Illinois Cannabis Update

Dan Shapiro • Jul 16, 2021

Activity finally on the horizon for new licenses

On July 15, 2021, The Illinois Department of Agriculture sent notifications to applicants who are eligible to receive one of 40 craft grow, 32 infuser, and 141 transporter licenses. Applicants for craft grower and infuser licenses have 10 business days to submit their license fees and certification forms. Applicants for transporter licenses have until February 14, 2022, to submit their license fees and certification forms. The Department will also be issuing up to 60 additional craft grower and up to 60 additional infuser licenses before December 21, 2021.

HB 1433 will also authorize 115 cannabis dispensary licenses and a lottery for 75 dispensary licenses that have been in litigation since last fall. The lotteries will take place starting on July 29, 2021, and continue until August 5, 2021, as follows:
  • July 29 – 55 adult-use licenses, for applicants to the January 2020 process who scored at least 85%, or 213 of 250 applicant points.
  • August 5 - 55 adult-use licenses, for applicants to the January 2020 process who scored at least 85%, and which do not include applicants who obtained social equity justice status by employing 10 people who were from disproportionately impacted areas or had been arrested because of a cannabis-related crime.
  • August 19 – The Tied Applicant Lottery, for the twenty-one applicants (75 dispensary adult-use licenses) to the January 2020 dispensary application process who scored perfect scores.
After a conditional dispensary license is awarded, successful applicants will have 180 days to “find a suitable physical address in the opinion of the Department [of Financial & Professional Regulation (“IDFPR”)]….” 410 ILCS 705/15-25(e). While an extension of 180 days is possible, it is subject to IDFPR’s discretion and will only be possible if the applicant has “demonstrated concrete attempts to secure a location and a hardship.”

The process of securing real estate and obtaining zoning can be a complicated process even for conventional projects, let alone a novel and potentially controversial project like the location of a cannabis dispensary. It can take several months to get local government zoning approvals.
During those months, applicants will be undergoing a multi-step process that will likely include:
  • Completing the appropriate zoning application(s),
  • Preparing materials including extensive project planning documents for the specific location (which were not required for the application to the State),
  • Working with the local government planning staff to ensure all materials are property submitted and a hearing date is set,
  • Preparing and/or providing legally required forms of notice to surrounding property owners,
  • Presenting the application and project at several meetings and/or public hearings,
  • Addressing questions and concerns of planning staff, local officials and members of the public, and
  • Convincing the local officials to vote in favor of the application.
Before an applicant can even begin taking the steps above, they first must determine which community they want to locate their business. While typically retail market capacity and real estate availability are the most important factors in location decisions, zoning calculations play a critical role for cannabis businesses. Unlike other retail, cannabis businesses face a wide array of local zoning regulations including limited geographic areas or even complete prohibitions from the community.

Depending on where an applicant seeks to open, the time required to get zoning approvals can vary greatly. In an industry and economy where everyday counts, the difference of several weeks or months could make or break a new company. It is important that a future owner of a cannabis license work closely with the appropriate consultants in order to be in the best position for future success.

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185 New Dispensaries Are On Their Way

By Dan Shapiro • 16 Jun, 2022
The Illinois Department of Financial and Professional Regulation (IDFPR) recently announced the next steps to issue 185 Conditional Adult Use Cannabis Dispensing Organization Licenses to applicants selected in three lotteries in 2021. The Conditional Licenses will be issued to applicants selected in the 2021 lotteries in three waves: Wave 1, on or before July 22, 2022. Naperville-Chicago-Elgin BLS Region. Wave 2, on or before August 5, 2022. Other BLS Regions with multiple licenses available. Wave 3, on or before August 19, 2022. BLS Regions with a single license available. Next Steps Principal officers must submit a Principal Officer Affirmation form no later than July 1, 2022. The IDFPR will then verify all principal officers are not delinquent in taxes or owe money to the State of Illinois and notify any applicant if a principal officer is not tax compliant. The applicant will then have 60 days after notification to prove tax compliance. Any applicant with a principal officer who is not tax compliant after the 60-day period shall forfeit their awarded license, which will then be offered to the next eligible applicant. The IDFPR will also verify that no principal officers have a financial interest in more than 10 Adult Use Cannabis Dispensary licenses. Any applicant with a principal officer who may become a principal officer in any combination of more than 10 Early Approval Adult Use Dispensing Organization Licenses, Conditional Adult Use Dispensing Organization Licenses, and Adult Use Dispensing Organization Licenses will forfeit any license they are awarded. After IDFPR issues the Conditional Licenses, it will conduct background checks of principal officers. Importantly, after receiving a Conditional License, the Conditional Licensees will have 180 days to select a physical storefront location and obtain the full Adult Use Dispensing Organization License (the full list of criteria to be met may be found here ). If a Conditional Licensee is unable to find a suitable physical location within the 180-day period, they may request an extension of 180 days.
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