La Crosse's cannabis restrictions could boot iconic business, 'crush industry growth'

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Stacks Family Farms, based in La Crosse, Wis., is the largest indoor hemp farm in the Coulee Region. The farm grows a form of cannabis which contains levels of THC under the state's legal limit of 0.3%, and produces an array of products including edible gummies, beverages and smokable flower.

If you've been downtown on a late night out, chances are high you've seen the bright green glow on Third or Main street emanating from an equally green food truck. The decorations continue with large green cannabis plant decals and a rotating menu of extravagant edible goodies and smoking devices.

Operator Joseph Lomen said early reactions to his H.A.F. Baked truck were often over-the-top curiousness and shock as to how he can do business. He still gets a surprised patron "at least once a night every night," but he's also carved out a niche in La Crosse's nightlife and wider cannabis community.

"There's a lot of people that thinking, 'Oh, downtown, the bars, just a lot of drunk people gonna buy with us.' No, that's not how this works," Lomen said. "There's a lot of people saying that, 'I hope you know this and take this to heart. We come here for you.' This is the way you connect."

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The infamous roving La Crosse businesses could get the boot from downtown as new cannabis regulations are drafted in city hall. Lomen and truck owner David Polanski see a particular section of the new regulations as an overstep that will sever their business and halt any others from coming to town.

The H.A.F. Baked truck has been selling cannabis products downtown since 2022 as is legally permitted under the 2018 Farm Bill, which legalized hemp-derived cannabis products.

The mobile recipe has made H.A.F. Baked a familiar part of La Crosse's post-COVID nightlife. Lomen often helps curious consumers find the right goodie to continue a night out and has established regulars who come to him to support a small business.

Since it does not have a permanent physical footprint, La Crosse's proposed cannabis sale restrictions threaten to kick the truck out of its most popular market.

Not only is H.A.F. Baked under heavy scrutiny downtown if the law passes, almost all of La Crosse becomes a no-go zone for any new cannabis businesses.

The proposed cannabis restrictions are up for debate in La Crosse's subcommittee public hearing Aug. 5 and again at the full council meeting Aug. 14.

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Most of La Crosse's proposed new cannabis rules aim to address lapses caused by a lack of state guidelines.

The city has proposed to require cannabis businesses use identification verification for every purchase, only sell to adults 21 and older and maintain signs and packaging that is clearly labeled with warnings that the hemp-derived products are not for minors.

Cannabis businesses also would be restricted from setting up within 1,000 feet of schools, child care centers, public parks, churches and any other locations that can serve groups of children.

Versions of the boundary restrictions exist in other cities that have passed their own cannabis restrictions. In La Crosse, the rules would severely limit where businesses can stake a claim.

Virtually all of downtown is off limits, along with almost all of the North Side and most existing business parks would also be ruled unavailable.

Existing cannabis stores with physical storefronts will be grandfathered into the rules as long as they have been operating at their address before the law is adopted.

"In essence, that is zoning. It's telling you what you can do with your property because of its location. And there is legal, non-conforming use that means if you were using the property in a way that now you're being outzoned, you can continue to use your zoning," explained Carol Moss, leading cannabis litigation expert at Hellmuth and Johnson.

The grandfather clause does not help the H.A.F. Baked truck, as it does not have a permanent address. Moss also does not see a path for H.A.F Baked to appeal La Crosse's new law if it is adopted.

"To me, 1,000 feet from churches and schools, all these places, it's overly burdensome, but that's still a hard challenge to make," she said. "Because this law is pretty general and not targeting specific businesses, I don't think there's an appeal process here."

La Crosse is not the first to pass these rules. Onalaska approved an almost identical package of laws adopted in May and La Crosse County is debating the same rules next month.

David Polanski, owner of the H.A.F Baked truck and High Society dispensaries, said he and Lomen will look for slivers in the 1,000 foot zones they can set up that can still attract customers.

Polanski's other suggestion: add a time limit to the rules. Since the restrictions are in place to protect children, a reasonable time limit where nightlife begins and children are home could open opportunities for businesses like the truck to continue while still preventing new sites from being near children.

"It's not just us either. I mean, I can't help but see how this won't crush industry growth, and the industry is evolving," Lomen said. "It's not reasonable, and it isn't actually providing the ability to do trade."

Unless a business is already established in the boundary zone before Aug. 15, they won't be allowed in a majority of the city.

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These policy decisions have fallen on individual cities and counties because of the state's refusal to consider new cannabis rules.

When the federal government passed the 2018 Farm Bill, it opened up the nation's cannabis industry. Hemp-derived cannabis became legalized, allowing a flood of products similar to marijuana but with different chemical makeups that were legal under the new loophole.

The guides were also very loose.

In a state like Wisconsin without detailed cannabis restrictions, there are no age restrictions for purchasing hemp-derived cannabis.

While most businesses have self-regulated and only sell to adults over 21 - like states with legal cannabis - the open door is still open to bad players in the industry.

Polanski said the new rules for La Crosse are smart for this reason. He's had his own run-ins with bad business owners in the cannabis industry who have little regard for public safety. To him, it pushes good players and numerous other La Crosse-founded businesses out.

Still, cities are forced to pass reactionary rules instead of thorough packages as they deal with the lack of state leadership on the issue.

A poll from Marquette University conducted in June reported 63% of Wisconsinites believe marijuana should be legalized in the state. Marquette polled 873 registered voters on various policy questions, including legal marijuana.

"It's not just a stunt. I help people all the time who are curious, people who like it for medical relief and so much more in a place that's easy and not intimidating to come up to," Lomen said.

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