Cannabis legalization has been sweeping across the United States over the last ten years, but few states have made waves like Illinois, according to Illinois Governor J.B. Pritzker. He highlighted his state’s cannabis social equity program at the Cannabis Law Institute, hosted by the International Cannabis Bar Association on Thursday.
Pritzker proudly stated its success in promoting diversity and economic growth, calling it “the most diverse cannabis industry in the nation. Pritzker also touted “cannabis tourists” and how a significant portion of marijuana tax revenue is coming from out-of-state visitors.
Illinois’ Cannabis Social Equity Program Ranks As the Nation’s Best
Illinois has become a national leader in cannabis social equity, with Governor Pritzker touting the state’s program as a model for others to follow. A study by the Illinois Cannabis Regulation Oversight Office (CROO) found that women or minorities held 59% of adult-use permits as of January 2023.
During his keynote address at the seventh annual Cannabis Law Institute in Chicago, Pritzker expressed pride in the progress made but acknowledged the need for more work. He emphasized the importance of continuing to create opportunities and wealth for communities of color, which have faced disproportionate impacts from the war on drugs.
“I really am incredibly proud of the progress we’ve made. It hasn’t been easy. We have more work to do. There’s no doubt. I’m not satisfied with where we are. We have a long way to go to repair the damage done by the war on drugs,” Pritzker said during his speech reports Green Market Report “I’m really hopeful that the cannabis industry will continue to bring opportunity and wealth to communities of color for decades to come.”
The CROO study reported that Illinois outperformed other states in terms of diversity in the cannabis industry. Following Illinois, Maryland had the second most diverse cannabis industry, with 37% of business permits held by minorities or women. New Jersey, Colorado, Michigan, and Massachusetts followed with 36%, 34%, 25%, and 24% respectively.
Additionally, minority- or women-owned businesses held 63% of craft grower licenses, 61% of infuser licenses, and 74% of transporter licenses in Illinois.
Illinois’ Cannabis Sales Continue to Grow a Testament to Effective Policy?
Governor J.B. Pritzker’s approach to cannabis legalization and social equity is clearly yielding positive results, as evidenced by Illinois’s impressive milestone of over $1 billion in cannabis retail sales by July 1st.
This figure, which comprises more than $850 million in adult-use cannabis and nearly $150 million in medical cannabis sales, reflects a significant increase in consumer interest and market growth.
This achievement came nearly two weeks earlier than the same point in 2023, indicating a strong upward trend in the industry. As Fiscal Year 2024 progresses, total cannabis sales have already exceeded $2 billion, surpassing the previous records of $1.9 billion in FY 2023 and $1.8 billion in FY 2022.
Cannabis Tourists Helping Illinois Cannabis Sales
Another significant aspect of Illinois’ cannabis program is its ability to attract out-of-state visitors. Governor Pritzker estimated that about 25% of all state marijuana tax revenue comes from “cannabis tourists” who visit Illinois from neighboring states with no cannabis laws, such as Indiana, Iowa, Wisconsin, and currently Kentucky, which will start its medical program in 2025.
Pritzker humorously suggested that these visitors might be staying in Illinois after purchasing cannabis, contributing to the state’s economy. This influx of out-of-state dollars not only boosts tax revenue but also supports local businesses and creates jobs.
Governor Pritzker’s speech also touched on the need for federal marijuana legalization with a focus on social equity. He argued that equity demands a federal approach to ensure that the benefits of legalization are shared across the nation.
Pritzker’s call for federal action is significant, as it highlights the challenges faced by states trying to implement equitable cannabis policies independently. A federal framework could provide consistent guidelines and support for states, helping to address the disparities created by the war on drugs.
Expungements and 280E
Illinois has made strides in addressing the injustices caused by marijuana prohibition. The state has reinvested “hundreds of millions of dollars” of cannabis tax revenue into communities harmed by the war on drugs. Additionally, more than 800,000 nonviolent cannabis criminal records have been expunged, providing a fresh start for many individuals.
Illinois lawmakers have also taken steps to support cannabis businesses by passing legislation that provides a workaround for Section 280E of the IRS tax code. This allows cannabis businesses to deduct ordinary business expenses, helping to alleviate some of the financial burdens they face and fostering a more equitable industry in the state.
These efforts demonstrate Illinois’ commitment to using cannabis legalization as a tool for social justice, ensuring that the benefits of this new industry are accessible to those who have been most affected by past policies.
