Bill Text: IL HB1438 | 2019-2020 | 101st General Assembly | Enrolled

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Creates the Cannabis Regulation and Tax Act and amends various Acts. Provides that it is lawful for persons 21 years of age or older to possess, use, and purchase limited amounts of cannabis for personal use in accordance with the Act. Authorizes registered qualifying patients to cultivate limited amounts of cannabis for personal use. Provides for the regulation and licensing of various entities and occupations engaged in cultivation, dispensing, processing, transportation, and other activities regarding cannabis for adult use. Sets forth duties of an Illinois Cannabis Regulation Oversight Officer, the Department of State Police, the Department of Agriculture, the Department of Financial and Professional Regulation, the Department of Public Health, the Department of Commerce and Economic Opportunity, the Department of Human Services, the Department of Revenue, the State Treasurer, the Illinois Criminal Justice Information Authority, and other governmental entities. Provides for expungement of minor cannabis violations under specified circumstances. Creates a Restore, Reinvest, and Renew Program and a Restore, Reinvest, and Renew Program Board and contains various provisions regarding a low-interest loan program for social equity applicants, investment in communities that have suffered because of drug policies, and the promotion of cannabis business ownership by individuals who have resided in areas of high poverty and high enforcement of cannabis-related laws. Contains provisions regarding health and safety, packaging, advertising, local ordinances, providing financial services to a cannabis-related legitimate business, and other matters. Creates a Cannabis Cultivation Privilege Tax and a Cannabis Purchaser Excise Tax. Authorizes the imposition of a County Cannabis Retailers' Occupation Tax and a Municipal Cannabis Retailers' Occupation Tax. Provides for allocation of revenues and creates various funds in the State treasury. Repeals the Cannabis and Controlled Substances Tax Act. Contains home rule preemptions. Contains other provisions. Effective immediately.

Spectrum: Moderate Partisan Bill (Democrat 26-4)

Status: (Passed) 2019-06-25 - Public Act . . . . . . . . . 101-0027 [HB1438 Detail]

Download: Illinois-2019-HB1438-Enrolled.html



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1 AN ACT concerning regulation.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4
ARTICLE 1.
5
SHORT TITLE; FINDINGS; DEFINITIONS
6 Section 1-1. Short title. This Act may be cited as the
7Cannabis Regulation and Tax Act.
8 Section 1-5. Findings.
9 (a) In the interest of allowing law enforcement to focus on
10violent and property crimes, generating revenue for education,
11substance abuse prevention and treatment, freeing public
12resources to invest in communities and other public purposes,
13and individual freedom, the General Assembly finds and declares
14that the use of cannabis should be legal for persons 21 years
15of age or older and should be taxed in a manner similar to
16alcohol.
17 (b) In the interest of the health and public safety of the
18residents of Illinois, the General Assembly further finds and
19declares that cannabis should be regulated in a manner similar
20to alcohol so that:
21 (1) persons will have to show proof of age before
22 purchasing cannabis;

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1 (2) selling, distributing, or transferring cannabis to
2 minors and other persons under 21 years of age shall remain
3 illegal;
4 (3) driving under the influence of cannabis shall
5 remain illegal;
6 (4) legitimate, taxpaying business people, and not
7 criminal actors, will conduct sales of cannabis;
8 (5) cannabis sold in this State will be tested,
9 labeled, and subject to additional regulation to ensure
10 that purchasers are informed and protected; and
11 (6) purchasers will be informed of any known health
12 risks associated with the use of cannabis, as concluded by
13 evidence-based, peer reviewed research.
14 (c) The General Assembly further finds and declares that it
15is necessary to ensure consistency and fairness in the
16application of this Act throughout the State and that,
17therefore, the matters addressed by this Act are, except as
18specified in this Act, matters of statewide concern.
19 (d) The General Assembly further finds and declares that
20this Act shall not diminish the State's duties and commitment
21to seriously ill patients registered under the Compassionate
22Use of Medical Cannabis Pilot Program Act, nor alter the
23protections granted to them.
24 (e) The General Assembly supports and encourages labor
25neutrality in the cannabis industry and further finds and
26declares that employee workplace safety shall not be diminished

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1and employer workplace policies shall be interpreted broadly to
2protect employee safety.
3 Section 1-10. Definitions. In this Act:
4 "Adult Use Cultivation Center License" means a license
5issued by the Department of Agriculture that permits a person
6to act as a cultivation center under this Act and any
7administrative rule made in furtherance of this Act.
8 "Adult Use Dispensing Organization License" means a
9license issued by the Department of Financial and Professional
10Regulation that permits a person to act as a dispensing
11organization under this Act and any administrative rule made in
12furtherance of this Act.
13 "Advertise" means to engage in promotional activities
14including, but not limited to: newspaper, radio, Internet and
15electronic media, and television advertising; the distribution
16of fliers and circulars; and the display of window and interior
17signs.
18 "BLS Region" means a region in Illinois used by the United
19States Bureau of Labor Statistics to gather and categorize
20certain employment and wage data. The 17 such regions in
21Illinois are: Bloomington, Cape Girardeau, Carbondale-Marion,
22Champaign-Urbana, Chicago-Naperville-Elgin, Danville,
23Davenport-Moline-Rock Island, Decatur, Kankakee, Peoria,
24Rockford, St. Louis, Springfield, Northwest Illinois
25nonmetropolitan area, West Central Illinois nonmetropolitan

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1area, East Central Illinois nonmetropolitan area, and South
2Illinois nonmetropolitan area.
3 "Cannabis" means marijuana, hashish, and other substances
4that are identified as including any parts of the plant
5Cannabis sativa and including derivatives or subspecies, such
6as indica, of all strains of cannabis, whether growing or not;
7the seeds thereof, the resin extracted from any part of the
8plant; and any compound, manufacture, salt, derivative,
9mixture, or preparation of the plant, its seeds, or resin,
10including tetrahydrocannabinol (THC) and all other naturally
11produced cannabinol derivatives, whether produced directly or
12indirectly by extraction; however, "cannabis" does not include
13the mature stalks of the plant, fiber produced from the stalks,
14oil or cake made from the seeds of the plant, any other
15compound, manufacture, salt, derivative, mixture, or
16preparation of the mature stalks (except the resin extracted
17from it), fiber, oil or cake, or the sterilized seed of the
18plant that is incapable of germination. "Cannabis" does not
19include industrial hemp as defined and authorized under the
20Industrial Hemp Act. "Cannabis" also means concentrate and
21cannabis-infused products.
22 "Cannabis business establishment" means a cultivation
23center, craft grower, processing organization, dispensing
24organization, or transporting organization.
25 "Cannabis concentrate" means a product derived from
26cannabis that is produced by extracting cannabinoids from the

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1plant through the use of propylene glycol, glycerin, butter,
2olive oil or other typical cooking fats; water, ice, or dry
3ice; or butane, propane, CO2, ethanol, or isopropanol. The use
4of any other solvent is expressly prohibited unless and until
5it is approved by the Department of Agriculture.
6 "Cannabis container" means a sealed, traceable, container,
7or package used for the purpose of containment of cannabis or
8cannabis-infused product during transportation.
9 "Cannabis flower" means marijuana, hashish, and other
10substances that are identified as including any parts of the
11plant Cannabis sativa and including derivatives or subspecies,
12such as indica, of all strains of cannabis; including raw kief,
13leaves, and buds, but not resin that has been extracted from
14any part of such plant; nor any compound, manufacture, salt,
15derivative, mixture, or preparation of such plant, its seeds,
16or resin.
17 "Cannabis-infused product" means a beverage, food, oil,
18ointment, tincture, topical formulation, or another product
19containing cannabis that is not intended to be smoked.
20 "Cannabis plant monitoring system" or "plant monitoring
21system" means a system that includes, but is not limited to,
22testing and data collection established and maintained by the
23cultivation center, craft grower, or processing organization
24and that is available to the Department of Revenue, the
25Department of Agriculture, the Department of Financial and
26Professional Regulation, and the Department of State Police for

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1the purposes of documenting each cannabis plant and monitoring
2plant development throughout the life cycle of a cannabis plant
3cultivated for the intended use by a customer from seed
4planting to final packaging.
5 "Cannabis testing facility" means an entity registered by
6the Department of Agriculture to test cannabis for potency and
7contaminants.
8 "Clone" means a plant section from a female cannabis plant
9not yet rootbound, growing in a water solution or other
10propagation matrix, that is capable of developing into a new
11plant.
12 "Community College Cannabis Vocational Training Pilot
13Program faculty participant" means a person who is 21 years of
14age or older, licensed by the Department of Agriculture, and is
15employed or contracted by an Illinois community college to
16provide student instruction using cannabis plants at an
17Illinois Community College.
18 "Community College Cannabis Vocational Training Pilot
19Program faculty participant Agent Identification Card" means a
20document issued by the Department of Agriculture that
21identifies a person as Community College Cannabis Vocational
22Training Pilot Program faculty participant.
23 "Conditional Adult Use Dispensing Organization License"
24means a license awarded to top-scoring applicants for an Adult
25Use Dispensing Organization License that reserves the right to
26an adult use dispensing organization license if the applicant

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1meets certain conditions described in this Act, but does not
2entitle the recipient to begin purchasing or selling cannabis
3or cannabis-infused products.
4 "Conditional Adult Use Cultivation Center License" means a
5license awarded to top-scoring applicants for an Adult Use
6Cultivation Center License that reserves the right to an Adult
7Use Cultivation Center License if the applicant meets certain
8conditions as determined by the Department of Agriculture by
9rule, but does not entitle the recipient to begin growing,
10processing, or selling cannabis or cannabis-infused products.
11 "Craft grower" means a facility operated by an organization
12or business that is licensed by the Department of Agriculture
13to cultivate, dry, cure, and package cannabis and perform other
14necessary activities to make cannabis available for sale at a
15dispensing organization or use at a processing organization. A
16craft grower may contain up to 5,000 square feet of canopy
17space on its premises for plants in the flowering state. The
18Department of Agriculture may authorize an increase or decrease
19of flowering stage cultivation space in increments of 3,000
20square feet by rule based on market need, craft grower
21capacity, and the licensee's history of compliance or
22noncompliance, with a maximum space of 14,000 square feet for
23cultivating plants in the flowering stage, which must be
24cultivated in all stages of growth in an enclosed and secure
25area. A craft grower may share premises with a processing
26organization or a dispensing organization, or both, provided

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1each licensee stores currency and cannabis or cannabis-infused
2products in a separate secured vault to which the other
3licensee does not have access or all licensees sharing a vault
4share more than 50% of the same ownership.
5 "Craft grower agent" means a principal officer, board
6member, employee, or other agent of a craft grower who is 21
7years of age or older.
8 "Craft Grower Agent Identification Card" means a document
9issued by the Department of Agriculture that identifies a
10person as a craft grower agent.
11 "Cultivation center" means a facility operated by an
12organization or business that is licensed by the Department of
13Agriculture to cultivate, process, transport (unless otherwise
14limited by this Act), and perform other necessary activities to
15provide cannabis and cannabis-infused products to cannabis
16business establishments.
17 "Cultivation center agent" means a principal officer,
18board member, employee, or other agent of a cultivation center
19who is 21 years of age or older.
20 "Cultivation Center Agent Identification Card" means a
21document issued by the Department of Agriculture that
22identifies a person as a cultivation center agent.
23 "Currency" means currency and coin of the United States.
24 "Dispensary" means a facility operated by a dispensing
25organization at which activities licensed by this Act may
26occur.

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1 "Dispensing organization" means a facility operated by an
2organization or business that is licensed by the Department of
3Financial and Professional Regulation to acquire cannabis from
4a cultivation center, craft grower, processing organization,
5or another dispensary for the purpose of selling or dispensing
6cannabis, cannabis-infused products, cannabis seeds,
7paraphernalia, or related supplies under this Act to purchasers
8or to qualified registered medical cannabis patients and
9caregivers. As used in this Act, dispensary organization shall
10include a registered medical cannabis organization as defined
11in the Compassionate Use of Medical Cannabis Pilot Program Act
12or its successor Act that has obtained an Early Approval Adult
13Use Dispensing Organization License.
14 "Dispensing organization agent" means a principal officer,
15employee, or agent of a dispensing organization who is 21 years
16of age or older.
17 "Dispensing organization agent identification card" means
18a document issued by the Department of Financial and
19Professional Regulation that identifies a person as a
20dispensing organization agent.
21 "Disproportionately Impacted Area" means a census tract or
22comparable geographic area that satisfies the following
23criteria as determined by the Department of Commerce and
24Economic 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"
20means a license that permits a medical cannabis cultivation
21center licensed under the Compassionate Use of Medical Cannabis
22Pilot Program Act as of the effective date of this Act to begin
23cultivating, infusing, packaging, transporting (unless
24otherwise provided in this Act), and selling cannabis to
25cannabis business establishments for resale to purchasers as
26permitted by this Act as of January 1, 2020.

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1 "Early Approval Adult Use Dispensing Organization License"
2means a license that permits a medical cannabis dispensing
3organization licensed under the Compassionate Use of Medical
4Cannabis Pilot Program Act as of the effective date of this Act
5to begin selling cannabis to purchasers as permitted by this
6Act as of January 1, 2020.
7 "Early Approval Adult Use Dispensing Organization at a
8secondary site" means a license that permits a medical cannabis
9dispensing organization licensed under the Compassionate Use
10of Medical Cannabis Pilot Program Act as of the effective date
11of this Act to begin selling cannabis to purchasers as
12permitted by this Act on January 1, 2020 at a different
13dispensary location from its existing registered medical
14dispensary location.
15 "Enclosed, locked facility" means a room, greenhouse,
16building, or other enclosed area equipped with locks or other
17security devices that permit access only by cannabis business
18establishment agents working for the licensed cannabis
19business establishment or acting pursuant to this Act to
20cultivate, process, store, or distribute cannabis.
21 "Enclosed, locked space" means a closet, room, greenhouse,
22building or other enclosed area equipped with locks or other
23security devices that permit access only by authorized
24individuals under this Act. "Enclosed, locked space" may
25include:
26 (1) a space within a residential building that (i) is

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1 the primary residence of the individual cultivating 5 or
2 fewer cannabis plants that are more than 5 inches tall and
3 (ii) includes sleeping quarters and indoor plumbing. The
4 space must only be accessible by a key or code that is
5 different from any key or code that can be used to access
6 the residential building from the exterior; or
7 (2) a structure, such as a shed or greenhouse, that
8 lies on the same plot of land as a residential building
9 that (i) includes sleeping quarters and indoor plumbing and
10 (ii) is used as a primary residence by the person
11 cultivating 5 or fewer cannabis plants that are more than 5
12 inches tall, such as a shed or greenhouse. The structure
13 must remain locked when it is unoccupied by people.
14 "Financial institution" has the same meaning as "financial
15organization" as defined in Section 1501 of the Illinois Income
16Tax Act, and also includes the holding companies, subsidiaries,
17and affiliates of such financial organizations.
18 "Flowering stage" means the stage of cultivation where and
19when a cannabis plant is cultivated to produce plant material
20for cannabis products. This includes mature plants as follows:
21 (1) if greater than 2 stigmas are visible at each
22 internode of the plant; or
23 (2) if the cannabis plant is in an area that has been
24 intentionally deprived of light for a period of time
25 intended to produce flower buds and induce maturation, from
26 the moment the light deprivation began through the

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1 remainder of the marijuana plant growth cycle.
2 "Individual" means a natural person.
3 "Infuser organization" or "infuser" means a facility
4operated by an organization or business that is licensed by the
5Department of Agriculture to directly incorporate cannabis or
6cannabis concentrate into a product formulation to produce a
7cannabis-infused product.
8 "Kief" means the resinous crystal-like trichomes that are
9found on cannabis and that are accumulated, resulting in a
10higher concentration of cannabinoids, untreated by heat or
11pressure, or extracted using a solvent.
12 "Labor peace agreement" means an agreement between a
13cannabis business establishment and any labor organization
14recognized under the National Labor Relations Act, referred to
15in this Act as a bona fide labor organization, that prohibits
16labor organizations and members from engaging in picketing,
17work stoppages, boycotts, and any other economic interference
18with the cannabis business establishment. This agreement means
19that the cannabis business establishment has agreed not to
20disrupt efforts by the bona fide labor organization to
21communicate with, and attempt to organize and represent, the
22cannabis business establishment's employees. The agreement
23shall provide a bona fide labor organization access at
24reasonable times to areas in which the cannabis business
25establishment's employees work, for the purpose of meeting with
26employees to discuss their right to representation, employment

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1rights under State law, and terms and conditions of employment.
2This type of agreement shall not mandate a particular method of
3election or certification of the bona fide labor organization.
4 "Limited access area" means a building, room, or other area
5under the control of a cannabis dispensing organization
6licensed under this Act and upon the licensed premises with
7access limited to purchasers, dispensing organization owners
8and other dispensing organization agents, or service
9professionals conducting business with the dispensing
10organization.
11 "Member of an impacted family" means an individual who has
12a parent, legal guardian, child, spouse, or dependent, or was a
13dependent of an individual who, prior to the effective date of
14this Act, was arrested for, convicted of, or adjudicated
15delinquent for any offense that is eligible for expungement
16under this Act.
17 "Mother plant" means a cannabis plant that is cultivated or
18maintained for the purpose of generating clones, and that will
19not be used to produce plant material for sale to an infuser or
20dispensing organization.
21 "Ordinary public view" means within the sight line with
22normal visual range of a person, unassisted by visual aids,
23from a public street or sidewalk adjacent to real property, or
24from within an adjacent property.
25 "Ownership and control" means ownership of at least 51% of
26the business, including corporate stock if a corporation, and

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1control over the management and day-to-day operations of the
2business and an interest in the capital, assets, and profits
3and losses of the business proportionate to percentage of
4ownership.
5 "Person" means a natural individual, firm, partnership,
6association, joint stock company, joint venture, public or
7private corporation, limited liability company, or a receiver,
8executor, trustee, guardian, or other representative appointed
9by order of any court.
10 "Possession limit" means the amount of cannabis under
11Section 10-10 that may be possessed at any one time by a person
1221 years of age or older or who is a registered qualifying
13medical cannabis patient or caregiver under the Compassionate
14Use of Medical Cannabis Pilot Program Act.
15 "Principal officer" includes a cannabis business
16establishment applicant or licensed cannabis business
17establishment's board member, owner with more than 1% interest
18of the total cannabis business establishment or more than 5%
19interest of the total cannabis business establishment of a
20publicly traded company, president, vice president, secretary,
21treasurer, partner, officer, member, manager member, or person
22with a profit sharing, financial interest, or revenue sharing
23arrangement. The definition includes a person with authority to
24control the cannabis business establishment, a person who
25assumes responsibility for the debts of the cannabis business
26establishment and who is further defined in this Act.

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1 "Primary residence" means a dwelling where a person usually
2stays or stays more often than other locations. It may be
3determined by, without limitation, presence, tax filings;
4address on an Illinois driver's license, an Illinois
5Identification Card, or an Illinois Person with a Disability
6Identification Card; or voter registration. No person may have
7more than one primary residence.
8 "Processing organization" or "processor" means a facility
9operated by an organization or business that is licensed by the
10Department of Agriculture to either extract constituent
11chemicals or compounds to produce cannabis concentrate or
12incorporate cannabis or cannabis concentrate into a product
13formulation to produce a cannabis product.
14 "Processing organization agent" means a principal officer,
15board member, employee, or agent of a processing organization.
16 "Processing organization agent identification card" means
17a document issued by the Department of Agriculture that
18identifies a person as a processing organization agent.
19 "Purchaser" means a person 21 years of age or older who
20acquires cannabis for a valuable consideration. "Purchaser"
21does not include a cardholder under the Compassionate Use of
22Medical Cannabis Pilot Program Act.
23 "Qualified Social Equity Applicant" means a Social Equity
24Applicant who has been awarded a conditional license under this
25Act to operate a cannabis business establishment.
26 "Resided" means an individual's primary residence was

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1located within the relevant geographic area as established by 2
2of the following:
3 (1) a signed lease agreement that includes the
4 applicant's name;
5 (2) a property deed that includes the applicant's name;
6 (3) school records;
7 (4) a voter registration card;
8 (5) an Illinois driver's license, an Illinois
9 Identification Card, or an Illinois Person with a
10 Disability Identification Card;
11 (6) a paycheck stub;
12 (7) a utility bill; or
13 (8) 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
16combustion of cannabis.
17 "Social Equity Applicant" means an applicant that is an
18Illinois 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 an
11 impacted family.
12 Nothing in this Act shall be construed to preempt or limit
13the duties of any employer under the Job Opportunities for
14Qualified Applicants Act. Nothing in this Act shall permit an
15employer to require an employee to disclose sealed or expunged
16offenses, unless otherwise required by law.
17 "Tincture" means a cannabis-infused solution, typically
18comprised of alcohol, glycerin, or vegetable oils, derived
19either directly from the cannabis plant or from a processed
20cannabis extract. A tincture is not an alcoholic liquor as
21defined in the Liquor Control Act of 1934. A tincture shall
22include a calibrated dropper or other similar device capable of
23accurately measuring servings.
24 "Transporting organization" or "transporter" means an
25organization or business that is licensed by the Department of
26Agriculture to transport cannabis on behalf of a cannabis

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1business establishment or a community college licensed under
2the Community College Cannabis Vocational Training Pilot
3Program.
4 "Transporting organization agent" means a principal
5officer, board member, employee, or agent of a transporting
6organization.
7 "Transporting organization agent identification card"
8means a document issued by the Department of Agriculture that
9identifies a person as a transporting organization agent.
10 "Unit of local government" means any county, city, village,
11or incorporated town.
12 "Vegetative stage" means the stage of cultivation in which
13a cannabis plant is propagated to produce additional cannabis
14plants or reach a sufficient size for production. This includes
15seedlings, clones, mothers, and other immature cannabis plants
16as follows:
17 (1) if the cannabis plant is in an area that has not
18 been intentionally deprived of light for a period of time
19 intended to produce flower buds and induce maturation, it
20 has no more than 2 stigmas visible at each internode of the
21 cannabis plant; or
22 (2) any cannabis plant that is cultivated solely for
23 the purpose of propagating clones and is never used to
24 produce cannabis.
25
ARTICLE 5.

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1
AUTHORITY
2 Section 5-5. Sharing of authority. Notwithstanding any
3provision or law to the contrary, any authority granted to any
4State agency or State employees or appointees under the
5Compassionate Use of Medical Cannabis Pilot Program Act shall
6be shared by any State agency or State employees or appointees
7given authority to license, discipline, revoke, regulate, or
8make rules under this Act.
9 Section 5-10. Department of Agriculture. The Department of
10Agriculture shall administer and enforce provisions of this Act
11relating to the oversight and registration of cultivation
12centers, craft growers, infuser organizations, and
13transporting organizations and agents, including the issuance
14of identification cards and establishing limits on potency or
15serving size for cannabis or cannabis products. The Department
16of Agriculture may suspend or revoke the license of, or impose
17other penalties upon cultivation centers, craft growers,
18infuser organizations, transporting organizations, and their
19principal officers, Agents-in-Charge, and agents for
20violations of this Act and any rules adopted under this Act.
21 Section 5-15. Department of Financial and Professional
22Regulation. The Department of Financial and Professional
23Regulation shall enforce the provisions of this Act relating to

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1the oversight and registration of dispensing organizations and
2agents, including the issuance of identification cards for
3dispensing organization agents. The Department of Financial
4and Professional Regulation may suspend or revoke the license
5of, or impose other penalties upon, dispensing organizations
6for violations of this Act and any rules adopted under this
7Act.
8 Section 5-20. Background checks.
9 (a) Through the Department of State Police, the licensing
10or issuing Department shall conduct a criminal history record
11check of the prospective principal officers, board members, and
12agents of a cannabis business establishment applying for a
13license or identification card under this Act.
14 Each cannabis business establishment prospective principal
15officer, board member, or agent shall submit his or her
16fingerprints to the Department of State Police in the form and
17manner prescribed by the Department of State Police.
18 Such fingerprints shall be transmitted through a live scan
19fingerprint vendor licensed by the Department of Financial and
20Professional Regulation. These fingerprints shall be checked
21against the fingerprint records now and hereafter filed in the
22Department of State Police and Federal Bureau of Investigation
23criminal history records databases. The Department of State
24Police shall charge a fee for conducting the criminal history
25record check, which shall be deposited into the State Police

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1Services Fund and shall not exceed the actual cost of the State
2and national criminal history record check. The Department of
3State Police shall furnish, pursuant to positive
4identification, all Illinois conviction information and shall
5forward the national criminal history record information to:
6 (i) the Department of Agriculture, with respect to a
7 cultivation center, craft grower, infuser organization, or
8 transporting organization; or
9 (ii) the Department of Financial and Professional
10 Regulation, with respect to a dispensing organization.
11 (b) When applying for the initial license or identification
12card, the background checks for all prospective principal
13officers, board members, and agents shall be completed before
14submitting the application to the licensing or issuing agency.
15 (c) All applications for licensure under this Act by
16applicants with criminal convictions shall be subject to
17Sections 2105-131, 2105-135, and 2105-205 of the Department of
18Professional Regulation Law of the Civil Administrative Code of
19Illinois.
20 Section 5-25. Department of Public Health to make health
21warning recommendations.
22 (a) The Department of Public Health shall make
23recommendations to the Department of Agriculture and the
24Department of Financial and Professional Regulation on
25appropriate health warnings for dispensaries and advertising,

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1which may apply to all cannabis products, including item-type
2specific labeling or warning requirements, regulate the
3facility where cannabis-infused products are made, regulate
4cannabis-infused products as provided in subsection (e) of
5Section 55-5, and facilitate the Adult Use Cannabis Health
6Advisory Committee.
7 (b) An Adult Use Cannabis Health Advisory Committee is
8hereby created and shall meet at least twice annually. The
9Chairperson may schedule meetings more frequently upon his or
10her initiative or upon the request of a Committee member.
11Meetings may be held in person or by teleconference. The
12Committee shall discuss and monitor changes in drug use data in
13Illinois and the emerging science and medical information
14relevant to the health effects associated with cannabis use and
15may provide recommendations to the Department of Human Services
16about public health awareness campaigns and messages. The
17Committee shall include the following members appointed by the
18Governor and shall represent the geographic, ethnic, and racial
19diversity of the State:
20 (1) The Director of Public Health, or his or her
21 designee, who shall serve as the Chairperson.
22 (2) The Secretary of Human Services, or his or her
23 designee, who shall serve as the Co-Chairperson.
24 (3) A representative of the poison control center.
25 (4) A pharmacologist.
26 (5) A pulmonologist.

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1 (6) An emergency room physician.
2 (7) An emergency medical technician, paramedic, or
3 other first responder.
4 (8) A nurse practicing in a school-based setting.
5 (9) A psychologist.
6 (10) A neonatologist.
7 (11) An obstetrician-gynecologist.
8 (12) A drug epidemiologist.
9 (13) A medical toxicologist.
10 (14) An addiction psychiatrist.
11 (15) A pediatrician.
12 (16) A representative of a statewide professional
13 public health organization.
14 (17) A representative of a statewide hospital/health
15 system association.
16 (18) An individual registered as a patient in the
17 Compassionate Use of Medical Cannabis Pilot Program.
18 (19) An individual registered as a caregiver in the
19 Compassionate Use of Medical Cannabis Pilot Program.
20 (20) A representative of an organization focusing on
21 cannabis-related policy.
22 (21) A representative of an organization focusing on
23 the civil liberties of individuals who reside in Illinois.
24 (22) A representative of the criminal defense or civil
25 aid community of attorneys serving Disproportionately
26 Impacted Areas.

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1 (23) A representative of licensed cannabis business
2 establishments.
3 (24) A Social Equity Applicant.
4 (c) The Committee shall provide a report by September 30,
52021, and every year thereafter, to the General Assembly. The
6Department of Public Health shall make the report available on
7its website.
8 Section 5-30. Department of Human Services. The Department
9of Human Services shall identify evidence-based programs for
10preventive mental health, the prevention or treatment of
11alcohol abuse, tobacco use, illegal drug use (including
12prescription drugs), and cannabis use by pregnant women, and
13make policy recommendations, as appropriate, to the Adult Use
14Cannabis Health Advisory Committee. The Department of Human
15Services shall develop and disseminate educational materials
16for purchasers based on recommendations received from the
17Department of Public Health and the Adult Use Cannabis Health
18Advisory Committee.
19 Section 5-45. Illinois Cannabis Regulation Oversight
20Officer.
21 (a) The position of Illinois Cannabis Regulation Oversight
22Officer is created within the Department of Financial and
23Professional Regulation under the Secretary of Financial and
24Professional Regulation. The Illinois Cannabis Regulation

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1Oversight Officer shall be appointed by the Governor with the
2advice and consent of the Senate. The term of office of the
3Officer shall expire on the third Monday of January in
4odd-numbered years provided that he or she shall hold office
5until a successor is appointed and qualified. In case of
6vacancy in office during the recess of the Senate, the Governor
7shall make a temporary appointment until the next meeting of
8the Senate, when the Governor shall nominate some person to
9fill the office, and any person so nominated who is confirmed
10by the Senate shall hold office during the remainder of the
11term and until his or her successor is appointed and qualified.
12 (b) The Illinois Cannabis Regulation Oversight Officer
13may:
14 (1) maintain a staff;
15 (2) make recommendations for policy, statute, and rule
16 changes;
17 (3) collect data both in Illinois and outside Illinois
18 regarding the regulation of cannabis;
19 (4) compile or assist in the compilation of any reports
20 required by this Act;
21 (5) ensure the coordination of efforts between various
22 State agencies involved in regulating and taxing the sale
23 of cannabis in Illinois; and
24 (6) encourage, promote, suggest, and report best
25 practices for ensuring diversity in the cannabis industry
26 in Illinois.

