Illinois-2023-SB3480-Introduced

103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3480

Introduced 2/8/2024, by Sen. Adriane Johnson

SYNOPSIS AS INTRODUCED:

`410 ILCS 130/115`
`410 ILCS 705/1-10`
`410 ILCS 705/7-1`

Amends the Compassionate Use of Medical Cannabis Program Act. Provides that the Department of Financial and Professional Regulation shall adopt rules to create a registration process for Adult Use Dispensing Organization Social Equity Licenses, as defined in the Cannabis Regulation and Tax Act, to sell cannabis under the Act. Provides that the registration process shall be available to all Adult Use Dispensing Organization Social Equity Licenses within 30 days of the issuance of the Adult Use Dispensing Organization Social Equity License. Amends the Cannabis Regulation and Tax Act. Defines "Adult Use Dispensing Organization Social Equity License". In the findings provisions of the Social Equity in the Cannabis Industry Article of the Act, provides that the General Assembly also finds and recognizes that the dispensaries established under the Compassionate Use of Medical Cannabis Program Act enacted in 2014 have inadvertently placed those dispensaries with an Adult Use Dispensing Organization Social Equity License at a competitive disadvantage. Provides that this competitive imbalance stems primarily from the established dispensaries' existing market presence and their capacity to sell cannabis to a well-established medical patient base at lower prices, a benefit derived from the exemption of certain taxes applicable to medical cannabis sales.

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A BILL FOR

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1 AN ACT concerning health.

2 Be it enacted by the People of the State of Illinois,

3 represented in the General Assembly:

4 Section 5. The Compassionate Use of Medical Cannabis

5 Program Act is amended by changing Section 115 as follows:

6 (410 ILCS 130/115)

7 Sec. 115. Registration of dispensing organizations.

8 (a) The Department of Financial and Professional

9 Regulation may issue up to 60 dispensing organization

10 registrations for operation. The Department of Financial and

11 Professional Regulation may not issue less than the 60

12 registrations if there are qualified applicants who have

13 applied with the Department of Financial and Professional

14 Regulation. The organizations shall be geographically

15 dispersed throughout the State to allow all registered

16 qualifying patients reasonable proximity and access to a

17 dispensing organization.

18 (a-5) The Department of Financial and Professional

19 Regulation shall adopt rules to create a registration process

20 for Social Equity Justice Involved Applicants and Qualifying

21 Applicants, a streamlined application, and a Social Equity

22 Justice Involved Medical Lottery under Section 115.5 to issue

23 the remaining available 5 dispensing organization

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1 registrations for operation.

2 (a-6) The Department of Financial and Professional

3 Regulation shall adopt rules to create a registration process

4 for Adult Use Dispensing Organization Social Equity Licenses,

5 as defined in the Cannabis Regulation and Tax Act, to sell

6 cannabis under this Act. The registration process shall be

7 available to all Adult Use Dispensing Organization Social

8 Equity Licenses within 30 days of the issuance of the Adult Use

9 Dispensing Organization Social Equity License.

10 For purposes of this Section:

11 "Disproportionately Impacted Area" means a census tract or

12 comparable geographic area that satisfies the following

13 criteria as determined by the Department of Commerce and

14 Economic Opportunity, that:

15 (1) meets at least one of the following criteria:

16 (A) the area has a poverty rate of at least 20%

17 according to the latest federal decennial census; or

18 (B) 75% or more of the children in the area

19 participate in the federal free lunch program

20 according to reported statistics from the State Board

21 of Education; or

22 (C) at least 20% of the households in the area

23 receive assistance under the Supplemental Nutrition

24 Assistance Program; or

25 (D) the area has an average unemployment rate, as

26 determined by the Illinois Department of Employment

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1 Security, that is more than 120% of the national

2 unemployment average, as determined by the United

3 States Department of Labor, for a period of at least 2

4 consecutive calendar years preceding the date of the

5 application; and

6 (2) has high rates of arrest, conviction, and

7 incarceration related to sale, possession, use,

8 cultivation, manufacture, or transport of cannabis.

