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Illinois Municipalities Prepare for Recreational Marijuana Business

by Sarah Cawthon November 13, 2019

On May 31, 2019, the Illinois General Assembly passed the Illinois Cannabis Regulation and Tax Act to legalize recreational marijuana making Illinois the 11th state in the U.S. to legalize. 

As part of the Illinois Cannabis Regulation and Tax Act, existing medical cannabis dispensaries have been granted an edge in the recreational business licensing process with early-approval licenses. This means the state’s 55 existing medical marijuana dispensaries may apply for Adult-Use Dispensing Organization licenses if they are interested in selling recreational marijuana at their present site beginning in January 2020.

Illinois awarded its first five Adult-Use Dispensing Organization licenses on August 26, 2019 to existing Green Thumb Industries, with medical dispensaries in Canton, Effingham, Joliet, Mundelein and Naperville. However, not all of Green Thumb’s shops will be able to serve recreational customers come January 1st.

In a 6-3 vote, the Naperville City Council prohibited recreational marijuana businesses in the city, blocking Green Thumb Industries from using their awarded early-approval license. In Illinois, municipalities are able to opt in or out of allowing recreational marijuana businesses within their borders.illinoisblog-7

“I don’t see this as a definite opt out,” stated Councilwoman Judith Brodhead, who voted in favor of recreational sales. “I see it as a temporary decision until a final decision is made.” A referendum has been placed on the primary ballot allowing Naperville voters to voice their opinions on the ban at the polls come March 17, 2020.

Naperville isn’t the only municipality opting out of adult-use cannabis sales. Several other municipalities including Bolingbrook, Decatur and smaller communities such as Marion are also barring recreational marijuana businesses. Outside the Chicago area, Illinois is generally a rural and conservative state making adult-use marijuana a tougher sell in these communities.  

There is now a total of 14 existing medical marijuana dispensaries that have been issued an Adult-Use Dispensing Organization license and will be able to sell to recreational marijuana customers on January 1, 2020.   

The state will open applications for Adult-Use Dispensing Organization licenses to the general public on December 10, 2019 and will accept applications from interested parties through January 2, 2020. The Illinois Department of Financial and Professional Regulation (IDFPR) will then award 75 Adult-Use Dispensing Organization licenses to top-scoring applicants by May 1, 2020. Applicants will be graded using a merit-based scoring system totaling 250 points.

If you plan on applying for an Adult-Use Dispensing Organization license, here’s a list of municipalities that have opted in to allowing recreational marijuana sales and where you could potentially locate your business:

  • Aurora 
  • Bloomington
  • Buffalo Grove 
  • Chicago*
  • Crystal Lake 
  • Darien
  • Deerfield
  • Elburn 
  • Evanston
  • Glencoe
  • Highland
  • Lombard
  • Mt. Vernon
  • Niles
  • Northbrook
  • Oak Park 
  • Park City
  • Prairie Grove 
  • Riverside
  • Schaumburg 
  • Skokie 
  • St. Charles 
  • Waukegan 
  • Wheeling
  • Zion

*While the sale of recreational marijuana will be permitted in most of Chicago, Mayor Lori Lightfoot has introduced a zoning ordinance that would enact an exclusion zone in the City’s Central Business district, which includes popular tourist destinations such as the Loop and the Magnificent Mile. The rest of the city will be divided into seven zones with 13 dispensary locations permitted in each. 

Initially, each of the new 75 recreational businesses selected will be granted a conditional license that will allow them 180 days to secure a location within their designated regions. Only once a location is secured, fees are payed and inspections have been passed, will businesses be awarded licenses to allow them to begin selling.

Additional Information for Upcoming Adult-Use Dispensing Organization Applications:

Licensing and Fees:
The non-refundable application fee is set at $5,000. However, for social equity applicants, their fee will be cut in half to only $2,500 in addition to receiving an extra 50 points on the 250-point system.

An additional licensing fee of $60,000 would then be required upon license approval with social equity applicants paying half, or $30,000. The licensing fee will cover the first two years. 

Low-interest loans will also be made available by the state for social equity applicants once awarded a license.  

What’s Needed:
The Adult-Use Dispensing Organization License application released in October 2019 requires aspiring businesses to submit, among other materials, the following articles: 

Applying for an Illinois Conditional Adult-Use Dispensing Organization License?

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If you’re planning to apply for an Illinois Adult-Use Dispensing Organization License, download our Dispensary Business Plan Package to receive helpful business planning templates needed to complete your application. Our Dispensary Business Plan Package includes templates for all of the plans listed above, plus additional template plans necessary for establishing and operating a successful marijuana business.

  • All template plans were drafted by our industry consultants from successful application material, in conjunction with subject matter experts so you can be confident in its content.
  • All plans are editable documents so you may customize them to fit your market, business, and state laws.

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