Illinois Grants First Adult-Use Cannabis Licenses

Recreational cannabis sales have been fast-tracked in Illinois after the recent legalization bill was passed in the State Congress. The Department of Financial and Professional Regulation has already issued 5 adult-use cannabis licenses to pre-existing medical marijuana dispensaries around the state.

Cities to Decide on Cannabis Sales

The five marijuana dispensaries that were awarded adult-use cannabis licenses are spread all across Illinois — in Naperville, Mundelein, Joliet, Effingham and Canton. These storefronts now have approval from the state to sell cannabis to anyone over age 21, starting January 1st, 2020.

The problem is that only two of the five cities have approved recreational cannabis businesses, Canton and Joliet. Naperville, Effingham and Mundelein have yet to make a decision on whether or not they will allow adult-use marijuana dispensaries. It seems like some municipalities are more comfortable with medical marijuana shops and are wary of the influx of consumers.

Some Naperville residents participated in a protest over the weekend attempting to convince the city council to ban cannabis retailers. City officials plan on discussing the topic more next week, and even though a license has already been issued the city has the right to overrule it according to city spokeswoman Kate Schultz.  

Green Thumb Industries

Four of the five shops that got adult-use cannabis licenses are owned by Chicago-based Green Thumb Industries, and has a 50% stake in the fifth storefront, The Clinic Effingham. GTI has been in ongoing discussions with local communities to find a solution that works for everyone. 

GTI spokeswoman Linda Marsicano explained that, “GTI is thrilled that our five stores received the state of Illinois’ first approvals. GTI has had a great relationship with the city of Naperville since 2015 … We continue to talk and work with the city on this important issue.”

Local Cannabis Sales Tax

These Illinois medical marijuana dispensaries are 5 of 55 around the state who have all applied for adult-use cannabis licenses. Not only are they eligible for a license at their current storefront but also have the option to apply for a second cannabis retailer license. The applications are reviewed on a first come, first serve basis but Chris Slaby, spokesman for the state’s Department of Financial and Professional Regulation readily admitted that there will more licenses issued in the near future. 

Every municipality is responsible for taking action to ban recreational marijuana retailers or they will automatically be approved by the state. The town of Effingham is still on the fence but city officials are holding open discussion on the issue next month according to city administrator Steve Miller. “We anticipated Effingham might be granted a license, so with that we’ll have to get public input and then the (city) council can make an informed decision,” he noted.

Most of Illinois cities are excited about the opportunity recreational marijuana brings with it as well as the additional tax income. Local jurisdictions have the option to impose their own tax on dispensaries that can be at most 3% on top of the regular sales taxes and the state excise tax. Canton Mayor Kent McDowell expressed his enthusiasm saying “It’s nice we get a little piece of the pie down here south of I-80.” McDowell added, “We have to fight for existence all the time.”

Dispensaries Can’t Move

Unfortunately, there is one shortcoming to the legalization legislation that needs to be clarified. Recently, the Illinois Department of Financial and Professional Regulation issued its interpretation of the bill regarding a business moving location. If a medical marijuana dispensary moves, it will no longer be eligible to receive an adult-use cannabis license. This is a significant problem for medical shops who will be forced to move is their local jurisdiction bans cannabis sales.

The legislators themselves disagree with this interpretation and have requested that the Governor overrule this statute confusion. Before the Governor takes action he wants to assess how many shops will be affected. He stated “My office is more than willing to discuss potential solutions with you when we have a better understanding of the scope of the problem.”