9 "Qualifying Applicant" means an applicant that: (i)

10 submitted an application pursuant to Section 15-30 of the

11 Cannabis Regulation and Tax Act that received at least 85% of

12 250 application points available under Section 15-30 of the

13 Cannabis Regulation and Tax Act as the applicant's final

14 score; (ii) received points at the conclusion of the scoring

15 process for meeting the definition of a "Social Equity

16 Applicant" as set forth under the Cannabis Regulation and Tax

17 Act; and (iii) is an applicant that did not receive a

18 Conditional Adult Use Dispensing Organization License through

19 a Qualifying Applicant Lottery pursuant to Section 15-35 of

20 the Cannabis Regulation and Tax Act or any Tied Applicant

21 Lottery conducted under the Cannabis Regulation and Tax Act.

22 "Social Equity Justice Involved Applicant" means an

23 applicant that is an Illinois resident and one of the

24 following:

25 (1) an applicant with at least 51% ownership and

26 control by one or more individuals who have resided for at

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1 least 5 of the preceding 10 years in a Disproportionately

2 Impacted Area;

3 (2) an applicant with at least 51% of ownership and

4 control by one or more individuals who have been arrested

5 for, convicted of, or adjudicated delinquent for any

6 offense that is eligible for expungement under subsection

7 (i) of Section 5.2 of the Criminal Identification Act; or

8 (3) an applicant with at least 51% ownership and

9 control by one or more members of an impacted family.

10 (b) A dispensing organization may only operate if it has

11 been issued a registration from the Department of Financial

12 and Professional Regulation. The Department of Financial and

13 Professional Regulation shall adopt rules establishing the

14 procedures for applicants for dispensing organizations.

15 (c) When applying for a dispensing organization

16 registration, the applicant shall submit, at a minimum, the

17 following in accordance with Department of Financial and

18 Professional Regulation rules:

19 (1) a non-refundable application fee established by

20 rule;

21 (2) the proposed legal name of the dispensing

22 organization;

23 (3) the proposed physical address of the dispensing

24 organization;

25 (4) the name, address, and date of birth of each

26 principal officer and board member of the dispensing

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1 organization, provided that all those individuals shall be

2 at least 21 years of age;

3 (5) (blank);

4 (6) (blank); and

5 (7) (blank).

6 (d) The Department of Financial and Professional

7 Regulation shall conduct a background check of the prospective

8 dispensing organization agents in order to carry out this

9 Section. The Department of State Police shall charge a fee for

10 conducting the criminal history record check, which shall be

11 deposited in the State Police Services Fund and shall not

12 exceed the actual cost of the record check. Each person

13 applying as a dispensing organization agent shall submit a

14 full set of fingerprints to the Department of State Police for

15 the purpose of obtaining a State and federal criminal records

16 check. These fingerprints shall be checked against the

17 fingerprint records now and hereafter, to the extent allowed

18 by law, filed in the Department of State Police and Federal

19 Bureau of Investigation criminal history records databases.

20 The Department of State Police shall furnish, following

21 positive identification, all Illinois conviction information

22 to the Department of Financial and Professional Regulation.

23 (e) A dispensing organization must pay a registration fee

24 set by the Department of Financial and Professional

25 Regulation.

26 (f) An application for a medical cannabis dispensing

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1 organization registration must be denied if any of the

2 following conditions are met:

3 (1) the applicant failed to submit the materials

4 required by this Section, including if the applicant's

5 plans do not satisfy the security, oversight, or

6 recordkeeping rules issued by the Department of Financial

7 and Professional Regulation;

8 (2) the applicant would not be in compliance with

9 local zoning rules issued in accordance with Section 140;

10 (3) the applicant does not meet the requirements of

11 Section 130;

12 (4) one or more of the prospective principal officers

13 or board members has been convicted of an excluded

14 offense;

15 (5) one or more of the prospective principal officers

16 or board members has served as a principal officer or

17 board member for a registered medical cannabis dispensing

18 organization that has had its registration revoked; and

19 (6) one or more of the principal officers or board

20 members is under 21 years of age.

21 (Source: P.A. 101-363, eff. 8-9-19; 102-98, eff. 7-15-21.)

22 Section 10. The Cannabis Regulation and Tax Act is amended

23 by changing Sections 1-10 and 7-1 as follows:

24 (410 ILCS 705/1-10)

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1 Sec. 1-10. Definitions. In this Act:

2 "Adult Use Cultivation Center License" means a license

3 issued by the Department of Agriculture that permits a person

4 to act as a cultivation center under this Act and any

5 administrative rule made in furtherance of this Act.

6 "Adult Use Dispensing Organization License" means a

7 license issued by the Department of Financial and Professional

8 Regulation that permits a person to act as a dispensing

9 organization under this Act and any administrative rule made

10 in furtherance of this Act.