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1 (c) The Illinois Cannabis Regulation Oversight Officer
2shall not:
3 (1) participate in the issuance of any business
4 licensing or the making of awards; or
5 (2) participate in any adjudicative decision-making
6 process involving licensing or licensee discipline.
7 (d) Any funding required for the Illinois Cannabis
8Regulation Oversight Officer, its staff, or its activities
9shall be drawn from the Cannabis Regulation Fund.
10 (e) The Illinois Cannabis Regulation Oversight Officer
11shall commission and publish a disparity and availability study
12by March 1, 2021 that: (1) evaluates whether there exists
13discrimination in the State's cannabis industry; and (2) if so,
14evaluates the impact of such discrimination on the State and
15includes recommendations to the Department of Financial and
16Professional Regulation and the Department of Agriculture for
17reducing or eliminating any identified barriers to entry in the
18cannabis market. The Illinois Cannabis Regulation Oversight
19Officer shall forward a copy of its findings and
20recommendations to the Department of Financial and
21Professional Regulation, the Department of Agriculture, the
22Department of Commerce and Economic Opportunity, the General
23Assembly, and the Governor.
24 (f) The Illinois Cannabis Regulation Oversight Officer may
25compile, collect, or otherwise gather data necessary for the
26administration of this Act and to carry out the Officer's duty

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1relating to the recommendation of policy changes. The Illinois
2Cannabis Regulation Oversight Officer may direct the
3Department of Agriculture, Department of Financial and
4Professional Regulation, Department of Public Health,
5Department of Human Services, and Department of Commerce and
6Economic Opportunity to assist in the compilation, collection,
7and data gathering authorized pursuant to this subsection. The
8Illinois Cannabis Regulation Oversight Officer shall compile
9all of the data into a single report and submit the report to
10the Governor and the General Assembly and publish the report on
11its website.
12
ARTICLE 7.
13
SOCIAL EQUITY IN THE CANNABIS INDUSTRY
14 Section 7-1. Findings.
15 (a) The General Assembly finds that the medical cannabis
16industry, established in 2014 through the Compassionate Use of
17Medical Cannabis Pilot Program Act, has shown that additional
18efforts are needed to reduce barriers to ownership. Through
19that program, 55 licenses for dispensing organizations and 20
20licenses for cultivation centers have been issued. Those
21licenses are held by only a small number of businesses, the
22ownership of which does not sufficiently meet the General
23Assembly's interest in business ownership that reflects the
24population of the State of Illinois and that demonstrates the

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1need to reduce barriers to entry for individuals and
2communities most adversely impacted by the enforcement of
3cannabis-related laws.
4 (b) In the interest of establishing a legal cannabis
5industry that is equitable and accessible to those most
6adversely impacted by the enforcement of drug-related laws in
7this State, including cannabis-related laws, the General
8Assembly finds and declares that a social equity program should
9be established.
10 (c) The General Assembly also finds and declares that
11individuals who have been arrested or incarcerated due to drug
12laws suffer long-lasting negative consequences, including
13impacts to employment, business ownership, housing, health,
14and long-term financial well-being.
15 (d) The General Assembly also finds and declares that
16family members, especially children, and communities of those
17who have been arrested or incarcerated due to drug laws, suffer
18from emotional, psychological, and financial harms as a result
19of such arrests or incarcerations.
20 (e) Furthermore, the General Assembly finds and declares
21that certain communities have disproportionately suffered the
22harms of enforcement of cannabis-related laws. Those
23communities face greater difficulties accessing traditional
24banking systems and capital for establishing businesses.
25 (f) The General Assembly also finds that individuals who
26have resided in areas of high poverty suffer negative

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1consequences, including barriers to entry in employment,
2business ownership, housing, health, and long-term financial
3well-being.
4 (g) The General Assembly also finds and declares that
5promotion of business ownership by individuals who have resided
6in areas of high poverty and high enforcement of
7cannabis-related laws furthers an equitable cannabis industry.
8 (h) Therefore, in the interest of remedying the harms
9resulting from the disproportionate enforcement of
10cannabis-related laws, the General Assembly finds and declares
11that a social equity program should offer, among other things,
12financial assistance and license application benefits to
13individuals most directly and adversely impacted by the
14enforcement of cannabis-related laws who are interested in
15starting cannabis business establishments.
16 Section 7-10. Cannabis Business Development Fund.
17 (a) There is created in the State treasury a special fund,
18which shall be held separate and apart from all other State
19moneys, to be known as the Cannabis Business Development Fund.
20The Cannabis Business Development Fund shall be exclusively
21used for the following purposes:
22 (1) to provide low-interest rate loans to Social Equity
23 Applicants to pay for ordinary and necessary expenses to
24 start and operate a cannabis business establishment
25 permitted by this Act;

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1 (2) to provide grants to Qualified Social Equity
2 Applicants to pay for ordinary and necessary expenses to
3 start and operate a cannabis business establishment
4 permitted by this Act;
5 (3) to compensate the Department of Commerce and
6 Economic Opportunity for any costs related to the provision
7 of low-interest loans and grants to Qualified Social Equity
8 Applicants;
9 (4) to pay for outreach that may be provided or
10 targeted to attract and support Social Equity Applicants;
11 (5) (blank);
12 (6) to conduct any study or research concerning the
13 participation of minorities, women, veterans, or people
14 with disabilities in the cannabis industry, including,
15 without limitation, barriers to such individuals entering
16 the industry as equity owners of cannabis business
17 establishments;
18 (7) (blank); and
19 (8) to assist with job training and technical
20 assistance for residents in Disproportionately Impacted
21 Areas.
22 (b) All moneys collected under Sections 15-15 and 15-20 for
23Early Approval Adult Use Dispensing Organization Licenses
24issued before January 1, 2021 and remunerations made as a
25result of transfers of permits awarded to Qualified Social
26Equity Applicants shall be deposited into the Cannabis Business

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1Development Fund.
2 (c) As soon as practical after July 1, 2019, the
3Comptroller shall order and the Treasurer shall transfer
4$12,000,000 from the Compassionate Use of Medical Cannabis Fund
5to the Cannabis Business Development Fund.
6 (d) Notwithstanding any other law to the contrary, the
7Cannabis Business Development Fund is not subject to sweeps,
8administrative charge-backs, or any other fiscal or budgetary
9maneuver that would in any way transfer any amounts from the
10Cannabis Business Development Fund into any other fund of the
11State.
12 Section 7-15. Loans and grants to Social Equity Applicants.
13 (a) The Department of Commerce and Economic Opportunity
14shall establish grant and loan programs, subject to
15appropriations from the Cannabis Business Development Fund,
16for the purposes of providing financial assistance, loans,
17grants, and technical assistance to Social Equity Applicants.
18 (b) The Department of Commerce and Economic Opportunity has
19the power to:
20 (1) provide Cannabis Social Equity loans and grants
21 from appropriations from the Cannabis Business Development
22 Fund to assist Social Equity Applicants in gaining entry
23 to, and successfully operating in, the State's regulated
24 cannabis marketplace;
25 (2) enter into agreements that set forth terms and

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1 conditions of the financial assistance, accept funds or
2 grants, and engage in cooperation with private entities and
3 agencies of State or local government to carry out the
4 purposes of this Section;
5 (3) fix, determine, charge, and collect any premiums,
6 fees, charges, costs and expenses, including application
7 fees, commitment fees, program fees, financing charges, or
8 publication fees in connection with its activities under
9 this Section;
10 (4) coordinate assistance under these loan programs
11 with activities of the Illinois Department of Financial and
12 Professional Regulation, the Illinois Department of
13 Agriculture, and other agencies as needed to maximize the
14 effectiveness and efficiency of this Act;
15 (5) provide staff, administration, and related support
16 required to administer this Section;
17 (6) take whatever actions are necessary or appropriate
18 to protect the State's interest in the event of bankruptcy,
19 default, foreclosure, or noncompliance with the terms and
20 conditions of financial assistance provided under this
21 Section, including the ability to recapture funds if the
22 recipient is found to be noncompliant with the terms and
23 conditions of the financial assistance agreement;
24 (7) establish application, notification, contract, and
25 other forms, procedures, or rules deemed necessary and
26 appropriate; and

HB1438 Enrolled- 34 -LRB101 04919 JRG 49928 b
1 (8) utilize vendors or contract work to carry out the
2 purposes of this Act.
3 (c) Loans made under this Section:
4 (1) shall only be made if, in the Department's
5 judgment, the project furthers the goals set forth in this
6 Act; and
7 (2) shall be in such principal amount and form and
8 contain such terms and provisions with respect to security,
9 insurance, reporting, delinquency charges, default
10 remedies, and other matters as the Department shall
11 determine appropriate to protect the public interest and to
12 be consistent with the purposes of this Section. The terms
13 and provisions may be less than required for similar loans
14 not covered by this Section.
15 (d) Grants made under this Section shall be awarded on a
16competitive and annual basis under the Grant Accountability and
17Transparency Act. Grants made under this Section shall further
18and promote the goals of this Act, including promotion of
19Social Equity Applicants, job training and workforce
20development, and technical assistance to Social Equity
21Applicants.
22 (e) Beginning January 1, 2021 and each year thereafter, the
23Department shall annually report to the Governor and the
24General Assembly on the outcomes and effectiveness of this
25Section that shall include the following:
26 (1) the number of persons or businesses receiving

HB1438 Enrolled- 35 -LRB101 04919 JRG 49928 b
1 financial assistance under this Section;
2 (2) the amount in financial assistance awarded in the
3 aggregate, in addition to the amount of loans made that are
4 outstanding and the amount of grants awarded;
5 (3) the location of the project engaged in by the
6 person or business; and
7 (4) if applicable, the number of new jobs and other
8 forms of economic output created as a result of the
9 financial assistance.
10 (f) The Department of Commerce and Economic Opportunity
11shall include engagement with individuals with limited English
12proficiency as part of its outreach provided or targeted to
13attract and support Social Equity Applicants.
14 Section 7-20. Fee waivers.
15 (a) For Social Equity Applicants, the Department of
16Financial and Professional Regulation and the Department of
17Agriculture shall waive 50% of any nonrefundable license
18application fees, any nonrefundable fees associated with
19purchasing a license to operate a cannabis business
20establishment, and any surety bond or other financial
21requirements, provided a Social Equity Applicant meets the
22following qualifications at the time the payment is due:
23 (1) the applicant, including all individuals and
24 entities with 10% or greater ownership and all parent
25 companies, subsidiaries, and affiliates, has less than a

HB1438 Enrolled- 36 -LRB101 04919 JRG 49928 b
1 total of $750,000 of income in the previous calendar year;
2 and
3 (2) the applicant, including all individuals and
4 entities with 10% or greater ownership and all parent
5 companies, subsidiaries, and affiliates, has no more than 2
6 other licenses for cannabis business establishments in the
7 State of Illinois.
8 (b) The Department of Financial and Professional
9Regulation and the Department of Agriculture may require Social
10Equity Applicants to attest that they meet the requirements for
11a fee waiver as provided in subsection (a) and to provide
12evidence of annual total income in the previous calendar year.
13 (c) If the Department of Financial and Professional
14Regulation or the Department of Agriculture determines that an
15applicant who applied as a Social Equity Applicant is not
16eligible for such status, the applicant shall be provided an
17additional 10 days to provide alternative evidence that he or
18she qualifies as a Social Equity Applicant. Alternatively, the
19applicant may pay the remainder of the waived fee and be
20considered as a non-Social Equity Applicant. If the applicant
21cannot do either, then the Departments may keep the initial
22application fee and the application shall not be graded.
23 Section 7-25. Transfer of license awarded to Social Equity
24Applicant.
25 (a) In the event a Social Equity Applicant seeks to

HB1438 Enrolled- 37 -LRB101 04919 JRG 49928 b
1transfer, sell, or grant a cannabis business establishment
2license within 5 years after it was issued to a person or
3entity that does not qualify as a Social Equity Applicant, the
4transfer agreement shall require the new license holder to pay
5the Cannabis Business Development Fund an amount equal to:
6 (1) any fees that were waived by any State agency based
7 on the applicant's status as a Social Equity Applicant, if
8 applicable;
9 (2) any outstanding amount owed by the Qualified Social
10 Equity Applicant for a loan through the Cannabis Business
11 Development Fund, if applicable; and
12 (3) the full amount of any grants that the Qualified
13 Social Equity Applicant received from the Department of
14 Commerce and Economic Opportunity, if applicable.
15 (b) Transfers of cannabis business establishment licenses
16awarded to a Social Equity Applicant are subject to all other
17provisions of this Act, the Compassionate Use of Medical
18Cannabis Pilot Program Act, and rules regarding transfers.
19 Section 7-30. Reporting. By January 1, 2021, and on January
201 of every year thereafter, or upon request by the Illinois
21Cannabis Regulation Oversight Officer, each cannabis business
22establishment licensed under this Act shall report to the
23Illinois Cannabis Regulation Oversight Officer, on a form to be
24provided by the Illinois Cannabis Regulation Oversight
25Officer, information that will allow it to assess the extent of

HB1438 Enrolled- 38 -LRB101 04919 JRG 49928 b
1diversity in the medical and adult use cannabis industry and
2methods for reducing or eliminating any identified barriers to
3entry, including access to capital. The information to be
4collected shall be designed to identify the following:
5 (1) the number and percentage of licenses provided to
6 Social Equity Applicants and to businesses owned by
7 minorities, women, veterans, and people with disabilities;
8 (2) the total number and percentage of employees in the
9 cannabis industry who meet the criteria in (3)(i) or
10 (3)(ii) in the definition of Social Equity Applicant or who
11 are minorities, women, veterans, or people with
12 disabilities;
13 (3) the total number and percentage of contractors and
14 subcontractors in the cannabis industry that meet the
15 definition of a Social Equity Applicant or who are owned by
16 minorities, women, veterans, or people with disabilities,
17 if known to the cannabis business establishment; and
18 (4) recommendations on reducing or eliminating any
19 identified barriers to entry, including access to capital,
20 in the cannabis industry.
21
ARTICLE 10.
22
PERSONAL USE OF CANNABIS
23 Section 10-5. Personal use of cannabis; restrictions on
24cultivation; penalties.

HB1438 Enrolled- 39 -LRB101 04919 JRG 49928 b
1 (a) Beginning January 1, 2020, notwithstanding any other
2provision of law, and except as otherwise provided in this Act,
3the following acts are not a violation of this Act and shall
4not be a criminal or civil offense under State law or the
5ordinances of any unit of local government of this State or be
6a basis for seizure or forfeiture of assets under State law for
7persons other than natural individuals under 21 years of age:
8 (1) possession, consumption, use, purchase, obtaining,
9 or transporting an amount of cannabis for personal use that
10 does not exceed the possession limit under Section 10-10 or
11 otherwise in accordance with the requirements of this Act;
12 (2) cultivation of cannabis for personal use in
13 accordance with the requirements of this Act; and
14 (3) controlling property if actions that are
15 authorized by this Act occur on the property in accordance
16 with this Act.
17 (a-1) Beginning January 1, 2020, notwithstanding any other
18provision of law, and except as otherwise provided in this Act,
19possessing, consuming, using, purchasing, obtaining, or
20transporting an amount of cannabis purchased or produced in
21accordance with this Act that does not exceed the possession
22limit under subsection (a) of Section 10-10 shall not be a
23basis for seizure or forfeiture of assets under State law.
24 (b) Cultivating cannabis for personal use is subject to the
25following limitations:
26 (1) An Illinois resident 21 years of age or older who

HB1438 Enrolled- 40 -LRB101 04919 JRG 49928 b
1 is a registered qualifying patient under the Compassionate
2 Use of Medical Cannabis Pilot Program Act may cultivate
3 cannabis plants, with a limit of 5 plants that are more
4 than 5 inches tall, per household without a cultivation
5 center or craft grower license. In this Section, "resident"
6 means a person who has been domiciled in the State of
7 Illinois for a period of 30 days before cultivation.
8 (2) Cannabis cultivation must take place in an
9 enclosed, locked space.
10 (3) Adult registered qualifying patients may purchase
11 cannabis seeds from a dispensary for the purpose of home
12 cultivation. Seeds may not be given or sold to any other
13 person.
14 (4) Cannabis plants shall not be stored or placed in a
15 location where they are subject to ordinary public view, as
16 defined in this Act. A registered qualifying patient who
17 cultivates cannabis under this Section shall take
18 reasonable precautions to ensure the plants are secure from
19 unauthorized access, including unauthorized access by a
20 person under 21 years of age.
21 (5) Cannabis cultivation may occur only on residential
22 property lawfully in possession of the cultivator or with
23 the consent of the person in lawful possession of the
24 property. An owner or lessor of residential property may
25 prohibit the cultivation of cannabis by a lessee.
26 (6) (Blank).

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1 (7) A dwelling, residence, apartment, condominium
2 unit, enclosed, locked space, or piece of property not
3 divided into multiple dwelling units shall not contain more
4 than 5 plants at any one time.
5 (8) Cannabis plants may only be tended by registered
6 qualifying patients who reside at the residence, or their
7 authorized agent attending to the residence for brief
8 periods, such as when the qualifying patient is temporarily
9 away from the residence.
10 (9) A registered qualifying patient who cultivates
11 more than the allowable number of cannabis plants, or who
12 sells or gives away cannabis plants, cannabis, or
13 cannabis-infused products produced under this Section, is
14 liable for penalties as provided by law, including the
15 Cannabis Control Act, in addition to loss of home
16 cultivation privileges as established by rule.
17 Section 10-10. Possession limit.
18 (a) Except if otherwise authorized by this Act, for a
19person who is 21 years of age or older and a resident of this
20State, the possession limit is as follows:
21 (1) 30 grams of cannabis flower;
22 (2) no more than 500 milligrams of THC contained in
23 cannabis-infused product;
24 (3) 5 grams of cannabis concentrate; and
25 (4) for registered qualifying patients, any cannabis

HB1438 Enrolled- 42 -LRB101 04919 JRG 49928 b
1 produced by cannabis plants grown under subsection (b) of
2 Section 10-5, provided any amount of cannabis produced in
3 excess of 30 grams of raw cannabis or its equivalent must
4 remain secured within the residence or residential
5 property in which it was grown.
6 (b) For a person who is 21 years of age or older and who is
7not a resident of this State, the possession limit is:
8 (1) 15 grams of cannabis flower;
9 (2) 2.5 grams of cannabis concentrate; and
10 (3) 250 milligrams of THC contained in a
11 cannabis-infused product.
12 (c) The possession limits found in subsections (a) and (b)
13of this Section are to be considered cumulative.
14 (d) No person shall knowingly obtain, seek to obtain, or
15possess an amount of cannabis from a dispensing organization or
16craft grower that would cause him or her to exceed the
17possession limit under this Section, including cannabis that is
18cultivated by a person under this Act or obtained under the
19Compassionate Use of Medical Cannabis Pilot Program Act.
20 Section 10-15. Persons under 21 years of age.
21 (a) Nothing in this Act is intended to permit the transfer
22of cannabis, with or without remuneration, to a person under 21
23years of age, or to allow a person under 21 years of age to
24purchase, possess, use, process, transport, grow, or consume
25cannabis except where authorized by the Compassionate Use of

HB1438 Enrolled- 43 -LRB101 04919 JRG 49928 b
1Medical Cannabis Pilot Program Act or by the Community College
2Cannabis Vocational Pilot Program.
3 (b) Notwithstanding any other provisions of law
4authorizing the possession of medical cannabis, nothing in this
5Act authorizes a person who is under 21 years of age to possess
6cannabis. A person under 21 years of age with cannabis in his
7or her possession is guilty of a civil law violation as
8outlined in paragraph (a) of Section 4 of the Cannabis Control
9Act.
10 (c) If the person under the age of 21 was in a motor
11vehicle at the time of the offense, the Secretary of State may
12suspend or revoke the driving privileges of any person for a
13violation of this Section under Section 6-206 of the Illinois
14Vehicle Code and the rules adopted under it.
15 (d) It is unlawful for any parent or guardian to knowingly
16permit his or her residence, any other private property under
17his or her control, or any vehicle, conveyance, or watercraft
18under his or her control to be used by an invitee of the
19parent's child or the guardian's ward, if the invitee is under
20the age of 21, in a manner that constitutes a violation of this
21Section. A parent or guardian is deemed to have knowingly
22permitted his or her residence, any other private property
23under his or her control, or any vehicle, conveyance, or
24watercraft under his or her control to be used in violation of
25this Section if he or she knowingly authorizes or permits
26consumption of cannabis by underage invitees. Any person who

HB1438 Enrolled- 44 -LRB101 04919 JRG 49928 b
1violates this subsection (d) is guilty of a Class A misdemeanor
2and the person's sentence shall include, but shall not be
3limited to, a fine of not less than $500. If a violation of
4this subsection (d) directly or indirectly results in great
5bodily harm or death to any person, the person violating this
6subsection is guilty of a Class 4 felony. In this subsection
7(d), where the residence or other property has an owner and a
8tenant or lessee, the trier of fact may infer that the
9residence or other property is occupied only by the tenant or
10lessee.
11 Section 10-20. Identification; false identification;
12penalty.
13 (a) To protect personal privacy, the Department of
14Financial and Professional Regulation shall not require a
15purchaser to provide a dispensing organization with personal
16information other than government-issued identification to
17determine the purchaser's age, and a dispensing organization
18shall not obtain and record personal information about a
19purchaser without the purchaser's consent. A dispensing
20organization shall use an electronic reader or electronic
21scanning device to scan a purchaser's government-issued
22identification, if applicable, to determine the purchaser's
23age and the validity of the identification. Any identifying or
24personal information of a purchaser obtained or received in
25accordance with this Section shall not be retained, used,

HB1438 Enrolled- 45 -LRB101 04919 JRG 49928 b
1shared or disclosed for any purpose except as authorized by
2this Act.
3 (b) A person who is under 21 years of age may not present
4or offer to a cannabis business establishment or the cannabis
5business establishment's principal or employee any written or
6oral evidence of age that is false, fraudulent, or not actually
7the person's own, for the purpose of:
8 (1) purchasing, attempting to purchase, or otherwise
9 obtaining or attempting to obtain cannabis or any cannabis
10 product; or
11 (2) gaining access to a cannabis business
12 establishment.
13 (c) A violation of this Section is a Class A misdemeanor
14consistent with Section 6-20 of the Liquor Control Act of 1934.
15 (d) The Secretary of State may suspend or revoke the
16driving privileges of any person for a violation of this
17Section under Section 6-206 of the Illinois Vehicle Code and
18the rules adopted under it.
19 (e) No agent or employee of the licensee shall be
20disciplined or discharged for selling or furnishing cannabis or
21cannabis products to a person under 21 years of age if the
22agent or employee demanded and was shown, before furnishing
23cannabis or cannabis products to a person under 21 years of
24age, adequate written evidence of age and identity of the
25person. This subsection (e) does not apply if the agent or
26employee accepted the written evidence knowing it to be false

HB1438 Enrolled- 46 -LRB101 04919 JRG 49928 b
1or fraudulent. Adequate written evidence of age and identity of
2the person is a document issued by a federal, State, county, or
3municipal government, or subdivision or agency thereof,
4including, but not limited to, a motor vehicle operator's
5license, a registration certificate issued under the Military
6Selective Service Act, or an identification card issued to a
7member of the Armed Forces. Proof that the licensee or his or
8her employee or agent was shown and reasonably relied upon such
9written evidence in any transaction forbidden by this Section
10is an affirmative defense in any criminal prosecution therefor
11or to any proceedings for the suspension or revocation of any
12license based thereon.
13 Section 10-25. Immunities and presumptions related to the
14use of cannabis by purchasers.
15 (a) A purchaser who is 21 years of age or older is not
16subject to arrest, prosecution, denial of any right or
17privilege, or other punishment including, but not limited to,
18any civil penalty or disciplinary action taken by an
19occupational or professional licensing board, based solely on
20the use of cannabis if (1) the purchaser possesses an amount of
21cannabis that does not exceed the possession limit under
22Section 10-10 and, if the purchaser is licensed, certified, or
23registered to practice any trade or profession under any Act
24and (2) the use of cannabis does not impair that person when he
25or she is engaged in the practice of the profession for which

HB1438 Enrolled- 47 -LRB101 04919 JRG 49928 b
1he or she is licensed, certified, or registered.
2 (b) A purchaser 21 years of age or older is not subject to
3arrest, prosecution, denial of any right or privilege, or other
4punishment, including, but not limited to, any civil penalty or
5disciplinary action taken by an occupational or professional
6licensing board, based solely for (i) selling cannabis
7paraphernalia if employed and licensed as a dispensing agent by
8a dispensing organization or (ii) being in the presence or
9vicinity of the use of cannabis as allowed under this Act.
10 (c) Mere possession of, or application for, an agent
11identification card or license does not constitute probable
12cause or reasonable suspicion to believe that a crime has been
13committed, nor shall it be used as the sole basis to support
14the search of the person, property, or home of the person
15possessing or applying for the agent identification card. The
16possession of, or application for, an agent identification card
17does not preclude the existence of probable cause if probable
18cause exists based on other grounds.
19 (d) No person employed by the State of Illinois shall be
20subject to criminal or civil penalties for taking any action in
21good faith in reliance on this Act when acting within the scope
22of his or her employment. Representation and indemnification
23shall be provided to State employees as set forth in Section 2
24of the State Employee Indemnification Act.
25 (e) No law enforcement or correctional agency, nor any
26person employed by a law enforcement or correctional agency,

HB1438 Enrolled- 48 -LRB101 04919 JRG 49928 b
1shall be subject to criminal or civil liability, except for
2willful and wanton misconduct, as a result of taking any action
3within the scope of the official duties of the agency or person
4to prohibit or prevent the possession or use of cannabis by a
5person incarcerated at a correctional facility, jail, or
6municipal lockup facility, on parole or mandatory supervised
7release, or otherwise under the lawful jurisdiction of the
8agency or person.
9 (f) For purposes of receiving medical care, including organ
10transplants, a person's use of cannabis under this Act does not
11constitute the use of an illicit substance or otherwise
12disqualify a person from medical care.
13 Section 10-30. Discrimination prohibited.
14 (a) Neither the presence of cannabinoid components or
15metabolites in a person's bodily fluids nor possession of
16cannabis-related paraphernalia, nor conduct related to the use
17of cannabis or the participation in cannabis-related
18activities lawful under this Act by a custodial or noncustodial
19parent, grandparent, legal guardian, foster parent, or other
20person charged with the well-being of a child, shall form the
21sole or primary basis or supporting basis for any action or
22proceeding by a child welfare agency or in a family or juvenile
23court, any adverse finding, adverse evidence, or restriction of
24any right or privilege in a proceeding related to adoption of a
25child, acting as a foster parent of a child, or a person's

HB1438 Enrolled- 49 -LRB101 04919 JRG 49928 b
1fitness to adopt a child or act as a foster parent of a child,
2or serve as the basis of any adverse finding, adverse evidence,
3or restriction of any right of privilege in a proceeding
4related to guardianship, conservatorship, trusteeship, the
5execution of a will, or the management of an estate, unless the
6person's actions in relation to cannabis created an
7unreasonable danger to the safety of the minor or otherwise
8show the person to not be competent as established by clear and
9convincing evidence. This subsection applies only to conduct
10protected under this Act.
11 (b) No landlord may be penalized or denied any benefit
12under State law for leasing to a person who uses cannabis under
13this Act.
14 (c) Nothing in this Act may be construed to require any
15person or establishment in lawful possession of property to
16allow a guest, client, lessee, customer, or visitor to use
17cannabis on or in that property.
18 Section 10-35. Limitations and penalties.
19 (a) This Act does not permit any person to engage in, and
20does not prevent the imposition of any civil, criminal, or
21other penalties for engaging in, any of the following conduct:
22 (1) undertaking any task under the influence of
23 cannabis when doing so would constitute negligence,
24 professional malpractice, or professional misconduct;
25 (2) possessing cannabis:

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1 (A) in a school bus, unless permitted for a
2 qualifying patient or caregiver pursuant to the
3 Compassionate Use of Medical Cannabis Pilot Program
4 Act;
5 (B) on the grounds of any preschool or primary or
6 secondary school, unless permitted for a qualifying
7 patient or caregiver pursuant to the Compassionate Use
8 of Medical Cannabis Pilot Program Act;
9 (C) in any correctional facility;
10 (D) in a vehicle not open to the public unless the
11 cannabis is in a reasonably secured, sealed container
12 and reasonably inaccessible while the vehicle is
13 moving; or
14 (E) in a private residence that is used at any time
15 to provide licensed child care or other similar social
16 service care on the premises;
17 (3) using cannabis:
18 (A) in a school bus, unless permitted for a
19 qualifying patient or caregiver pursuant to the
20 Compassionate Use of Medical Cannabis Pilot Program
21 Act;
22 (B) on the grounds of any preschool or primary or
23 secondary school, unless permitted for a qualifying
24 patient or caregiver pursuant to the Compassionate Use
25 of Medical Cannabis Pilot Program Act;
26 (C) in any correctional facility;

HB1438 Enrolled- 51 -LRB101 04919 JRG 49928 b
1 (D) in any motor vehicle;
2 (E) in a private residence that is used at any time
3 to provide licensed child care or other similar social
4 service care on the premises;
5 (F) in any public place; or
6 (G) knowingly in close physical proximity to
7 anyone under 21 years of age who is not a registered
8 medical cannabis patient under the Compassionate Use
9 of Medical Cannabis Pilot Program Act;
10 (4) smoking cannabis in any place where smoking is
11 prohibited under the Smoke Free Illinois Act;
12 (5) operating, navigating, or being in actual physical
13 control of any motor vehicle, aircraft, or motorboat while
14 using or under the influence of cannabis in violation of
15 Section 11-501 or 11-502.1 of the Illinois Vehicle Code;
16 (6) facilitating the use of cannabis by any person who
17 is not allowed to use cannabis under this Act or the
18 Compassionate Use of Medical Cannabis Pilot Program Act;
19 (7) transferring cannabis to any person contrary to
20 this Act or the Compassionate Use of Medical Cannabis Pilot
21 Program Act;
22 (8) the use of cannabis by a law enforcement officer,
23 corrections officer, probation officer, or firefighter
24 while on duty; or
25 (9) the use of cannabis by a person who has a school
26 bus permit or a Commercial Driver's License while on duty.

