Was opposition to cannabis legislation a “red herring”?

The Illinois House met in the Bank of Springfield Center earlier this month to help limit COVID transmission between members. (Photo from State Rep. Joyce Mason Facebook page)

The cannabis bill the General Assembly took up in special session two weeks ago was huge, with a dozen provisions that each began as its own piece of legislation.

“I viewed the bill as a typical Springfield Christmas tree,” said lobbyist and cannabis patient advocate Mark Peysakhovich. “It started as a few easy things that should have been done, and then everyone hung their ornament on, and it collapsed of its own weight.”

Stretching to almost 200 pages, the bill, ultimately known as HB2924, tried to fix practically every desire the cannabis industry would want. After quick passage in the Illinois Senate, it faltered in the House, never actually coming up for a vote after the Black Caucus voiced opposition and Gov. J.B. Pritzker made a statement of solidarity with the Caucus.

Compiled by a workgroup led by State Sen. Heather Steans (D-7), the bill, ultimately known as HB2924, was exhaustive. It freed medical cannabis patients from registering with a specific dispensary, created rules allowing print and digital advertising, expedited the state’s badging process for cultivators and dispensaries, and established a lottery system for breaking scoring ties for awarding dispensary licenses.

But two specific points drew the most attention: A provision that allowed dispensaries to move if they were sited in a location that only allowed medical use sales, and sweeping new oversight powers for state agencies to ensure “a fair and competitive marketplace” for cultivator sales to dispensaries.

Meanwhile, the bill was taken up during one of Springfield’s most unusual sessions. To protect from COVID transmission, House debate was held in the Bank of Springfield Center, to give legislators extra space between desks. As a result, lobbyists lacked “the rail”, a meeting area in front of House chambers where lobbyists and legislators meet during debate to twist arms and swap horses. Complicating matters, cannabis advocates were unsure if legislation would be brought up at all, and Steans introduced her Senate bill at the last minute.

Then the provision moved to the House, where, numerous lobbyists and advocates tell Grown In, the bill failed to come to a vote through the efforts of a team of lobbyists Green Thumb Industries (GTI) hired to stop the bill’s passage. Exactly why GTI opposed the legislation remains up for debate.

GTI representatives claim their opposition was heartfelt, claiming they were working on behalf of social equity applicants, in an attempt to ensure social equity applicants get an equal shot at obtaining plum dispensary locations, rather than allowing existing dispensary owners to snap up all the best spots.

Speaking to Grown In, GTI representatives point to a statement issued by Gov. Pritzker in the middle of session, “The Governor believes that social equity applicants deserve a chance to acquire their licenses, acquire their real estate, open, and be in operation before further advantage is provided to existing license holders. Any re-location by existing industry operators needs to take place at least one year after the awarding of the upcoming 75 dispensary licenses, the first to include social equity applicants. The Governor is supportive of the reasonable concerns of the Black Caucus and will be standing with them to ensure the most equitable cannabis law in the nation remains as such.”

“Green Thumb is supportive of the Governor’s position and concerns of the Black Caucus regarding certain aspects of the bill,” says GTI’s Vice President of Communications, Linda Marsicano.

But it also so happens that one of GTI’s biggest Illinois competitors, Cresco Labs, desperately needed passage of the provision since two of Cresco’s Sunnyside dispensaries need to move. One in Buffalo Grove, is currently limited to selling to medical patients but has been approved to move by the village to a site that allows recreational sales. A second location, in Wrigleyville, Cresco has complained is too small for the crush of recreational and medical patients, so the company is seeking a new, nearby location.

A leading advocate for social equity participants, ChicagoNORML, released a letter questioning GTI’s motives asking, “Is GTI giving us this information because they have the best interests of social equity applicants in mind?” The letter goes on to suggest that GTI was using the social equity angle as an excuse to oppose the legislation for other reasons. 

“We ask that you reconsider your position and see the situation for what it is. A red herring. We need to have the licenses awarded as soon as possible. The relocation clause of this bill does not hurt us,” ChicagoNORMAL’s letter concludes.

Meanwhile, independent dispensaries have told Grown In that empowering the state to enforce “a fair and competitive marketplace” for cultivator sales would significantly impact GTI, who owns cultivators in Rock Island and Oglesby. No dispensary managers would speak on the record to Grown In about GTI’s practices, but multiple dispensaries singled out GTI as a vertically-integrated company that limits supply to independent dispensaries while ensuring their own dispensaries are always well-stocked. 

Until the provision sunsets on June 30, current law requires medical-use dispensaries to ensure they have “adequate supply” for medical cannabis patients. In addition, dispensaries are not allowed to stock more than 40% of their shelves with product from any one cultivator. However, independent dispensaries speaking to Grown In, charge vertically-integrated companies merely ensure their own product just gets restocked more often than competing cultivators, diverting supply that would otherwise go to independents.

One independent dispensary owner, who was only willing to speak on the record generally, was Nature’s Care co-owner Christine Wildrick in Quincy. “Prior to adult use legalization we had good relationships with all of the cultivators. We are considered a good customer, we pay our bills timely and then all of a sudden things change. Unfortunately, the independents don’t have any control. It went from us, the dispensaries working with a cultivator in determining what our order would entail, to where now it’s flipped to where a cultivator says, ‘This is what we’re going to give you.’”

Multiple other independent dispensary owners confirmed Wildrick’s experience to Grown In. 

Asked for comment on supply, Executive Vice President for Public Affairs John Sullivan said, “We give more to independent dispensaries than we do to ourselves. We put 75% of our product into the marketplace. In general, in the last three months, in terms of flower, our stores have been just as bare as others.”

Acreage Holdings General Manager for Illinois, Charles Amadin said, “We understand the challenge, we buy from everybody and we sell to everyone. As far dispensaries are concerned, that’s what we’re trying to do.” Acreage owns one cultivator in Freeport and a Nature’s Care dispensary in Rolling Meadows.

When asked for comment on supply issues, Green Thumb Industries refused to comment.