New Illinois Cannabis Dispensary Licensing Round Presents Additional Opportunities for Cannabusinesses

By Yolanda Clarke, Alex Solome

Jan 11, 2023

Illinois is hitting the ground running in this new year! After successfully granting 192 conditional-use dispensary licenses throughout 2022, the Illinois Department of Finance and Professional Regulation (IDFPR) will hold another dispensary license round in early 2023. 

Continuing its goal of establishing Illinois as the model for a social-equity-focused cannabis market, this new licensing round will see an additional 55 conditional adult-use licenses granted, dispersed amongst the state’s 17 Bureau of Labor Statistics (BLS) regions. Social equity status will be critical in the initial licensing round. Says Governor Pritzker in a recent press release, “Illinois is committed to having the most accessible and equitable cannabis industry in the nation, and we look forward to issuing additional social equity licenses and cementing our status as a national leader.”

Illinois Cannabis License Application Lottery Requirements

It is clear that IDFPR has taken the criticisms of the 2019 round to heart to improve the system. Compared to the 2019 application, the new initial application requirements are minimal. The new low barrier to entry should encourage participation by a wide variety of stakeholders (who will not have to spend hundreds of thousands of dollars on application components for licenses they may not win).  

In the online application, applicants need to provide basic information on their legal entity, principal officers, and select which BLS region they want to locate in, along with various attestations. The submission cost has been reduced to only $250. Importantly, principal officers cannot be included in more than one lottery entry and applicants cannot have more than one lottery entry across all 17 regions. Other ownership restrictions from the Cannabis Regulation and Tax Act remain in effect.

Illinois Cannabis Social Equity Provisions

If selected for a license, applicants must prove their social equity eligibility before being issued a conditional license. As previously required, applicants must be 51% owned or controlled by one or more individuals who satisfy the social equity criteria. However, the criteria for this round have been altered to introduce Criteria A and Criteria B buckets. 

Criteria A pertains to residency, where an individual must demonstrate they live within an eligible census tract and have resided in an eligible census tract for a total of 5 of the past 10 years. Criteria B provides multiple options for qualification, including those who have cannabis-related offenses, family members with cannabis-related offenses, or who have been a victim of firearm injury. Importantly, all individuals who comprise the 51% ownership or control of the entity for social equity purposes must satisfy BOTH Criteria A and at least one Criteria B component

Illinois Cannabis License Application Timeline

The IDFPR will open the cannabis license application window on January 30, 2023, with an anticipated window closure on February 14, 2023. A list of lottery participants is slated to be published February 21, 2023. Any applicants not listed will have at least 5 days to contest, with an updated list published by IDFPR prior to the lottery itself. Conducted by the Illinois Lottery, results will be published once the lottery has concluded.  

Once the lottery is held, selected applicants will have 45 calendar days to provide documentation demonstrating their social equity eligibility. Then, IDFPR has 60 calendar days to review and approve. After conditional license issuance, the Conditional Phase begins for cannabis dispensary licensees to become operational.

VS Can Help!

Vicente Sederberg, LLP successfully obtained multiple dispensary licenses for clients in Illinois’ initial licensing round—let us guide you to victory now! While the process has been streamlined, unsuspecting applicants will lose out on this exciting opportunity if they cannot properly document their social equity status, have corporate issues, or are unable to satisfy the requirements to become operational. The VS Licensing Team is ready and able to help you secure your future success, as we have for hundreds of clients around the country. Contact us today!

The content and links provided on this page are for informational purposes only and not for the purpose of providing legal or tax advice. Viewing this page does not establish an attorney-client relationship. You should consult with a qualified legal professional for advice regarding any particular issue or problem. The contents of this page may be considered attorney advertising under certain rules of professional conduct.