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1 As used in this Section, "public place" means any place
2where a person could reasonably be expected to be observed by
3others. "Public place" includes all parts of buildings owned in
4whole or in part, or leased, by the State or a unit of local
5government. "Public place" does not include a private residence
6unless the private residence is used to provide licensed child
7care, foster care, or other similar social service care on the
8premises.
9 (b) Nothing in this Act shall be construed to prevent the
10arrest or prosecution of a person for reckless driving or
11driving under the influence of cannabis if probable cause
12exists.
13 (c) Nothing in this Act shall prevent a private business
14from restricting or prohibiting the use of cannabis on its
15property, including areas where motor vehicles are parked.
16 (d) Nothing in this Act shall require an individual or
17business entity to violate the provisions of federal law,
18including colleges or universities that must abide by the
19Drug-Free Schools and Communities Act Amendments of 1989, that
20require campuses to be drug free.
21 Section 10-40. Restore, Reinvest, and Renew Program.
22 (a) The General Assembly finds that in order to address the
23disparities described below, aggressive approaches and
24targeted resources to support local design and control of
25community-based responses to these outcomes are required. To

HB1438 Enrolled- 53 -LRB101 04919 JRG 49928 b
1carry out this intent, the Restore, Reinvest, and Renew (R3)
2Program is created for the following purposes:
3 (1) to directly address the impact of economic
4 disinvestment, violence, and the historical overuse of
5 criminal justice responses to community and individual
6 needs by providing resources to support local design and
7 control of community-based responses to these impacts;
8 (2) to substantially reduce both the total amount of
9 gun violence and concentrated poverty in this State;
10 (3) to protect communities from gun violence through
11 targeted investments and intervention programs, including
12 economic growth and improving family violence prevention,
13 community trauma treatment rates, gun injury victim
14 services, and public health prevention activities;
15 (4) to promote employment infrastructure and capacity
16 building related to the social determinants of health in
17 the eligible community areas.
18 (b) In this Section, "Authority" means the Illinois
19Criminal Justice Information Authority in coordination with
20the Justice, Equity, and Opportunity Initiative of the
21Lieutenant Governor's Office.
22 (c) Eligibility of R3 Areas. Within 180 days after the
23effective date of this Act, the Authority shall identify as
24eligible, areas in this State by way of historically recognized
25geographic boundaries, to be designated by the Restore,
26Reinvest, and Renew Program Board as R3 Areas and therefore

HB1438 Enrolled- 54 -LRB101 04919 JRG 49928 b
1eligible to apply for R3 funding. Local groups within R3 Areas
2will be eligible to apply for State funding through the
3Restore, Reinvest, and Renew Program Board. Qualifications for
4designation as an R3 Area are as follows:
5 (1) Based on an analysis of data, communities in this
6 State that are high need, underserved, disproportionately
7 impacted by historical economic disinvestment, and ravaged
8 by violence as indicated by the highest rates of gun
9 injury, unemployment, child poverty rates, and commitments
10 to and returns from the Illinois Department of Corrections.
11 (2) The Authority shall send to the Legislative Audit
12 Commission and make publicly available its analysis and
13 identification of eligible R3 Areas and shall recalculate
14 he eligibility data every 4 years. On an annual basis, the
15 Authority shall analyze data and indicate if data covering
16 any R3 Area or portion of an Area has, for 4 consecutive
17 years, substantially deviated from the average of
18 statewide data on which the original calculation was made
19 to determine the Areas, including disinvestment, violence,
20 gun injury, unemployment, child poverty rates, or
21 commitments to or returns from the Illinois Department of
22 Corrections.
23 (d) The Restore, Reinvest, and Renew Program Board shall
24encourage collaborative partnerships within each R3 Area to
25minimize multiple partnerships per Area.
26 (e) The Restore, Reinvest, and Renew Program Board is

HB1438 Enrolled- 55 -LRB101 04919 JRG 49928 b
1created and shall reflect the diversity of the State of
2Illinois, including geographic, racial, and ethnic diversity.
3Using the data provided by the Authority, the Restore,
4Reinvest, and Renew Program Board shall be responsible for
5designating the R3 Area boundaries and for the selection and
6oversight of R3 Area grantees. The Restore, Reinvest, and Renew
7Program Board ex officio members shall, within 4 months after
8the effective date of this Act, convene the Board to appoint a
9full Restore, Reinvest, and Renew Program Board and oversee,
10provide guidance to, and develop an administrative structure
11for the R3 Program.
12 (1) The ex officio members are:
13 (A) The Lieutenant Governor, or his or her
14 designee, who shall serve as chair.
15 (B) The Attorney General, or his or her
16 designee.
17 (C) The Director of Commerce and Economic
18 Opportunity, or his or her designee.
19 (D) The Director of Public Health, or his or
20 her designee.
21 (E) The Director of Corrections, or his or her
22 designee.
23 (F) The Executive Director of the Illinois
24 Criminal Justice Information Authority, or his or
25 her designee.
26 (G) The Director of Employment Security, or

HB1438 Enrolled- 56 -LRB101 04919 JRG 49928 b
1 his or her designee.
2 (H) The Secretary of Human Services, or his or
3 her designee.
4 (I) A member of the Senate, designated by the
5 President of the Senate.
6 (J) A member of the House of Representatives,
7 designated by the Speaker of the House of
8 Representatives.
9 (K) A member of the Senate, designated by the
10 Minority Leader of the Senate.
11 (L) A member of the House of Representatives,
12 designated by the Minority Leader of the House of
13 Representatives.
14 (2) Within 90 days after the R3 Areas have been
15 designated by the Restore, Reinvest, and Renew Program
16 Board, the following members shall be appointed to the
17 Board by the R3 board chair:
18 (A) public officials of municipal geographic
19 jurisdictions in the State that include an R3 Area, or
20 their designees;
21 (B) 4 community-based providers or community
22 development organization representatives who provide
23 services to treat violence and address the social
24 determinants of health, or promote community
25 investment, including, but not limited to, services
26 such as job placement and training, educational

HB1438 Enrolled- 57 -LRB101 04919 JRG 49928 b
1 services, workforce development programming, and
2 wealth building. The community-based organization
3 representatives shall work primarily in jurisdictions
4 that include an R3 Area and no more than 2
5 representatives shall work primarily in Cook County.
6 At least one of the community-based providers shall
7 have expertise in providing services to an immigrant
8 population;
9 (C) Two experts in the field of violence reduction;
10 (D) One male who has previously been incarcerated
11 and is over the age of 24 at time of appointment;
12 (E) One female who has previously been
13 incarcerated and is over the age of 24 at time of
14 appointment;
15 (F) Two individuals who have previously been
16 incarcerated and are between the ages of 17 and 24 at
17 time of appointment.
18 As used in this paragraph (2), "an individual who has
19 been previously incarcerated" means a person who has been
20 convicted of or pled guilty to one or more felonies, who
21 was sentenced to a term of imprisonment, and who has
22 completed his or her sentence. Board members shall serve
23 without compensation and may be reimbursed for reasonable
24 expenses incurred in the performance of their duties from
25 funds appropriated for that purpose. Once all its members
26 have been appointed as outlined in items (A) through (F) of

HB1438 Enrolled- 58 -LRB101 04919 JRG 49928 b
1 this paragraph (2), the Board may exercise any power,
2 perform any function, take any action, or do anything in
3 furtherance of its purposes and goals upon the appointment
4 of a quorum of its members. The Board terms of the non-ex
5 officio and General Assembly Board members shall end 4
6 years from the date of appointment.
7 (f) Within 12 months after the effective date of this Act,
8the Board shall:
9 (1) develop a process to solicit applications from
10 eligible R3 Areas;
11 (2) develop a standard template for both planning and
12 implementation activities to be submitted by R3 Areas to
13 the State;
14 (3) identify resources sufficient to support the full
15 administration and evaluation of the R3 Program, including
16 building and sustaining core program capacity at the
17 community and State levels;
18 (4) review R3 Area grant applications and proposed
19 agreements and approve the distribution of resources;
20 (5) develop a performance measurement system that
21 focuses on positive outcomes;
22 (6) develop a process to support ongoing monitoring and
23 evaluation of R3 programs; and
24 (7) deliver an annual report to the General Assembly
25 and to the Governor to be posted on the Governor's Office
26 and General Assembly websites and provide to the public an

HB1438 Enrolled- 59 -LRB101 04919 JRG 49928 b
1 annual report on its progress.
2 (g) R3 Area grants.
3 (1) Grant funds shall be awarded by the Illinois
4 Criminal Justice Information Authority, in coordination
5 with the R3 board, based on the likelihood that the plan
6 will achieve the outcomes outlined in subsection (a) and
7 consistent with the requirements of the Grant
8 Accountability and Transparency Act. The R3 Program shall
9 also facilitate the provision of training and technical
10 assistance for capacity building within and among R3 Areas.
11 (2) R3 Program Board grants shall be used to address
12 economic development, violence prevention services,
13 re-entry services, youth development, and civil legal aid.
14 (3) The Restore, Reinvest, and Renew Program Board and
15 the R3 Area grantees shall, within a period of no more than
16 120 days from the completion of planning activities
17 described in this Section, finalize an agreement on the
18 plan for implementation. Implementation activities may:
19 (A) have a basis in evidence or best practice
20 research or have evaluations demonstrating the
21 capacity to address the purpose of the program in
22 subsection (a);
23 (B) collect data from the inception of planning
24 activities through implementation, with data
25 collection technical assistance when needed, including
26 cost data and data related to identified meaningful

HB1438 Enrolled- 60 -LRB101 04919 JRG 49928 b
1 short-term, mid-term, and long-term goals and metrics;
2 (C) report data to the Restore, Reinvest, and Renew
3 Program Board biannually; and
4 (D) report information as requested by the R3
5 Program Board.
6 Section 10-50. Employment; employer liability.
7 (a) Nothing in this Act shall prohibit an employer from
8adopting reasonable zero tolerance or drug free workplace
9policies, or employment policies concerning drug testing,
10smoking, consumption, storage, or use of cannabis in the
11workplace or while on call provided that the policy is applied
12in a nondiscriminatory manner.
13 (b) Nothing in this Act shall require an employer to permit
14an employee to be under the influence of or use cannabis in the
15employer's workplace or while performing the employee's job
16duties or while on call.
17 (c) Nothing in this Act shall limit or prevent an employer
18from disciplining an employee or terminating employment of an
19employee for violating an employer's employment policies or
20workplace drug policy.
21 (d) An employer may consider an employee to be impaired or
22under the influence of cannabis if the employer has a good
23faith belief that an employee manifests specific, articulable
24symptoms while working that decrease or lessen the employee's
25performance of the duties or tasks of the employee's job

HB1438 Enrolled- 61 -LRB101 04919 JRG 49928 b
1position, including symptoms of the employee's speech,
2physical dexterity, agility, coordination, demeanor,
3irrational or unusual behavior, or negligence or carelessness
4in operating equipment or machinery; disregard for the safety
5of the employee or others, or involvement in any accident that
6results in serious damage to equipment or property; disruption
7of a production or manufacturing process; or carelessness that
8results in any injury to the employee or others. If an employer
9elects to discipline an employee on the basis that the employee
10is under the influence or impaired by cannabis, the employer
11must afford the employee a reasonable opportunity to contest
12the basis of the determination.
13 (e) Nothing in this Act shall be construed to create or
14imply a cause of action for any person against an employer for:
15 (1) actions, including but not limited to subjecting an
16 employee or applicant to reasonable drug and alcohol
17 testing under the employer's workplace drug policy,
18 including an employee's refusal to be tested or to
19 cooperate in testing procedures or disciplining or
20 termination of employment, based on the employer's good
21 faith belief that an employee used or possessed cannabis in
22 the employer's workplace or while performing the
23 employee's job duties or while on call in violation of the
24 employer's employment policies;
25 (2) actions, including discipline or termination of
26 employment, based on the employer's good faith belief that

HB1438 Enrolled- 62 -LRB101 04919 JRG 49928 b
1 an employee was impaired as a result of the use of
2 cannabis, or under the influence of cannabis, while at the
3 employer's workplace or while performing the employee's
4 job duties or while on call in violation of the employer's
5 workplace drug policy; or
6 (3) injury, loss, or liability to a third party if the
7 employer neither knew nor had reason to know that the
8 employee was impaired.
9 (f) Nothing in this Act shall be construed to enhance or
10diminish protections afforded by any other law, including but
11not limited to the Compassionate Use of Medical Cannabis Pilot
12Program Act or the Opioid Alternative Pilot Program.
13 (g) Nothing in this Act shall be construed to interfere
14with any federal, State, or local restrictions on employment
15including, but not limited to, the United States Department of
16Transportation regulation 49 CFR 40.151(e) or impact an
17employer's ability to comply with federal or State law or cause
18it to lose a federal or State contract or funding.
19 (h) As used in this Section, "workplace" means the
20employer's premises, including any building, real property,
21and parking area under the control of the employer or area used
22by an employee while in performance of the employee's job
23duties, and vehicles, whether leased, rented, or owned.
24"Workplace" may be further defined by the employer's written
25employment policy, provided that the policy is consistent with
26this Section.

HB1438 Enrolled- 63 -LRB101 04919 JRG 49928 b
1 (i) For purposes of this Section, an employee is deemed "on
2call" when such employee is scheduled with at least 24 hours'
3notice by his or her employer to be on standby or otherwise
4responsible for performing tasks related to his or her
5employment either at the employer's premises or other
6previously designated location by his or her employer or
7supervisor to perform a work-related task.
8
ARTICLE 15.
9
LICENSE AND REGULATION OF DISPENSING ORGANIZATIONS
10 Section 15-5. Authority.
11 (a) In this Article, "Department" means the Department of
12Financial and Professional Regulation.
13 (b) It is the duty of the Department to administer and
14enforce the provisions of this Act relating to the licensure
15and oversight of dispensing organizations and dispensing
16organization agents unless otherwise provided in this Act.
17 (c) No person shall operate a dispensing organization for
18the purpose of serving purchasers of cannabis or cannabis
19products without a license issued under this Article by the
20Department. No person shall be an officer, director, manager,
21or employee of a dispensing organization without having been
22issued a dispensing organization agent card by the Department.
23 (d) Subject to the provisions of this Act, the Department
24may exercise the following powers and duties:

HB1438 Enrolled- 64 -LRB101 04919 JRG 49928 b
1 (1) Prescribe forms to be issued for the administration
2 and enforcement of this Article.
3 (2) Examine, inspect, and investigate the premises,
4 operations, and records of dispensing organization
5 applicants and licensees.
6 (3) Conduct investigations of possible violations of
7 this Act pertaining to dispensing organizations and
8 dispensing organization agents.
9 (4) Conduct hearings on proceedings to refuse to issue
10 or renew licenses or to revoke, suspend, place on
11 probation, reprimand, or otherwise discipline a license
12 under this Article or take other nondisciplinary action.
13 (5) Adopt rules required for the administration of this
14 Article.
15 Section 15-10. Medical cannabis dispensing organization
16exemption. This Article does not apply to medical cannabis
17dispensing organizations registered under the Compassionate
18Use of Medical Cannabis Pilot Program Act, except where
19otherwise specified.
20 Section 15-15. Early Approval Adult Use Dispensing
21Organization License.
22 (a) Any medical cannabis dispensing organization holding a
23valid registration under the Compassionate Use of Medical
24Cannabis Pilot Program Act as of the effective date of this Act

HB1438 Enrolled- 65 -LRB101 04919 JRG 49928 b
1may, within 60 days of the effective date of this Act, apply to
2the Department for an Early Approval Adult Use Dispensing
3Organization License to serve purchasers at any medical
4cannabis dispensing location in operation on the effective date
5of this Act, pursuant to this Section.
6 (b) A medical cannabis dispensing organization seeking
7issuance of an Early Approval Adult Use Dispensing Organization
8License to serve purchasers at any medical cannabis dispensing
9location in operation as of the effective date of this Act
10shall submit an application on forms provided by the
11Department. The application must be submitted by the same
12person or entity that holds the medical cannabis dispensing
13organization registration and include the following:
14 (1) Payment of a nonrefundable fee of $30,000 to be
15 deposited into the Cannabis Regulation Fund;
16 (2) Proof of registration as a medical cannabis
17 dispensing organization that is in good standing;
18 (3) Certification that the applicant will comply with
19 the requirements contained in the Compassionate Use of
20 Medical Cannabis Pilot Program Act except as provided in
21 this Act;
22 (4) The legal name of the dispensing organization;
23 (5) The physical address of the dispensing
24 organization;
25 (6) The name, address, social security number, and date
26 of birth of each principal officer and board member of the

HB1438 Enrolled- 66 -LRB101 04919 JRG 49928 b
1 dispensing organization, each of whom must be at least 21
2 years of age;
3 (7) A nonrefundable Cannabis Business Development Fee
4 equal to 3% of the dispensing organization's total sales
5 between June 1, 2018 to June 1, 2019, or $100,000,
6 whichever is less, to be deposited into the Cannabis
7 Business Development Fund; and
8 (8) Identification of one of the following Social
9 Equity Inclusion Plans to be completed by March 31, 2021:
10 (A) Make a contribution of 3% of total sales from
11 June 1, 2018 to June 1, 2019, or $100,000, whichever is
12 less, to the Cannabis Business Development Fund. This
13 is in addition to the fee required by item (7) of this
14 subsection (b);
15 (B) Make a grant of 3% of total sales from June 1,
16 2018 to June 1, 2019, or $100,000, whichever is less,
17 to a cannabis industry training or education program at
18 an Illinois community college as defined in the Public
19 Community College Act;
20 (C) Make a donation of $100,000 or more to a
21 program that provides job training services to persons
22 recently incarcerated or that operates in a
23 Disproportionately Impacted Area;
24 (D) Participate as a host in a cannabis business
25 establishment incubator program approved by the
26 Department of Commerce and Economic Opportunity, and

HB1438 Enrolled- 67 -LRB101 04919 JRG 49928 b
1 in which an Early Approval Adult Use Dispensing
2 Organization License holder agrees to provide a loan of
3 at least $100,000 and mentorship to incubate a licensee
4 that qualifies as a Social Equity Applicant for at
5 least a year. As used in this Section, "incubate" means
6 providing direct financial assistance and training
7 necessary to engage in licensed cannabis industry
8 activity similar to that of the host licensee. The
9 Early Approval Adult Use Dispensing Organization
10 License holder or the same entity holding any other
11 licenses issued pursuant to this Act shall not take an
12 ownership stake of greater than 10% in any business
13 receiving incubation services to comply with this
14 subsection. If an Early Approval Adult Use Dispensing
15 Organization License holder fails to find a business to
16 incubate to comply with this subsection before its
17 Early Approval Adult Use Dispensing Organization
18 License expires, it may opt to meet the requirement of
19 this subsection by completing another item from this
20 subsection; or
21 (E) Participate in a sponsorship program for at
22 least 2 years approved by the Department of Commerce
23 and Economic Opportunity in which an Early Approval
24 Adult Use Dispensing Organization License holder
25 agrees to provide an interest-free loan of at least
26 $200,000 to a Social Equity Applicant. The sponsor

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1 shall not take an ownership stake in any cannabis
2 business establishment receiving sponsorship services
3 to comply with this subsection.
4 (c) The license fee required by paragraph (1) of subsection
5(b) of this Section shall be in addition to any license fee
6required for the renewal of a registered medical cannabis
7dispensing organization license.
8 (d) Applicants must submit all required information,
9including the requirements in subsection (b) of this Section,
10to the Department. Failure by an applicant to submit all
11required information may result in the application being
12disqualified.
13 (e) If the Department receives an application that fails to
14provide the required elements contained in subsection (b), the
15Department shall issue a deficiency notice to the applicant.
16The applicant shall have 10 calendar days from the date of the
17deficiency notice to submit complete information. Applications
18that are still incomplete after this opportunity to cure may be
19disqualified.
20 (f) If an applicant meets all the requirements of
21subsection (b) of this Section, the Department shall issue the
22Early Approval Adult Use Dispensing Organization License
23within 14 days of receiving a completed application unless:
24 (1) The licensee or a principal officer is delinquent
25 in filing any required tax returns or paying any amounts
26 owed to the State of Illinois;

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1 (2) The Secretary of Financial and Professional
2 Regulation determines there is reason, based on documented
3 compliance violations, the licensee is not entitled to an
4 Early Approval Adult Use Dispensing Organization License;
5 or
6 (3) Any principal officer fails to register and remain
7 in compliance with this Act or the Compassionate Use of
8 Medical Cannabis Pilot Program Act.
9 (g) A registered medical cannabis dispensing organization
10that obtains an Early Approval Adult Use Dispensing
11Organization License may begin selling cannabis,
12cannabis-infused products, paraphernalia, and related items to
13purchasers under the rules of this Act no sooner than January
141, 2020.
15 (h) A dispensing organization holding a medical cannabis
16dispensing organization license issued under the Compassionate
17Use of Medical Cannabis Pilot Program Act must maintain an
18adequate supply of cannabis and cannabis-infused products for
19purchase by qualifying patients, caregivers, provisional
20patients, and Opioid Alternative Pilot Program participants.
21For the purposes of this subsection, "adequate supply" means a
22monthly inventory level that is comparable in type and quantity
23to those medical cannabis products provided to patients and
24caregivers on an average monthly basis for the 6 months before
25the effective date of this Act.
26 (i) If there is a shortage of cannabis or cannabis-infused

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1products, a dispensing organization holding both a dispensing
2organization license under the Compassionate Use of Medical
3Cannabis Pilot Program Act and this Act shall prioritize
4serving qualifying patients, caregivers, provisional patients,
5and Opioid Alternative Pilot Program participants before
6serving purchasers.
7 (j) Notwithstanding any law or rule to the contrary, a
8person that holds a medical cannabis dispensing organization
9license issued under the Compassionate Use of Medical Cannabis
10Pilot Program Act and an Early Approval Adult Use Dispensing
11Organization License may permit purchasers into a limited
12access area as that term is defined in administrative rules
13made under the authority in the Compassionate Use of Medical
14Cannabis Pilot Program Act.
15 (k) An Early Approval Adult Use Dispensing Organization
16License is valid until March 31, 2021. A dispensing
17organization that obtains an Early Approval Adult Use
18Dispensing Organization License shall receive written or
19electronic notice 90 days before the expiration of the license
20that the license will expire, and inform the license holder
21that it may renew its Early Approval Adult Use Dispensing
22Organization License. The Department shall renew the Early
23Approval Adult Use Dispensing Organization License within 60
24days of the renewal application being deemed complete if:
25 (1) the dispensing organization submits an application
26 and the required nonrefundable renewal fee of $30,000, to

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1 be deposited into the Cannabis Regulation Fund;
2 (2) the Department has not suspended or revoked the
3 Early Approval Adult Use Dispensing Organization License
4 or a medical cannabis dispensing organization license on
5 the same premises for violations of this Act, the
6 Compassionate Use of Medical Cannabis Pilot Program Act, or
7 rules adopted pursuant to those Acts; and
8 (3) the dispensing organization has completed a Social
9 Equity Inclusion Plan as required by paragraph (8) of
10 subsection (b) of this Section.
11 (l) The Early Approval Adult Use Dispensing Organization
12License renewed pursuant to subsection (k) of this Section
13shall expire March 31, 2022. The Early Approval Adult Use
14Dispensing Organization Licensee shall receive written or
15electronic notice 90 days before the expiration of the license
16that the license will expire, and inform the license holder
17that it may apply for an Adult Use Dispensing Organization
18License. The Department shall grant an Adult Use Dispensing
19Organization License within 60 days of an application being
20deemed complete if the applicant has met all of the criteria in
21Section 15-36.
22 (m) If a dispensary fails to submit an application for an
23Adult Use Dispensing Organization License before the
24expiration of the Early Approval Adult Use Dispensing
25Organization License pursuant to subsection (k) of this
26Section, the dispensing organization shall cease serving

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1purchasers and cease all operations until it receives an Adult
2Use Dispensing Organization License.
3 (n) A dispensing organization agent who holds a valid
4dispensing organization agent identification card issued under
5the Compassionate Use of Medical Cannabis Pilot Program Act and
6is an officer, director, manager, or employee of the dispensing
7organization licensed under this Section may engage in all
8activities authorized by this Article to be performed by a
9dispensing organization agent.
10 (o) All fees collected pursuant to this Section shall be
11deposited into the Cannabis Regulation Fund, unless otherwise
12specified.
13 Section 15-20. Early Approval Adult Use Dispensing
14Organization License; secondary site.
15 (a) If the Department suspends or revokes the Early
16Approval Adult Use Dispensing Organization License of a
17dispensing organization that also holds a medical cannabis
18dispensing organization license issued under the Compassionate
19Use of Medical Cannabis Pilot Program Act, the Department may
20consider the suspension or revocation as grounds to take
21disciplinary action against the medical cannabis dispensing
22organization license.
23 (a-5) If, within 360 days of the effective date of this
24Act, a dispensing organization is unable to find a location
25within the BLS Regions prescribed in subsection (a) of this

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1Section in which to operate an Early Approval Adult Use
2Dispensing Organization at a secondary site because no
3jurisdiction within the prescribed area allows the operation of
4an Adult Use Cannabis Dispensing Organization, the Department
5of Financial and Professional Regulation may waive the
6geographic restrictions of subsection (a) of this Section and
7specify another BLS Region into which the dispensary may be
8placed.
9 (b) Any medical cannabis dispensing organization holding a
10valid registration under the Compassionate Use of Medical
11Cannabis Pilot Program Act as of the effective date of this Act
12may, within 60 days of the effective date of this Act, apply to
13the Department for an Early Approval Adult Use Dispensing
14Organization License to operate a dispensing organization to
15serve purchasers at a secondary site not within 1,500 feet of
16another medical cannabis dispensing organization or adult use
17dispensing organization. The Early Approval Adult Use
18Dispensing Organization secondary site shall be within any BLS
19region that shares territory with the dispensing organization
20district to which the medical cannabis dispensing organization
21is assigned under the administrative rules for dispensing
22organizations under the Compassionate Use of Medical Cannabis
23Pilot Program Act.
24 (c) A medical cannabis dispensing organization seeking
25issuance of an Early Approval Adult Use Dispensing Organization
26License at a secondary site to serve purchasers at a secondary

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1site as prescribed in subsection (b) of this Section shall
2submit an application on forms provided by the Department. The
3application must meet or include the following qualifications:
4 (1) a payment of a nonrefundable application fee of
5 $30,000;
6 (2) proof of registration as a medical cannabis
7 dispensing organization that is in good standing;
8 (3) submission of the application by the same person or
9 entity that holds the medical cannabis dispensing
10 organization registration;
11 (4) the legal name of the medical cannabis dispensing
12 organization;
13 (5) the physical address of the medical cannabis
14 dispensing organization and the proposed physical address
15 of the secondary site;
16 (6) a copy of the current local zoning ordinance
17 Sections relevant to dispensary operations and
18 documentation of the approval, the conditional approval or
19 the status of a request for zoning approval from the local
20 zoning office that the proposed dispensary location is in
21 compliance with the local zoning rules;
22 (7) a plot plan of the dispensary drawn to scale. The
23 applicant shall submit general specifications of the
24 building exterior and interior layout;
25 (8) a statement that the dispensing organization
26 agrees to respond to the Department's supplemental

HB1438 Enrolled- 75 -LRB101 04919 JRG 49928 b
1 requests for information;
2 (9) for the building or land to be used as the proposed
3 dispensary:
4 (A) if the property is not owned by the applicant,
5 a written statement from the property owner and
6 landlord, if any, certifying consent that the
7 applicant may operate a dispensary on the premises; or
8 (B) if the property is owned by the applicant,
9 confirmation of ownership;
10 (10) a copy of the proposed operating bylaws;
11 (11) a copy of the proposed business plan that complies
12 with the requirements in this Act, including, at a minimum,
13 the following:
14 (A) a description of services to be offered; and
15 (B) a description of the process of dispensing
16 cannabis;
17 (12) a copy of the proposed security plan that complies
18 with the requirements in this Article, including:
19 (A) a description of the delivery process by which
20 cannabis will be received from a transporting
21 organization, including receipt of manifests and
22 protocols that will be used to avoid diversion, theft,
23 or loss at the dispensary acceptance point; and
24 (B) the process or controls that will be
25 implemented to monitor the dispensary, secure the
26 premises, agents, patients, and currency, and prevent

HB1438 Enrolled- 76 -LRB101 04919 JRG 49928 b
1 the diversion, theft, or loss of cannabis; and
2 (C) the process to ensure that access to the
3 restricted access areas is restricted to, registered
4 agents, service professionals, transporting
5 organization agents, Department inspectors, and
6 security personnel;
7 (13) a proposed inventory control plan that complies
8 with this Section;
9 (14) the name, address, social security number, and
10 date of birth of each principal officer and board member of
11 the dispensing organization; each of those individuals
12 shall be at least 21 years of age;
13 (15) a nonrefundable Cannabis Business Development Fee
14 equal to $200,000, to be deposited into the Cannabis
15 Business Development Fund; and
16 (16) a commitment to completing one of the following
17 Social Equity Inclusion Plans in subsection (d).
18 (d) Before receiving an Early Approval Adult Use Dispensing
19Organization License at a secondary site, a dispensing
20organization shall indicate the Social Equity Inclusion Plan
21that the applicant plans to achieve before the expiration of
22the Early Approval Adult Use Dispensing Organization License
23from the list below:
24 (1) make a contribution of 3% of total sales from June
25 1, 2018 to June 1, 2019, or $100,000, whichever is less, to
26 the Cannabis Business Development Fund. This is in addition

HB1438 Enrolled- 77 -LRB101 04919 JRG 49928 b
1 to the fee required by paragraph (16) of subsection (c) of
2 this Section;
3 (2) make a grant of 3% of total sales from June 1, 2018
4 to June 1, 2019, or $100,000, whichever is less, to a
5 cannabis industry training or education program at an
6 Illinois community college as defined in the Public
7 Community College Act;
8 (3) make a donation of $100,000 or more to a program
9 that provides job training services to persons recently
10 incarcerated or that operates in a Disproportionately
11 Impacted Area;
12 (4) participate as a host in a cannabis business
13 establishment incubator program approved by the Department
14 of Commerce and Economic Opportunity, and in which an Early
15 Approval Adult Use Dispensing Organization License at a
16 secondary site holder agrees to provide a loan of at least
17 $100,000 and mentorship to incubate a licensee that
18 qualifies as a Social Equity Applicant for at least a year.
19 In this paragraph (4), "incubate" means providing direct
20 financial assistance and training necessary to engage in
21 licensed cannabis industry activity similar to that of the
22 host licensee. The Early Approval Adult Use Dispensing
23 Organization License holder or the same entity holding any
24 other licenses issued under this Act shall not take an
25 ownership stake of greater than 10% in any business
26 receiving incubation services to comply with this

