Illinois cannabis consumers may have noticed that social equity retailers were terribly hard to find.
The Illinois cannabis market is set to expand with the release of 185 new retail licenses for social equity applicants. On Friday, May 27, Cook County Circuit Judge Michael Mullen ended a court-ordered stay on licenses that had stalled the opening of all new stores for nearly a year.
The earlier stay, ordered last August by Cook County Judge Moshe Jacobius, put social equity licenses on ice while other Illinois applicants argued over their eligibility for social equity status in court. The stay allowed 55 non-social equity cannabis stores to open for business, while social equity applicants were forced to survive without any revenue for the past 10 months.
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The social equity slowdown in Illinois cannabis retail
Illinois started out with a bang in the adult-use market, bringing in millions in sales from both local residents and visitors from neighboring states since the market opened on January 1.
When the adult-use program began, state officials had earlier announced an ambitious slate of goals for integrating social equity into the Illinois cannabis industry – and have struggled toward those goals with varying degrees of success.
Governor J.B. Pritzker delivered on his promise to introduce more cannabis justice into the state, by expunging nearly half a million cannabis convictions. And licenses for processing and growing have rolled out in a smooth and inclusive fashion. In fact, of the 40 conditional licensees awarded for craft growers in Illinois, 80% of owners identify as nonwhite, and 88% qualified as social equity applicants. Illinois also set up a $30 million fund to help social equity licensees.
But that success did not carry over into the retail licensing program.
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How social equity retail licenses will (and have) shaped the Illinois market
With the addition of 185 new retail businesses, the Illinois market is set to expand by more than 160%. That’s expected to open up new market dynamics.
Illinois cannabis consumers will have more locations to shop, along with the option for a more meaningful shopping experience knowing that they are supporting a social equity retailer. This could translate to their cannabis spending. For example, this report shows that socially responsible consumer spending increased by 25% in 2021 – highlighting the unique patterns of a more conscious consumer.
Socially conscious cannabis consumers in Illinois have so far been denied the opportunity to support social equity retailers with their money. Once this new wave of retail licensees start opening stores, customers will finally have the opportunity to pivot their spending if they so choose.
What we don’t know is when the 185 social equity licensees will get the final all-clear. While the stay is currently lifted, there’s no guarantee that other businesses that didn’t qualify for the state’s equity program won’t bring further lawsuits.
Many prospective business owners—both equity and non-equity applicants—still have a sour taste in their mouths over the way the state initially evaluated their applications. Their criticisms brought the Illinois Department of Financial and Professional Regulation under scrutiny, and they demanded corrective action.
In response, the state has created three more licensing lotteries planned for summer 2022 to make up for their failed licensing launch.
Will Illinois social equity retailers finally get their time to shine?
Licensees who were able to ride out the wait are overdue for their piece of the state’s multi-million dollar legal cannabis industry. In the meantime, the budding business owners who didn’t have the hundreds of thousands of dollars it took to maintain their inactive storefronts are the biggest victims of the social equity slowdown in Illinois.
The longer it takes to sort it out, the longer Illinois cannabis consumers who care about supporting minority-owned cannabis businesses may stay out of the legal market altogether.
Janessa Bailey
Janessa was born and raised in the Midwest, and serves as Leafly’s current culture editor. She has a background in content, activism, and African-American Studies.
Janessa is the creator of Lumen and Seeds of Change.
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