By all accounts, Illinois is the “new kid on the block” in the adult-use marijuana world, but it is quickly taking its place as a major player in the country’s cannabis industry.
With its adult-use program a mere six months old, Illinois is already seeing sales numbers and tax revenue on par with long-standing adult-use states.
Despite currently operating with fewer adult-use dispensaries than allowed by law (53 adult-use dispensaries out of a possible 104 licenses available to current medical dispensary license holders) and a very limited supply of product, as well as the ongoing coronavirus pandemic, statewide adult-use sales totaled $147.2 million in the first four months of the program. Adult-use sales resulted in the state recognizing more than $40 million in tax revenue, based on an excise tax between 10% and 25%, depending on product potency.
In May, with the state still locked down, sales totaled $44.3 million, a single-month record, with 25% of those sales coming from out-of-state buyers, establishing Illinois’ adult-use market as the go-to source for residents in neighboring states. Of the five states bordering Illinois, only Missouri has a medical program, and none have an adult-use program.
With these numbers, it’s no wonder that individuals and entities are literally lining up to get licenses.
Any day now, the state Department of Financial and Professional Regulation is expected to announce the winners of 75 new adult-use dispensary licenses out of more than 850 applicants.
By the end of August, the state Department of Agriculture is expected to announce the winners of 40 new adult-use craft cultivation, processing and transportation licenses (applicant numbers have not yet been disclosed).
Although the application periods for these licenses are now closed, Illinois’ adult-use statute provides for another round of licensing in 2021, when up to 110 adult-use dispensary licenses and another 40 adult-use craft cultivation licenses will be made available through the statewide application process.
Meanwhile, not to be outdone, the state’s medical marijuana program is also seeing a significant rise in sales.
After limping along for almost four years, with a maximum of 45,000 patients out of a pool of 350,000 qualified state residents, the program now has more than 100,000 registered patients, many looking to avoid the excise tax associated with adult-use sales. This is also a big win for the medical cannabis businesses that survived the program’s rough early years.
Larry Mishkin and John Brooks | Hoban Law Group
Larry Mishkin has been an attorney at Hoban Law Group since 2015 and represents entrepreneurs and small to mid-size businesses in Illinois.
John Brooks is a C.L.E.O Scholar and a 2020 graduate of Vermont Law School. He has spent the last year working with Larry Mishkin of the Hoban Law Group processing marijuana applications. Before law school, Mr. Brooks worked in the Chicago Innocence Project and worked on the 2016 presidential campaign. John Is currently studying for the Uniform Bar Exam.