11 "Adult Use Dispensing Organization Social Equity License"

12 means a license issued by the Department of Financial and

13 Professional Regulation to a Qualified Social Equity Applicant

14 with current Ownership and Control that permits a person to

15 act as a dispensing organization under this Act and any

16 administrative rule made in furtherance of this Act and the

17 Compassionate Use of Medical Cannabis Program Act.

18 "Advertise" means to engage in promotional activities

19 including, but not limited to: newspaper, radio, Internet and

20 electronic media, and television advertising; the distribution

21 of fliers and circulars; billboard advertising; and the

22 display of window and interior signs. "Advertise" does not

23 mean exterior signage displaying only the name of the licensed

24 cannabis business establishment.

25 "Application points" means the number of points a

26 Dispensary Applicant receives on an application for a

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1 Conditional Adult Use Dispensing Organization License.

2 "BLS Region" means a region in Illinois used by the United

3 States Bureau of Labor Statistics to gather and categorize

4 certain employment and wage data. The 17 such regions in

5 Illinois are: Bloomington, Cape Girardeau, Carbondale-Marion,

6 Champaign-Urbana, Chicago-Naperville-Elgin, Danville,

7 Davenport-Moline-Rock Island, Decatur, Kankakee, Peoria,

8 Rockford, St. Louis, Springfield, Northwest Illinois

9 nonmetropolitan area, West Central Illinois nonmetropolitan

10 area, East Central Illinois nonmetropolitan area, and South

11 Illinois nonmetropolitan area.

12 "By lot" means a randomized method of choosing between 2

13 or more Eligible Tied Applicants or 2 or more Qualifying

14 Applicants.

15 "Cannabis" means marijuana, hashish, and other substances

16 that are identified as including any parts of the plant

17 Cannabis sativa and including derivatives or subspecies, such

18 as indica, of all strains of cannabis, whether growing or not;

19 the seeds thereof, the resin extracted from any part of the

20 plant; and any compound, manufacture, salt, derivative,

21 mixture, or preparation of the plant, its seeds, or resin,

22 including tetrahydrocannabinol (THC) and all other naturally

23 produced cannabinol derivatives, whether produced directly or

24 indirectly by extraction; however, "cannabis" does not include

25 the mature stalks of the plant, fiber produced from the

26 stalks, oil or cake made from the seeds of the plant, any other

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1 compound, manufacture, salt, derivative, mixture, or

2 preparation of the mature stalks (except the resin extracted

3 from it), fiber, oil or cake, or the sterilized seed of the

4 plant that is incapable of germination. "Cannabis" does not

5 include industrial hemp as defined and authorized under the

6 Industrial Hemp Act. "Cannabis" also means cannabis flower,

7 concentrate, and cannabis-infused products.

8 "Cannabis business establishment" means a cultivation

9 center, craft grower, processing organization, infuser

10 organization, dispensing organization, or transporting

11 organization.

12 "Cannabis concentrate" means a product derived from

13 cannabis that is produced by extracting cannabinoids,

14 including tetrahydrocannabinol (THC), from the plant through

15 the use of propylene glycol, glycerin, butter, olive oil, or

16 other typical cooking fats; water, ice, or dry ice; or butane,

17 propane, CO₂, ethanol, or isopropanol and with the intended

18 use of smoking or making a cannabis-infused product. The use

19 of any other solvent is expressly prohibited unless and until

20 it is approved by the Department of Agriculture.

21 "Cannabis container" means a sealed or resealable,

22 traceable, container, or package used for the purpose of

23 containment of cannabis or cannabis-infused product during

24 transportation.

25 "Cannabis flower" means marijuana, hashish, and other

26 substances that are identified as including any parts of the

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1 plant Cannabis sativa and including derivatives or subspecies,

2 such as indica, of all strains of cannabis; including raw

3 kief, leaves, and buds, but not resin that has been extracted

4 from any part of such plant; nor any compound, manufacture,

5 salt, derivative, mixture, or preparation of such plant, its

6 seeds, or resin.

7 "Cannabis-infused product" means a beverage, food, oil,

8 ointment, tincture, topical formulation, or another product

9 containing cannabis or cannabis concentrate that is not

10 intended to be smoked.

11 "Cannabis paraphernalia" means equipment, products, or

12 materials intended to be used for planting, propagating,

13 cultivating, growing, harvesting, manufacturing, producing,

14 processing, preparing, testing, analyzing, packaging,

15 repackaging, storing, containing, concealing, ingesting, or

16 otherwise introducing cannabis into the human body.