HB1438 Enrolled- 78 -LRB101 04919 JRG 49928 b
1 subsection. If an Early Approval Adult Use Dispensing
2 Organization License at a secondary site holder fails to
3 find a business to incubate in order to comply with this
4 subsection before its Early Approval Adult Use Dispensing
5 Organization License at a secondary site expires, it may
6 opt to meet the requirement of this subsection by
7 completing another item from this subsection before the
8 expiration of its Early Approval Adult Use Dispensing
9 Organization License at a secondary site to avoid a
10 penalty; or
11 (5) participate in a sponsorship program for at least 2
12 years approved by the Department of Commerce and Economic
13 Opportunity in which an Early Approval Adult Use Dispensing
14 Organization License at a secondary site holder agrees to
15 provide an interest-free loan of at least $200,000 to a
16 Social Equity Applicant. The sponsor shall not take an
17 ownership stake of greater than 10% in any business
18 receiving sponsorship services to comply with this
19 subsection.
20 (e) The license fee required by paragraph (1) of subsection
21(c) of this Section is in addition to any license fee required
22for the renewal of a registered medical cannabis dispensing
23organization license.
24 (f) Applicants must submit all required information,
25including the requirements in subsection (c) of this Section,
26to the Department. Failure by an applicant to submit all

HB1438 Enrolled- 79 -LRB101 04919 JRG 49928 b
1required information may result in the application being
2disqualified.
3 (g) If the Department receives an application that fails to
4provide the required elements contained in subsection (c), the
5Department shall issue a deficiency notice to the applicant.
6The applicant shall have 10 calendar days from the date of the
7deficiency notice to submit complete information. Applications
8that are still incomplete after this opportunity to cure may be
9disqualified.
10 (h) Once all required information and documents have been
11submitted, the Department will review the application. The
12Department may request revisions and retains final approval
13over dispensary features. Once the application is complete and
14meets the Department's approval, the Department shall
15conditionally approve the license. Final approval is
16contingent on the build-out and Department inspection.
17 (i) Upon submission of the Early Approval Adult Use
18Dispensing Organization at a secondary site application, the
19applicant shall request an inspection and the Department may
20inspect the Early Approval Adult Use Dispensing Organization's
21secondary site to confirm compliance with the application and
22this Act.
23 (j) The Department shall only issue an Early Approval Adult
24Use Dispensing Organization License at a secondary site after
25the completion of a successful inspection.
26 (k) If an applicant passes the inspection under this

HB1438 Enrolled- 80 -LRB101 04919 JRG 49928 b
1Section, the Department shall issue the Early Approval Adult
2Use Dispensing Organization License at a secondary site within
310 business days unless:
4 (1) The licensee; principal officer, board member, or
5 person having a financial or voting interest of 5% or
6 greater in the licensee; or agent is delinquent in filing
7 any required tax returns or paying any amounts owed to the
8 State of Illinois; or
9 (2) The Secretary of Financial and Professional
10 Regulation determines there is reason, based on documented
11 compliance violations, the licensee is not entitled to an
12 Early Approval Adult Use Dispensing Organization License
13 at its secondary site.
14 (l) Once the Department has issued a license, the
15dispensing organization shall notify the Department of the
16proposed opening date.
17 (m) A registered medical cannabis dispensing organization
18that obtains an Early Approval Adult Use Dispensing
19Organization License at a secondary site may begin selling
20cannabis, cannabis-infused products, paraphernalia, and
21related items to purchasers under the rules of this Act no
22sooner than January 1, 2020.
23 (n) If there is a shortage of cannabis or cannabis-infused
24products, a dispensing organization holding both a dispensing
25organization license under the Compassionate Use of Medical
26Cannabis Pilot Program Act and this Article shall prioritize

HB1438 Enrolled- 81 -LRB101 04919 JRG 49928 b
1serving qualifying patients and caregivers before serving
2purchasers.
3 (o) An Early Approval Adult Use Dispensing Organization
4License at a secondary site is valid until March 31, 2021. A
5dispensing organization that obtains an Early Approval Adult
6Use Dispensing Organization License at a secondary site shall
7receive written or electronic notice 90 days before the
8expiration of the license that the license will expire, and
9inform the license holder that it may renew its Early Approval
10Adult Use Dispensing Organization License at a secondary site.
11The Department shall renew an Early Approval Adult Use
12Dispensing Organization License at a secondary site within 60
13days of submission of the renewal application being deemed
14complete if:
15 (1) the dispensing organization submits an application
16 and the required nonrefundable renewal fee of $30,000, to
17 be deposited into the Cannabis Regulation Fund;
18 (2) the Department has not suspended or revoked the
19 Early Approval Adult Use Dispensing Organization License
20 or a medical cannabis dispensing organization license held
21 by the same person or entity for violating this Act or
22 rules adopted under this Act or the Compassionate Use of
23 Medical Cannabis Pilot Program Act or rules adopted under
24 that Act; and
25 (3) the dispensing organization has completed a Social
26 Equity Inclusion Plan as required by paragraph (16) of

HB1438 Enrolled- 82 -LRB101 04919 JRG 49928 b
1 subsection (c) of this Section.
2 (p) The Early Approval Adult Use Dispensing Organization
3Licensee at a secondary site renewed pursuant to subsection (o)
4shall receive written or electronic notice 90 days before the
5expiration of the license that the license will expire, and
6inform the license holder that it may apply for an Adult Use
7Dispensing Organization License. The Department shall grant an
8Adult Use Dispensing Organization License within 60 days of an
9application being deemed complete if the applicant has meet all
10of the criteria in Section 15-36.
11 (q) If a dispensing organization fails to submit an
12application for renewal of an Early Approval Adult Use
13Dispensing Organization License or for an Adult Use Dispensing
14Organization License before the expiration dates provided in
15subsections (o) and (p) of this Section, the dispensing
16organization shall cease serving purchasers until it receives a
17renewal or an Adult Use Dispensing Organization License.
18 (r) A dispensing organization agent who holds a valid
19dispensing organization agent identification card issued under
20the Compassionate Use of Medical Cannabis Pilot Program Act and
21is an officer, director, manager, or employee of the dispensing
22organization licensed under this Section may engage in all
23activities authorized by this Article to be performed by a
24dispensing organization agent.
25 (s) If the Department suspends or revokes the Early
26Approval Adult Use Dispensing Organization License of a

HB1438 Enrolled- 83 -LRB101 04919 JRG 49928 b
1dispensing organization that also holds a medical cannabis
2dispensing organization license issued under the Compassionate
3Use of Medical Cannabis Pilot Program Act, the Department may
4consider the suspension or revocation as grounds to take
5disciplinary action against the medical cannabis dispensing
6organization.
7 (t) All fees or fines collected from an Early Approval
8Adult Use Dispensary Organization License at a secondary site
9holder as a result of a disciplinary action in the enforcement
10of this Act shall be deposited into the Cannabis Regulation
11Fund and be appropriated to the Department for the ordinary and
12contingent expenses of the Department in the administration and
13enforcement of this Section.
14 Section 15-25. Awarding of Conditional Adult Use
15Dispensing Organization Licenses prior to January 1, 2021.
16 (a) The Department shall issue up to 75 Conditional Adult
17Use Dispensing Organization Licenses before May 1, 2020.
18 (b) The Department shall make the application for a
19Conditional Adult Use Dispensing Organization License
20available no later than October 1, 2019 and shall accept
21applications no later than January 1, 2020.
22 (c) To ensure the geographic dispersion of Conditional
23Adult Use Dispensing Organization License holders, the
24following number of licenses shall be awarded in each BLS
25Region as determined by each region's percentage of the State's

HB1438 Enrolled- 84 -LRB101 04919 JRG 49928 b
1population:
2 (1) Bloomington: 1
3 (2) Cape Girardeau: 1
4 (3) Carbondale-Marion: 1
5 (4) Champaign-Urbana: 1
6 (5) Chicago-Naperville-Elgin: 47
7 (6) Danville: 1
8 (7) Davenport-Moline-Rock Island: 1
9 (8) Decatur: 1
10 (9) Kankakee: 1
11 (10) Peoria: 3
12 (11) Rockford: 2
13 (12) St. Louis: 4
14 (13) Springfield: 1
15 (14) Northwest Illinois nonmetropolitan: 3
16 (15) West Central Illinois nonmetropolitan: 3
17 (16) East Central Illinois nonmetropolitan: 2
18 (17) South Illinois nonmetropolitan: 2
19 (d) An applicant seeking issuance of a Conditional Adult
20Use Dispensing Organization License shall submit an
21application on forms provided by the Department. An applicant
22must meet the following requirements:
23 (1) Payment of a nonrefundable application fee of
24 $5,000 for each license for which the applicant is
25 applying, which shall be deposited into the Cannabis
26 Regulation Fund;

HB1438 Enrolled- 85 -LRB101 04919 JRG 49928 b
1 (2) Certification that the applicant will comply with
2 the requirements contained in this Act;
3 (3) The legal name of the proposed dispensing
4 organization;
5 (4) A statement that the dispensing organization
6 agrees to respond to the Department's supplemental
7 requests for information;
8 (5) From each principal officer, a statement
9 indicating whether that person:
10 (A) has previously held or currently holds an
11 ownership interest in a cannabis business
12 establishment in Illinois; or
13 (B) has held an ownership interest in a dispensing
14 organization or its equivalent in another state or
15 territory of the United States that had the dispensing
16 organization registration or license suspended,
17 revoked, placed on probationary status, or subjected
18 to other disciplinary action;
19 (6) Disclosure of whether any principal officer has
20 ever filed for bankruptcy or defaulted on spousal support
21 or child support obligation;
22 (7) A resume for each principal officer, including
23 whether that person has an academic degree, certification,
24 or relevant experience with a cannabis business
25 establishment or in a related industry;
26 (8) A description of the training and education that

HB1438 Enrolled- 86 -LRB101 04919 JRG 49928 b
1 will be provided to dispensing organization agents;
2 (9) A copy of the proposed operating bylaws;
3 (10) A copy of the proposed business plan that complies
4 with the requirements in this Act, including, at a minimum,
5 the following:
6 (A) A description of services to be offered; and
7 (B) A description of the process of dispensing
8 cannabis;
9 (11) A copy of the proposed security plan that complies
10 with the requirements in this Article, including:
11 (A) The process or controls that will be
12 implemented to monitor the dispensary, secure the
13 premises, agents, and currency, and prevent the
14 diversion, theft, or loss of cannabis; and
15 (B) The process to ensure that access to the
16 restricted access areas is restricted to, registered
17 agents, service professionals, transporting
18 organization agents, Department inspectors, and
19 security personnel;
20 (12) A proposed inventory control plan that complies
21 with this Section;
22 (13) A proposed floor plan, a square footage estimate,
23 and a description of proposed security devices, including,
24 without limitation, cameras, motion detectors, servers,
25 video storage capabilities, and alarm service providers;
26 (14) The name, address, social security number, and

HB1438 Enrolled- 87 -LRB101 04919 JRG 49928 b
1 date of birth of each principal officer and board member of
2 the dispensing organization; each of those individuals
3 shall be at least 21 years of age;
4 (15) Evidence of the applicant's status as a Social
5 Equity Applicant, if applicable, and whether a Social
6 Equity Applicant plans to apply for a loan or grant issued
7 by the Department of Commerce and Economic Opportunity;
8 (16) The address, telephone number, and email address
9 of the applicant's principal place of business, if
10 applicable. A post office box is not permitted;
11 (17) Written summaries of any information regarding
12 instances in which a business or not-for-profit that a
13 prospective board member previously managed or served on
14 were fined or censured, or any instances in which a
15 business or not-for-profit that a prospective board member
16 previously managed or served on had its registration
17 suspended or revoked in any administrative or judicial
18 proceeding;
19 (18) A plan for community engagement;
20 (19) Procedures to ensure accurate recordkeeping and
21 security measures that are in accordance with this Article
22 and Department rules;
23 (20) The estimated volume of cannabis it plans to store
24 at the dispensary;
25 (21) A description of the features that will provide
26 accessibility to purchasers as required by the Americans

HB1438 Enrolled- 88 -LRB101 04919 JRG 49928 b
1 with Disabilities Act;
2 (22) A detailed description of air treatment systems
3 that will be installed to reduce odors;
4 (23) A reasonable assurance that the issuance of a
5 license will not have a detrimental impact on the community
6 in which the applicant wishes to locate;
7 (24) The dated signature of each principal officer;
8 (25) A description of the enclosed, locked facility
9 where cannabis will be stored by the dispensing
10 organization;
11 (26) Signed statements from each dispensing
12 organization agent stating that he or she will not divert
13 cannabis;
14 (27) The number of licenses it is applying for in each
15 BLS Region;
16 (28) A diversity plan that includes a narrative of at
17 least 2,500 words that establishes a goal of diversity in
18 ownership, management, employment, and contracting to
19 ensure that diverse participants and groups are afforded
20 equality of opportunity;
21 (29) A contract with a private security contractor that
22 is licensed under Section 10-5 of the Private Detective,
23 Private Alarm, Private Security, Fingerprint Vendor, and
24 Locksmith Act of 2004 in order for the dispensary to have
25 adequate security at its facility; and
26 (30) Other information deemed necessary by the

HB1438 Enrolled- 89 -LRB101 04919 JRG 49928 b
1 Illinois Cannabis Regulation Oversight Officer to conduct
2 the disparity and availability study referenced in
3 subsection (e) of Section 5-45.
4 (e) An applicant who receives a Conditional Adult Use
5Dispensing Organization License under this Section has 180 days
6from the date of award to identify a physical location for the
7dispensing organization retail storefront. Before a
8conditional licensee receives an authorization to build out the
9dispensing organization from the Department, the Department
10shall inspect the physical space selected by the conditional
11licensee. The Department shall verify the site is suitable for
12public access, the layout promotes the safe dispensing of
13cannabis, the location is sufficient in size, power allocation,
14lighting, parking, handicapped accessible parking spaces,
15accessible entry and exits as required by the Americans with
16Disabilities Act, product handling, and storage. The applicant
17shall also provide a statement of reasonable assurance that the
18issuance of a license will not have a detrimental impact on the
19community. The applicant shall also provide evidence that the
20location is not within 1,500 feet of an existing dispensing
21organization. If an applicant is unable to find a suitable
22physical address in the opinion of the Department within 180
23days of the issuance of the Conditional Adult Use Dispensing
24Organization License, the Department may extend the period for
25finding a physical address another 180 days if the Conditional
26Adult Use Dispensing Organization License holder demonstrates

HB1438 Enrolled- 90 -LRB101 04919 JRG 49928 b
1concrete attempts to secure a location and a hardship. If the
2Department denies the extension or the Conditional Adult Use
3Dispensing Organization License holder is unable to find a
4location or become operational within 360 days of being awarded
5a conditional license, the Department shall rescind the
6conditional license and award it to the next highest scoring
7applicant in the BLS Region for which the license was assigned,
8provided the applicant receiving the license: (i) confirms a
9continued interest in operating a dispensing organization;
10(ii) can provide evidence that the applicant continues to meet
11the financial requirements provided in subsection (c) of this
12Section; and (iii) has not otherwise become ineligible to be
13awarded a dispensing organization license. If the new awardee
14is unable to accept the Conditional Adult Use Dispensing
15Organization License, the Department shall award the
16Conditional Adult Use Dispensing Organization License to the
17next highest scoring applicant in the same manner. The new
18awardee shall be subject to the same required deadlines as
19provided in this subsection.
20 (e-5) If, within 180 days of being awarded a Conditional
21Adult Use Dispensing Organization license, a dispensing
22organization is unable to find a location within the BLS Region
23in which it was awarded a Conditional Adult Use Dispensing
24Organization license because no jurisdiction within the BLS
25Region allows for the operation of an Adult Use Dispensing
26Organization, the Department of Financial and Professional

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1Regulation may authorize the Conditional Adult Use Dispensing
2Organization License holder to transfer its license to a BLS
3Region specified by the Department.
4 (f) A dispensing organization that is awarded a Conditional
5Adult Use Dispensing Organization License pursuant to the
6criteria in Section 15-30 shall not purchase, possess, sell, or
7dispense cannabis or cannabis-infused products until the
8person has received an Adult Use Dispensing Organization
9License issued by the Department pursuant to Section 15-36 of
10this Act. The Department shall not issue an Adult Use
11Dispensing Organization License until:
12 (1) the Department has inspected the dispensary site
13 and proposed operations and verified that they are in
14 compliance with this Act and local zoning laws; and
15 (2) the Conditional Adult Use Dispensing Organization
16 License holder has paid a registration fee of $60,000, or a
17 prorated amount accounting for the difference of time
18 between when the Adult Use Dispensing Organization License
19 is issued and March 31 of the next even-numbered year.
20 (g) The Department shall conduct a background check of the
21prospective organization agents in order to carry out this
22Article. The Department of State Police shall charge the
23applicant a fee for conducting the criminal history record
24check, which shall be deposited into the State Police Services
25Fund and shall not exceed the actual cost of the record check.
26Each person applying as a dispensing organization agent shall

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1submit a full set of fingerprints to the Department of State
2Police for the purpose of obtaining a State and federal
3criminal records check. These fingerprints shall be checked
4against the fingerprint records now and hereafter, to the
5extent allowed by law, filed in the Department of State Police
6and Federal Bureau of Identification criminal history records
7databases. The Department of State Police shall furnish,
8following positive identification, all Illinois conviction
9information to the Department.
10 Section 15-30. Selection criteria for conditional licenses
11awarded under Section 15-25.
12 (a) Applicants for a Conditional Adult Use Dispensing
13Organization License must submit all required information,
14including the information required in Section 15-25, to the
15Department. Failure by an applicant to submit all required
16information may result in the application being disqualified.
17 (b) If the Department receives an application that fails to
18provide the required elements contained in this Section, the
19Department shall issue a deficiency notice to the applicant.
20The applicant shall have 10 calendar days from the date of the
21deficiency notice to resubmit the incomplete information.
22Applications that are still incomplete after this opportunity
23to cure will not be scored and will be disqualified.
24 (c) The Department will award up to 250 points to complete
25applications based on the sufficiency of the applicant's

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1responses to required information. Applicants will be awarded
2points based on a determination that the application
3satisfactorily includes the following elements:
4 (1) Suitability of Employee Training Plan (15 points).
5 The plan includes an employee training plan that
6 demonstrates that employees will understand the rules
7 and laws to be followed by dispensary employees, have
8 knowledge of any security measures and operating
9 procedures of the dispensary, and are able to advise
10 purchasers on how to safely consume cannabis and use
11 individual products offered by the dispensary.
12 (2) Security and Recordkeeping (65 points).
13 (A) The security plan accounts for the prevention
14 of the theft or diversion of cannabis. The security
15 plan demonstrates safety procedures for dispensary
16 agents and purchasers, and safe delivery and storage of
17 cannabis and currency. It demonstrates compliance with
18 all security requirements in this Act and rules.
19 (B) A plan for recordkeeping, tracking, and
20 monitoring inventory, quality control, and other
21 policies and procedures that will promote standard
22 recordkeeping and discourage unlawful activity. This
23 plan includes the applicant's strategy to communicate
24 with the Department and the Department of State Police
25 on the destruction and disposal of cannabis. The plan
26 must also demonstrate compliance with this Act and

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1 rules.
2 (C) The security plan shall also detail which
3 private security contractor licensed under Section
4 10-5 of the Private Detective, Private Alarm, Private
5 Security, Fingerprint Vendor, and Locksmith Act of
6 2004 the dispensary will contract with in order to
7 provide adequate security at its facility.
8 (3) Applicant's Business Plan, Financials, Operating
9 and Floor Plan (65 points).
10 (A) The business plan shall describe, at a minimum,
11 how the dispensing organization will be managed on a
12 long-term basis. This shall include a description of
13 the dispensing organization's point-of-sale system,
14 purchases and denials of sale, confidentiality, and
15 products and services to be offered. It will
16 demonstrate compliance with this Act and rules.
17 (B) The operating plan shall include, at a minimum,
18 best practices for day-to-day dispensary operation and
19 staffing. The operating plan may also include
20 information about employment practices, including
21 information about the percentage of full-time
22 employees who will be provided a living wage.
23 (C) The proposed floor plan is suitable for public
24 access, the layout promotes safe dispensing of
25 cannabis, is compliant with the Americans with
26 Disabilities Act and the Environmental Barriers Act,

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1 and facilitates safe product handling and storage.
2 (4) Knowledge and Experience (30 points).
3 (A) The applicant's principal officers must
4 demonstrate experience and qualifications in business
5 management or experience with the cannabis industry.
6 This includes ensuring optimal safety and accuracy in
7 the dispensing and sale of cannabis.
8 (B) The applicant's principal officers must
9 demonstrate knowledge of various cannabis product
10 strains or varieties and describe the types and
11 quantities of products planned to be sold. This
12 includes confirmation of whether the dispensing
13 organization plans to sell cannabis paraphernalia or
14 edibles.
15 (C) Knowledge and experience may be demonstrated
16 through experience in other comparable industries that
17 reflect on applicant's ability to operate a cannabis
18 business establishment.
19 (5) Status as a Social Equity Applicant (50 points).
20 The applicant meets the qualifications for a
21 Social Equity Applicant as set forth in this Act.
22 (6) Labor and employment practices (5 points): The
23 applicant may describe plans to provide a safe, healthy,
24 and economically beneficial working environment for its
25 agents, including, but not limited to, codes of conduct,
26 health care benefits, educational benefits, retirement

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1 benefits, living wage standards, and entering a labor peace
2 agreement with employees.
3 (7) Environmental Plan (5 points): The applicant may
4 demonstrate an environmental plan of action to minimize the
5 carbon footprint, environmental impact, and resource needs
6 for the dispensary, which may include, without limitation,
7 recycling cannabis product packaging.
8 (8) Illinois owner (5 points): The applicant is 51% or
9 more owned and controlled by an Illinois resident, who can
10 prove residency in each of the past 5 years with tax
11 records.
12 (9) Status as veteran (5 points): The applicant is 51%
13 or more controlled and owned by an individual or
14 individuals who meet the qualifications of a veteran as
15 defined by Section 45-57 of the Illinois Procurement Code.
16 (10) A diversity plan (5 points): that includes a
17 narrative of not more than 2,500 words that establishes a
18 goal of diversity in ownership, management, employment,
19 and contracting to ensure that diverse participants and
20 groups are afforded equality of opportunity.
21 (d) The Department may also award up to 2 bonus points for
22a plan to engage with the community. The applicant may
23demonstrate a desire to engage with its community by
24participating in one or more of, but not limited to, the
25following actions: (i) establishment of an incubator program
26designed to increase participation in the cannabis industry by

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1persons who would qualify as Social Equity Applicants; (ii)
2providing financial assistance to substance abuse treatment
3centers; (iii) educating children and teens about the potential
4harms of cannabis use; or (iv) other measures demonstrating a
5commitment to the applicant's community. Bonus points will only
6be awarded if the Department receives applications that receive
7an equal score for a particular region.
8 (e) The Department may verify information contained in each
9application and accompanying documentation to assess the
10applicant's veracity and fitness to operate a dispensing
11organization.
12 (f) The Department may, in its discretion, refuse to issue
13an authorization to any applicant:
14 (1) Who is unqualified to perform the duties required
15 of the applicant;
16 (2) Who fails to disclose or states falsely any
17 information called for in the application;
18 (3) Who has been found guilty of a violation of this
19 Act, or whose medical cannabis dispensing organization,
20 medical cannabis cultivation organization, or Early
21 Approval Adult Use Dispensing Organization License, or
22 Early Approval Adult Use Dispensing Organization License
23 at a secondary site, or Early Approval Cultivation Center
24 License was suspended, restricted, revoked, or denied for
25 just cause, or the applicant's cannabis business
26 establishment license was suspended, restricted, revoked,

HB1438 Enrolled- 98 -LRB101 04919 JRG 49928 b
1 or denied in any other state; or
2 (4) Who has engaged in a pattern or practice of unfair
3 or illegal practices, methods, or activities in the conduct
4 of owning a cannabis business establishment or other
5 business.
6 (g) The Department shall deny the license if any principal
7officer, board member, or person having a financial or voting
8interest of 5% or greater in the licensee is delinquent in
9filing any required tax returns or paying any amounts owed to
10the State of Illinois.
11 (h) The Department shall verify an applicant's compliance
12with the requirements of this Article and rules before issuing
13a dispensing organization license.
14 (i) Should the applicant be awarded a license, the
15information and plans provided in the application, including
16any plans submitted for bonus points, shall become a condition
17of the Conditional Adult Use Dispensing Organization Licenses,
18except as otherwise provided by this Act or rule. Dispensing
19organizations have a duty to disclose any material changes to
20the application. The Department shall review all material
21changes disclosed by the dispensing organization, and may
22re-evaluate its prior decision regarding the awarding of a
23license, including, but not limited to, suspending or revoking
24a license. Failure to comply with the conditions or
25requirements in the application may subject the dispensing
26organization to discipline, up to and including suspension or

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1revocation of its authorization or license by the Department.
2 (j) If an applicant has not begun operating as a dispensing
3organization within one year of the issuance of the Conditional
4Adult Use Dispensing Organization License, the Department may
5revoke the Conditional Adult Use Dispensing Organization
6License and award it to the next highest scoring applicant in
7the BLS Region if a suitable applicant indicates a continued
8interest in the license or begin a new selection process to
9award a Conditional Adult Use Dispensing Organization License.
10 (k) The Department shall deny an application if granting
11that application would result in a single person or entity
12having a direct or indirect financial interest in more than 10
13Early Approval Adult Use Dispensing Organization Licenses,
14Conditional Adult Use Dispensing Organization Licenses, or
15Adult Use Dispensing Organization Licenses. Any entity that is
16awarded a license that results in a single person or entity
17having a direct or indirect financial interest in more than 10
18licenses shall forfeit the most recently issued license and
19suffer a penalty to be determined by the Department, unless the
20entity declines the license at the time it is awarded.
21 Section 15-35. Conditional Adult Use Dispensing
22Organization License after January 1, 2021.
23 (a) In addition to any of the licenses issued in Sections
2415-15, Section 15-20, or Section 15-25 of this Act, by December
2521, 2021, the Department shall issue up to 110 Conditional

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1Adult Use Dispensing Organization Licenses, pursuant to the
2application process adopted under this Section. Prior to
3issuing such licenses, the Department may adopt rules through
4emergency rulemaking in accordance with subsection (gg) of
5Section 5-45 of the Illinois Administrative Procedure Act. The
6General Assembly finds that the adoption of rules to regulate
7cannabis use is deemed an emergency and necessary for the
8public interest, safety, and welfare. Such rules may:
9 (1) Modify or change the BLS Regions as they apply to
10 this Article or modify or raise the number of Adult
11 Conditional Use Dispensing Organization Licenses assigned
12 to each region based on the following factors:
13 (A) Purchaser wait times;
14 (B) Travel time to the nearest dispensary for
15 potential purchasers;
16 (C) Percentage of cannabis sales occurring in
17 Illinois not in the regulated market using data from
18 the Substance Abuse and Mental Health Services
19 Administration, National Survey on Drug Use and
20 Health, Illinois Behavioral Risk Factor Surveillance
21 System, and tourism data from the Illinois Office of
22 Tourism to ascertain total cannabis consumption in
23 Illinois compared to the amount of sales in licensed
24 dispensing organizations;
25 (D) Whether there is an adequate supply of cannabis
26 and cannabis-infused products to serve registered

HB1438 Enrolled- 101 -LRB101 04919 JRG 49928 b
1 medical cannabis patients;
2 (E) Population increases or shifts;
3 (F) Density of dispensing organizations in a
4 region;
5 (G) The Department's capacity to appropriately
6 regulate additional licenses;
7 (H) The findings and recommendations from the
8 disparity and availability study commissioned by the
9 Illinois Cannabis Regulation Oversight Officer in
10 subsection (e) of Section 5-45 to reduce or eliminate
11 any identified barriers to entry in the cannabis
12 industry; and
13 (I) Any other criteria the Department deems
14 relevant.
15 (2) Modify or change the licensing application process
16 to reduce or eliminate the barriers identified in the
17 disparity and availability study commissioned by the
18 Illinois Cannabis Regulation Oversight Officer and make
19 modifications to remedy evidence of discrimination.
20 (b) After January 1, 2022, the Department may by rule
21modify or raise the number of Adult Use Dispensing Organization
22Licenses assigned to each region, and modify or change the
23licensing application process to reduce or eliminate barriers
24based on the criteria in subsection (a). At no time shall the
25Department issue more than 500 Adult Use Dispensary
26Organization Licenses.

