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Cannabis Act

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1. When was cannabis made legal in Illinois?

On Tuesday 6/25/2019, Governor JB Pritzker signed Illinois House Bill 1438, better known as the Cannabis Regulation and Tax Act (CRTA), thus legalizing the consumption and possession of cannabis for adults 21 and older in Illinois starting January 1, 2020. Illinois is the 11th state in the country to legalize the recreational use and purchase of marijuana (after Alaska, California, Colorado, Maine, Massachusetts, Michigan, Nevada, Oregon, Vermont, and Washington).

2. How much cannabis may an individual possess?

Illinois residents may possess up to:

• 30 grams, or just over one ounce of “flower”
• 5 grams of cannabis concentrate
• 500 milligrams of THC - the chemical that makes users high – in a cannabis infused product such as gummies, candy, other consumable products (referred to as “edibles”), or tinctures, and lotions

Non-Illinois residents may legally possess up to ½ of these amounts.

3. Who can legally purchase and consume cannabis?

As a result of the new State legislation, the consumption of cannabis as of 1/1/2020, will be treated similarly to that of the consumption of alcohol with any Illinois resident, or non-resident, ages 21 or over, now being able to purchase and consume cannabis.

4. Who can legally grow and sell recreational cannabis?

Only licensed businesses will be able to legally grow and sell cannabis. Medical cannabis patients will be allowed to grow up to five plants each within their home. Recreational users will not be allowed to grow any plants.

5. Can the consumption/possession of cannabis be banned by a local municipality like Libertyville?

No, municipalities cannot ban or override the CRTA. Furthermore, municipalities cannot ban residents from private cannabis consumption.

6. Will the Village have any regulatory abilities?

Yes, Section 55-25 of the Act (attached) outlines what municipalities are allowed to regulate. The Village may enact reasonable zoning regulations that do not conflict with the act including buffers between sensitive uses. Furthermore, the Village can require Conditional/Special Use permits for cannabis businesses to impose limits on “time, place, manner, and number” of cannabis business operations. The Village is allowed to ban recreational cannabis businesses completely and may regulate or ban on-premise consumption of cannabis at cannabis business establishments. Please note, local governments are required to allow medical cannabis dispensaries subject only to local zoning provisions and cannot ban residents from using cannabis products on private property.

7. What regulatory abilities, if any, do business owners and landlords have?

Any person, business, public entity, or landlord may prohibit the use of cannabis on private property. Smoking cannabis is prohibited in any location where smoking is prohibited by the Smoke Free Illinois Act (410 ILCS 82), including hospitals, restaurants, retail stores, offices, commercial establishments, etc.

8. Will cannabis consumption be allowed in public spaces?

No, the consumption of cannabis in public, including school grounds, will be considered unlawful. It will be unlawful to consume cannabis in close physical proximity to someone under 21 who is not a registered medical cannabis patient.

9. Where will consumption be allowed?

The consumption of cannabis will be allowed on private property. Consumption may potentially be permitted at specifically designated establishments such as dispensaries or smoking lounges if allowed by local ordinance. Smoking at dispensaries or smoking lounges would be dependent on the Village Board approving zoning for such a use.

10. Does the Act itself restrict the location of cannabis business or advertising?

The Recreational Cannabis Act itself prohibits a new cannabis dispensary from locating within 1,500 feet of another dispensary. Libertyville may further restrict the location through reasonable zoning regulations. The Act authorizes up to 500 dispensary licenses, allows dispensaries to operate from 6 a.m. to 10 p.m. and enables dispensaries, infusers and/or craft growers to share a facility if allowed by the local municipalities. The Act requires that cannabis advertising be at least 1,000 feet from school grounds, playgrounds, public recreational facilities, child care centers, public parks, public libraries, and gaming arcades (if that arcade is not limited to patrons 21+).

11. What is the licensing timeline?

The 55 current medical-cannabis dispensaries receive early approval for licenses to sell under the new Act. They may apply to dispense recreational marijuana at their current stores and for a license for a second location, meaning the state could have 110 recreational cannabis outlets by the time sales start January 1, 2020.

• On October 15, 2019, applications for up to 75 dispensaries will be made available. These new businesses will serve in addition to medical dispensaries that receive approval to serve adult consumers during the transition.
• On January 1, 2020, sales begin. January 7, 2020, applications for infusers, transporters, and a new category of cultivator called a craft grower will be published for business applicants. 
• On May 1, 2020, new dispensaries licenses will be issued, and the state will begin a disparity and market study of the cannabis industry.
• On July 1, 2020, up to 40 craft grower and infuser licenses will be issued, along with an unlimited number of transporter licenses.

