The cannabis industry in Illinois, which in June 2019 became the latest state to legalize, broke its own record for recreational sales last month. The Prairie State’s 56 adult-use dispensaries sold nearly a million cannabis items worth upwards of $47.6 million after taxes.
According to official state figures reported by the Arlington Heights Daily Herald and industry monitor Marijuana Moment, $35.3 million worth of sales came from in-state residents, with $12.4 million attributed to sales made by out-of-state visitors. All told, Illinois retailers sold 994,545 THC products in June 2020 — 5,000 more than the previous month.
Illinois dispensaries have sold over $239 million worth of merchandise since legal sales took effect Jan 1.
This is, of course, good news for the state of Illinois. New tax figures are to be released later this month by the state Department of Revenue. In May —also a record-breaking month — the state took in $12.5 million in cannabis taxes and associated sales taxes.
That brought the state’s tax collections from legal cannabis to $52.7 million for the first five months of sales — well above the $28 million estimated for this year’s budget, which ended June 30.
Towns and counties that allow cannabis sales will begin adding their own taxes in July. While this might modestly increase the purchase price, it will be a boon to localities in a challenging time.
Still Grappling with Equity
Amid this boom, state and local authorities in the Land of Lincoln are grappling with how to craft a cannabis industry and regulation regime that will promote social equity and begin to reverse the racial and economic injustices associated with marijuana prohibition and the War on Drugs.
With this in mind, new licenses were created to encourage smaller businesses to enter the Illinois cannabis industry. They were supposed to be issued by the state on July 1, Patch reports.
But since the COVID-19 crisis shut down much of state government, Pritzker issued executive orders extending or suspending the deadlines to apply for these new license categories designated for “craft” growers, infusers and independent dispensaries.
Leading up to the passage of the Cannabis Regulation and Tax Act in June of 2019, medical marijuana dispensaries lobbied lawmakers and the office of Gov. JB Pritzker to allow them to effectively monopolize the adult-use market for the first quarter of legal sales. These dispensaries are dominated by only a few large companies with little diversity among their leadership.
Acting Illinois Department of Agriculture director Jerry Costello II told Patch that his office is trying to open multiple paths into the industry for state residents who live in the communities that were hardest hit by marijuana prohibition.
“The COVID-19 pandemic and the 6-week deadline extension granted to applicants have caused unforeseeable delays in the application review process,” Costello said. “The Department is working tirelessly to ensure that applications are scored and awarded in a fair, deliberate and equitable manner.”
The governor’s office is similarly pledging progress. Patch quoted a statement issued last month by the Commerce Department featuring words from Toi Hutchinson, the former state senator who was a chief sponsor of the legalization bill and now serves as Pritzker’s senior cannabis advisor.
“The Pritzker administration remains committed to protecting and pursuing diversity in the adult-use cannabis industry, despite the challenges presented by the COVID-19 pandemic,” Hutchinson said. “Pritzker has made it clear the state’s new industry is about more than revenue, it’s about ensuring communities that have been left out and left behind have new opportunity.”
Localities are meanwhile seeking their own institutional remedies for the social ills of prohibition. Chicago is considering various experimental models for cultivation and retail sales aimed at empowering those communities disproportionately criminalized under prohibition. Ideas being weighed include a city-owned cultivation co-op for residents — including special membership options for low-income individuals who can join on a “sweat equity” basis.
The Chicago suburb of Evanston is the first city in the United States to put revenues from legal cannabis sales into a “reparations” fund for the city’s African American residents — seeking to redress harms, not only from the War on Drugs, but also a greater matrix of social injustice.
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