17 "Cannabis plant monitoring system" or "plant monitoring

18 system" means a system that includes, but is not limited to,

19 testing and data collection established and maintained by the

20 cultivation center, craft grower, or processing organization

21 and that is available to the Department of Revenue, the

22 Department of Agriculture, the Department of Financial and

23 Professional Regulation, and the Illinois State Police for the

24 purposes of documenting each cannabis plant and monitoring

25 plant development throughout the life cycle of a cannabis

26 plant cultivated for the intended use by a customer from seed

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1 planting to final packaging.

2 "Cannabis testing facility" means an entity registered by

3 the Department of Agriculture to test cannabis for potency and

4 contaminants.

5 "Clone" means a plant section from a female cannabis plant

6 not yet rootbound, growing in a water solution or other

7 propagation matrix, that is capable of developing into a new

8 plant.

9 "Community College Cannabis Vocational Training Pilot

10 Program faculty participant" means a person who is 21 years of

11 age or older, licensed by the Department of Agriculture, and

12 is employed or contracted by an Illinois community college to

13 provide student instruction using cannabis plants at an

14 Illinois Community College.

15 "Community College Cannabis Vocational Training Pilot

16 Program faculty participant Agent Identification Card" means a

17 document issued by the Department of Agriculture that

18 identifies a person as a Community College Cannabis Vocational

19 Training Pilot Program faculty participant.

20 "Conditional Adult Use Dispensing Organization License"

21 means a contingent license awarded to applicants for an Adult

22 Use Dispensing Organization License that reserves the right to

23 an Adult Use Dispensing Organization License if the applicant

24 meets certain conditions described in this Act, but does not

25 entitle the recipient to begin purchasing or selling cannabis

26 or cannabis-infused products.

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1 "Conditional Adult Use Cultivation Center License" means a

2 license awarded to top-scoring applicants for an Adult Use

3 Cultivation Center License that reserves the right to an Adult

4 Use Cultivation Center License if the applicant meets certain

5 conditions as determined by the Department of Agriculture by

6 rule, but does not entitle the recipient to begin growing,

7 processing, or selling cannabis or cannabis-infused products.

8 "Craft grower" means a facility operated by an

9 organization or business that is licensed by the Department of

10 Agriculture to cultivate, dry, cure, and package cannabis and

11 perform other necessary activities to make cannabis available

12 for sale at a dispensing organization or use at a processing

13 organization. A craft grower may contain up to 5,000 square

14 feet of canopy space on its premises for plants in the

15 flowering state. The Department of Agriculture may authorize

16 an increase or decrease of flowering stage cultivation space

17 in increments of 3,000 square feet by rule based on market

18 need, craft grower capacity, and the licensee's history of

19 compliance or noncompliance, with a maximum space of 14,000

20 square feet for cultivating plants in the flowering stage,

21 which must be cultivated in all stages of growth in an enclosed

22 and secure area. A craft grower may share premises with a

23 processing organization or a dispensing organization, or both,

24 provided each licensee stores currency and cannabis or

25 cannabis-infused products in a separate secured vault to which

26 the other licensee does not have access or all licensees

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1 sharing a vault share more than 50% of the same ownership.

2 "Craft grower agent" means a principal officer, board

3 member, employee, or other agent of a craft grower who is 21

4 years of age or older.

5 "Craft Grower Agent Identification Card" means a document

6 issued by the Department of Agriculture that identifies a

7 person as a craft grower agent.

8 "Cultivation center" means a facility operated by an

9 organization or business that is licensed by the Department of

10 Agriculture to cultivate, process, transport (unless otherwise

11 limited by this Act), and perform other necessary activities

12 to provide cannabis and cannabis-infused products to cannabis

13 business establishments.

14 "Cultivation center agent" means a principal officer,

15 board member, employee, or other agent of a cultivation center

16 who is 21 years of age or older.

17 "Cultivation Center Agent Identification Card" means a

18 document issued by the Department of Agriculture that

19 identifies a person as a cultivation center agent.

20 "Currency" means currency and coin of the United States.

21 "Dispensary" means a facility operated by a dispensing

22 organization at which activities licensed by this Act may

23 occur.

24 "Dispensary Applicant" means the Proposed Dispensing

25 Organization Name as stated on an application for a

26 Conditional Adult Use Dispensing Organization License.

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1 "Dispensing organization" means a facility operated by an

2 organization or business that is licensed by the Department of

3 Financial and Professional Regulation to acquire cannabis from

4 a cultivation center, craft grower, processing organization,

5 or another dispensary for the purpose of selling or dispensing

6 cannabis, cannabis-infused products, cannabis seeds,

7 paraphernalia, or related supplies under this Act to

8 purchasers or to qualified registered medical cannabis

9 patients and caregivers. As used in this Act, "dispensing

10 organization" includes a registered medical cannabis

11 organization as defined in the Compassionate Use of Medical

12 Cannabis Program Act or its successor Act that has obtained an

13 Early Approval Adult Use Dispensing Organization License.

14 "Dispensing organization agent" means a principal officer,

15 employee, or agent of a dispensing organization who is 21

16 years of age or older.

