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How an overlooked facet of the weed law could trip up two of the industry’s biggest players The fine print in the state's 610-page recreational marijuana bill could provide some challenges to getting retail sales up and running by Jan. 1.

Crain's Chicago Business

Wednesday, August 14, 2019  |  Article  |  John Pletz

Recreational Marijuana

It looks like the marijuana industry is about to hit one of the early speed bumps on the road to legalization of recreational sales in Illinois.

To be ready to sell marijuana to the masses on Jan. 1, the state decided to allow the existing the 55 medical-marijuana retail outlets to also sell weed for recreational use, rather than take its chances on having a bunch of new applicants ready to go.

In passing a detailed law that topped 600 pages, legislators hoped to eliminate the bureaucratic uncertainties that slowed the rollout of recreational use in states such as California and Massachusetts, which simply asked voters whether to allow recreational marijuana use in their states. But red tape, like water, finds its own path.

The Illinois Department of Financial & Professional Regulation, the agency in charge of issuing those initial recreational-use licenses, interprets the legislation literally: “Any medical cannabis dispensing location in operation on the effective date of this act” is eligible.

That could pose a problem for two of the major cannabis players: Cresco Labs and Green Thumb Industries. 

Cresco wants to move the MedMar dispensary it owns in Wrigleyville about three blocks to the John Barleycorn tavern at 3524 N. Clark St. The company says it’s already outgrown its existing 900-square-foot facility when it comes to medical use, which has grown significantly from the early days of the program. And it wants to move to a 2,500-square-foot location. (It hasn’t yet asked for a license for recreational sales at the new location.)

The city’s Board of Zoning Appeals will decide next month whether to allow the special-use zoning that’s required for a medical-marijuana retail outlet.

GTI has a medical dispensary in Naperville, where the City Council is asking for an ordinance to outlaw retail sales of marijuana for recreational use.

The challenge, however, is that recreational use, by definition, is expected to dramatically expand the number of marijuana customers. 

Sen. Heather Steans, a co-author of the recreational-legalization law, says the apparent mismatch could get addressed in an expected “trailer bill,” or legislation that will clean up any oversights or procedural problems in the 610-page statute. “We know they need more space because they’ll have more customers,” she said. “We don’t want lines to be around the block.”

Medical dispensary license holders have until Sept. 1 to apply for recreational-use permits. Cresco and GTI each have five medical dispensaries.

A second provision of the law allows existing medical-use license holders to seek a license for an additional location. That’s 55 new locations by Jan. 1. License holders are scouring the city for the best locations along busy thoroughfares. The Chicago Tribune reported that cannabis companies scouted the former Apple store on Michigan Avenue.

“Everyone’s looking at everything,” says Jason Erkes, a spokesman for Cresco. “We’re all looking at the most heavily trafficked corridors as potential locations.”

But for now, at least in Chicago, that’s just window shopping. The city of Chicago hasn’t spelled out its zoning criteria for exactly where it will allow marijuana retailers.