First year of legal marijuana in Illinois generated big bucks but no new minority license holders

Cannifem represents much of what state lawmakers hoped for when they legalized marijuana in Illinois.

The startup business was formed by three Black women from areas hardest hit by the war on drugs. Yet the group failed to get any of the three cannabis licenses for which it applied. And the women spent tens of thousands of dollars trying.


Now Cannifem represents much of what went wrong with the first year of legalization. Applicants who lawmakers had hoped would get a slice of the lucrative pie feel betrayed. One year after the pot law took effect, no new entrepreneurs have been licensed to open because of problems with scoring the applications.

“It’s a shame. The people they intended to benefit are being left behind,” Cannifem co-founder Nakisha Hobbs said. “The legislators should take every possible step to correct the inequities that still exist to ensure a level playing ground.”


Meanwhile, the industry remains dominated by a few wealthy, white male-owned businesses. And customers have paid the price, initially with product shortages, and then with prices that remain twice as high as in Western states with legal weed.

Despite that, Illinois was expected to surpass $1 billion in total sales, bringing in more than $100 million in taxes and fees for a cash-strapped state government. Businesses already running medical marijuana shops opened new stores in Chicago and statewide. And voters in six of seven suburbs approved ballot questions allowing legal weed sales, and Arlington Heights, Downers Grove and Naperville dropped their bans on pot shops.

Nationally, voters in Arizona, Montana, New Jersey and South Dakota approved legalizing cannabis, and Mississippi voters supported allowing it for medical use.

For many in Illinois, 2020 began with high hopes and excitement. On New Year’s Day, thousands of people lined up for hours before dawn to make history with the end of cannabis prohibition. Soon after, one company began offering marijuana bus tours in Chicago.

But the long lines continued for weeks, as severe product shortages led to purchasing limits, and medical patients complained that they were cut off from their medicine. Eventually, supply began to catch up with demand.

Customers line up Jan. 1, 2020, outside MOCA Modern Cannabis on Milwaukee Avenue on the first day of recreational marijuana sales in Illinois.

Even with cannabis deemed an “essential” industry and demand during the COVID-19 pandemic at an all-time high, reported that Illinois still had the most expensive high-quality cannabis of any state as of October, at $352 per ounce.

The Illinois market is limited to just 21 growers’ licenses, which severely restricts supply compared with the hundreds of growers in states like Colorado and California. Lawmakers initially gave the market exclusively to the medical growers, who said they could supply the market with no new competition, even though a state-commissioned study said otherwise.

By law, the state was required to award 75 new marijuana retail store licenses by May 1, and 40 new craft grower licenses by July 1. Citing delays in the application review process due to COVID-19, Gov. J.B. Pritzker issued executive orders delaying the issuance of those new licenses indefinitely.


When the state announced in September that only 21 finalists qualified for a lottery for the 75 pot shops, the hundreds of other applicants cried foul. Many said they never received required notices to correct problems with their applications, and that identical submissions were scored differently.

In response, Pritzker said the state would send out new deficiency notices, and applicants could correct the problems and get rescored. That process is ongoing. In the meantime, lawsuits have been filed by those who qualified for a lottery to award the licenses and those who didn’t, with both sides demanding they be given a shot at opening for business.

Despite the problems, Pritzker’s senior cannabis adviser, former state Sen. Toi Hutchinson, said she was proud of how the law that legalized pot in Illinois included unprecedented provisions for social equity, saying it would take time to take effect. She noted that a group of stakeholders are holding meetings to consider ways to improve the rollout of the program.

As one example of unanticipated issue that could be addressed, Hutchinson cited the fact that only applicants with perfect scores, which required majority-veteran ownership and meeting social equity bench marks, qualified for licenses.

“We want to make sure that we can restore some trust and faith in the process,” she said. “We want it to be as fair as possible.”

More progress was made on another aspect of legalization: clearing low-level marijuana convictions. On New Year’s Eve 2019, Pritzker pardoned 11,000 people, and prosecutors in Cook and McHenry counties later cleared a combined 4,100 more cases.

Gov. J.B. Pritzker grants pardons for people with low-level cannabis convictions during an event Dec. 31, 2019, at the Trinity United Church of Christ in Chicago. Standing behind the governor are the Rev. Otis Moss III, Lt. Gov. Juliana Stratton, senior adviser on cannabis control Toi Hutchinson and Cook County State's Attorney Kim Foxx.

After months of delays caused in part by court closures due to the pandemic, Pritzker announced Thursday that he pardoned an additional 9,000 convictions, and state police wiped out nearly 500,000 nonfelony cannabis arrest records statewide.

The other major aspect of social equity was the funding of $31 million in grants for community renewal in areas hard hit by the war on drugs. Advocates say such measures are needed to undo the effects of law enforcement disparities that left Black people in Illinois seven times more likely than whites to be arrested for marijuana possession, despite similar levels of use, according to a report this year from the American Civil Liberties Union.

The state also generated more than $100 million from legalizing marijuana, which goes into the general fund, as well as to police, drug education and treatment, local governments and social programs.

Opponents such as Parents Opposed to Pot say the social costs of more potent legal marijuana — addiction and driving while high — far outweigh the benefits. They note studies that show marijuana harms cognitive development, impairs memory and learning, and leads to thousands of hospital treatments annually.

One result of legalization is that some people now use cannabis more frequently, at all times of the day and in stronger doses, said Dr. Raymond Garcia, medical director at Rosecrance Harrison Campus treatment center in Rockford.

Cannabis use disorder still leaves some users with a lack of motivation, a lack of engagement in relationships, anxiety, paranoia and even psychosis, Garcia said.


“A lot of people think of it as a soothing drug, and it can be, but it has diminishing returns because you can get to a point where too much and too frequent use can trigger or worsen anxiety,” he said.

Despite increased use, Garcia said, insurers increasingly are unlikely to cover cannabis use disorder because the drug is now legal. He hoped that cannabis would be recognized as similar to alcohol, in that it’s legal but can still cause major problems in people’s lives.

Regarding public safety, one study in the Journal of the American Medical Association found fatal crashes increased after cannabis stores opened in states where it’s legal, and predicted 6,800 more roadway deaths annually if cannabis is legalized nationwide.

By and large, police and regulators reported no major diversion of legal marijuana to the black market, as has happened with oversupply in Oregon and California.

State police did report an increase in citations issued for having too high a concentration of THC while driving — 35 in 2020, compared with six in 2019 and five in 2018.

State troopers also reported that they attempted more than 90 undercover purchases by minors at legal pot shops, resulting in five illegal sales.


There have been break-ins and attempted break-ins at dispensaries, including the MOCA store in Logan Square early in the year, and Mission South Shore during late May looting. State police also are investigating an overnight break-in and theft of plants at the Ataraxia cultivation center in Albion, and said Aurora police are investigating a theft at Curative Health Cultivation.

Cannabis remains illegal at the federal level, though President-elect Joe Biden has talked about decriminalizing it. In general, advocates say, the sky hasn’t fallen, and marijuana has become a common and unobtrusive part of daily life. Cannabis companies say the only way to get the program running right away was to let existing growers start immediately.

“I think it’s been hugely successful on many fronts,” cannabis company Cresco Labs spokesman Jason Erkes said. “From the operators’ perspective, the program has run pretty seamlessly. Like with anything new, there have been hiccups and lessons learned.”