Illinois Cannabis Business Licenses
WHAT IS ILLINOIS' CURRENT CANNABIS MARKET STATUS?
Content Below Last Updated by Point7 3/31/2022
In 2019, for the first time in the nation's cannabis history, legalization was achieved through a state legislature making Illinois the 11th state to approve adult-use cannabis. Under the state’s Cannabis Regulation and Tax Act (CRTA), recreational sales began on January 1, 2020 with the first round of licensing going to active operators in the state's existing medical cannabis industry. The new law initially allowed 55 medical cannabis dispensaries to apply for adult-use retail licenses, along with the opportunity to apply for a second retail location. Within the first week, recreational cannabis sales reached nearly $11 million among only a few dozen dispensaries and despite a statewide shortage of product. The market has continued to thrive and had a lucrative month in April 2020 where the industry saw $37.3 million in sales.
In early 2020, the state opened the opportunity to new licenses for dispensaries, craft growers, processors, and transportation cannabis businesses that qualify under the CRTA. It was expected that Illinois dispensary licenses would be awarded on May 1, 2020, but with the COVID pandemic, the license awarding process was postponed until 2021, when Governor Pritzker announced three lotteries to distribute 185 licenses that were held in July and August 2021.
WHAT ARE ILLINOIS' CANNABIS LAWS?
In August 2013 Illinois was the 20th state to legalize the use of medical cannabis through the passage of the Compassionate Use of Medical Cannabis Pilot Program. This Act, signed into law by Governor Quinn, allowed doctors to recommend the use of medical cannabis to patients once they registered with the state of Illinois as a medical patient.
The Illinois Cannabis Regulation and Tax Act was passed in May 2019, legalizing recreational cannabis beginning on January 1, 2020. The approach for legalization presented by the state of Illinois is celebrated for the remarkable measures implemented to assist with rebuilding the lives of those affected by the state’s earlier war on cannabis. Illinois residents who were charged with a cannabis offense received priority in the first round of competitive licensure by receiving additional points during the application scoring process, along with access to financial resources to start a cannabis business. Illinois residents 21 years of age or over are able to purchase up to one ounce of flower and up to five grams of cannabis concentrate. Illinois visitors are able to purchase half of those amounts. Adult-use cannabis users are prohibited from growing plants at home. Medical cannabis patients are allowed to grow five plants within the privacy of their homes.
- Department of Financial and Professional Regulation: Oversees Dispensaries
- Department of Agriculture: Oversees Craft Growers, Processors and Transportation
- Possession limit for Illinois residents:
- Up to 30 grams of cannabis flower
- Up to 5 grams of cannabis concentrate
- Up to 500 milligrams of THC contained in a cannabis-infused product
- People may possess more than 30 grams of cannabis if it is grown secured in their residence under certain conditions
- Possession limit for non-Illinois residents:
- Up to 15 grams of cannabis flower
- Up to 2.5 grams of cannabis
- Up to 250 milligrams of THC contained in a cannabis-infused product
- The possession limits are to be considered cumulative.
Only licensed dispensaries may sell cannabis and only licensed transporters can transport and deliver cannabis. The Illinois Department of Financial and Professional Regulation started accepting applications for licenses as of January 7, 2020 and has since closed this application process.
WHAT IS ILLINOIS' CANNABIS LICENSING TIMELINE & CANNABIS APPLICATION PROCESS?
Illinois officials announced in March 2022 that future license applications for recreational cannabis retail stores will be greatly simplified in hopes to increase ownership by those affected by the war on drugs. The new application will be a simple online form covering basics such as the name of the organization, principal officers, contact information and a $250 fee. All applicants who submit an approved application would participate in a lottery for 55 new licenses in late summer or early fall of 2022. Also, for the first time applicants will be required to qualify as a “social equity” applicant, rather than just getting a bonus in scoring of their applications
Point7 worked eagerly through the first round with multiple clients to meet the specific needs of the applications which were social equity and operational plan focused. We have a clear picture of the wants and needs the State of Illinois has for a cannabis business license holder and are prepared to guide you through the application process. With less than a year to prepare, contact Point7 now to discuss the actions that could be taken to ensure readiness when the second round of Illinois cannabis applications opens.
WHAT IS THE HISTORY OF CANNABIS IN ILLINOIS?
Illinois’ road to full cannabis legalization began in August 2013 when Governor Quinn signed the Compassionate Use of Medical Cannabis Program Act making Illinois the 20th state to legalize medical cannabis. Medical professionals can prescribe patients to apply for a medical ID card that allows the purchase and use of medical cannabis. In January 2020, the program has grown to include nearly 100,00 qualifying patients, many of whom are participants in the state’s opioid alternative program.
In May 2019, the Illinois Cannabis Regulation and Tax Act was passed by the Illinois General Assembly, legalizing recreational cannabis. Unlike the previous ten states to legalize recreational cannabis, Illinois succeeded in legalization through a state legislature rather than a ballot initiative presented to voters. On January 1, 2020, the first day recreational cannabis could be purchased, $3.2 million was generated in sales. The state has been applauded for including positive measures to incorporate a social equity component that allowed those affected by a previous cannabis prohibition a greater than equal opportunity at being awarded a cannabis business license in the first round of applications. Also, pre-legalization convictions for cannabis-related offenses (under 30 grams) are eligible for pardons as long as no violent crimes were committed. Cases will be reviewed by the Prisoner Review Board.
DOES ILLINOIS HAVE A HEMP PROGRAM?
As of January 2022, IDOA submitted a revised Hemp Plan to the USDA for approval. The next step is for IDOA to start working on administrative rule changes. Key changes and additions to the Hemp Plan include: the expansion of institutions eligible to conduct hemp research, hemp remediation and disposal methods and requirements, laboratory testing requirements and specifications, inspection and sampling details, and provisions for negligent violations of the rules.
Illinois harvested 73% of hemp crops planted in 2019, according to first year hemp production totals from the state despite unfavorable weather. Illinois hemp farmers produced nearly 2.3 million pounds of industrial hemp, most of which went to CBD oil production with the rest going to hemp seed oil, fiber, and animal bedding.
PREPARING FOR THE ILLINOIS CANNABIS MARKET
We are ready to support your team as you prepare for cannabis licensure in Illinois. Contact Point7 to discuss the fully customizable products and service packages available that have proved successful for operators around the country.