HB1438 Enrolled- 102 -LRB101 04919 JRG 49928 b
1 Section 15-36. Adult Use Dispensing Organization License.
2 (a) A person is only eligible to receive an Adult Use
3Dispensing Organization if the person has been awarded a
4Conditional Adult Use Dispensing Organization License pursuant
5to this Act or has renewed its license pursuant to subsection
6(k) of Section 15-15 or subsection (p) of Section 15-20.
7 (b) The Department shall not issue an Adult Use Dispensing
8Organization License until:
9 (1) the Department has inspected the dispensary site
10 and proposed operations and verified that they are in
11 compliance with this Act and local zoning laws;
12 (2) the Conditional Adult Use Dispensing Organization
13 License holder has paid a registration fee of $60,000 or a
14 prorated amount accounting for the difference of time
15 between when the Adult Use Dispensing Organization License
16 is issued and March 31 of the next even-numbered year; and
17 (3) the Conditional Adult Use Dispensing Organization
18 License holder has met all the requirements in the Act and
19 rules.
20 (c) No person or entity shall hold any legal, equitable,
21ownership, or beneficial interest, directly or indirectly, of
22more than 10 dispensing organizations licensed under this
23Article. Further, no person or entity that is:
24 (1) employed by, is an agent of, or participates in the
25 management of a dispensing organization or registered

HB1438 Enrolled- 103 -LRB101 04919 JRG 49928 b
1 medical cannabis dispensing organization;
2 (2) a principal officer of a dispensing organization or
3 registered medical cannabis dispensing organization; or
4 (3) an entity controlled by or affiliated with a
5 principal officer of a dispensing organization or
6 registered medical cannabis dispensing organization;
7shall hold any legal, equitable, ownership, or beneficial
8interest, directly or indirectly, in a dispensing organization
9that would result in such person or entity owning or
10participating in the management of more than 10 dispensing
11organizations. For the purpose of this subsection,
12participating in management may include, without limitation,
13controlling decisions regarding staffing, pricing, purchasing,
14marketing, store design, hiring, and website design.
15 (d) The Department shall deny an application if granting
16that application would result in a person or entity obtaining
17direct or indirect financial interest in more than 10 Early
18Approval Adult Use Dispensing Organization Licenses,
19Conditional Adult Use Dispensing Organization Licenses, Adult
20Use Dispensing Organization Licenses, or any combination
21thereof. If a person or entity is awarded a Conditional Adult
22Use Dispensing Organization License that would cause the person
23or entity to be in violation of this subsection, he, she, or it
24shall choose which license application it wants to abandon and
25such licenses shall become available to the next qualified
26applicant in the region in which the abandoned license was

HB1438 Enrolled- 104 -LRB101 04919 JRG 49928 b
1awarded.
2 Section 15-40. Dispensing organization agent
3identification card; agent training.
4 (a) The Department shall:
5 (1) Verify the information contained in an application
6 or renewal for a dispensing organization agent
7 identification card submitted under this Article, and
8 approve or deny an application or renewal, within 30 days
9 of receiving a completed application or renewal
10 application and all supporting documentation required by
11 rule;
12 (2) Issue a dispensing organization agent
13 identification card to a qualifying agent within 15
14 business days of approving the application or renewal;
15 (3) Enter the registry identification number of the
16 dispensing organization where the agent works;
17 (4) Within one year from the effective date of this
18 Act, allow for an electronic application process and
19 provide a confirmation by electronic or other methods that
20 an application has been submitted; and
21 (5) Collect a $100 nonrefundable fee from the applicant
22 to be deposited into the Cannabis Regulation Fund.
23 (b) A dispensing agent must keep his or her identification
24card visible at all times when on the property of the
25dispensing organization.

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1 (c) The dispensing organization agent identification cards
2shall contain the following:
3 (1) The name of the cardholder;
4 (2) The date of issuance and expiration date of the
5 dispensing organization agent identification cards;
6 (3) A random 10-digit alphanumeric identification
7 number containing at least 4 numbers and at least 4 letters
8 that is unique to the cardholder; and
9 (4) A photograph of the cardholder.
10 (d) The dispensing organization agent identification cards
11shall be immediately returned to the dispensing organization
12upon termination of employment.
13 (e) The Department shall not issue an agent identification
14card if the applicant is delinquent in filing any required tax
15returns or paying any amounts owed to the State of Illinois.
16 (f) Any card lost by a dispensing organization agent shall
17be reported to the Department of State Police and the
18Department immediately upon discovery of the loss.
19 (g) An applicant shall be denied a dispensing organization
20agent identification card if he or she fails to complete the
21training provided for in this Section.
22 (h) A dispensing organization agent shall only be required
23to hold one card for the same employer regardless of what type
24of dispensing organization license the employer holds.
25 (i) Cannabis retail sales training requirements.
26 (1) Within 90 days of September 1, 2019, or 90 days of

HB1438 Enrolled- 106 -LRB101 04919 JRG 49928 b
1 employment, whichever is later, all owners, managers,
2 employees, and agents involved in the handling or sale of
3 cannabis or cannabis-infused product employed by an adult
4 use dispensing organization or medical cannabis dispensing
5 organization as defined in Section 10 of the Compassionate
6 Use of Medical Cannabis Pilot Program Act shall attend and
7 successfully complete a Responsible Vendor Program.
8 (2) Each owner, manager, employee, and agent of an
9 adult use dispensing organization or medical cannabis
10 dispensing organization shall successfully complete the
11 program annually.
12 (3) Responsible Vendor Program Training modules shall
13 include at least 2 hours of instruction time approved by
14 the Department including:
15 (i) Health and safety concerns of cannabis use,
16 including the responsible use of cannabis, its
17 physical effects, onset of physiological effects,
18 recognizing signs of impairment, and appropriate
19 responses in the event of overconsumption.
20 (ii) Training on laws and regulations on driving
21 while under the influence.
22 (iii) Sales to minors prohibition. Training shall
23 cover all relevant Illinois laws and rules.
24 (iv) Quantity limitations on sales to purchasers.
25 Training shall cover all relevant Illinois laws and
26 rules.

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1 (v) Acceptable forms of identification. Training
2 shall include:
3 (I) How to check identification; and
4 (II) Common mistakes made in verification;
5 (vi) Safe storage of cannabis;
6 (vii) Compliance with all inventory tracking
7 system regulations;
8 (viii) Waste handling, management, and disposal;
9 (ix) Health and safety standards;
10 (x) Maintenance of records;
11 (xi) Security and surveillance requirements;
12 (xii) Permitting inspections by State and local
13 licensing and enforcement authorities;
14 (xiii) Privacy issues;
15 (xiv) Packaging and labeling requirement for sales
16 to purchasers; and
17 (xv) Other areas as determined by rule.
18 (j)BLANK.
19 (k) Upon the successful completion of the Responsible
20Vendor Program, the provider shall deliver proof of completion
21either through mail or electronic communication to the
22dispensing organization, which shall retain a copy of the
23certificate.
24 (l) The license of a dispensing organization or medical
25cannabis dispensing organization whose owners, managers,
26employees, or agents fail to comply with this Section may be

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1suspended or revoked under Section 15-145 or may face other
2disciplinary action.
3 (m) The regulation of dispensing organization and medical
4cannabis dispensing employer and employee training is an
5exclusive function of the State, and regulation by a unit of
6local government, including a home rule unit, is prohibited.
7This subsection (m) is a denial and limitation of home rule
8powers and functions under subsection (h) of Section 6 of
9Article VII of the Illinois Constitution.
10 (n) Persons seeking Department approval to offer the
11training required by paragraph (3) of subsection (i) may apply
12for such approval between August 1 and August 15 of each
13odd-numbered year in a manner prescribed by the Department.
14 (o) Persons seeking Department approval to offer the
15training required by paragraph (3) of subsection (i) shall
16submit a non-refundable application fee of $2,000 to be
17deposited into the Cannabis Regulation Fund or a fee as may be
18set by rule. Any changes made to the training module shall be
19approved by the Department.
20 (p) The Department shall not unreasonably deny approval of
21a training module that meets all the requirements of paragraph
22(3) of subsection (i). A denial of approval shall include a
23detailed description of the reasons for the denial.
24 (q) Any person approved to provide the training required by
25paragraph (3) of subsection (i) shall submit an application for
26re-approval between August 1 and August 15 of each odd-numbered

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1year and include a non-refundable application fee of $2,000 to
2be deposited into the Cannabis Regulation Fund or a fee as may
3be set by rule.
4 Section 15-45. Renewal.
5 (a) Adult Use Dispensing Organization Licenses shall
6expire on March 31 of even-numbered years.
7 (b) Agent identification cards shall expire one year from
8the date they are issued.
9 (c) Licensees and dispensing agents shall submit a renewal
10application as provided by the Department and pay the required
11renewal fee. The Department shall require an agent, employee,
12contracting, and subcontracting diversity report and an
13environmental impact report with its renewal application. No
14license or agent identification card shall be renewed if it is
15currently under revocation or suspension for violation of this
16Article or any rules that may be adopted under this Article or
17the licensee, principal officer, board member, person having a
18financial or voting interest of 5% or greater in the licensee,
19or agent is delinquent in filing any required tax returns or
20paying any amounts owed to the State of Illinois.
21 (d) Renewal fees are:
22 (1) For a dispensing organization, $60,000, to be
23 deposited into the Cannabis Regulation Fund.
24 (2) For an agent identification card, $100, to be
25 deposited into the Cannabis Regulation Fund.

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1 (e) If a dispensing organization fails to renew its license
2before expiration, the dispensing organization shall cease
3operations until the license is renewed.
4 (f) If a dispensing organization agent fails to renew his
5or her registration before its expiration, he or she shall
6cease to perform duties authorized by this Article at a
7dispensing organization until his or her registration is
8renewed.
9 (g) Any dispensing organization that continues to operate
10or dispensing agent that continues to perform duties authorized
11by this Article at a dispensing organization that fails to
12renew its license is subject to penalty as provided in this
13Article, or any rules that may be adopted pursuant to this
14Article.
15 (h) The Department shall not renew a license if the
16applicant is delinquent in filing any required tax returns or
17paying any amounts owed to the State of Illinois. The
18Department shall not renew a dispensing agent identification
19card if the applicant is delinquent in filing any required tax
20returns or paying any amounts owed to the State of Illinois.
21 Section 15-50. Disclosure of ownership and control.
22 (a) Each dispensing organization applicant and licensee
23shall file and maintain a Table of Organization, Ownership and
24Control with the Department. The Table of Organization,
25Ownership and Control shall contain the information required by

HB1438 Enrolled- 111 -LRB101 04919 JRG 49928 b
1this Section in sufficient detail to identify all owners,
2directors, and principal officers, and the title of each
3principal officer or business entity that, through direct or
4indirect means, manages, owns, or controls the applicant or
5licensee.
6 (b) The Table of Organization, Ownership and Control shall
7identify the following information:
8 (1) The management structure, ownership, and control
9 of the applicant or license holder including the name of
10 each principal officer or business entity, the office or
11 position held, and the percentage ownership interest, if
12 any. If the business entity has a parent company, the name
13 of each owner, board member, and officer of the parent
14 company and his or her percentage ownership interest in the
15 parent company and the dispensing organization.
16 (2) If the applicant or licensee is a business entity
17 with publicly traded stock, the identification of
18 ownership shall be provided as required in subsection (c).
19 (c) If a business entity identified in subsection (b) is a
20publicly traded company, the following information shall be
21provided in the Table of Organization, Ownership and Control:
22 (1) The name and percentage of ownership interest of
23 each individual or business entity with ownership of more
24 than 5% of the voting shares of the entity, to the extent
25 such information is known or contained in 13D or 13G
26 Securities and Exchange Commission filings.

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1 (2) To the extent known, the names and percentage of
2 interest of ownership of persons who are relatives of one
3 another and who together exercise control over or own more
4 than 10% of the voting shares of the entity.
5 (d) A dispensing organization with a parent company or
6companies, or partially owned or controlled by another entity
7must disclose to the Department the relationship and all
8owners, board members, officers, or individuals with control or
9management of those entities. A dispensing organization shall
10not shield its ownership or control from the Department.
11 (e) All principal officers must submit a complete online
12application with the Department within 14 days of the
13dispensing organization being licensed by the Department or
14within 14 days of Department notice of approval as a new
15principal officer.
16 (f) A principal officer may not allow his or her
17registration to expire.
18 (g) A dispensing organization separating with a principal
19officer must do so under this Act. The principal officer must
20communicate the separation to the Department within 5 business
21days.
22 (h) A principal officer not in compliance with the
23requirements of this Act shall be removed from his or her
24position with the dispensing organization or shall otherwise
25terminate his or her affiliation. Failure to do so may subject
26the dispensing organization to discipline, suspension, or

HB1438 Enrolled- 113 -LRB101 04919 JRG 49928 b
1revocation of its license by the Department.
2 (i) It is the responsibility of the dispensing organization
3and its principal officers to promptly notify the Department of
4any change of the principal place of business address, hours of
5operation, change in ownership or control, or a change of the
6dispensing organization's primary or secondary contact
7information. Any changes must be made to the Department in
8writing.
9 Section 15-55. Financial responsibility. Evidence of
10financial responsibility is a requirement for the issuance,
11maintenance, or reactivation of a license under this Article.
12Evidence of financial responsibility shall be used to guarantee
13that the dispensing organization timely and successfully
14completes dispensary construction, operates in a manner that
15provides an uninterrupted supply of cannabis, faithfully pays
16registration renewal fees, keeps accurate books and records,
17makes regularly required reports, complies with State tax
18requirements, and conducts the dispensing organization in
19conformity with this Act and rules. Evidence of financial
20responsibility shall be provided by one of the following:
21 (1) Establishing and maintaining an escrow or surety
22 account in a financial institution in the amount of
23 $50,000, with escrow terms, approved by the Department,
24 that it shall be payable to the Department in the event of
25 circumstances outlined in this Act and rules.

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1 (A) A financial institution may not return money in
2 an escrow or surety account to the dispensing
3 organization that established the account or a
4 representative of the organization unless the
5 organization or representative presents a statement
6 issued by the Department indicating that the account
7 may be released.
8 (B) The escrow or surety account shall not be
9 canceled on less than 30 days' notice in writing to the
10 Department, unless otherwise approved by the
11 Department. If an escrow or surety account is canceled
12 and the registrant fails to secure a new account with
13 the required amount on or before the effective date of
14 cancellation, the registrant's registration may be
15 revoked. The total and aggregate liability of the
16 surety on the bond is limited to the amount specified
17 in the escrow or surety account.
18 (2) Providing a surety bond in the amount of $50,000,
19 naming the dispensing organization as principal of the
20 bond, with terms, approved by the Department, that the bond
21 defaults to the Department in the event of circumstances
22 outlined in this Act and rules. Bond terms shall include:
23 (A) The business name and registration number on
24 the bond must correspond exactly with the business name
25 and registration number in the Department's records.
26 (B) The bond must be written on a form approved by

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1 the Department.
2 (C) A copy of the bond must be received by the
3 Department within 90 days after the effective date.
4 (D) The bond shall not be canceled by a surety on
5 less than 30 days' notice in writing to the Department.
6 If a bond is canceled and the registrant fails to file
7 a new bond with the Department in the required amount
8 on or before the effective date of cancellation, the
9 registrant's registration may be revoked. The total
10 and aggregate liability of the surety on the bond is
11 limited to the amount specified in the bond.
12 Section 15-60. Changes to a dispensing organization.
13 (a) A license shall be issued to the specific dispensing
14organization identified on the application and for the specific
15location proposed. The license is valid only as designated on
16the license and for the location for which it is issued.
17 (b) A dispensing organization may only add principal
18officers after being approved by the Department.
19 (c) A dispensing organization shall provide written notice
20of the removal of a principal officer within 5 business days
21after removal. The notice shall include the written agreement
22of the principal officer being removed, unless otherwise
23approved by the Department, and allocation of ownership shares
24after removal in an updated ownership chart.
25 (d) A dispensing organization shall provide a written

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1request to the Department for the addition of principal
2officers. A dispensing organization shall submit proposed
3principal officer applications on forms approved by the
4Department.
5 (e) All proposed new principal officers shall be subject to
6the requirements of this Act, this Article, and any rules that
7may be adopted pursuant to this Act.
8 (f) The Department may prohibit the addition of a principal
9officer to a dispensing organization for failure to comply with
10this Act, this Article, and any rules that may be adopted
11pursuant to this Act.
12 (g) A dispensing organization may not assign a license.
13 (h) A dispensing organization may not transfer a license
14without prior Department approval. Such approval may be
15withheld if the person to whom the license is being transferred
16does not commit to the same or a similar community engagement
17plan provided as part of the dispensing organization's
18application under paragraph (18) of subsection (d) of Section
1915-25, and such transferee's license shall be conditional upon
20that commitment.
21 (i) With the addition or removal of principal officers, the
22Department will review the ownership structure to determine
23whether the change in ownership has had the effect of a
24transfer of the license. The dispensing organization shall
25supply all ownership documents requested by the Department.
26 (j) A dispensing organization may apply to the Department

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1to approve a sale of the dispensing organization. A request to
2sell the dispensing organization must be on application forms
3provided by the Department. A request for an approval to sell a
4dispensing organization must comply with the following:
5 (1) New application materials shall comply with this
6 Act and any rules that may be adopted pursuant to this Act;
7 (2) Application materials shall include a change of
8 ownership fee of $5,000 to be deposited into the Cannabis
9 Regulation Fund;
10 (3) The application materials shall provide proof that
11 the transfer of ownership will not have the effect of
12 granting any of the owners or principal officers direct or
13 indirect ownership or control of more than 10 adult use
14 dispensing organization licenses;
15 (4) New principal officers shall each complete the
16 proposed new principal officer application;
17 (5) If the Department approves the application
18 materials and proposed new principal officer applications,
19 it will perform an inspection before approving the sale and
20 issuing the dispensing organization license;
21 (6) If a new license is approved, the Department will
22 issue a new license number and certificate to the new
23 dispensing organization.
24 (k) The dispensing organization shall provide the
25Department with the personal information for all new dispensing
26organizations agents as required in this Article and all new

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1dispensing organization agents shall be subject to the
2requirements of this Article. A dispensing organization agent
3must obtain an agent identification card from the Department
4before beginning work at a dispensary.
5 (l) Before remodeling, expansion, reduction, or other
6physical, noncosmetic alteration of a dispensary, the
7dispensing organization must notify the Department and confirm
8the alterations are in compliance with this Act and any rules
9that may be adopted pursuant to this Act.
10 Section 15-65. Administration.
11 (a) A dispensing organization shall establish, maintain,
12and comply with written policies and procedures as submitted in
13the Business, Financial and Operating plan as required in this
14Article or by rules established by the Department, and approved
15by the Department, for the security, storage, inventory, and
16distribution of cannabis. These policies and procedures shall
17include methods for identifying, recording, and reporting
18diversion, theft, or loss, and for correcting errors and
19inaccuracies in inventories. At a minimum, dispensing
20organizations shall ensure the written policies and procedures
21provide for the following:
22 (1) Mandatory and voluntary recalls of cannabis
23 products. The policies shall be adequate to deal with
24 recalls due to any action initiated at the request of the
25 Department and any voluntary action by the dispensing

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1 organization to remove defective or potentially defective
2 cannabis from the market or any action undertaken to
3 promote public health and safety, including:
4 (i) A mechanism reasonably calculated to contact
5 purchasers who have, or likely have, obtained the
6 product from the dispensary, including information on
7 the policy for return of the recalled product;
8 (ii) A mechanism to identify and contact the adult
9 use cultivation center, craft grower, or infuser that
10 manufactured the cannabis;
11 (iii) Policies for communicating with the
12 Department, the Department of Agriculture, and the
13 Department of Public Health within 24 hours of
14 discovering defective or potentially defective
15 cannabis; and
16 (iv) Policies for destruction of any recalled
17 cannabis product;
18 (2) Responses to local, State, or national
19 emergencies, including natural disasters, that affect the
20 security or operation of a dispensary;
21 (3) Segregation and destruction of outdated, damaged,
22 deteriorated, misbranded, or adulterated cannabis. This
23 procedure shall provide for written documentation of the
24 cannabis disposition;
25 (4) Ensure the oldest stock of a cannabis product is
26 distributed first. The procedure may permit deviation from

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1 this requirement, if such deviation is temporary and
2 appropriate;
3 (5) Training of dispensing organization agents in the
4 provisions of this Act and rules, to effectively operate
5 the point-of-sale system and the State's verification
6 system, proper inventory handling and tracking, specific
7 uses of cannabis or cannabis-infused products, instruction
8 regarding regulatory inspection preparedness and law
9 enforcement interaction, awareness of the legal
10 requirements for maintaining status as an agent, and other
11 topics as specified by the dispensing organization or the
12 Department. The dispensing organization shall maintain
13 evidence of all training provided to each agent in its
14 files that is subject to inspection and audit by the
15 Department. The dispensing organization shall ensure
16 agents receive a minimum of 8 hours of training subject to
17 the requirements in subsection (i) of Section 15-40
18 annually, unless otherwise approved by the Department;
19 (6) Maintenance of business records consistent with
20 industry standards, including bylaws, consents, manual or
21 computerized records of assets and liabilities, audits,
22 monetary transactions, journals, ledgers, and supporting
23 documents, including agreements, checks, invoices,
24 receipts, and vouchers. Records shall be maintained in a
25 manner consistent with this Act and shall be retained for 5
26 years;

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1 (7) Inventory control, including:
2 (i) Tracking purchases and denials of sale;
3 (ii) Disposal of unusable or damaged cannabis as
4 required by this Act and rules; and
5 (8) Purchaser education and support, including:
6 (i) Whether possession of cannabis is illegal
7 under federal law;
8 (ii) Current educational information issued by the
9 Department of Public Health about the health risks
10 associated with the use or abuse of cannabis;
11 (iii) Information about possible side effects;
12 (iv) Prohibition on smoking cannabis in public
13 places; and
14 (v) Offering any other appropriate purchaser
15 education or support materials.
16 (b) BLANK.
17 (c) A dispensing organization shall maintain copies of the
18policies and procedures on the dispensary premises and provide
19copies to the Department upon request. The dispensing
20organization shall review the dispensing organization policies
21and procedures at least once every 12 months from the issue
22date of the license and update as needed due to changes in
23industry standards or as requested by the Department.
24 (d) A dispensing organization shall ensure that each
25principal officer and each dispensing organization agent has a
26current agent identification card in the agent's immediate

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1possession when the agent is at the dispensary.
2 (e) A dispensing organization shall provide prompt written
3notice to the Department, including the date of the event, when
4a dispensing organization agent no longer is employed by the
5dispensing organization.
6 (f) A dispensing organization shall promptly document and
7report any loss or theft of cannabis from the dispensary to the
8Department of State Police and the Department. It is the duty
9of any dispensing organization agent who becomes aware of the
10loss or theft to report it as provided in this Article.
11 (g) A dispensing organization shall post the following
12information in a conspicuous location in an area of the
13dispensary accessible to consumers:
14 (1) The dispensing organization's license;
15 (2) The hours of operation.
16 (h) Signage that shall be posted inside the premises.
17 (1) All dispensing organizations must display a
18 placard that states the following: "Cannabis consumption
19 can impair cognition and driving, is for adult use only,
20 may be habit forming, and should not be used by pregnant or
21 breastfeeding women.".
22 (2) Any dispensing organization that sells edible
23 cannabis-infused products must display a placard that
24 states the following:
25 (A) "Edible cannabis-infused products were
26 produced in a kitchen that may also process common food

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1 allergens."; and
2 (B) "The effects of cannabis products can vary from
3 person to person, and it can take as long as two hours
4 to feel the effects of some cannabis-infused products.
5 Carefully review the portion size information and
6 warnings contained on the product packaging before
7 consuming.".
8 (3) All of the required signage in this subsection (h)
9 shall be no smaller than 24 inches tall by 36 inches wide,
10 with typed letters no smaller than 2 inches. The signage
11 shall be clearly visible and readable by customers. The
12 signage shall be placed in the area where cannabis and
13 cannabis-infused products are sold and may be translated
14 into additional languages as needed. The Department may
15 require a dispensary to display the required signage in a
16 different language, other than English, if the Secretary
17 deems it necessary.
18 (i) A dispensing organization shall prominently post
19notices inside the dispensing organization that state
20activities that are strictly prohibited and punishable by law,
21including, but not limited to:
22 (1) No minors permitted on the premises unless the
23 minor is a minor qualifying patient under the Compassionate
24 Use of Medical Cannabis Pilot Program Act;
25 (2) Distribution to persons under the age of 21 is
26 prohibited;

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1 (3) Transportation of cannabis or cannabis products
2 across state lines is prohibited.
3 Section 15-70. Operational requirements; prohibitions.
4 (a) A dispensing organization shall operate in accordance
5with the representations made in its application and license
6materials. It shall be in compliance with this Act and rules.
7 (b) A dispensing organization must include the legal name
8of the dispensary on the packaging of any cannabis product it
9sells.
10 (c) All cannabis, cannabis-infused products, and cannabis
11seeds must be obtained from an Illinois registered adult use
12cultivation center, craft grower, infuser, or another
13dispensary.
14 (d) Dispensing organizations are prohibited from selling
15any product containing alcohol except tinctures, which must be
16limited to containers that are no larger than 100 milliliters.
17 (e) A dispensing organization shall inspect and count
18product received by the adult use cultivation center before
19dispensing it.
20 (f) A dispensing organization may only accept cannabis
21deliveries into a restricted access area. Deliveries may not be
22accepted through the public or limited access areas unless
23otherwise approved by the Department.
24 (g) A dispensing organization shall maintain compliance
25with State and local building, fire, and zoning requirements or

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1regulations.
2 (h) A dispensing organization shall submit a list to the
3Department of the names of all service professionals that will
4work at the dispensary. The list shall include a description of
5the type of business or service provided. Changes to the
6service professional list shall be promptly provided. No
7service professional shall work in the dispensary until the
8name is provided to the Department on the service professional
9list.
10 (i) A dispensing organization's license allows for a
11dispensary to be operated only at a single location.
12 (j) A dispensary may operate between 6 a.m. and 10 p.m.
13local time.
14 (k) A dispensing organization must keep all lighting
15outside and inside the dispensary in good working order and
16wattage sufficient for security cameras.
17 (l) A dispensing organization shall ensure that any
18building or equipment used by a dispensing organization for the
19storage or sale of cannabis is maintained in a clean and
20sanitary condition.
21 (m) The dispensary shall be free from infestation by
22insects, rodents, or pests.
23 (n) A dispensing organization shall not:
24 (1) Produce or manufacture cannabis;
25 (2) Accept a cannabis product from an adult use
26 cultivation center, craft grower, infuser, dispensing

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1 organization, or transporting organization unless it is
2 pre-packaged and labeled in accordance with this Act and
3 any rules that may be adopted pursuant to this Act;
4 (3) Obtain cannabis or cannabis-infused products from
5 outside the State of Illinois;
6 (4) Sell cannabis or cannabis-infused products to a
7 purchaser unless the dispensary organization is licensed
8 under the Compassionate Use of Medical Cannabis Pilot
9 Program, and the individual is registered under the
10 Compassionate Use of Medical Cannabis Pilot Program or the
11 purchaser has been verified to be over the age of 21;
12 (5) Enter into an exclusive agreement with any adult
13 use cultivation center, craft grower, or infuser.
14 Dispensaries shall provide consumers an assortment of
15 products from various cannabis business establishment
16 licensees such that the inventory available for sale at any
17 dispensary from any single cultivation center, craft
18 grower, processor, or infuser entity shall not be more than
19 40% of the total inventory available for sale. For the
20 purpose of this subsection, a cultivation center, craft
21 grower, processor, or infuser shall be considered part of
22 the same entity if the licensees share at least one
23 principal officer. The Department may request that a
24 dispensary diversify its products as needed or otherwise
25 discipline a dispensing organization for violating this
26 requirement;

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1 (6) Refuse to conduct business with an adult use
2 cultivation center, craft grower, transporting
3 organization, or infuser that has the ability to properly
4 deliver the product and is permitted by the Department of
5 Agriculture, on the same terms as other adult use
6 cultivation centers, craft growers, infusers, or
7 transporters with whom it is dealing;
8 (7) Operate drive-through windows;
9 (8) Allow for the dispensing of cannabis or
10 cannabis-infused products in vending machines;
11 (9) Transport cannabis to residences or other
12 locations where purchasers may be for delivery;
13 (10) Enter into agreements to allow persons who are not
14 dispensing organization agents to deliver cannabis or to
15 transport cannabis to purchasers.
16 (11) Operate a dispensary if its video surveillance
17 equipment is inoperative;
18 (12) Operate a dispensary if the point-of-sale
19 equipment is inoperative;
20 (13) Operate a dispensary if the State's cannabis
21 electronic verification system is inoperative;
22 (14) Have fewer than 2 people working at the dispensary
23 at any time while the dispensary is open;
24 (15) Be located within 1,500 feet of the property line
25 of a pre-existing dispensing organization;
26 (16) Sell clones or any other live plant material;

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1 (17) Sell cannabis, cannabis concentrate, or
2 cannabis-infused products in combination or bundled with
3 each other or any other items for one price, and each item
4 of cannabis, concentrate, or cannabis-infused product must
5 be separately identified by quantity and price on the
6 receipt;
7 (18) Violate any other requirements or prohibitions
8 set by Department rules.
9 (o) It is unlawful for any person having an Early Approval
10Adult Use Cannabis Dispensing Organization License, a
11Conditional Adult Use Cannabis Dispensing Organization, an
12Adult Use Dispensing Organization License, or a medical
13cannabis dispensing organization license issued under the
14Compassionate Use of Medical Cannabis Pilot Program or any
15officer, associate, member, representative, or agent of such
16licensee to accept, receive, or borrow money or anything else
17of value or accept or receive credit (other than merchandising
18credit in the ordinary course of business for a period not to
19exceed 30 days) directly or indirectly from any adult use
20cultivation center, craft grower, infuser, or transporting
21organization. This includes anything received or borrowed or
22from any stockholders, officers, agents, or persons connected
23with an adult use cultivation center, craft grower, infuser, or
24transporting organization. This also excludes any received or
25borrowed in exchange for preferential placement by the
26dispensing organization, including preferential placement on

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1the dispensing organization's shelves, display cases, or
2website.
3 (p) It is unlawful for any person having an Early Approval
4Adult Use Cannabis Dispensing Organization License, a
5Conditional Adult Use Cannabis Dispensing Organization, an
6Adult Use Dispensing Organization License, or a medical
7cannabis dispensing organization license issued under the
8Compassionate Use of Medical Cannabis Pilot Program to enter
9into any contract with any person licensed to cultivate,
10process, or transport cannabis whereby such dispensary
11organization agrees not to sell any cannabis cultivated,
12processed, transported, manufactured, or distributed by any
13other cultivator, transporter, or infuser, and any provision in
14any contract violative of this Section shall render the whole
15of such contract void and no action shall be brought thereon in
16any court.
17 Section 15-75. Inventory control system.
18 (a) A dispensing organization agent-in-charge shall have
19primary oversight of the dispensing organization's cannabis
20inventory verification system, and its point-of-sale system.
21The inventory point-of-sale system shall be real-time,
22web-based, and accessible by the Department at any time. The
23point-of-sale system shall track, at a minimum the date of
24sale, amount, price, and currency.
25 (b) A dispensing organization shall establish an account