17 "Dispensing organization agent identification card" means

18 a document issued by the Department of Financial and

19 Professional Regulation that identifies a person as a

20 dispensing organization agent.

21 "Disproportionately Impacted Area" means a census tract or

22 comparable geographic area that satisfies the following

23 criteria as determined by the Department of Commerce and

24 Economic Opportunity, that:

25 (1) meets at least one of the following criteria:

26 (A) the area has a poverty rate of at least 20%

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1 according to the latest federal decennial census; or

2 (B) 75% or more of the children in the area

3 participate in the federal free lunch program

4 according to reported statistics from the State Board

5 of Education; or

6 (C) at least 20% of the households in the area

7 receive assistance under the Supplemental Nutrition

8 Assistance Program; or

9 (D) the area has an average unemployment rate, as

10 determined by the Illinois Department of Employment

11 Security, that is more than 120% of the national

12 unemployment average, as determined by the United

13 States Department of Labor, for a period of at least 2

14 consecutive calendar years preceding the date of the

15 application; and

16 (2) has high rates of arrest, conviction, and

17 incarceration related to the sale, possession, use,

18 cultivation, manufacture, or transport of cannabis.

19 "Early Approval Adult Use Cultivation Center License"

20 means a license that permits a medical cannabis cultivation

21 center licensed under the Compassionate Use of Medical

22 Cannabis Program Act as of the effective date of this Act to

23 begin cultivating, infusing, packaging, transporting (unless

24 otherwise provided in this Act), processing, and selling

25 cannabis or cannabis-infused product to cannabis business

26 establishments for resale to purchasers as permitted by this

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1 Act as of January 1, 2020.

2 "Early Approval Adult Use Dispensing Organization License"

3 means a license that permits a medical cannabis dispensing

4 organization licensed under the Compassionate Use of Medical

5 Cannabis Program Act as of the effective date of this Act to

6 begin selling cannabis or cannabis-infused product to

7 purchasers as permitted by this Act as of January 1, 2020.

8 "Early Approval Adult Use Dispensing Organization at a

9 secondary site" means a license that permits a medical

10 cannabis dispensing organization licensed under the

11 Compassionate Use of Medical Cannabis Program Act as of the

12 effective date of this Act to begin selling cannabis or

13 cannabis-infused product to purchasers as permitted by this

14 Act on January 1, 2020 at a different dispensary location from

15 its existing registered medical dispensary location.

16 "Eligible Tied Applicant" means a Tied Applicant that is

17 eligible to participate in the process by which a remaining

18 available license is distributed by lot pursuant to a Tied

19 Applicant Lottery.

20 "Enclosed, locked facility" means a room, greenhouse,

21 building, or other enclosed area equipped with locks or other

22 security devices that permit access only by cannabis business

23 establishment agents working for the licensed cannabis

24 business establishment or acting pursuant to this Act to

25 cultivate, process, store, or distribute cannabis.

26 "Enclosed, locked space" means a closet, room, greenhouse,

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1 building, or other enclosed area equipped with locks or other

2 security devices that permit access only by authorized

3 individuals under this Act. "Enclosed, locked space" may

4 include:

5 (1) a space within a residential building that (i) is

6 the primary residence of the individual cultivating 5 or

7 fewer cannabis plants that are more than 5 inches tall and

8 (ii) includes sleeping quarters and indoor plumbing. The

9 space must only be accessible by a key or code that is

10 different from any key or code that can be used to access

11 the residential building from the exterior; or

12 (2) a structure, such as a shed or greenhouse, that

13 lies on the same plot of land as a residential building

14 that (i) includes sleeping quarters and indoor plumbing

15 and (ii) is used as a primary residence by the person

16 cultivating 5 or fewer cannabis plants that are more than

17 5 inches tall, such as a shed or greenhouse. The structure

18 must remain locked when it is unoccupied by people.

19 "Financial institution" has the same meaning as "financial

20 organization" as defined in Section 1501 of the Illinois

21 Income Tax Act, and also includes the holding companies,

22 subsidiaries, and affiliates of such financial organizations.

