Illinois Cannabis Laws

The Department of Financial and Professional Regulation (IDFPR) is in charge of cannabis licensing in Illinois. That said, the Cannabis Regulation Oversight Office (CROO) plays an active role in monitoring the day-to-day operations of cannabis businesses in Illinois.

The process for obtaining an adult-use dispensary license is slightly more complicated in Illinois than it is in other states.

As of March 2024, the Illinois Department of Financial and Professional Regulation (IDFPR) is using the Social Equity Criteria Lottery, a new application and lottery process designed to award social equity licenses to 55 applicants.

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Once the applicants submit their online application and fee, they receive a unique number and receipt. The IDFPR will then publicly post the list of eligible lottery participants with their unique identifiers.

All eligible applicants are given 45 days to submit proof of their social equity status and operational requirements. After this, the IDFPR will conduct a lottery to select 55 top participants from 17 BLS regions. If all documentation is order, the 55 participants will be awarded a conditional license that enables them to start work on their retail dispensary as well as apply for an adult-use retail dispensary.

Dispensaries are not allowed to sell cannabis products on a conditional adult-use dispensary license.

The application process for the social equity license is online and costs $250. The full authority Adult Use Dispensing Organization (AUDO) license costs $60,000 for 2 years for regular (non-Social Equity) applicants.

There is also a $50,000 surety bond to be held in escrow.

For applicants who meet the Social Equity criteria the cost of an approved 2-year AUDO license is $30,000.

To ensure geographical dispersion of adult-use cannabis dispensaries, Illinois spreads out dispensary licenses among the 17 Bureau of Labor Statistics (BLS) Regions within the state. This means that, if approved for an adult-use dispensary license, you must locate your dispensary within the BLS Region identified on your application.

Once approved for a license, you will have 180 days to identify a physical location for your retail storefront. The location must be suitable for public access; have a layout that promotes the safe dispensing of cannabis; and be sufficient in size, power allocation, lighting, parking, accessible parking spaces, accessible entry and exits as required by the Americans with Disabilities Act, product handling, and storage. Additionally, the location must not be within 1,500 feet of an existing dispensary location.

Exceptions may be granted in special cases and social equity applications.

Before selling any cannabis or cannabis products, dispensary staff must:

• Verify the age of the purchaser by checking a valid government-issued ID card by use of an electronic scanner
• Offer any appropriate purchaser education or support materials
• Enter the required information into the state’s electronic verification system, including the dispensary’s ID number, the dispensing agent’s ID number, the amount and type of cannabis or cannabis-infused product being sold, and the date and time of the sale

Qualifying registered medical marijuana patients in Illinois may purchase up to 2.5 ounces of cannabis flower every 14 days. For concentrates, edibles, or other non-flower cannabis products, the pre-weight of the cannabis flower used to make the product counts toward the purchase limit.

Dispensaries cannot sell:

• Any product containing alcohol except tinctures, which are limited to containers no larger than 100 milliliters
• Clones or other live plant material
• Cannabis, cannabis concentrate, or cannabis-infused products in combination or bundled with each other for one price

Illinois is imposing a tiered tax rate on cannabis products, based on the THC content of the product. The tax rate for cannabis products is as follows:

• 10 percent tax on cannabis flower or product containing less than 35 percent THC
• 20 percent tax on all infused cannabis products, including edibles
• 25 percent tax on any product with a THC concentration higher than 35 percent
• When there are fewer than two people working in the dispensary

Additionally, the regular state sales tax of 6.25 percent will apply, along with local taxes of up to 3.5 percent

Cannabis businesses in Illinois may not engage in advertising that:

• Is false or misleading
• Promotes overconsumption of cannabis
• Depicts the actual consumption of cannabis
• Makes any health, medicinal, or therapeutic claims about cannabis
• Includes the image of a cannabis leaf or bud
• Includes any image designed or likely to appeal to minors, including cartoons, toys, animals, or children

Additionally, no cannabis business may advertise cannabis or cannabis products in any form:

• Within 1,000 feet of a school, playground, recreation center, child care center, public park or library, or game arcade which allows persons under the age of 21
• On or in a public transit vehicle or public transit shelter
• On or in publicly owned or publicly operated property

Cannabis businesses, including retailers, are also prohibited from promoting the sale of cannabis products by giving away cannabis or cannabis products, conducting games or competitions related to consumption, or by providing promotional materials or activities that would be appealing to children.

Dispensaries may operate between the hours of 6:00 a.m. and 10:00 p.m. Additionally, operations are prohibited under the following circumstances:

• When video surveillance equipment is inoperative
• When point-of-sale equipment is inoperative
• When the state’s electronic verification system is inoperative
• When fewer than two people are working in the dispensary

Illinois cannabis retailers must establish an account with the state’s verification system that documents:

• Each sales transaction at the time of sale
• Each day’s beginning and ending inventory
• Acquisitions of cannabis and cannabis-infused products
• Disposal of cannabis

Cannabis retailers in Illinois must have an inventory control and point-of-sale system that is real-time, web-based, and accessible by the state at any time. Additionally, retailers must conduct a daily inventory reconciliation, documenting and balancing cannabis inventory by confirming that the state’s verification system matches the dispensary’s point of sale system and the amount of physical product at the dispensary.

BioTrack provides statewide cannabis verification and monitoring in Illinois.

Yes, Cova's Cannabis Dispensary POS and inventory management system is fully compliant with BioTrack and Illinois’ cannabis tracking, reporting, and inventory control requirements.

Cova has all the features needed to keep Illinois dispensaries compliant, including:

• Fully integrated inventory and sales tracking and reporting
• Built-in product equivalency conversions and purchase limit enforcement
• ID scanner for government-issued and patient ID card verification