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1with the State's verification system that documents:
2 (1) Each sales transaction at the time of sale and each
3 day's beginning inventory, acquisitions, sales, disposal,
4 and ending inventory.
5 (2) Acquisition of cannabis and cannabis-infused
6 products from a licensed adult use cultivation center,
7 craft grower, infuser, or transporter, including:
8 (i) A description of the products, including the
9 quantity, strain, variety, and batch number of each
10 product received;
11 (ii) The name and registry identification number
12 of the licensed adult use cultivation center, craft
13 grower, or infuser providing the cannabis and
14 cannabis-infused products;
15 (iii) The name and registry identification number
16 of the licensed adult use cultivation center, craft
17 grower, infuser, or transportation agent delivering
18 the cannabis;
19 (iv) The name and registry identification number
20 of the dispensing organization agent receiving the
21 cannabis; and
22 (v) The date of acquisition.
23 (3) The disposal of cannabis, including:
24 (i) A description of the products, including the
25 quantity, strain, variety, batch number, and reason
26 for the cannabis being disposed;

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1 (ii) The method of disposal; and
2 (iii) The date and time of disposal.
3 (c) Upon cannabis delivery, a dispensing organization
4shall confirm the product's name, strain name, weight, and
5identification number on the manifest matches the information
6on the cannabis product label and package. The product name
7listed and the weight listed in the State's verification system
8shall match the product packaging.
9 (d) The agent-in-charge shall conduct daily inventory
10reconciliation documenting and balancing cannabis inventory by
11confirming the State's verification system matches the
12dispensing organization's point-of-sale system and the amount
13of physical product at the dispensary.
14 (1) A dispensing organization must receive Department
15 approval before completing an inventory adjustment. It
16 shall provide a detailed reason for the adjustment.
17 Inventory adjustment documentation shall be kept at the
18 dispensary for 2 years from the date performed.
19 (2) If the dispensing organization identifies an
20 imbalance in the amount of cannabis after the daily
21 inventory reconciliation due to mistake, the dispensing
22 organization shall determine how the imbalance occurred
23 and immediately upon discovery take and document
24 corrective action. If the dispensing organization cannot
25 identify the reason for the mistake within 2 calendar days
26 after first discovery, it shall inform the Department

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1 immediately in writing of the imbalance and the corrective
2 action taken to date. The dispensing organization shall
3 work diligently to determine the reason for the mistake.
4 (3) If the dispensing organization identifies an
5 imbalance in the amount of cannabis after the daily
6 inventory reconciliation or through other means due to
7 theft, criminal activity, or suspected criminal activity,
8 the dispensing organization shall immediately determine
9 how the reduction occurred and take and document corrective
10 action. Within 24 hours after the first discovery of the
11 reduction due to theft, criminal activity, or suspected
12 criminal activity, the dispensing organization shall
13 inform the Department and the Department of State Police in
14 writing.
15 (4) The dispensing organization shall file an annual
16 compilation report with the Department, including a
17 financial statement that shall include, but not be limited
18 to, an income statement, balance sheet, profit and loss
19 statement, statement of cash flow, wholesale cost and
20 sales, and any other documentation requested by the
21 Department in writing. The financial statement shall
22 include any other information the Department deems
23 necessary in order to effectively administer this Act and
24 all rules, orders, and final decisions promulgated under
25 this Act. Statements required by this Section shall be
26 filed with the Department within 60 days after the end of

HB1438 Enrolled- 133 -LRB101 04919 JRG 49928 b
1 the calendar year. The compilation report shall include a
2 letter authored by a licensed certified public accountant
3 that it has been reviewed and is accurate based on the
4 information provided. The dispensing organization,
5 financial statement, and accompanying documents are not
6 required to be audited unless specifically requested by the
7 Department.
8 (e) A dispensing organization shall:
9 (1) Maintain the documentation required in this
10 Section in a secure locked location at the dispensing
11 organization for 5 years from the date on the document;
12 (2) Provide any documentation required to be
13 maintained in this Section to the Department for review
14 upon request; and
15 (3) If maintaining a bank account, retain for a period
16 of 5 years a record of each deposit or withdrawal from the
17 account.
18 (f) If a dispensing organization chooses to have a return
19policy for cannabis and cannabis products, the dispensing
20organization shall seek prior approval from the Department.
21 Section 15-80. Storage requirements.
22 (a) Authorized on-premises storage. A dispensing
23organization must store inventory on its premises. All
24inventory stored on the premises must be secured in a
25restricted access area and tracked consistently with the

HB1438 Enrolled- 134 -LRB101 04919 JRG 49928 b
1inventory tracking rules.
2 (b) A dispensary shall be of suitable size and construction
3to facilitate cleaning, maintenance, and proper operations.
4 (c) A dispensary shall maintain adequate lighting,
5ventilation, temperature, humidity control, and equipment.
6 (d) Containers storing cannabis that have been tampered
7with, damaged, or opened shall be labeled with the date opened
8and quarantined from other cannabis products in the vault until
9they are disposed.
10 (e) Cannabis that was tampered with, expired, or damaged
11shall not be stored at the premises for more than 7 calendar
12days.
13 (f) Cannabis samples shall be in a sealed container.
14Samples shall be maintained in the restricted access area.
15 (g) The dispensary storage areas shall be maintained in
16accordance with the security requirements in this Act and
17rules.
18 (h) Cannabis must be stored at appropriate temperatures and
19under appropriate conditions to help ensure that its packaging,
20strength, quality, and purity are not adversely affected.
21 Section 15-85. Dispensing cannabis.
22 (a) Before a dispensing organization agent dispenses
23cannabis to a purchaser, the agent shall:
24 (1) Verify the age of the purchaser by checking a
25 government-issued identification card by use of an

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1 electronic reader or electronic scanning device to scan a
2 purchaser's government-issued identification, if
3 applicable, to determine the purchaser's age and the
4 validity of the identification;
5 (2) Verify the validity of the government-issued
6 identification card;
7 (3) Offer any appropriate purchaser education or
8 support materials;
9 (4) Enter the following information into the State's
10 cannabis electronic verification system:
11 (i) The dispensing organization agent's
12 identification number;
13 (ii) The dispensing organization's identification
14 number;
15 (iii) The amount, type (including strain, if
16 applicable) of cannabis or cannabis-infused product
17 dispensed;
18 (iv) The date and time the cannabis was dispensed.
19 (b) A dispensing organization shall refuse to sell cannabis
20or cannabis-infused products to any person unless the person
21produces a valid identification showing that the person is 21
22years of age or older. A medical cannabis dispensing
23organization may sell cannabis or cannabis-infused products to
24a person who is under 21 years of age if the sale complies with
25the provisions of the Compassionate Use of Medical Cannabis
26Pilot Program Act and rules.

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1 (c) For the purposes of this Section, valid identification
2must:
3 (1) Be valid and unexpired;
4 (2) Contain a photograph and the date of birth of the
5 person.
6 Section 15-90. Destruction and disposal of cannabis.
7 (a) Cannabis and cannabis-infused products must be
8destroyed by rendering them unusable using methods approved by
9the Department that comply with this Act and rules.
10 (b) Cannabis waste rendered unusable must be promptly
11disposed according to this Act and rules. Disposal of the
12cannabis waste rendered unusable may be delivered to a
13permitted solid waste facility for final disposition.
14Acceptable permitted solid waste facilities include, but are
15not limited to:
16 (1) Compostable mixed waste: Compost, anaerobic
17 digester, or other facility with approval of the
18 jurisdictional health department.
19 (2) Noncompostable mixed waste: Landfill, incinerator,
20 or other facility with approval of the jurisdictional
21 health department.
22 (c) All waste and unusable product shall be weighed,
23recorded, and entered into the inventory system before
24rendering it unusable. All waste and unusable cannabis
25concentrates and cannabis-infused products shall be recorded

HB1438 Enrolled- 137 -LRB101 04919 JRG 49928 b
1and entered into the inventory system before rendering it
2unusable. Verification of this event shall be performed by an
3agent-in-charge and conducted in an area with video
4surveillance.
5 (d) Electronic documentation of destruction and disposal
6shall be maintained for a period of at least 5 years.
7 Section 15-95. Agent-in-charge.
8 (a) Every dispensing organization shall designate, at a
9minimum, one agent-in-charge for each licensed dispensary. The
10designated agent-in-charge must hold a dispensing organization
11agent identification card. Maintaining an agent-in-charge is a
12continuing requirement for the license, except as provided in
13subsection (f).
14 (b) The agent-in-charge shall be a principal officer or a
15full-time agent of the dispensing organization and shall manage
16the dispensary. Managing the dispensary includes, but is not
17limited to, responsibility for opening and closing the
18dispensary, delivery acceptance, oversight of sales and
19dispensing organization agents, recordkeeping, inventory,
20dispensing organization agent training, and compliance with
21this Act and rules. Participation in affairs also includes the
22responsibility for maintaining all files subject to audit or
23inspection by the Department at the dispensary.
24 (c) The agent-in-charge is responsible for promptly
25notifying the Department of any change of information required

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1to be reported to the Department.
2 (d) In determining whether an agent-in-charge manages the
3dispensary, the Department may consider the responsibilities
4identified in this Section, the number of dispensing
5organization agents under the supervision of the
6agent-in-charge, and the employment relationship between the
7agent-in-charge and the dispensing organization, including the
8existence of a contract for employment and any other relevant
9fact or circumstance.
10 (e) The agent-in-charge is responsible for notifying the
11Department of a change in the employment status of all
12dispensing organization agents within 5 business days after the
13change, including notice to the Department if the termination
14of an agent was for diversion of product or theft of currency.
15 (f) In the event of the separation of an agent-in-charge
16due to death, incapacity, termination, or any other reason and
17if the dispensary does not have an active agent-in-charge, the
18dispensing organization shall immediately contact the
19Department and request a temporary certificate of authority
20allowing the continuing operation. The request shall include
21the name of an interim agent-in-charge until a replacement is
22identified, or shall include the name of the replacement. The
23Department shall issue the temporary certificate of authority
24promptly after it approves the request. If a dispensing
25organization fails to promptly request a temporary certificate
26of authority after the separation of the agent-in-charge, its

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1registration shall cease until the Department approves the
2temporary certificate of authority or registers a new
3agent-in-charge. No temporary certificate of authority shall
4be valid for more than 90 days. The succeeding agent-in-charge
5shall register with the Department in compliance with this
6Article. Once the permanent succeeding agent-in-charge is
7registered with the Department, the temporary certificate of
8authority is void. No temporary certificate of authority shall
9be issued for the separation of an agent-in-charge due to
10disciplinary action by the Department related to his or her
11conduct on behalf of the dispensing organization.
12 (g) The dispensing organization agent-in-charge
13registration shall expire one year from the date it is issued.
14The agent-in-charge's registration shall be renewed annually.
15The Department shall review the dispensing organization's
16compliance history when determining whether to grant the
17request to renew.
18 (h) Upon termination of an agent-in-charge's employment,
19the dispensing organization shall immediately reclaim the
20dispensing agent identification card. The dispensing
21organization shall promptly return the identification card to
22the Department.
23 (i) The Department may deny an application or renewal or
24discipline or revoke an agent-in-charge identification card
25for any of the following reasons:
26 (1) Submission of misleading, incorrect, false, or

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1 fraudulent information in the application or renewal
2 application;
3 (2) Violation of the requirements of this Act or rules;
4 (3) Fraudulent use of the agent-in-charge
5 identification card;
6 (4) Selling, distributing, transferring in any manner,
7 or giving cannabis to any unauthorized person;
8 (5) Theft of cannabis, currency, or any other items
9 from a dispensary.
10 (6) Tampering with, falsifying, altering, modifying,
11 or duplicating an agent-in-charge identification card;
12 (7) Tampering with, falsifying, altering, or modifying
13 the surveillance video footage, point-of-sale system, or
14 the State's verification system;
15 (8) Failure to notify the Department immediately upon
16 discovery that the agent-in-charge identification card has
17 been lost, stolen, or destroyed;
18 (9) Failure to notify the Department within 5 business
19 days after a change in the information provided in the
20 application for an agent-in-charge identification card;
21 (10) Conviction of a felony offense in accordance with
22 Sections 2105-131, 2105-135, and 2105-205 of the
23 Department of Professional Regulation Law of the Civil
24 Administrative Code of Illinois or any incident listed in
25 this Act or rules following the issuance of an
26 agent-in-charge identification card;

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1 (11) Dispensing to purchasers in amounts above the
2 limits provided in this Act; or
3 (12) Delinquency in filing any required tax returns or
4 paying any amounts owed to the State of Illinois
5 Section 15-100. Security.
6 (a) A dispensing organization shall implement security
7measures to deter and prevent entry into and theft of cannabis
8or currency.
9 (b) A dispensing organization shall submit any changes to
10the floor plan or security plan to the Department for
11pre-approval. All cannabis shall be maintained and stored in a
12restricted access area during construction.
13 (c) The dispensing organization shall implement security
14measures to protect the premises, purchasers, and dispensing
15organization agents including, but not limited to the
16following:
17 (1) Establish a locked door or barrier between the
18 facility's entrance and the limited access area;
19 (2) Prevent individuals from remaining on the premises
20 if they are not engaging in activity permitted by this Act
21 or rules;
22 (3) Develop a policy that addresses the maximum
23 capacity and purchaser flow in the waiting rooms and
24 limited access areas;
25 (4) Dispose of cannabis in accordance with this Act and

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1 rules;
2 (5) During hours of operation, store and dispense all
3 cannabis from the restricted access area. During
4 operational hours, cannabis shall be stored in an enclosed
5 locked room or cabinet and accessible only to specifically
6 authorized dispensing organization agents;
7 (6) When the dispensary is closed, store all cannabis
8 and currency in a reinforced vault room in the restricted
9 access area and in a manner as to prevent diversion, theft,
10 or loss;
11 (7) Keep the reinforced vault room and any other
12 equipment or cannabis storage areas securely locked and
13 protected from unauthorized entry;
14 (8) Keep an electronic daily log of dispensing
15 organization agents with access to the reinforced vault
16 room and knowledge of the access code or combination;
17 (9) Keep all locks and security equipment in good
18 working order;
19 (10) Maintain an operational security and alarm system
20 at all times;
21 (11) Prohibit keys, if applicable, from being left in
22 the locks, or stored or placed in a location accessible to
23 persons other than specifically authorized personnel;
24 (12) Prohibit accessibility of security measures,
25 including combination numbers, passwords, or electronic or
26 biometric security systems to persons other than

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1 specifically authorized dispensing organization agents;
2 (13) Ensure that the dispensary interior and exterior
3 premises are sufficiently lit to facilitate surveillance;
4 (14) Ensure that trees, bushes, and other foliage
5 outside of the dispensary premises do not allow for a
6 person or persons to conceal themselves from sight;
7 (15) Develop emergency policies and procedures for
8 securing all product and currency following any instance of
9 diversion, theft, or loss of cannabis, and conduct an
10 assessment to determine whether additional safeguards are
11 necessary; and
12 (16) Develop sufficient additional safeguards in
13 response to any special security concerns, or as required
14 by the Department.
15 (d) The Department may request or approve alternative
16security provisions that it determines are an adequate
17substitute for a security requirement specified in this
18Article. Any additional protections may be considered by the
19Department in evaluating overall security measures.
20 (e) A dispensary organization may share premises with a
21craft grower or an infuser organization, or both, provided each
22licensee stores currency and cannabis or cannabis-infused
23products in a separate secured vault to which the other
24licensee does not have access or all licensees sharing a vault
25share more than 50% of the same ownership.
26 (f) A dispensing organization shall provide additional

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1security as needed and in a manner appropriate for the
2community where it operates.
3 (g) Restricted access areas.
4 (1) All restricted access areas must be identified by
5 the posting of a sign that is a minimum of 12 inches by 12
6 inches and that states "Do Not Enter - Restricted Access
7 Area - Authorized Personnel Only" in lettering no smaller
8 than one inch in height.
9 (2) All restricted access areas shall be clearly
10 described in the floor plan of the premises, in the form
11 and manner determined by the Department, reflecting walls,
12 partitions, counters, and all areas of entry and exit. The
13 floor plan shall show all storage, disposal, and retail
14 sales areas.
15 (3) All restricted access areas must be secure, with
16 locking devices that prevent access from the limited access
17 areas.
18 (h) Security and alarm.
19 (1) A dispensing organization shall have an adequate
20 security plan and security system to prevent and detect
21 diversion, theft, or loss of cannabis, currency, or
22 unauthorized intrusion using commercial grade equipment
23 installed by an Illinois licensed private alarm contractor
24 or private alarm contractor agency that shall, at a
25 minimum, include:
26 (i) A perimeter alarm on all entry points and glass

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1 break protection on perimeter windows;
2 (ii) Security shatterproof tinted film on exterior
3 windows;
4 (iii) A failure notification system that provides
5 an audible, text, or visual notification of any failure
6 in the surveillance system, including, but not limited
7 to, panic buttons, alarms, and video monitoring
8 system. The failure notification system shall provide
9 an alert to designated dispensing organization agents
10 within 5 minutes after the failure, either by telephone
11 or text message;
12 (iv) A duress alarm, panic button, and alarm, or
13 holdup alarm and after-hours intrusion detection alarm
14 that by design and purpose will directly or indirectly
15 notify, by the most efficient means, the Public Safety
16 Answering Point for the law enforcement agency having
17 primary jurisdiction;
18 (v) Security equipment to deter and prevent
19 unauthorized entrance into the dispensary, including
20 electronic door locks on the limited and restricted
21 access areas that include devices or a series of
22 devices to detect unauthorized intrusion that may
23 include a signal system interconnected with a radio
24 frequency method, cellular, private radio signals or
25 other mechanical or electronic device.
26 (2) All security system equipment and recordings shall

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1 be maintained in good working order, in a secure location
2 so as to prevent theft, loss, destruction, or alterations.
3 (3) Access to surveillance monitoring recording
4 equipment shall be limited to persons who are essential to
5 surveillance operations, law enforcement authorities
6 acting within their jurisdiction, security system service
7 personnel, and the Department. A current list of authorized
8 dispensing organization agents and service personnel that
9 have access to the surveillance equipment must be available
10 to the Department upon request.
11 (4) All security equipment shall be inspected and
12 tested at regular intervals, not to exceed one month from
13 the previous inspection, and tested to ensure the systems
14 remain functional.
15 (5) The security system shall provide protection
16 against theft and diversion that is facilitated or hidden
17 by tampering with computers or electronic records.
18 (6) The dispensary shall ensure all access doors are
19 not solely controlled by an electronic access panel to
20 ensure that locks are not released during a power outage.
21 (i) To monitor the dispensary, the dispensing organization
22shall incorporate continuous electronic video monitoring
23including the following:
24 (1) All monitors must be 19 inches or greater;
25 (2) Unobstructed video surveillance of all enclosed
26 dispensary areas, unless prohibited by law, including all

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1 points of entry and exit that shall be appropriate for the
2 normal lighting conditions of the area under surveillance.
3 The cameras shall be directed so all areas are captured,
4 including, but not limited to, safes, vaults, sales areas,
5 and areas where cannabis is stored, handled, dispensed, or
6 destroyed. Cameras shall be angled to allow for facial
7 recognition, the capture of clear and certain
8 identification of any person entering or exiting the
9 dispensary area and in lighting sufficient during all times
10 of night or day;
11 (3) Unobstructed video surveillance of outside areas,
12 the storefront, and the parking lot, that shall be
13 appropriate for the normal lighting conditions of the area
14 under surveillance. Cameras shall be angled so as to allow
15 for the capture of facial recognition, clear and certain
16 identification of any person entering or exiting the
17 dispensary and the immediate surrounding area, and license
18 plates of vehicles in the parking lot;
19 (4) 24-hour recordings from all video cameras
20 available for immediate viewing by the Department upon
21 request. Recordings shall not be destroyed or altered and
22 shall be retained for at least 90 days. Recordings shall be
23 retained as long as necessary if the dispensing
24 organization is aware of the loss or theft of cannabis or a
25 pending criminal, civil, or administrative investigation
26 or legal proceeding for which the recording may contain

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1 relevant information;
2 (5) The ability to immediately produce a clear, color
3 still photo from the surveillance video, either live or
4 recorded;
5 (6) A date and time stamp embedded on all video
6 surveillance recordings. The date and time shall be
7 synchronized and set correctly and shall not significantly
8 obscure the picture;
9 (7) The ability to remain operational during a power
10 outage and ensure all access doors are not solely
11 controlled by an electronic access panel to ensure that
12 locks are not released during a power outage;
13 (8) All video surveillance equipment shall allow for
14 the exporting of still images in an industry standard image
15 format, including .jpg, .bmp, and .gif. Exported video
16 shall have the ability to be archived in a proprietary
17 format that ensures authentication of the video and
18 guarantees that no alteration of the recorded image has
19 taken place. Exported video shall also have the ability to
20 be saved in an industry standard file format that can be
21 played on a standard computer operating system. All
22 recordings shall be erased or destroyed before disposal;
23 (9) The video surveillance system shall be operational
24 during a power outage with a 4-hour minimum battery backup;
25 (10) A video camera or cameras recording at each
26 point-of-sale location allowing for the identification of

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1 the dispensing organization agent distributing the
2 cannabis and any purchaser. The camera or cameras shall
3 capture the sale, the individuals and the computer monitors
4 used for the sale;
5 (11) A failure notification system that provides an
6 audible and visual notification of any failure in the
7 electronic video monitoring system; and
8 (12) All electronic video surveillance monitoring must
9 record at least the equivalent of 8 frames per second and
10 be available as recordings to the Department and the
11 Department of State Police 24 hours a day via a secure
12 web-based portal with reverse functionality.
13 (j) The requirements contained in this Act are minimum
14requirements for operating a dispensing organization. The
15Department may establish additional requirements by rule.
16 Section 15-110. Recordkeeping.
17 (a) Dispensing organization records must be maintained
18electronically for 3 years and be available for inspection by
19the Department upon request. Required written records include,
20but are not limited to, the following:
21 (1) Operating procedures;
22 (2) Inventory records, policies, and procedures;
23 (3) Security records;
24 (4) Audit records;
25 (5) Staff training plans and completion documentation;

HB1438 Enrolled- 150 -LRB101 04919 JRG 49928 b
1 (6) Staffing plan; and
2 (7) Business records, including but not limited to:
3 (i) Assets and liabilities;
4 (ii) Monetary transactions;
5 (iii) Written or electronic accounts, including
6 bank statements, journals, ledgers, and supporting
7 documents, agreements, checks, invoices, receipts, and
8 vouchers; and
9 (iv) Any other financial accounts reasonably
10 related to the dispensary operations.
11 (b) Storage and transfer of records. If a dispensary closes
12due to insolvency, revocation, bankruptcy, or for any other
13reason, all records must be preserved at the expense of the
14dispensing organization for at least 3 years in a form and
15location in Illinois acceptable to the Department. The
16dispensing organization shall keep the records longer if
17requested by the Department. The dispensing organization shall
18notify the Department of the location where the dispensary
19records are stored or transferred.
20 Section 15-120. Closure of a dispensary.
21 (a) If a dispensing organization decides not to renew its
22license or decides to close its business, it shall promptly
23notify the Department not less than 3 months before the
24effective date of the closing date or as otherwise authorized
25by the Department.

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1 (b) The dispensing organization shall work with the
2Department to develop a closure plan that addresses, at a
3minimum, the transfer of business records, transfer of cannabis
4products, and anything else the Department finds necessary.
5 Section 15-125. Fees. After January 1, 2022, the Department
6may by rule modify any fee established under this Article.
7 Section 15-135. Investigations.
8 (a) Dispensing organizations are subject to random and
9unannounced dispensary inspections and cannabis testing by the
10Department, the Department of State Police, and local law
11enforcement.
12 (b) The Department and its authorized representatives may
13enter any place, including a vehicle, in which cannabis is
14held, stored, dispensed, sold, produced, delivered,
15transported, manufactured, or disposed of and inspect, in a
16reasonable manner, the place and all pertinent equipment,
17containers and labeling, and all things including records,
18files, financial data, sales data, shipping data, pricing data,
19personnel data, research, papers, processes, controls, and
20facility, and inventory any stock of cannabis and obtain
21samples of any cannabis or cannabis-infused product, any labels
22or containers for cannabis, or paraphernalia.
23 (c) The Department may conduct an investigation of an
24applicant, application, dispensing organization, principal

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1officer, dispensary agent, third party vendor, or any other
2party associated with a dispensing organization for an alleged
3violation of this Act or rules or to determine qualifications
4to be granted a registration by the Department.
5 (d) The Department may require an applicant or holder of
6any license issued pursuant to this Article to produce
7documents, records, or any other material pertinent to the
8investigation of an application or alleged violations of this
9Act or rules. Failure to provide the required material may be
10grounds for denial or discipline.
11 (e) Every person charged with preparation, obtaining, or
12keeping records, logs, reports, or other documents in
13connection with this Act and rules and every person in charge,
14or having custody, of those documents shall, upon request by
15the Department, make the documents immediately available for
16inspection and copying by the Department, the Department's
17authorized representative, or others authorized by law to
18review the documents.
19 Section 15-140. Citations. The Department may issue
20nondisciplinary citations for minor violations. Any such
21citation issued by the Department may be accompanied by a fee.
22The fee shall not exceed $20,000 per violation. The citation
23shall be issued to the licensee and shall contain the
24licensee's name and address, the licensee's license number, a
25brief factual statement, the Sections of the law allegedly

HB1438 Enrolled- 153 -LRB101 04919 JRG 49928 b
1violated, and the fee, if any, imposed. The citation must
2clearly state that the licensee may choose, in lieu of
3accepting the citation, to request a hearing. If the licensee
4does not dispute the matter in the citation with the Department
5within 30 days after the citation is served, then the citation
6shall become final and not subject to appeal. The penalty shall
7be a fee or other conditions as established by rule.
8 Section 15-145. Grounds for discipline.
9 (a) The Department may deny issuance, refuse to renew or
10restore, or may reprimand, place on probation, suspend, revoke,
11or take other disciplinary or nondisciplinary action against
12any license or agent identification card or may impose a fine
13for any of the following:
14 (1) Material misstatement in furnishing information to
15 the Department;
16 (2) Violations of this Act or rules;
17 (3) Obtaining an authorization or license by fraud or
18 misrepresentation;
19 (4) A pattern of conduct that demonstrates
20 incompetence or that the applicant has engaged in conduct
21 or actions that would constitute grounds for discipline
22 under the Act;
23 (5) Aiding or assisting another person in violating any
24 provision of this Act or rules;
25 (6) Failing to respond to a written request for

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1 information by the Department within 30 days;
2 (7) Engaging in unprofessional, dishonorable, or
3 unethical conduct of a character likely to deceive,
4 defraud, or harm the public;
5 (8) Adverse action by another United States
6 jurisdiction or foreign nation;
7 (9) A finding by the Department that the licensee,
8 after having his or her license placed on suspended or
9 probationary status, has violated the terms of the
10 suspension or probation;
11 (10) Conviction, entry of a plea of guilty, nolo
12 contendere, or the equivalent in a State or federal court
13 of a principal officer or agent-in-charge of a felony
14 offense in accordance with Sections 2105-131, 2105-135,
15 and 2105-205 of the Department of Professional Regulation
16 Law of the Civil Administrative Code of Illinois;
17 (11) Excessive use or addiction to alcohol, narcotics,
18 stimulants, or any other chemical agent or drug;
19 (12) A finding by the Department of a discrepancy in a
20 Department audit of cannabis;
21 (13) A finding by the Department of a discrepancy in a
22 Department audit of capital or funds;
23 (14) A finding by the Department of acceptance of
24 cannabis from a source other than an Adult Use Cultivation
25 Center, craft grower, infuser, or transporting
26 organization licensed by the Department of Agriculture, or

HB1438 Enrolled- 155 -LRB101 04919 JRG 49928 b
1 a dispensing organization licensed by the Department;
2 (15) An inability to operate using reasonable
3 judgment, skill, or safety due to physical or mental
4 illness or other impairment or disability, including,
5 without limitation, deterioration through the aging
6 process or loss of motor skills or mental incompetence;
7 (16) Failing to report to the Department within the
8 time frames established, or if not identified, 14 days, of
9 any adverse action taken against the dispensing
10 organization or an agent by a licensing jurisdiction in any
11 state or any territory of the United States or any foreign
12 jurisdiction, any governmental agency, any law enforcement
13 agency or any court defined in this Section;
14 (17) Any violation of the dispensing organization's
15 policies and procedures submitted to the Department
16 annually as a condition for licensure;
17 (18) Failure to inform the Department of any change of
18 address within 10 business days;
19 (19) Disclosing customer names, personal information,
20 or protected health information in violation of any State
21 or federal law;
22 (20) Operating a dispensary before obtaining a license
23 from the Department;
24 (21) Performing duties authorized by this Act prior to
25 receiving a license to perform such duties;
26 (22) Dispensing cannabis when prohibited by this Act or

HB1438 Enrolled- 156 -LRB101 04919 JRG 49928 b
1 rules;
2 (23) Any fact or condition that, if it had existed at
3 the time of the original application for the license, would
4 have warranted the denial of the license;
5 (24) Permitting a person without a valid agent
6 identification card to perform licensed activities under
7 this Act;
8 (25) Failure to assign an agent-in-charge as required
9 by this Article;
10 (26) Failure to provide the training required by
11 paragraph (3) of subsection (i) of Section 15-40 within the
12 provided timeframe
13 (27) Personnel insufficient in number or unqualified
14 in training or experience to properly operate the
15 dispensary business;
16 (28) Any pattern of activity that causes a harmful
17 impact on the community; and
18 (29) Failing to prevent diversion, theft, or loss of
19 cannabis.
20 (b) All fines and fees imposed under this Section shall be
21paid within 60 days after the effective date of the order
22imposing the fine or as otherwise specified in the order.
23 (c) A circuit court order establishing that an
24agent-in-charge or principal officer holding an agent
25identification card is subject to involuntary admission as that
26term is defined in Section 1-119 or 1-119.1 of the Mental