The Act allows for up to 47 dispensary licenses to be awarded within the “Chicago-Naperville-Elgin” region by May 1, 2020. The applications for such licenses shall be available by October 1. Once the disparity and market studies are complete, the state can issue additional licenses if needed. These licenses must take into account the findings of the disparity study.

12. What will the Village's role be in the licensing process?

The Village plays no role in the licensing process as it is left up to the Department of Financial and Professional Regulation (DFRF) to select and process those individuals attempting to obtain a license. The 55 current medical-cannabis dispensaries get early approval for licenses to sell under the new Act.

13. Are there any changes to existing medical cannabis laws?

Yes; the list of conditions that are covered under the use of medial cannabis was expanded to now include chronic pain, autism, migraines, irritable bowel syndrome, osteoarthritis, and anorexia.

14. How is cannabis taxed?

Sales will be taxed at 10% for cannabis with THC levels at or less than 35%; 25% for cannabis with THC levels above 35%; and 20% for cannabis infused products such as edibles. This is in addition to standard state and local sales taxes. Additionally, municipalities may add a special tax of up to 3% and counties may add a special tax up to 3.75% in unincorporated areas.

The municipal cannabis sales tax will be collected and enforced by the Illinois Department of Revenue (IDR), which is entitled to retain 1.5% of the amount distributed to each municipality as an administrative fee.

While the Act presently would allow for the tax to be effective not sooner than September 1, 2020, the Illinois Municipal League (IML) recommends that municipalities consider adopting the tax ordinance imposing the tax effective on January 1, 2020, and certify the ordinance to the IDR by October 1, 2019, in anticipation of a legislative amendment to the Act that may authorize the local tax as of January 1, 2020.

Additional taxes will be collected by other government bodies including a cultivation privilege tax, cannabis purchaser excise tax, cannabis county retailers’ occupation tax. State tax revenue will be placed in the Cannabis Regulation Fund. The Department of Revenue projects that this industry will generate over $57 million in tax revenue and licensing fees in FY20.

15. How will the potential tax revenue generated be used?

Within the Act, distribution of government proceeds collected by the State associated with the sale of recreational cannabis was established as follows:

• 20% to State mental health services and substance abuse programs
• 10% to pay unpaid State bills
• 35% to the State General Revenue Fund
• 2% to public education and safety campaigns
• 8% to the Local Government Distributive Fund, for prevention and training for law enforcement
• 25% for identified social equity programs

16. How does the law affect workplace drug policies?

Nothing in the Act prohibits employers from adopting reasonable zero tolerance or drug free workplace policies, or employment policies concerning drug testing, smoking, consumption, storage, or use of cannabis in the workplace or while on call provided that the policy is applied in a nondiscriminatory manner. Nothing in the Act limits or prevents an employer from disciplining an employee or terminating employment of an employee for violating an employer’s employment policies or workplace drug policy. The Act prohibits discrimination against employees for use of "lawful products" like cannabis during nonworking and non-call hours.

17. Does the Act place limits on cannabis advertising?

The Act bans any sign that makes any health, medicinal, or therapeutic claims about cannabis or cannabis products, includes the image of a cannabis leaf or bud, or advertises to minors (such as including cartoons, toys, or animals). Packaging will require warnings about cannabis consumption.

18. How does recreational cannabis effect criminal records?

Illinois Governor JB Pritzker has stated that he will pardon past convictions for possession of up to 30 grams, with the attorney general going to court to delete public records of a conviction or arrest for the now legal amount. Regarding possession of 30-500 grams, an individual or a state’s attorney may petition the court to vacate or expunge the conviction. If the cannabis offense was connected to a violent crime it is ineligible for the automatic expungement processes but the individual (or State’s Attorney) can still file motion with the court to vacate conviction.

• Arrest records between January 1, 2013 and effective date must be expunged by January 1, 2021
• Arrest records between January 1, 2000, and January 1, 2013, must be expunged by January 1, 2023
• Arrest records prior to January 1, 2000, must be expunged prior to January 1, 2025.

Records will be expunged if one year or more has elapsed since the date of the arrest with no criminal charges filed or charges were subsequently dismissed, vacated, or the individual was acquitted. Many of the records will relate to municipal code violations, which will be required to be expunged according to a schedule described in the bill that will give municipalities until January 1, 2025 to expunge records that precede January 1, 2000.