With
the Illinois legislature’s passage of the Cannabis Regulation and Tax
Act (CRTA), many local government officials are trying to understand
what the bill will mean for them when Governor Pritzker signs the bill into law.While much will be written about the 610-page bill in the coming weeks
and months, this article focuses on some of the CRTA’s potential land use implications
at the local government level.
Legislative Achievement and Caps on Cannabis
Upon
the CRTA’s signing, Illinois will become the 11th state to legalize
recreational cannabis. It will be only the second state to legalize its use
through the legislative process (i.e. a vote by elected officials) and the first state
to use the legislative process to legalize the taxing and selling
of it.
Vermont’s legislature legalized
recreational use and home cultivation but not sales and taxation. The other nine
states legalized recreational use and sales through referendum (i.e. a direct
vote by the people).
The
CRTA will allow any Illinois resident over the age of 21 to possess a
cumulative amount of up to 30 grams of cannabis flower, up to 500 milligrams of
THC in a cannabis-infused product or 5 grams of a cannabis concentrate.
Non-Illinois residents can possess only half of those amounts. Only cannabis products purchased from an Illinois-licensed dispensary are allowed to be recreationally possessed. Additionally,
medical marijuana patients will be allowed to home grow up to five plants for
medical consumption though any amount they grow in excess of 30 grams must
remain secured in their home.
The CRTA also establishes new types of licenses
.
Rather than just the dispensing and cultivation business licenses that are currently issued,
the CRTA creates additional licenses for processing, transporting, infusing
and craft growing.
The
55 existing medical cannabis dispensaries will get the first opportunity to
sell recreational cannabis to the adult public. Currently, the 55 dispensaries serve the state’s 67,000
medical cannabis patients (including 1,500 patients in the Opioid Alternative
Pilot Program)—about 0.5% of the state population. However, on Sunday, the legislature expanded the list
of conditions qualifying for medical cannabis and made the medical program
permanent. The expansion, which includes chronic pain, autism,
migraines, irritable bowel syndrome, osteoarthritis and anorexia, should provide
a big boost to the number of registered patients perhaps covering upwards
of 380,000 people—about 3.0% of the state population, similar to the percentages seen in Michigan and several other states.
All
55 medical dispensaries can apply to sell recreational cannabis at their
existing locations and can also apply for an additional dispensary location
in the same medical cannabis district. If each existing medical dispensary timely applies for their two “Early Approval Adult Use Dispensing Organization
Licenses,” Illinois could have 110 recreational dispensaries by January 1,
2020.
The
CRTA allows the state to issue a total of 500 recreational dispensary licenses by
2022 over a series of waves. For context, if all 500 licenses are eventually
issued, Illinois would have around one
dispensary for every 25,000 residents
—still far less than Colorado’s rate
of one dispensary per 11,000 residents.
Zoning and the Unknowns
While
the state will hold most authority on the recreational cannabis industry, the
CRTA grants local governments important (though not fully clear) zoning power
to regulate commercial cannabis activity within their boundaries. Local
governments can ban recreational operations but cannot ban possession and
consumption. However, municipalities will still not be able to ban or even
unreasonably restrict medical-only dispensaries as has been the case under the Illinois
Compassionate Use of Medical Cannabis Pilot Program Act.
Municipalities will be able
to opt out
by
passing an ordinance banning recreational marijuana businesses. Local governments that do not ban
recreational businesses may instead permit and regulate businesses through
zoning restrictions provided they are “reasonable” and “not in conflict” with
the CRTA.
While
it is unclear how restrictive local zoning regulations can be without running
afoul of the CRTA, the CRTA explicitly allows local governments to provide for conditional (or special) use
permits “governing the time, place, manner, and number” of cannabis businesses
“including minimum distance limitations” between cannabis businesses and other
types of land uses the local government deems “sensitive” such as schools. Thus,
for example, local zoning regulations and conditions could presumably increase the minimum distance between two dispensaries (the CRTA sets a minimum
1,500 feet) and could can establish a minimum distance a dispensary must be
from another type of cannabis business or from other land use types such as
schools (where the CRTA is silent as to minimum distances).
However,
the extent to which local zoning regulations can restrict such businesses remains
unclear. That is, while the CRTA authorizes up to 500 dispensary licenses, allows dispensaries
to operate from 6 a.m. to 10 p.m. and enables dispensaries, infusers and/or
craft grower to share a facility, it remains uncertain how far local zoning
regulations and conditions can limit the number of cannabis businesses in their
jurisdiction, their operational hours, and minimum distances between other cannabis operations and land use types.
Where Locals Have the Most Power: On-Site
Consumption
One
of the more interesting and open-ended provisions in the CRTA is one granting local governments broad authority to permit the consumption of cannabis “at or
in a cannabis business establishment” or “other entity” and deems that such
on-site consumption locations are not public places under the Smoke Free
Illinois Act. Illinois State Representative Kelly Cassidy, one of the primary
authors and sponsors of the of the CRTA, stated that the on-site provision is
intended to empower but not require local governments to allow uses equivalent
to hookah lounges and cigar bars.
Three
other states (California, Colorado, and Alaska) allow on-site consumption of
cannabis, although very few licensed establishments exist in those states. While
Denver’s sole consumption lounge offers very modest services (e.g.
seating and a ping-pong table) and dispensing is allowed next-door but not
on-site, some recently licensed consumption lounges in West Hollywood, CA also have areas for dispensing, health cafes,
acupuncture, culinary classes, and private fine cannabis dinners.
While
the CRTA’s wide delegation of local autonomy as to on-site consumption allows
for tight municipal restrictions, the
grant of local autonomy in combination with the CRTA’s broad language regarding
on-site consumption may also give rise to creative cannabis concepts.
Considering
that dispensary, infuser, and craft grower uses can share the same premises,
could a municipality choose to permit such a triple-use facility to also
operate a consumption lounge? Could Illinois begin to see facilities that grow,
sell, infuse, cook and serve cannabis for on-site consumption similar to a
craft beer brewery and restaurant?
Once the CRTA becomes law,
municipalities should immediately consider whether
or not they will opt out. For local governments that choose to allow
recreational cannabis operations, a review of its current medical cannabis
ordinances is a wise first step followed by determining which zoning districts recreational
cannabis businesses should be allowed, whether conditional use permits will be
required, under what conditions to issue the conditional use permits, and what
it wants to do with on-site consumption. While the introduction of recreational
cannabis is all but certain for the Prairie State, what remains to be seen is
how much room local governments will give the industry to grow.