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1Health and Developmental Disabilities Code shall operate as a
2suspension of that card.
3 Section 15-150. Temporary suspension.
4 (a) The Secretary of Financial and Professional Regulation
5may temporarily suspend a dispensing organization license or an
6agent registration without a hearing if the Secretary finds
7that public safety or welfare requires emergency action. The
8Secretary shall cause the temporary suspension by issuing a
9suspension notice in connection with the institution of
10proceedings for a hearing.
11 (b) If the Secretary temporarily suspends a license or
12agent registration without a hearing, the licensee or agent is
13entitled to a hearing within 45 days after the suspension
14notice has been issued. The hearing shall be limited to the
15issues cited in the suspension notice, unless all parties agree
16otherwise.
17 (c) If the Department does not hold a hearing with 45 days
18after the date the suspension notice was issued, then the
19suspended license or registration shall be automatically
20reinstated and the suspension vacated.
21 (d) The suspended licensee or agent may seek a continuance
22of the hearing date, during which time the suspension remains
23in effect and the license or registration shall not be
24automatically reinstated.
25 (e) Subsequently discovered causes of action by the

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1Department after the issuance of the suspension notice may be
2filed as a separate notice of violation. The Department is not
3precluded from filing a separate action against the suspended
4licensee or agent.
5 Section 15-155. Consent to administrative supervision
6order. In appropriate cases, the Department may resolve a
7complaint against a licensee or agent through the issuance of a
8consent order for administrative supervision. A license or
9agent subject to a consent order shall be considered by the
10Department to hold a license or registration in good standing.
11 Section 15-160. Notice; hearing.
12 (a) The Department shall, before disciplining an applicant
13or licensee, at least 30 days before the date set for the
14hearing: (i) notify the accused in writing of the charges made
15and the time and place for the hearing on the charges; (ii)
16direct him or her to file a written answer to the charges under
17oath within 20 days after service; and (iii) inform the
18applicant or licensee that failure to answer will result in a
19default being entered against the applicant or licensee.
20 (b) At the time and place fixed in the notice, the hearing
21officer appointed by the Secretary shall proceed to hear the
22charges, and the parties or their counsel shall be accorded
23ample opportunity to present any pertinent statements,
24testimony, evidence, and arguments. The hearing officer may

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1continue the hearing from time to time. In case the person,
2after receiving the notice, fails to file an answer, his or her
3license may, in the discretion of the Secretary, having first
4received the recommendation of the hearing officer, be
5suspended, revoked, or placed on probationary status, or be
6subject to whatever disciplinary action the Secretary
7considers proper, including a fine, without hearing, if that
8act or acts charged constitute sufficient grounds for that
9action under this Act.
10 (c) The written notice and any notice in the subsequent
11proceeding may be served by regular mail or email to the
12licensee's or applicant's address of record.
13 Section 15-165. Subpoenas; oaths. The Department shall
14have the power to subpoena and bring before it any person and
15to take testimony either orally or by deposition, or both, with
16the same fees and mileage and in the same manner as prescribed
17by law in judicial proceedings in civil cases in courts in this
18State. The Secretary or the hearing officer shall each have the
19power to administer oaths to witnesses at any hearings that the
20Department is authorized to conduct.
21 Section 15-170. Hearing; motion for rehearing.
22 (a) The hearing officer shall hear evidence in support of
23the formal charges and evidence produced by the licensee. At
24the conclusion of the hearing, the hearing officer shall

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1present to the Secretary a written report of his or her
2findings of fact, conclusions of law, and recommendations.
3 (b) At the conclusion of the hearing, a copy of the hearing
4officer's report shall be served upon the applicant or licensee
5by the Department, either personally or as provided in this Act
6for the service of a notice of hearing. Within 20 calendar days
7after service, the applicant or licensee may present to the
8Department a motion in writing for rehearing, which shall
9specify the particular grounds for rehearing. The Department
10may respond to the motion for rehearing within 20 calendar days
11after its service on the Department. If no motion for rehearing
12is filed, then, upon the expiration of the time specified for
13filing such motion or upon denial of a motion for rehearing,
14the Secretary may enter an order in accordance with the
15recommendation of the hearing officer. If the applicant or
16licensee orders from the reporting service and pays for a
17transcript of the record within the time for filing a motion
18for rehearing, the 20-day period within which a motion may be
19filed shall commence upon the delivery of the transcript to the
20applicant or licensee.
21 (c) If the Secretary disagrees in any regard with the
22report of the hearing officer, the Secretary may issue an order
23contrary to the report.
24 (d) Whenever the Secretary is not satisfied that
25substantial justice has been done, the Secretary may order a
26rehearing by the same or another hearing officer.

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1 (e) At any point in any investigation or disciplinary
2proceeding under in this Article, both parties may agree to a
3negotiated consent order. The consent order shall be final upon
4signature of the Secretary.
5 Section 15-175. Review under the Administrative Review
6Law.
7 (a) All final administrative decisions of the Department
8hereunder shall be subject to judicial review under the
9provisions of the Administrative Review Law, and all amendment
10and modifications thereof. The term "administrative decision"
11is defined as in Section 3-101 of the Code of Civil Procedure.
12 (b) Proceedings for judicial review shall be commenced in
13the circuit court of the county in which the party applying for
14review resides, but if the party is not a resident of Illinois,
15the venue shall be in Sangamon County.
16 (c) The Department shall not be required to certify any
17record to the court, file any answer in court, or otherwise
18appear in any court in a judicial review proceeding, unless and
19until the Department has received from the plaintiff payment of
20the costs of furnishing and certifying the record, which costs
21shall be determined by the Department. Failure on the part of
22the plaintiff to file a receipt in court shall be grounds for
23dismissal of the action.
24
ARTICLE 20.

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1
ADULT USE CULTIVATION CENTERS
2 Section 20-1. Definition. In this Article, "Department"
3means the Department of Agriculture.
4 Section 20-5. Issuance of licenses. On or after July 1,
52021, the Department of Agriculture by rule may:
6 (1) Modify or change the number of cultivation center
7 licenses available, which shall at no time exceed 30
8 cultivation center licenses. In determining whether to
9 exercise the authority granted by this subsection, the
10 Department of Agriculture must consider the following
11 factors:
12 (A) The percentage of cannabis sales occurring in
13 Illinois not in the regulated market using data from
14 the Substance Abuse and Mental Health Services
15 Administration, National Survey on Drug Use and
16 Health, Illinois Behavioral Risk Factor Surveillance
17 System, and tourism data from the Illinois Office of
18 Tourism to ascertain total cannabis consumption in
19 Illinois compared to the amount of sales in licensed
20 dispensing organizations;
21 (B) Whether there is an adequate supply of cannabis
22 and cannabis-infused products to serve registered
23 medical cannabis patients;
24 (C) Whether there is an adequate supply of cannabis

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1 and cannabis-infused products to serve purchasers;
2 (D) Whether there is an oversupply of cannabis in
3 Illinois leading to trafficking of cannabis to any
4 other state;
5 (E) Population increases or shifts;
6 (F) Changes to federal law;
7 (G) Perceived security risks of increasing the
8 number or location of cultivation centers;
9 (H) The past security records of cultivation
10 centers;
11 (I) The Department of Agriculture's capacity to
12 appropriately regulate additional licensees;
13 (J) The findings and recommendations from the
14 disparity and availability study commissioned by the
15 Illinois Cannabis Regulation Oversight Officer
16 referenced in subsection (e) of Section 5-45 to reduce
17 or eliminate any identified barriers to entry in the
18 cannabis industry; and
19 (K) Any other criteria the Department of
20 Agriculture deems relevant.
21 (2) Modify or change the licensing application process
22 to reduce or eliminate the barriers identified in the
23 disparity and availability study commission by the
24 Illinois Cannabis Regulation Oversight Officer and shall
25 make modifications to remedy evidence of discrimination.

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1 Section 20-10. Early Approval of Adult Use Cultivation
2Center License.
3 (a) Any medical cannabis cultivation center registered and
4in good standing under the Compassionate Use of Medical
5Cannabis Pilot Program Act as of the effective date of this Act
6may, within 60 days of the effective date of this Act but no
7later than 180 days from the effective date of this Act, apply
8to the Department of Agriculture for an Early Approval Adult
9Use Cultivation Center License to produce cannabis and
10cannabis-infused products at its existing facilities as of the
11effective date of this Act.
12 (b) A medical cannabis cultivation center seeking issuance
13of an Early Approval Adult Use Cultivation Center License shall
14submit an application on forms provided by the Department of
15Agriculture. The application must meet or include the following
16qualifications:
17 (1) Payment of a nonrefundable application fee of
18 $100,000 to be deposited into the Cannabis Regulation Fund;
19 (2) Proof of registration as a medical cannabis
20 cultivation center that is in good standing;
21 (3) Submission of the application by the same person or
22 entity that holds the medical cannabis cultivation center
23 registration;
24 (4) Certification that the applicant will comply with
25 the requirements of Section 20-30;
26 (5) The legal name of the cultivation center;

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1 (6) The physical address of the cultivation center;
2 (7) The name, address, social security number, and date
3 of birth of each principal officer and board member of the
4 cultivation center; each of those individuals shall be at
5 least 21 years of age;
6 (8) A nonrefundable Cannabis Business Development Fee
7 equal to 5% of the cultivation center's total sales between
8 June 1, 2018 to June 1, 2019 or $750,000, whichever is
9 less, but at not less than $250,000, to be deposited into
10 the Cannabis Business Development Fund; and
11 (9) A commitment to completing one of the following
12 Social Equity Inclusion Plans provided for in this
13 subsection (b) before the expiration of the Early Approval
14 Adult Use Cultivation Center License:
15 (A) A contribution of 5% of the cultivation
16 center's total sales from June 1, 2018 to June 1, 2019,
17 or $100,000, whichever is less, to one of the
18 following:
19 (i) the Cannabis Business Development Fund.
20 This is in addition to the fee required by item (8)
21 of this subsection (b);
22 (ii) a cannabis industry training or education
23 program at an Illinois community college as
24 defined in the Public Community College Act;
25 (iii) a program that provides job training
26 services to persons recently incarcerated or that

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1 operates in a Disproportionately Impacted Area.
2 (B) Participate as a host in a cannabis business
3 incubator program for at least one year approved by the
4 Department of Commerce and Economic Opportunity, and
5 in which an Early Approval Adult Use Cultivation Center
6 License holder agrees to provide a loan of at least
7 $100,000 and mentorship to incubate a licensee that
8 qualifies as a Social Equity Applicant. As used in this
9 Section, "incubate" means providing direct financial
10 assistance and training necessary to engage in
11 licensed cannabis industry activity similar to that of
12 the host licensee. The Early Approval Adult Use
13 Cultivation Center License holder or the same entity
14 holding any other licenses issued pursuant to this Act
15 shall not take an ownership stake of greater than 10%
16 in any business receiving incubation services to
17 comply with this subsection. If an Early Approval Adult
18 Use Cultivation Center License holder fails to find a
19 business to incubate to comply with this subsection
20 before its Early Approval Adult Use Cultivation Center
21 License expires, it may opt to meet the requirement of
22 this subsection by completing another item from this
23 subsection prior to the expiration of its Early
24 Approval Adult Use Cultivation Center License to avoid
25 a penalty.
26 (c) An Early Approval Adult Use Cultivation Center License

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1is valid until March 31, 2021. A cultivation center that
2obtains an Early Approval Adult Use Cultivation Center License
3shall receive written or electronic notice 90 days before the
4expiration of the license that the license will expire, and
5inform the license holder that it may renew its Early Approval
6Adult Use Cultivation Center License. The Department of
7Agriculture shall grant a renewal of an Early Approval Adult
8Use Cultivation Center License within 60 days of submission of
9an application if:
10 (1) the cultivation center submits an application and
11 the required renewal fee of $100,000 for an Early Approval
12 Adult Use Cultivation Center License;
13 (2) the Department of Agriculture has not suspended the
14 license of the cultivation center or suspended or revoked
15 the license for violating this Act or rules adopted under
16 this Act; and
17 (3) the cultivation center has completed a Social
18 Equity Inclusion Plan as required by item (9) of subsection
19 (b) of this Section.
20 (c-5) The Early Approval Adult Use Cultivation Center
21License renewed pursuant to subsection (c) of this Section
22shall expire March 31, 2022. The Early Approval Adult Use
23Cultivation Center Licensee shall receive written or
24electronic notice 90 days before the expiration of the license
25that the license will expire, and inform the license holder
26that it may apply for an Adult Use Cultivation Center License.

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1The Department of Agriculture shall grant an Adult Use
2Dispensing Organization License within 60 days of an
3application being deemed complete if the applicant meets all of
4the criteria in Section 20-21.
5 (d) The license fee required by paragraph (1) of subsection
6(c) of this Section shall be in addition to any license fee
7required for the renewal of a registered medical cannabis
8cultivation center license that expires during the effective
9period of the Early Approval Adult Use Cultivation Center
10License.
11 (e) Applicants must submit all required information,
12including the requirements in subsection (b) of this Section,
13to the Department of Agriculture. Failure by an applicant to
14submit all required information may result in the application
15being disqualified.
16 (f) If the Department of Agriculture receives an
17application with missing information, the Department may issue
18a deficiency notice to the applicant. The applicant shall have
1910 calendar days from the date of the deficiency notice to
20submit complete information. Applications that are still
21incomplete after this opportunity to cure may be disqualified.
22 (g) If an applicant meets all the requirements of
23subsection (b) of this Section, the Department of Agriculture
24shall issue the Early Approval Adult Use Cultivation Center
25License within 14 days of receiving the application unless:
26 (1) The licensee; principal officer, board member, or

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1 person having a financial or voting interest of 5% or
2 greater in the licensee; or agent is delinquent in filing
3 any required tax returns or paying any amounts owed to the
4 State of Illinois;
5 (2) The Director of Agriculture determines there is
6 reason, based on an inordinate number of documented
7 compliance violations, the licensee is not entitled to an
8 Early Approval Adult Use Cultivation Center License; or
9 (3) The licensee fails to commit to the Social Equity
10 Inclusion Plan.
11 (h) A cultivation center may begin producing cannabis and
12cannabis-infused products once the Early Approval Adult Use
13Cultivation Center License is approved. A cultivation center
14that obtains an Early Approval Adult Use Cultivation Center
15License may begin selling cannabis and cannabis-infused
16products on December 1, 2019.
17 (i) An Early Approval Adult Use Cultivation Center License
18holder must continue to produce and provide an adequate supply
19of cannabis and cannabis-infused products for purchase by
20qualifying patients and caregivers. For the purposes of this
21subsection, "adequate supply" means a monthly production level
22that is comparable in type and quantity to those medical
23cannabis products produced for patients and caregivers on an
24average monthly basis for the 6 months before the effective
25date of this Act.
26 (j) If there is a shortage of cannabis or cannabis-infused

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1products, a license holder shall prioritize patients
2registered under the Compassionate Use of Medical Cannabis
3Pilot Program Act over adult use purchasers.
4 (k) If an Early Approval Adult Use Cultivation Center
5licensee fails to submit an application for an Adult Use
6Cultivation Center License before the expiration of the Early
7Approval Adult Use Cultivation Center License pursuant to
8subsection (c-5) of this Section, the cultivation center shall
9cease adult use cultivation until it receives an Adult Use
10Cultivation Center License.
11 (l) A cultivation center agent who holds a valid
12cultivation center agent identification card issued under the
13Compassionate Use of Medical Cannabis Pilot Program Act and is
14an officer, director, manager, or employee of the cultivation
15center licensed under this Section may engage in all activities
16authorized by this Article to be performed by a cultivation
17center agent.
18 (m) If the Department of Agriculture suspends or revokes
19the Early Approval Adult Use Cultivation Center License of a
20cultivation center that also holds a medical cannabis
21cultivation center license issued under the Compassionate Use
22of Medical Cannabis Pilot Program Act, the Department of
23Agriculture may suspend or revoke the medical cannabis
24cultivation center license concurrently with the Early
25Approval Adult Use Cultivation Center License.
26 (n) All fees or fines collected from an Early Approval

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1Adult Use Cultivation Center License holder as a result of a
2disciplinary action in the enforcement of this Act shall be
3deposited into the Cannabis Regulation Fund.
4 Section 20-15. Conditional Adult Use Cultivation Center
5application.
6 (a) If the Department of Agriculture makes available
7additional cultivation center licenses pursuant to Section
820-5, applicants for a Conditional Adult Use Cultivation Center
9License shall electronically submit the following in such form
10as the Department of Agriculture may direct:
11 (1) the nonrefundable application fee set by rule by
12 the Department of Agriculture, to be deposited into the
13 Cannabis Regulation Fund;
14 (2) the legal name of the cultivation center;
15 (3) the proposed physical address of the cultivation
16 center;
17 (4) the name, address, social security number, and date
18 of birth of each principal officer and board member of the
19 cultivation center; each principal officer and board
20 member shall be at least 21 years of age;
21 (5) the details of any administrative or judicial
22 proceeding in which any of the principal officers or board
23 members of the cultivation center (i) pled guilty, were
24 convicted, fined, or had a registration or license
25 suspended or revoked, or (ii) managed or served on the

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1 board of a business or non-profit organization that pled
2 guilty, was convicted, fined, or had a registration or
3 license suspended or revoked;
4 (6) proposed operating bylaws that include procedures
5 for the oversight of the cultivation center, including the
6 development and implementation of a plant monitoring
7 system, accurate recordkeeping, staffing plan, and
8 security plan approved by the Department of State Police
9 that are in accordance with the rules issued by the
10 Department of Agriculture under this Act. A physical
11 inventory shall be performed of all plants and cannabis on
12 a weekly basis by the cultivation center;
13 (7) verification from the Department of State Police
14 that all background checks of the prospective principal
15 officers, board members, and agents of the cannabis
16 business establishment have been conducted;
17 (8) a copy of the current local zoning ordinance or
18 permit and verification that the proposed cultivation
19 center is in compliance with the local zoning rules and
20 distance limitations established by the local
21 jurisdiction;
22 (9) proposed employment practices, in which the
23 applicant must demonstrate a plan of action to inform,
24 hire, and educate minorities, women, veterans, and persons
25 with disabilities, engage in fair labor practices, and
26 provide worker protections;

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1 (10) whether an applicant can demonstrate experience
2 in or business practices that promote economic empowerment
3 in Disproportionately Impacted Areas;
4 (11) experience with the cultivation of agricultural
5 or horticultural products, operating an agriculturally
6 related business, or operating a horticultural business;
7 (12) a description of the enclosed, locked facility
8 where cannabis will be grown, harvested, manufactured,
9 processed, packaged, or otherwise prepared for
10 distribution to a dispensing organization;
11 (13) a survey of the enclosed, locked facility,
12 including the space used for cultivation;
13 (14) cultivation, processing, inventory, and packaging
14 plans;
15 (15) a description of the applicant's experience with
16 agricultural cultivation techniques and industry
17 standards;
18 (16) a list of any academic degrees, certifications, or
19 relevant experience of all prospective principal officers,
20 board members, and agents of the related business;
21 (17) the identity of every person having a financial or
22 voting interest of 5% or greater in the cultivation center
23 operation with respect to which the license is sought,
24 whether a trust, corporation, partnership, limited
25 liability company, or sole proprietorship, including the
26 name and address of each person;

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1 (18) a plan describing how the cultivation center will
2 address each of the following:
3 (i) energy needs, including estimates of monthly
4 electricity and gas usage, to what extent it will
5 procure energy from a local utility or from on-site
6 generation, and if it has or will adopt a sustainable
7 energy use and energy conservation policy;
8 (ii) water needs, including estimated water draw
9 and if it has or will adopt a sustainable water use and
10 water conservation policy; and
11 (iii) waste management, including if it has or will
12 adopt a waste reduction policy;
13 (19) a diversity plan that includes a narrative of not
14 more than 2,500 words that establishes a goal of diversity
15 in ownership, management, employment, and contracting to
16 ensure that diverse participants and groups are afforded
17 equality of opportunity;
18 (20) any other information required by rule;
19 (21) a recycling plan:
20 (A) Purchaser packaging, including cartridges,
21 shall be accepted by the applicant and recycled.
22 (B) Any recyclable waste generated by the cannabis
23 cultivation facility shall be recycled per applicable
24 State and local laws, ordinances, and rules.
25 (C) Any cannabis waste, liquid waste, or hazardous
26 waste shall be disposed of in accordance with 8 Ill.

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1 Adm. Code 1000.460, except, to the greatest extent
2 feasible, all cannabis plant waste will be rendered
3 unusable by grinding and incorporating the cannabis
4 plant waste with compostable mixed waste to be disposed
5 of in accordance with 8 Ill Adm. Code 1000.460(g)(1);
6 (22) commitment to comply with local waste provisions:
7 a cultivation facility must remain in compliance with
8 applicable State and federal environmental requirements,
9 including, but not limited to:
10 (A) storing, securing, and managing all
11 recyclables and waste, including organic waste
12 composed of or containing finished cannabis and
13 cannabis products, in accordance with applicable State
14 and local laws, ordinances, and rules; and
15 (B) Disposing liquid waste containing cannabis or
16 byproducts of cannabis processing in compliance with
17 all applicable State and federal requirements,
18 including, but not limited to, the cannabis
19 cultivation facility's permits under Title X of the
20 Environmental Protection Act; and
21 (23) a commitment to a technology standard for resource
22 efficiency of the cultivation center facility.
23 (A) A cannabis cultivation facility commits to use
24 resources efficiently, including energy and water. For
25 the following, a cannabis cultivation facility commits
26 to meet or exceed the technology standard identified in

HB1438 Enrolled- 176 -LRB101 04919 JRG 49928 b
1 items (i), (ii), (iii), and (iv), which may be modified
2 by rule:
3 (i) lighting systems, including light bulbs;
4 (ii) HVAC system;
5 (iii) water application system to the crop;
6 and
7 (iv) filtration system for removing
8 contaminants from wastewater.
9 (B) Lighting. The Lighting Power Densities (LPD)
10 for cultivation space commits to not exceed an average
11 of 36 watts per gross square foot of active and growing
12 space canopy, or all installed lighting technology
13 shall meet a photosynthetic photon efficacy (PPE) of no
14 less than 2.2 micromoles per joule fixture and shall be
15 featured on the DesignLights Consortium (DLC)
16 Horticultural Specification Qualified Products List
17 (QPL). In the event that DLC requirement for minimum
18 efficacy exceeds 2.2 micromoles per joule fixture,
19 that PPE shall become the new standard.
20 (C) HVAC.
21 (i) For cannabis grow operations with less
22 than 6,000 square feet of canopy, the licensee
23 commits that all HVAC units will be
24 high-efficiency ductless split HVAC units, or
25 other more energy efficient equipment.
26 (ii) For cannabis grow operations with 6,000

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1 square feet of canopy or more, the licensee commits
2 that all HVAC units will be variable refrigerant
3 flow HVAC units, or other more energy efficient
4 equipment.
5 (D) Water application.
6 (i) The cannabis cultivation facility commits
7 to use automated watering systems, including, but
8 not limited to, drip irrigation and flood tables,
9 to irrigate cannabis crop.
10 (ii) The cannabis cultivation facility commits
11 to measure runoff from watering events and report
12 this volume in its water usage plan, and that on
13 average, watering events shall have no more than
14 20% of runoff of water.
15 (E) Filtration. The cultivator commits that HVAC
16 condensate, dehumidification water, excess runoff, and
17 other wastewater produced by the cannabis cultivation
18 facility shall be captured and filtered to the best of
19 the facility's ability to achieve the quality needed to
20 be reused in subsequent watering rounds.
21 (F) Reporting energy use and efficiency as
22 required by rule.
23 (b) Applicants must submit all required information,
24including the information required in Section 20-10, to the
25Department of Agriculture. Failure by an applicant to submit
26all required information may result in the application being

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1disqualified.
2 (c) If the Department of Agriculture receives an
3application with missing information, the Department of
4Agriculture may issue a deficiency notice to the applicant. The
5applicant shall have 10 calendar days from the date of the
6deficiency notice to resubmit the incomplete information.
7Applications that are still incomplete after this opportunity
8to cure will not be scored and will be disqualified.
9 (e) A cultivation center that is awarded a Conditional
10Adult Use Cultivation Center License pursuant to the criteria
11in Section 20-20 shall not grow, purchase, possess, or sell
12cannabis or cannabis-infused products until the person has
13received an Adult Use Cultivation Center License issued by the
14Department of Agriculture pursuant to Section 20-21 of this
15Act.
16 Section 20-20. Conditional Adult Use License scoring
17applications.
18 (a) The Department of Agriculture shall by rule develop a
19system to score cultivation center applications to
20administratively rank applications based on the clarity,
21organization, and quality of the applicant's responses to
22required information. Applicants shall be awarded points based
23on the following categories:
24 (1) Suitability of the proposed facility;
25 (2) Suitability of employee training plan;

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1 (3) Security and recordkeeping;
2 (4) Cultivation plan;
3 (5) Product safety and labeling plan;
4 (6) Business plan;
5 (7) The applicant's status as a Social Equity
6 Applicant, which shall constitute no less than 20% of total
7 available points;
8 (8) Labor and employment practices, which shall
9 constitute no less than 2% of total available points;
10 (9) Environmental plan as described in paragraphs
11 (18), (21), (22), and (23) of subsection (a) of Section
12 20-15;
13 (10) The applicant is 51% or more owned and controlled
14 by an individual or individuals who have been an Illinois
15 resident for the past 5 years as proved by tax records;
16 (11) The applicant is 51% or more controlled and owned
17 by an individual or individuals who meet the qualifications
18 of a veteran as defined by Section 45-57 of the Illinois
19 Procurement Code;
20 (12) a diversity plan that includes a narrative of not
21 more than 2,500 words that establishes a goal of diversity
22 in ownership, management, employment, and contracting to
23 ensure that diverse participants and groups are afforded
24 equality of opportunity; and
25 (13) Any other criteria the Department of Agriculture
26 may set by rule for points.

