen in a public forum.

What about testing facilities?  

Because there's no cap on the number of testing facilities, there is no lottery for these licenses and thus no set application window.