23 "Flowering stage" means the stage of cultivation where and

24 when a cannabis plant is cultivated to produce plant material

25 for cannabis products. This includes mature plants as follows:

26 (1) if greater than 2 stigmas are visible at each

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1 internode of the plant; or

2 (2) if the cannabis plant is in an area that has been

3 intentionally deprived of light for a period of time

4 intended to produce flower buds and induce maturation,

5 from the moment the light deprivation began through the

6 remainder of the marijuana plant growth cycle.

7 "Individual" means a natural person.

8 "Infuser organization" or "infuser" means a facility

9 operated by an organization or business that is licensed by

10 the Department of Agriculture to directly incorporate cannabis

11 or cannabis concentrate into a product formulation to produce

12 a cannabis-infused product.

13 "Kief" means the resinous crystal-like trichomes that are

14 found on cannabis and that are accumulated, resulting in a

15 higher concentration of cannabinoids, untreated by heat or

16 pressure, or extracted using a solvent.

17 "Labor peace agreement" means an agreement between a

18 cannabis business establishment and any labor organization

19 recognized under the National Labor Relations Act, referred to

20 in this Act as a bona fide labor organization, that prohibits

21 labor organizations and members from engaging in picketing,

22 work stoppages, boycotts, and any other economic interference

23 with the cannabis business establishment. This agreement means

24 that the cannabis business establishment has agreed not to

25 disrupt efforts by the bona fide labor organization to

26 communicate with, and attempt to organize and represent, the

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1 cannabis business establishment's employees. The agreement

2 shall provide a bona fide labor organization access at

3 reasonable times to areas in which the cannabis business

4 establishment's employees work, for the purpose of meeting

5 with employees to discuss their right to representation,

6 employment rights under State law, and terms and conditions of

7 employment. This type of agreement shall not mandate a

8 particular method of election or certification of the bona

9 fide labor organization.

10 "Limited access area" means a room or other area under the

11 control of a cannabis dispensing organization licensed under

12 this Act and upon the licensed premises where cannabis sales

13 occur with access limited to purchasers, dispensing

14 organization owners and other dispensing organization agents,

15 or service professionals conducting business with the

16 dispensing organization, or, if sales to registered qualifying

17 patients, caregivers, provisional patients, and Opioid

18 Alternative Pilot Program participants licensed pursuant to

19 the Compassionate Use of Medical Cannabis Program Act are also

20 permitted at the dispensary, registered qualifying patients,

21 caregivers, provisional patients, and Opioid Alternative Pilot

22 Program participants.

23 "Member of an impacted family" means an individual who has

24 a parent, legal guardian, child, spouse, or dependent, or was

25 a dependent of an individual who, prior to the effective date

26 of this Act, was arrested for, convicted of, or adjudicated

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1 delinquent for any offense that is eligible for expungement

2 under this Act.

3 "Mother plant" means a cannabis plant that is cultivated

4 or maintained for the purpose of generating clones, and that

5 will not be used to produce plant material for sale to an

6 infuser or dispensing organization.

7 "Ordinary public view" means within the sight line with

8 normal visual range of a person, unassisted by visual aids,

9 from a public street or sidewalk adjacent to real property, or

10 from within an adjacent property.

11 "Ownership and control" means ownership of at least 51% of

12 the business, including corporate stock if a corporation, and

13 control over the management and day-to-day operations of the

14 business and an interest in the capital, assets, and profits

15 and losses of the business proportionate to percentage of

16 ownership.

17 "Person" means a natural individual, firm, partnership,

18 association, joint stock company, joint venture, public or

19 private corporation, limited liability company, or a receiver,

20 executor, trustee, guardian, or other representative appointed

21 by order of any court.

22 "Possession limit" means the amount of cannabis under

23 Section 10-10 that may be possessed at any one time by a person

24 21 years of age or older or who is a registered qualifying

25 medical cannabis patient or caregiver under the Compassionate

26 Use of Medical Cannabis Program Act.

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1 "Principal officer" includes a cannabis business

2 establishment applicant or licensed cannabis business

3 establishment's board member, owner with more than 1% interest

4 of the total cannabis business establishment or more than 5%

5 interest of the total cannabis business establishment of a

6 publicly traded company, president, vice president, secretary,

7 treasurer, partner, officer, member, manager member, or person

8 with a profit sharing, financial interest, or revenue sharing

9 arrangement. The definition includes a person with authority

10 to control the cannabis business establishment, a person who

11 assumes responsibility for the debts of the cannabis business

12 establishment and who is further defined in this Act.

