The Minnesota Department of Iron Range Resources and Rehabilitation is moving ahead with a $2.5 million loan to the Fond du Lac Band of Lake Superior Chippewa to help build a start-up cannabis business on tribal land west of Duluth.
The decision comes despite an advisory board’s vote recommending against it.
At its meeting in Eveleth on Tuesday morning, the IRRR Advisory Board voted down the proposal 5-2 along party lines, with all five Republican members voting against it. State Rep. Dave Lislegard, DFL-Aurora, who announced this weekend he will not seek re-election to his Iron Range seat, was not present.
The vote came just over seven months after the Board supported a $10 million loan to a Missouri-based company to build a cannabis operation in Grand Rapids by a 5-3 vote.
But in a news release issued later in the day, IRRR commissioner Ida Rukavina said she plans to move the project forward, saying the project met the agency’s application guidelines, and the agency’s staff thoroughly vetted the project.
“This project will support numerous new manufacturing jobs in a rural area of St. Louis County that will further diversify and strengthen our region’s economy,” Rukavina said. “For these reasons, I will move this project forward.”
The Fond du Lac Cannabis Corporation, a subsidiary of the Fond du Lac Band, wants the loan to purchase “furniture, fixtures and equipment” to cultivate cannabis and manufacture cannabis products in an 18,000 square foot building in Brookston, about 25 miles west of Duluth and on the northern edge of the Band’s reservation.
The Band plans to sell cannabis products in a separate retail building to be located in Carlton County along Highway 210, which crosses the southern portion of the Fond du Lac reservation.
The Technical Advisory Committee of the IRRR recommended approving the loan at its May 20 meeting, in addition to a $250,000 loan to pay for infrastructure for the new facility.
The proposed investment package also includes a $2.5 million loan from the Minnesota Department of Employment and Economic Development, or DEED. The Fond du Lac Band would provide $9.45 million in equity for the project.
State Rep. Ben Davis, R-Merrifield, a pastor, was among those who voted against the proposal.
“I don’t support the people’s money going towards funding the recreational use of marijuana,” Davis said.
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