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Cannabis Licensing

Illinois Legislature Passes New Bill to Expand Cannabis Licensing

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More than 100 additional recreational marijuana dispensaries will be coming to Illinois under a bill approved by state lawmakers last week. The measure, HB 1443, received nearly unanimous approval from the state Senate on Friday after being passed by a bipartisan majority of the House of Representatives on Tuesday.

Passage of the bill in Illinois clears the way for the issuance of licenses for 75 adult-use cannabis dispensaries that were scheduled to be awarded in May 2020 but were delayed because of the COVID-19 pandemic. The measure also includes provisions to support social equity applicants in the selection process for 110 additional retail cannabis dispensary licenses. Democratic Gov. J.B. Pritzker is expected to sign the legislation, according to media reports.

“As a state that values making our laws reflective of our diverse communities, we must ensure that social justice is at the center of everything we do—and today, that means building upon our work of passing the most equity-centric cannabis law in the nation,” Pritzker said last week after the bill was approved by the Illinois House of Representatives.

The bill is designed to rectify controversies with the 2019 Cannabis Regulation and Tax Act, which legalized the use and sale of adult-use cannabis in Illinois. More than 900 applicants had vied for the 75 licenses that were supposed to be awarded in May of last year. But when only 21 applicants received a perfect score on their application and qualified for a lottery to issue the licenses, the process was put on hold by state officials.

Two Cannabis License Lotteries Upcoming in Illinois

Since that time, applicants have been allowed to correct their applications and submit them to be rescored. Under HB 1443, 55 new licenses will be awarded through a “Qualified Applicant Lottery” open only to those who scored 85 percent or higher in the application process for the original 75 licenses, allowing those who did not receive a perfect score another chance at receiving approval.

Another provision of the bill would offer 55 additional recreational marijuana dispensary licenses under a “Social Equity Justice Involved Lottery.” To be eligible for those licenses, applicants must be a qualified social equity applicant and score at least 85 percent on their application. Qualified social applicants apply to businesses with at least 51 percent ownership by someone who has lived in an area especially hard-hit by the War on Drugs for at least 10 years, or a person arrested or convicted of a marijuana-related crime eligible for expungement, or the immediate family member of such a person.

“By authorizing additional lotteries that are focused on social equity applicants, we’re ensuring that communities that have been left out and left behind have new opportunities to access the cannabis industry,” Pritzker said. “This legislation further ensures those least likely to have already had a foot in this industry will see a bigger piece of the pie.”

Under the original licensing process, most of the applications that received perfect scores were from companies led by wealthy, white investors. HB 1443 is designed to open up the state’s cannabis industry to companies led by members of communities of color, which have borne the brunt of cannabis prohibition over the years.

“Equity is at the core of cannabis legalization in Illinois, and this essential legislation will accelerate our collective vision to make sure that the communities harmed the most by the war on drugs can participate in this industry as it grows,” Pritzker said in a statement.

HB 1443 also allows for the issuance of licenses for five medical marijuana dispensaries. Democratic state Rep. La Shawn Ford, the sponsor of the legislation, said that while the bill is a compromise, it gives members of the state’s Black and Latino communities a path to participation in the cannabis industry.

“I’m relieved,” Ford said. “I’m happy.”



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Cannabis Licensing

Illinois Announces Upcoming Cannabis Dispensary License Lotteries

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Illinois Gov. J.B. Pritzker announced late last week that the state will conduct three lotteries later this summer to award licenses for recreational marijuana retailers. The lotteries, scheduled to be held in July and August, will determine who receives licenses for 185 adult-use cannabis dispensaries across the state. 

Pritzker’s office noted that in addition to the dispensary licenses, more than 200 people had qualified to receive licenses to operate as craft growers, transporters and infusers in the state’s lucrative, adult-use marijuana market. Of those who qualified for the licenses, 67 percent identify as non-white and 100 percent are eligible social equity applicants.

“Almost all states that have legalized cannabis have done so in a way that produced a multi-billion-dollar industry dominated by a handful of corporations and individuals that lack diversity. But Illinois is attempting to produce a cannabis industry that actually looks like Illinois,” Toi Hutchinson, Pritzker’s senior advisor on cannabis control, said in a statement from the governor’s office. “What we’re attempting to accomplish is hard to do and takes time to accomplish, but we have an obligation to ensure that it gets as strong a start as possible.” 

“These upcoming dispensary license lotteries are a result of the administration’s continued commitment to working hand in hand with the General Assembly, community groups and other stakeholders to put equity first as we take these initial steps in building an inclusive industry,” Hutchinson added.

A total of three lotteries for adult-use cannabis dispensaries will be conducted by the Illinois State Lottery, using a computer-automated, blind process that includes multiple quality assurance checks. The first lottery to award 55 licenses will be held on July 29 for qualifying applicants who received a score of at least 85 percent on their application.

On August 5, a lottery for 55 dispensary licenses will be held for social equity justice-involved applicants who scored at least 85 percent on their application and are located in a disproportionately impacted area or have an eligible conviction. The third lottery, to be held on August 19, will be held among top-scoring, tied applicants for the original 75 dispensary licenses authorized by the CRTA, which were delayed by legal action. Results of the lotteries will be announced at 5 p.m. local time on the day they are held.

Illinois Craft Grower, Transporter and Infuser Licenses Also Announced

In addition to the dispensary licenses, the Illinois Department of Agriculture last Thursday also notified 213 applicants that they were deemed eligible for cannabis business licenses. Of them, 40 had qualified as craft growers, 32 as cannabis infusers and 141 as transporters. Craft grow and infuser applicants have 10 business days to respond to the notification confirming their interest in receiving a license and to submit the required fee and documents, while transporter applicants have until February 2022 to confirm their continued interest in receiving a license.

“The Department is pleased to notify eligible applicants who will soon be joining the Illinois Adult Use Cannabis market,” said Jerry Costello, director of the Illinois Department of Agriculture. “I am proud that this new generation of licensed cannabis industry leaders in education, cultivation, manufacturing and transportation is one of the most diverse and equity-focused in any adult-use, legal state. I look forward to continuing to work with our licensees, our partners in the Legislature and at other state agencies and the community to improve our process as we move forward together.”

Illinois Social Equity Bill Signed

State officials also announced that Pritzker, who ran for office in 2018 promising to reform marijuana policy in Illinois, had signed a bill designed to increase the number of social equity applicants vying for licenses. The legislation, HB 1443, builds on the administration’s efforts to increase opportunities in the state’s new legal cannabis industry for Illinois residents from diverse backgrounds.

“Over the past century, the failed war on drugs has destroyed families, filled prisons with nonviolent offenders, and disproportionately disrupted Black and brown communities,” Pritzker said. “Legalizing adult-use cannabis brought about an important change, and this latest piece of legislation helps move us even closer to our goal of establishing a cannabis industry in Illinois that doesn’t shy away from the pain caused by the war on drugs, but instead centers equity and community reinvestment as the key to moving forward.”



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