13 "Primary residence" means a dwelling where a person

14 usually stays or stays more often than other locations. It may

15 be determined by, without limitation, presence, tax filings;

16 address on an Illinois driver's license, an Illinois

17 Identification Card, or an Illinois Person with a Disability

18 Identification Card; or voter registration. No person may have

19 more than one primary residence.

20 "Processing organization" or "processor" means a facility

21 operated by an organization or business that is licensed by

22 the Department of Agriculture to either extract constituent

23 chemicals or compounds to produce cannabis concentrate or

24 incorporate cannabis or cannabis concentrate into a product

25 formulation to produce a cannabis product.

26 "Processing organization agent" means a principal officer,

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1 board member, employee, or agent of a processing organization.

2 "Processing organization agent identification card" means

3 a document issued by the Department of Agriculture that

4 identifies a person as a processing organization agent.

5 "Purchaser" means a person 21 years of age or older who

6 acquires cannabis for a valuable consideration. "Purchaser"

7 does not include a cardholder under the Compassionate Use of

8 Medical Cannabis Program Act.

9 "Qualifying Applicant" means an applicant that submitted

10 an application pursuant to Section 15-30 that received at

11 least 85% of 250 application points available under Section

12 15-30 as the applicant's final score and meets the definition

13 of "Social Equity Applicant" as set forth under this Section.

14 "Qualifying Social Equity Justice Involved Applicant"

15 means an applicant that submitted an application pursuant to

16 Section 15-30 that received at least 85% of 250 application

17 points available under Section 15-30 as the applicant's final

18 score and meets the criteria of either paragraph (1) or (2) of

19 the definition of "Social Equity Applicant" as set forth under

20 this Section.

21 "Qualified Social Equity Applicant" means a Social Equity

22 Applicant who has been awarded a conditional license under

23 this Act to operate a cannabis business establishment.

24 "Resided" means an individual's primary residence was

25 located within the relevant geographic area as established by

26 2 of the following:

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1 (1) a signed lease agreement that includes the

2 applicant's name;

3 (2) a property deed that includes the applicant's

4 name;

5 (3) school records;

6 (4) a voter registration card;

7 (5) an Illinois driver's license, an Illinois

8 Identification Card, or an Illinois Person with a

9 Disability Identification Card;

10 (6) a paycheck stub;

11 (7) a utility bill;

12 (8) tax records; or

13 (9) any other proof of residency or other information

14 necessary to establish residence as provided by rule.

15 "Smoking" means the inhalation of smoke caused by the

16 combustion of cannabis.

17 "Social Equity Applicant" means an applicant that is an

18 Illinois resident that meets one of the following criteria:

19 (1) an applicant with at least 51% ownership and

20 control by one or more individuals who have resided for at

21 least 5 of the preceding 10 years in a Disproportionately

22 Impacted Area;

23 (2) an applicant with at least 51% ownership and

24 control by one or more individuals who:

25 (i) have been arrested for, convicted of, or

26 adjudicated delinquent for any offense that is

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1 eligible for expungement under this Act; or

2 (ii) is a member of an impacted family;

3 (3) for applicants with a minimum of 10 full-time

4 employees, an applicant with at least 51% of current

5 employees who:

6 (i) currently reside in a Disproportionately

7 Impacted Area; or

8 (ii) have been arrested for, convicted of, or

9 adjudicated delinquent for any offense that is

10 eligible for expungement under this Act or member of

11 an impacted family.

12 Nothing in this Act shall be construed to preempt or limit

13 the duties of any employer under the Job Opportunities for

14 Qualified Applicants Act. Nothing in this Act shall permit an

15 employer to require an employee to disclose sealed or expunged

16 offenses, unless otherwise required by law.

17 "Tied Applicant" means an application submitted by a

18 Dispensary Applicant pursuant to Section 15-30 that received

19 the same number of application points under Section 15-30 as

20 the Dispensary Applicant's final score as one or more

21 top-scoring applications in the same BLS Region and would have

22 been awarded a license but for the one or more other

23 top-scoring applications that received the same number of

24 application points. Each application for which a Dispensary

25 Applicant was required to pay a required application fee for

26 the application period ending January 2, 2020 shall be

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1 considered an application of a separate Tied Applicant.

2 "Tied Applicant Lottery" means the process established

3 under 68 Ill. Adm. Code 1291.50 for awarding Conditional Adult

4 Use Dispensing Organization Licenses pursuant to Sections

5 15-25 and 15-30 among Eligible Tied Applicants.

6 "Tincture" means a cannabis-infused solution, typically

7 comprised of alcohol, glycerin, or vegetable oils, derived

8 either directly from the cannabis plant or from a processed

9 cannabis extract. A tincture is not an alcoholic liquor as

10 defined in the Liquor Control Act of 1934. A tincture shall

11 include a calibrated dropper or other similar device capable

12 of accurately measuring servings.

13 "Transporting organization" or "transporter" means an

14 organization or business that is licensed by the Department of

15 Agriculture to transport cannabis or cannabis-infused product

16 on behalf of a cannabis business establishment or a community

17 college licensed under the Community College Cannabis

18 Vocational Training Pilot Program.

19 "Transporting organization agent" means a principal

20 officer, board member, employee, or agent of a transporting

21 organization.

22 "Transporting organization agent identification card"

23 means a document issued by the Department of Agriculture that

24 identifies a person as a transporting organization agent.

25 "Unit of local government" means any county, city,

26 village, or incorporated town.

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1 "Vegetative stage" means the stage of cultivation in which

2 a cannabis plant is propagated to produce additional cannabis

3 plants or reach a sufficient size for production. This

4 includes seedlings, clones, mothers, and other immature

5 cannabis plants as follows:

6 (1) if the cannabis plant is in an area that has not

7 been intentionally deprived of light for a period of time

8 intended to produce flower buds and induce maturation, it

9 has no more than 2 stigmas visible at each internode of the

10 cannabis plant; or

11 (2) any cannabis plant that is cultivated solely for

12 the purpose of propagating clones and is never used to

13 produce cannabis.

14 (Source: P.A. 101-27, eff. 6-25-19; 101-593, eff. 12-4-19;

15 102-98, eff. 7-15-21; 102-538, eff. 8-20-21; 102-813, eff.

16 5-13-22.)

17 (410 ILCS 705/7-1)

18 Sec. 7-1. Findings.

19 (a) The General Assembly finds that the medical cannabis

20 industry, established in 2014 through the Compassionate Use of

21 Medical Cannabis Program Act, has shown that additional

22 efforts are needed to reduce barriers to ownership. Through

23 that program, 55 licenses for dispensing organizations and 20

24 licenses for cultivation centers have been issued. Those

25 licenses are held by only a small number of businesses, the

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1 ownership of which does not sufficiently meet the General

2 Assembly's interest in business ownership that reflects the

3 population of the State of Illinois and that demonstrates the

4 need to reduce barriers to entry for individuals and

5 communities most adversely impacted by the enforcement of

6 cannabis-related laws.

7 (b) In the interest of establishing a legal cannabis

8 industry that is equitable and accessible to those most

9 adversely impacted by the enforcement of drug-related laws in

10 this State, including cannabis-related laws, the General

11 Assembly finds and declares that a social equity program

12 should be established.

13 (c) The General Assembly also finds and declares that

14 individuals who have been arrested or incarcerated due to drug

15 laws suffer long-lasting negative consequences, including

16 impacts to employment, business ownership, housing, health,

17 and long-term financial well-being.

18 (d) The General Assembly also finds and declares that

19 family members, especially children, and communities of those

20 who have been arrested or incarcerated due to drug laws,

21 suffer from emotional, psychological, and financial harms as a

22 result of such arrests or incarcerations.

23 (e) Furthermore, the General Assembly finds and declares

24 that certain communities have disproportionately suffered the

25 harms of enforcement of cannabis-related laws. Those

26 communities face greater difficulties accessing traditional

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1 banking systems and capital for establishing businesses.

2 (f) The General Assembly also finds that individuals who

3 have resided in areas of high poverty suffer negative

4 consequences, including barriers to entry in employment,

5 business ownership, housing, health, and long-term financial

6 well-being.

7 (g) The General Assembly also finds and declares that

8 promotion of business ownership by individuals who have

9 resided in areas of high poverty and high enforcement of

10 cannabis-related laws furthers an equitable cannabis industry.

11 (g-1) The General Assembly also finds and recognizes that

12 the dispensaries established under the Compassionate Use of

13 Medical Cannabis Program Act enacted in 2014 have

14 inadvertently placed those dispensaries with an Adult Use

15 Dispensing Organization Social Equity License at a competitive

16 disadvantage. This competitive imbalance stems primarily from

17 the established dispensaries' existing market presence and

18 their capacity to sell cannabis to a well-established medical

19 patient base at lower prices, a benefit derived from the

20 exemption of certain taxes applicable to medical cannabis

21 sales.

22 (h) Therefore, in the interest of remedying the harms

23 resulting from the disproportionate enforcement of

24 cannabis-related laws, the General Assembly finds and declares

25 that a social equity program should offer, among other things,

26 financial assistance and license application benefits to

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