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1 (b) The Department may also award bonus points for the
2applicant's plan to engage with the community. Bonus points
3will only be awarded if the Department receives applications
4that receive an equal score for a particular region.
5 (c) Should the applicant be awarded a cultivation center
6license, the information and plans that an applicant provided
7in its application, including any plans submitted for the
8acquiring of bonus points, becomes a mandatory condition of the
9permit. Any variation from or failure to perform such plans may
10result in discipline, including the revocation or nonrenewal of
11a license.
12 (d) Should the applicant be awarded a cultivation center
13license, it shall pay a fee of $100,000 prior to receiving the
14license, to be deposited into the Cannabis Regulation Fund. The
15Department of Agriculture may by rule adjust the fee in this
16Section after January 1, 2021.
17 Section 20-21. Adult Use Cultivation Center License.
18 (a) A person or entity is only eligible to receive an Adult
19Use Cultivation Center License if the person or entity has
20first been awarded a Conditional Adult Use Cultivation Center
21License pursuant to this Act or the person or entity has
22renewed its Early Approval Cultivation Center License pursuant
23to subsection (c) of Section 20-10.
24 (b) The Department of Agriculture shall not issue an Adult
25Use Cultivation Center License until:

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1 (1) the Department of Agriculture has inspected the
2 cultivation center site and proposed operations and
3 verified that they are in compliance with this Act and
4 local zoning laws;
5 (2) the Conditional Adult Use Cultivation Center
6 License holder has paid a registration fee of $100,000 or a
7 prorated amount accounting for the difference of time
8 between when the Adult Use Cultivation Center License is
9 issued and March 31 of the next even-numbered year; and
10 (3) The Conditional Adult Use Cultivation Center
11 License holder has met all the requirements in the Act and
12 rules.
13 Section 20-25. Denial of application. An application for a
14cultivation center license must be denied if any of the
15following conditions are met:
16 (1) the applicant failed to submit the materials
17 required by this Article;
18 (2) the applicant would not be in compliance with local
19 zoning rules;
20 (3) one or more of the prospective principal officers
21 or board members causes a violation of Section 20-30;
22 (4) one or more of the principal officers or board
23 members is under 21 years of age;
24 (5) the person has submitted an application for a
25 permit under this Act that contains false information; or

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1 (6) the licensee, principal officer, board member, or
2 person having a financial or voting interest of 5% or
3 greater in the licensee, or the agent is delinquent in
4 filing any required tax returns or paying any amounts owed
5 to the State of Illinois.
6 Section 20-30. Cultivation center requirements;
7prohibitions.
8 (a) The operating documents of a cultivation center shall
9include procedures for the oversight of the cultivation center
10a cannabis plant monitoring system including a physical
11inventory recorded weekly, accurate recordkeeping, and a
12staffing plan.
13 (b) A cultivation center shall implement a security plan
14reviewed by the Department of State Police that includes, but
15is not limited to: facility access controls, perimeter
16intrusion detection systems, personnel identification systems,
1724-hour surveillance system to monitor the interior and
18exterior of the cultivation center facility and accessibility
19to authorized law enforcement, the Department of Public Health
20where processing takes place, and the Department of Agriculture
21in real time.
22 (c) All cultivation of cannabis by a cultivation center
23must take place in an enclosed, locked facility at the physical
24address provided to the Department of Agriculture during the
25licensing process. The cultivation center location shall only

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1be accessed by the agents working for the cultivation center,
2the Department of Agriculture staff performing inspections,
3the Department of Public Health staff performing inspections,
4local and State law enforcement or other emergency personnel,
5contractors working on jobs unrelated to cannabis, such as
6installing or maintaining security devices or performing
7electrical wiring, transporting organization agents as
8provided in this Act, individuals in a mentoring or educational
9program approved by the State, or other individuals as provided
10by rule.
11 (d) A cultivation center may not sell or distribute any
12cannabis or cannabis-infused products to any person other than
13a dispensing organization, craft grower, infusing
14organization, transporter, or as otherwise authorized by rule.
15 (e) A cultivation center may not either directly or
16indirectly discriminate in price between different dispensing
17organizations, craft growers, or infuser organizations that
18are purchasing a like grade, strain, brand, and quality of
19cannabis or cannabis-infused product. Nothing in this
20subsection (e) prevents a cultivation centers from pricing
21cannabis differently based on differences in the cost of
22manufacturing or processing, the quantities sold, such as
23volume discounts, or the way the products are delivered.
24 (f) All cannabis harvested by a cultivation center and
25intended for distribution to a dispensing organization must be
26entered into a data collection system, packaged and labeled

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1under Section 55-21, and placed into a cannabis container for
2transport. All cannabis harvested by a cultivation center and
3intended for distribution to a craft grower or infuser
4organization must be packaged in a labeled cannabis container
5and entered into a data collection system before transport.
6 (g) Cultivation centers are subject to random inspections
7by the Department of Agriculture, the Department of Public
8Health, local safety or health inspectors, and the Department
9of State Police.
10 (h) A cultivation center agent shall notify local law
11enforcement, the Department of State Police, and the Department
12of Agriculture within 24 hours of the discovery of any loss or
13theft. Notification shall be made by phone or in person, or by
14written or electronic communication.
15 (i) A cultivation center shall comply with all State and
16any applicable federal rules and regulations regarding the use
17of pesticides on cannabis plants.
18 (j) No person or entity shall hold any legal, equitable,
19ownership, or beneficial interest, directly or indirectly, of
20more than 3 cultivation centers licensed under this Article.
21Further, no person or entity that is employed by, an agent of,
22has a contract to receive payment in any form from a
23cultivation center, is a principal officer of a cultivation
24center, or entity controlled by or affiliated with a principal
25officer of a cultivation shall hold any legal, equitable,
26ownership, or beneficial interest, directly or indirectly, in a

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1cultivation that would result in the person or entity owning or
2controlling in combination with any cultivation center,
3principal officer of a cultivation center, or entity controlled
4or affiliated with a principal officer of a cultivation center
5by which he, she, or it is employed, is an agent of, or
6participates in the management of, more than 3 cultivation
7center licenses.
8 (k) A cultivation center may not contain more than 210,000
9square feet of canopy space for plants in the flowering stage
10for cultivation of adult use cannabis as provided in this Act.
11 (l) A cultivation center may process cannabis, cannabis
12concentrates, and cannabis-infused products.
13 (m) Beginning July 1, 2020, a cultivation center shall not
14transport cannabis to a craft grower, dispensing organization,
15infuser organization, or laboratory licensed under this Act,
16unless it has obtained a transporting organization license.
17 (n) It is unlawful for any person having a cultivation
18center license or any officer, associate, member,
19representative, or agent of such licensee to offer or deliver
20money, or anything else of value, directly or indirectly to any
21person having an Early Approval Adult Use Dispensing
22Organization License, a Conditional Adult Use Dispensing
23Organization License, an Adult Use Dispensing Organization
24License, or a medical cannabis dispensing organization license
25issued under the Compassionate Use of Medical Cannabis Pilot
26Program Act, or to any person connected with or in any way

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1representing, or to any member of the family of, such person
2holding an Early Approval Adult Use Dispensing Organization
3License, a Conditional Adult Use Dispensing Organization
4License, an Adult Use Dispensing Organization License, or a
5medical cannabis dispensing organization license issued under
6the Compassionate Use of Medical Cannabis Pilot Program Act, or
7to any stockholders in any corporation engaged in the retail
8sale of cannabis, or to any officer, manager, agent, or
9representative of the Early Approval Adult Use Dispensing
10Organization License, a Conditional Adult Use Dispensing
11Organization License, an Adult Use Dispensing Organization
12License, or a medical cannabis dispensing organization license
13issued under the Compassionate Use of Medical Cannabis Pilot
14Program Act to obtain preferential placement within the
15dispensing organization, including, without limitation, on
16shelves and in display cases where purchasers can view
17products, or on the dispensing organization's website.
18 (o) A cultivation center must comply with any other
19requirements or prohibitions set by administrative rule of the
20Department of Agriculture.
21 Section 20-35. Cultivation center agent identification
22card.
23 (a) The Department of Agriculture shall:
24 (1) establish by rule the information required in an
25 initial application or renewal application for an agent

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1 identification card submitted under this Act and the
2 nonrefundable fee to accompany the initial application or
3 renewal application;
4 (2) verify the information contained in an initial
5 application or renewal application for an agent
6 identification card submitted under this Act, and approve
7 or deny an application within 30 days of receiving a
8 completed initial application or renewal application and
9 all supporting documentation required by rule;
10 (3) issue an agent identification card to a qualifying
11 agent within 15 business days of approving the initial
12 application or renewal application;
13 (4) enter the license number of the cultivation center
14 where the agent works; and
15 (5) allow for an electronic initial application and
16 renewal application process, and provide a confirmation by
17 electronic or other methods that an application has been
18 submitted. The Department of Agriculture may by rule
19 require prospective agents to file their applications by
20 electronic means and provide notices to the agents by
21 electronic means.
22 (b) An agent must keep his or her identification card
23visible at all times when on the property of the cultivation
24center at which the agent is employed.
25 (c) The agent identification cards shall contain the
26following:

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1 (1) the name of the cardholder;
2 (2) the date of issuance and expiration date of the
3 identification card;
4 (3) a random 10-digit alphanumeric identification
5 number containing at least 4 numbers and at least 4 letters
6 that is unique to the holder;
7 (4) a photograph of the cardholder; and
8 (5) the legal name of the cultivation center employing
9 the agent.
10 (d) An agent identification card shall be immediately
11returned to the cultivation center of the agent upon
12termination of his or her employment.
13 (e) Any agent identification card lost by a cultivation
14center agent shall be reported to the Department of State
15Police and the Department of Agriculture immediately upon
16discovery of the loss.
17 (f) The Department of Agriculture shall not issue an agent
18identification card if the applicant is delinquent in filing
19any required tax returns or paying any amounts owed to the
20State of Illinois.
21 Section 20-40. Cultivation center background checks.
22 (a) Through the Department of State Police, the Department
23of Agriculture shall conduct a background check of the
24prospective principal officers, board members, and agents of a
25cultivation center applying for a license or identification

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1card under this Act. The Department of State Police shall
2charge a fee set by rule for conducting the criminal history
3record check, which shall be deposited into the State Police
4Services Fund and shall not exceed the actual cost of the
5record check. In order to carry out this provision, each
6cultivation center prospective principal officer, board
7member, or agent shall submit a full set of fingerprints to the
8Department of State Police for the purpose of obtaining a State
9and federal criminal records check. These fingerprints shall be
10checked against the fingerprint records now and hereafter, to
11the extent allowed by law, filed in the Department of State
12Police and Federal Bureau of Investigation criminal history
13records databases. The Department of State Police shall
14furnish, following positive identification, all conviction
15information to the Department of Agriculture.
16 (b) When applying for the initial license or identification
17card, the background checks for all prospective principal
18officers, board members, and agents shall be completed before
19submitting the application to the licensing or issuing agency.
20 Section 20-45. Renewal of cultivation center licenses and
21agent identification cards.
22 (a) Licenses and identification cards issued under this Act
23shall be renewed annually. A cultivation center shall receive
24written or electronic notice 90 days before the expiration of
25its current license that the license will expire. The

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1Department of Agriculture shall grant a renewal within 45 days
2of submission of a renewal application if:
3 (1) the cultivation center submits a renewal
4 application and the required nonrefundable renewal fee of
5 $100,000, or another amount as the Department of
6 Agriculture may set by rule after January 1, 2021, to be
7 deposited into the Cannabis Regulation Fund.
8 (2) the Department of Agriculture has not suspended the
9 license of the cultivation center or suspended or revoked
10 the license for violating this Act or rules adopted under
11 this Act;
12 (3) the cultivation center has continued to operate in
13 accordance with all plans submitted as part of its
14 application and approved by the Department of Agriculture
15 or any amendments thereto that have been approved by the
16 Department of Agriculture;
17 (4) the cultivation center has submitted an agent,
18 employee, contracting, and subcontracting diversity report
19 as required by the Department; and
20 (5) the cultivation center has submitted an
21 environmental impact report.
22 (b) If a cultivation center fails to renew its license
23before expiration, it shall cease operations until its license
24is renewed.
25 (c) If a cultivation center agent fails to renew his or her
26identification card before its expiration, he or she shall

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1cease to work as an agent of the cultivation center until his
2or her identification card is renewed.
3 (d) Any cultivation center that continues to operate, or
4any cultivation center agent who continues to work as an agent,
5after the applicable license or identification card has expired
6without renewal is subject to the penalties provided under
7Section 45-5.
8 Section 20-50. Cultivator taxes; returns.
9 (a) A tax is imposed upon the privilege of cultivating and
10processing adult use cannabis at the rate of 7% of the gross
11receipts from the sale of cannabis by a cultivator to a
12dispensing organization. The sale of any adult use product that
13contains any amount of cannabis or any derivative thereof is
14subject to the tax under this Section on the full selling price
15of the product. The proceeds from this tax shall be deposited
16into the Cannabis Regulation Fund. This tax shall be paid by
17the cultivator who makes the first sale and is not the
18responsibility of a dispensing organization, qualifying
19patient, or purchaser.
20 (b)In the administration of and compliance with this
21Section, the Department of Revenue and persons who are subject
22to this Section: (i) have the same rights, remedies,
23privileges, immunities, powers, and duties, (ii) are subject to
24the same conditions, restrictions, limitations, penalties, and
25definitions of terms, and (iii) shall employ the same modes of

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1procedure as are set forth in the Cannabis Cultivation
2Privilege Tax Law and the Uniform Penalty and Interest Act as
3if those provisions were set forth in this Section.
4 (c)The tax imposed under this Act shall be in addition to
5all other occupation or privilege taxes imposed by the State of
6Illinois or by any municipal corporation or political
7subdivision thereof.
8
ARTICLE 25.
9
COMMUNITY COLLEGE CANNABIS VOCATIONAL PILOT PROGRAM
10 Section 25-1. Definitions In this Article:
11 "Board" means the Illinois Community College Board.
12 "Career in Cannabis Certificate" or "Certificate" means
13the certification awarded to a community college student who
14completes a prescribed course of study in cannabis and cannabis
15business industry related classes and curriculum at a community
16college awarded a Community College Cannabis Vocational Pilot
17Program license.
18 "Community college" means a public community college
19organized under the Public Community College Act.
20 "Department" means the Department of Agriculture.
21 "Licensee" means a community college awarded a Community
22College Cannabis Vocational Pilot Program license under this
23Article.
24 "Program" means the Community College Cannabis Vocational

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1Pilot Program.
2 "Program license" means a Community College Cannabis
3Vocational Pilot Program license issued to a community college
4under this Article.
5 Section 25-5. Administration.
6 (a) The Department shall establish and administer the
7Program in coordination with the Illinois Community College
8Board. The Department may issue up to 8 Program licenses by
9September 1, 2020.
10 (b) Beginning with the 2021-2022 academic year, and subject
11to subsection (h) of Section 2-12 of the Public Community
12College Act, community colleges awarded Program licenses may
13offer qualifying students a Career in Cannabis Certificate,
14which includes, but is not limited to, courses that allow
15participating students to work with, study, and grow live
16cannabis plants so as to prepare students for a career in the
17legal cannabis industry, and to instruct participating
18students on the best business practices, professional
19responsibility, and legal compliance of the cannabis business
20industry.
21 (c) The Board may issue rules pertaining to the provisions
22in this Act.
23 (d) Notwithstanding any other provision of this Act,
24students shall be at least 18 years old in order to enroll in a
25licensee's Career in Cannabis Certificate's prescribed course

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1of study.
2 Section 25-10. Issuance of Community College Cannabis
3Vocational Pilot Program licenses.
4 (a) The Department shall issue rules regulating the
5selection criteria for applicants by January 1, 2020. The
6Department shall make the application for a Program license
7available no later than February 1, 2020, and shall require
8that applicants submit the completed application no later than
9July 1, 2020.
10 (b) The Department shall by rule develop a system to score
11Program licenses to administratively rank applications based
12on the clarity, organization, and quality of the applicant's
13responses to required information. Applicants shall be awarded
14points that are based on or that meet the following categories:
15 (1) Geographic diversity of the applicants;
16 (2) Experience and credentials of the applicant's
17 faculty;
18 (3) At least 5 Program license awardees must have a
19 student population that is more than 50% low-income in each
20 of the past 4 years;
21 (4) Security plan, including a requirement that all
22 cannabis plants be in an enclosed, locked facility;
23 (5) Curriculum plan, including processing and testing
24 curriculum for the Career in Cannabis Certificate;
25 (6) Career advising and placement plan for

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1 participating students; and
2 (7) Any other criteria the Department may set by rule.
3 Section 25-15. Community College Cannabis Vocational Pilot
4Program requirements and prohibitions.
5 (a) Licensees shall not have more than 50 flowering
6cannabis plants at any one time.
7 (b) The agent-in-charge shall keep a vault log of the
8licensee's enclosed, locked facility or facilities, including
9but not limited to, the person entering the site location, the
10time of entrance, the time of exit, and any other information
11the Department may set by rule.
12 (c) Cannabis shall not be removed from the licensee's
13facility, except for the limited purpose of shipping a sample
14to a laboratory registered under this Act.
15 (d) The licensee shall limit keys, access cards, or an
16access code to the licensee's enclosed, locked facility, or
17facilities, to cannabis curriculum faculty and college
18security personnel with a bona fide need to access the facility
19for emergency purposes.
20 (e) A transporting organization may transport cannabis
21produced pursuant to this Article to a laboratory registered
22under this Act. All other cannabis produced by the licensee
23that was not shipped to a registered laboratory shall be
24destroyed within 5 weeks of being harvested.
25 (f) Licensees shall subscribe to the Department of

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1Agriculture's cannabis plant monitoring system.
2 (g) Licensees shall maintain a weekly inventory system.
3 (h) No student participating in the cannabis curriculum
4necessary to obtain a Certificate may be in the licensee's
5facility unless a faculty agent-in-charge is also physically
6present in the facility.
7 (i) Licensees shall conduct post-certificate follow up
8surveys and record participating students' job placements
9within the cannabis business industry within a year of the
10student's completion.
11 (j) The Illinois Community College Board shall report
12annually to the Department on the race, ethnicity, and gender
13of all students participating in the cannabis curriculum
14necessary to obtain a Certificate, and of those students who
15obtain a Certificate.
16 Section 25-20. Faculty.
17 (a) All faculty members shall be required to maintain
18registration as an agent-in-charge and have a valid agent
19identification card prior to teaching or participating in the
20licensee's cannabis curriculum that involves instruction
21offered in the enclosed, locked facility or facilities.
22 (b) All faculty receiving an agent-in-charge or agent
23identification card must successfully pass a background check
24required by Section 5-20 prior to participating in a licensee's
25cannabis curriculum that involves instruction offered in the

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1enclosed, locked facility.
2 Section 25-25. Enforcement.
3 (a) The Department has the authority to suspend or revoke
4any faculty agent-in-charge or agent identification card for
5any violation found under this Article.
6 (b) The Department has the authority to suspend or revoke
7any Program license for any violation found under this Article.
8 (c) The Board shall revoke the authority to offer the
9Certificate of any community college that has had its license
10revoked by the Department.
11 Section 25-30. Inspection rights.
12 (a) A licensee's enclosed, locked facilities are subject to
13random inspections by the Department and the Department of
14State Police.
15 (b) Nothing in this Section shall be construed to give the
16Department or the Department of State Police a right of
17inspection or access to any location on the licensee's premises
18beyond the facilities licensed under this Article.
19 Section 25-35. Community College Cannabis Vocational
20Training Pilot Program faculty participant agent
21identification card.
22 (a) The Department shall:
23 (1) establish by rule the information required in an

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1 initial application or renewal application for an agent
2 identification card submitted under this Article and the
3 nonrefundable fee to accompany the initial application or
4 renewal application;
5 (2) verify the information contained in an initial
6 application or renewal application for an agent
7 identification card submitted under this Article, and
8 approve or deny an application within 30 days of receiving
9 a completed initial application or renewal application and
10 all supporting documentation required by rule;
11 (3) issue an agent identification card to a qualifying
12 agent within 15 business days of approving the initial
13 application or renewal application;
14 (4) enter the license number of the community college
15 where the agent works; and
16 (5) allow for an electronic initial application and
17 renewal application process, and provide a confirmation by
18 electronic or other methods that an application has been
19 submitted. Each Department may by rule require prospective
20 agents to file their applications by electronic means and
21 to provide notices to the agents by electronic means.
22 (b) An agent must keep his or her identification card
23visible at all times when in the enclosed, locked facility, or
24facilities for which he or she is an agent.
25 (c) The agent identification cards shall contain the
26following:

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1 (1) the name of the cardholder;
2 (2) the date of issuance and expiration date of the
3 identification card;
4 (3) a random 10-digit alphanumeric identification
5 number containing at least 4 numbers and at least 4 letters
6 that is unique to the holder;
7 (4) a photograph of the cardholder; and
8 (5) the legal name of the community college employing
9 the agent.
10 (d) An agent identification card shall be immediately
11returned to the community college of the agent upon termination
12of his or her employment.
13 (e) Any agent identification card lost shall be reported to
14the Department of State Police and the Department of
15Agriculture immediately upon discovery of the loss.
16 Section 25-40. Study. By December 31, 2025, the Illinois
17Cannabis Regulation Oversight Officer, in coordination with
18the Board, must issue a report to the Governor and the General
19Assembly which includes, but is not limited to, the following:
20 (1) Number of security incidents or infractions at each
21 licensee and any action taken or not taken;
22 (2) Statistics, based on race, ethnicity, gender, and
23 participating community college of:
24 (A) students enrolled in career in cannabis
25 classes;

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1 (B) successful completion rates by community
2 college students for the Certificate;
3 (C) postgraduate job placement of students who
4 obtained a Certificate, including both cannabis
5 business establishment jobs and non-cannabis business
6 establishment jobs; and
7 (3) Any other relevant information.
8 Section 25-45. Repeal. This Article is repealed on July 1,
92026.
10
ARTICLE 30.
11
CRAFT GROWERS
12 Section 30-3. Definition. In this Article, "Department"
13means the Department of Agriculture.
14 Section 30-5. Issuance of licenses.
15 (a) The Department of Agriculture shall issue up to 40
16craft grower licenses by July 1, 2020. Any person or entity
17awarded a license pursuant to this subsection shall only hold
18one craft grower license and may not sell that license until
19after December 21, 2021.
20 (b) By December 21, 2021, the Department of Agriculture
21shall issue up to 60 additional craft grower licenses. Any
22person or entity awarded a license pursuant to this subsection

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1shall not hold more than 2 craft grower licenses. The person or
2entity awarded a license pursuant to this subsection or
3subsection (a) of this Section may sell its craft grower
4license subject to the restrictions of this Act or as
5determined by administrative rule. Prior to issuing such
6licenses, the Department may adopt rules through emergency
7rulemaking in accordance with subsection (gg) of Section 5-45
8of the Illinois Administrative Procedure Act, to modify or
9raise the number of craft grower licenses assigned to each
10region and modify or change the licensing application process
11to reduce or eliminate barriers. The General Assembly finds
12that the adoption of rules to regulate cannabis use is deemed
13an emergency and necessary for the public interest, safety, and
14welfare. In determining whether to exercise the authority
15granted by this subsection, the Department of Agriculture must
16consider the following factors:
17 (1) The percentage of cannabis sales occurring in
18 Illinois not in the regulated market using data from the
19 Substance Abuse and Mental Health Services Administration,
20 National Survey on Drug Use and Health, Illinois Behavioral
21 Risk Factor Surveillance System, and tourism data from the
22 Illinois Office of Tourism to ascertain total cannabis
23 consumption in Illinois compared to the amount of sales in
24 licensed dispensing organizations;
25 (2) Whether there is an adequate supply of cannabis and
26 cannabis-infused products to serve registered medical

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1 cannabis patients;
2 (3) Whether there is an adequate supply of cannabis and
3 cannabis-infused products to serve purchasers;
4 (4) Whether there is an oversupply of cannabis in
5 Illinois leading to trafficking of cannabis to states where
6 the sale of cannabis is not permitted by law;
7 (5) Population increases or shifts;
8 (6) The density of craft growers in any area of the
9 State;
10 (7) Perceived security risks of increasing the number
11 or location of craft growers;
12 (8) The past safety record of craft growers;
13 (9) The Department of Agriculture's capacity to
14 appropriately regulate additional licensees;
15 (10) The findings and recommendations from the
16 disparity and availability study commissioned by the
17 Illinois Cannabis Regulation Oversight Officer to reduce
18 or eliminate any identified barriers to entry in the
19 cannabis industry; and
20 (11) Any other criteria the Department of Agriculture
21 deems relevant.
22 (c) After January 1, 2022, the Department of Agriculture
23may by rule modify or raise the number of craft grower licenses
24assigned to each region, and modify or change the licensing
25application process to reduce or eliminate barriers based on
26the criteria in subsection (b). At no time may the number of

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1craft grower licenses exceed 150. Any person or entity awarded
2a license pursuant to this subsection shall not hold more than
33 craft grower licenses. A person or entity awarded a license
4pursuant to this subsection or subsection (a) or subsection (b)
5of this Section may sell its craft grower license or licenses
6subject to the restrictions of this Act or as determined by
7administrative rule.
8 Section 30-10. Application.
9 (a) When applying for a license, the applicant shall
10electronically submit the following in such form as the
11Department of Agriculture may direct:
12 (1) the nonrefundable application fee of $5,000 to be
13 deposited into the Cannabis Regulation Fund, or another
14 amount as the Department of Agriculture may set by rule
15 after January 1, 2021;
16 (2) the legal name of the craft grower;
17 (3) the proposed physical address of the craft grower;
18 (4) the name, address, social security number, and date
19 of birth of each principal officer and board member of the
20 craft grower; each principal officer and board member shall
21 be at least 21 years of age;
22 (5) the details of any administrative or judicial
23 proceeding in which any of the principal officers or board
24 members of the craft grower (i) pled guilty, were
25 convicted, fined, or had a registration or license

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1 suspended or revoked or (ii) managed or served on the board
2 of a business or non-profit organization that pled guilty,
3 was convicted, fined, or had a registration or license
4 suspended or revoked;
5 (6) proposed operating bylaws that include procedures
6 for the oversight of the craft grower, including the
7 development and implementation of a plant monitoring
8 system, accurate recordkeeping, staffing plan, and
9 security plan approved by the Department of State Police
10 that are in accordance with the rules issued by the
11 Department of Agriculture under this Act; a physical
12 inventory shall be performed of all plants and on a weekly
13 basis by the craft grower;
14 (7) verification from the Department of State Police
15 that all background checks of the prospective principal
16 officers, board members, and agents of the cannabis
17 business establishment have been conducted;
18 (8) a copy of the current local zoning ordinance or
19 permit and verification that the proposed craft grower is
20 in compliance with the local zoning rules and distance
21 limitations established by the local jurisdiction;
22 (9) proposed employment practices, in which the
23 applicant must demonstrate a plan of action to inform,
24 hire, and educate minorities, women, veterans, and persons
25 with disabilities, engage in fair labor practices, and
26 provide worker protections;

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1 (10) whether an applicant can demonstrate experience
2 in or business practices that promote economic empowerment
3 in Disproportionately Impacted Areas;
4 (11) experience with the cultivation of agricultural
5 or horticultural products, operating an agriculturally
6 related business, or operating a horticultural business;
7 (12) a description of the enclosed, locked facility
8 where cannabis will be grown, harvested, manufactured,
9 packaged, or otherwise prepared for distribution to a
10 dispensing organization or other cannabis business
11 establishment;
12 (13) a survey of the enclosed, locked facility,
13 including the space used for cultivation;
14 (14) cultivation, processing, inventory, and packaging
15 plans;
16 (15) a description of the applicant's experience with
17 agricultural cultivation techniques and industry
18 standards;
19 (16) a list of any academic degrees, certifications, or
20 relevant experience of all prospective principal officers,
21 board members, and agents of the related business;
22 (17) the identity of every person having a financial or
23 voting interest of 5% or greater in the craft grower
24 operation, whether a trust, corporation, partnership,
25 limited liability company, or sole proprietorship,
26 including the name and address of each person;

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1 (18) a plan describing how the craft grower will
2 address each of the following:
3 (i) energy needs, including estimates of monthly
4 electricity and gas usage, to what extent it will
5 procure energy from a local utility or from on-site
6 generation, and if it has or will adopt a sustainable
7 energy use and energy conservation policy;
8 (ii) water needs, including estimated water draw
9 and if it has or will adopt a sustainable water use and
10 water conservation policy; and
11 (iii) waste management, including if it has or will
12 adopt a waste reduction policy;
13 (19) a recycling plan:
14 (A) Purchaser packaging, including cartridges,
15 shall be accepted by the applicant and recycled.
16 (B) Any recyclable waste generated by the craft
17 grower facility shall be recycled per applicable State
18 and local laws, ordinances, and rules.
19 (C) Any cannabis waste, liquid waste, or hazardous
20 waste shall be disposed of in accordance with 8 Ill.
21 Adm. Code 1000.460, except, to the greatest extent
22 feasible, all cannabis plant waste will be rendered
23 unusable by grinding and incorporating the cannabis
24 plant waste with compostable mixed waste to be disposed
25 of in accordance with 8 Ill Adm. Code 1000.460(g)(1).
26 (20) a commitment to comply with local waste

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1 provisions: a craft grower facility must remain in
2 compliance with applicable State and federal environmental
3 requirements, including, but not limited to:
4 (A) storing, securing, and managing all
5 recyclables and waste, including organic waste
6 composed of or containing finished cannabis and
7 cannabis products, in accordance with applicable State
8 and local laws, ordinances, and rules; and
9 (B) Disposing liquid waste containing cannabis or
10 byproducts of cannabis processing in compliance with
11 all applicable State and federal requirements,
12 including, but not limited to, the cannabis
13 cultivation facility's permits under Title X of the
14 Environmental Protection Act.
15 (21) a commitment to a technology standard for resource
16 efficiency of the craft grower facility.
17 (A) A craft grower facility commits to use
18 resources efficiently, including energy and water. For
19 the following, a cannabis cultivation facility commits
20 to meet or exceed the technology standard identified in
21 paragraphs (i), (ii), (iii), and (iv), which may be
22 modified by rule:
23 (i) lighting systems, including light bulbs;
24 (ii) HVAC system;
25 (iii) water application system to the crop;
26 and

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1 (iv) filtration system for removing
2 contaminants from wastewater.
3 (B) Lighting. The Lighting Power Densities (LPD)
4 for cultivation space commits to not exceed an average
5 of 36 watts per gross square foot of active and growing
6 space canopy, or all installed lighting technology
7 shall meet a photosynthetic photon efficacy (PPE) of no
8 less than 2.2 micromoles per joule fixture and shall be
9 featured on the DesignLights Consortium (DLC)
10 Horticultural Specification Qualified Products List
11 (QPL). In the event that DLC requirement for minimum
12 efficacy exceeds 2.2 micromoles per joule fixture,
13 that PPE shall become the new standard.
14 (C) HVAC.
15 (i) For cannabis grow operations with less
16 than 6,000 square feet of canopy, the licensee
17 commits that all HVAC units will be
18 high-efficiency ductless split HVAC units, or
19 other more energy efficient equipment.
20 (ii) For cannabis grow operations with 6,000
21 square feet of canopy or more, the licensee commits
22 that all HVAC units will be variable refrigerant
23 flow HVAC units, or other more energy efficient
24 equipment.
25 (D) Water application.
26 (i) The craft grower facility commits to use

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1 automated watering systems, including, but not
2 limited to, drip irrigation and flood tables, to
3 irrigate cannabis crop.
4 (ii) The craft grower facility commits to
5 measure runoff from watering events and report
6 this volume in its water usage plan, and that on
7 average, watering events shall have no more than
8 20% of runoff of water.
9 (E) Filtration. The craft grower commits that HVAC
10 condensate, dehumidification water, excess runoff, and
11 other wastewater produced by the craft grower facility
12 shall be captured and filtered to the best of the
13 facility's ability to achieve the quality needed to be
14 reused in subsequent watering rounds.
15 (F) Reporting energy use and efficiency as
16 required by rule; and
17 (22) any other information required by rule.
18 (b) Applicants must submit all required information,
19including the information required in Section 30-15, to the
20Department of Agriculture. Failure by an applicant to submit
21all required information may result in the application being
22disqualified.
23 (c) If the Department of Agriculture receives an
24application with missing information, the Department of
25Agriculture may issue a deficiency notice to the applicant. The
26applicant shall have 10 calendar days from the date of the

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1deficiency notice to resubmit the incomplete information.
2Applications that are still incomplete after this opportunity
3to cure will not be scored and will be disqualified.
4 Section 30-15. Scoring applications.
5 (a) The Department of Agriculture shall by rule develop a
6system to score craft grower applications to administratively
7rank applications based on the clarity, organization, and
8quality of the applicant's responses to required information.
9Applicants shall be awarded points based on the following
10categories:
11 (1) Suitability of the proposed facility;
12 (2) Suitability of the employee training plan;
13 (3) Security and recordkeeping;
14 (4) Cultivation plan;
15 (5) Product safety and labeling plan;
16 (6) Business plan;
17 (7) The applicant's status as a Social Equity
18 Applicant, which shall constitute no less than 20% of total
19 available points;
20 (8) Labor and employment practices, which shall
21 constitute no less than 2% of total available points;
22 (9) Environmental plan as described in paragraphs
23 (18), (19), (20), and (21) of subsection (a) of Section
24 30-10;
25 (10) The applicant is 51% or more owned and controlled

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1 by an individual or individuals who have been an Illinois
2 resident for the past 5 years as proved by tax records;
3 (11) The applicant is 51% or more controlled and owned
4 by an individual or individuals who meet the qualifications
5 of a veteran as defined in Section 45-57 of the Illinois
6 Procurement Code;
7 (12) A diversity plan that includes a narrative of not
8 more than 2,500 words that establishes a goal of diversity
9 in ownership, management, employment, and contracting to
10 ensure that diverse participants and groups are afforded
11 equality of opportunity; and
12 (13) Any other criteria the Department of Agriculture
13 may set by rule for points.
14 (b) The Department may also award up to 2 bonus points for
15the applicant's plan to engage with the community. The
16applicant may demonstrate a desire to engage with its community
17by participating in one or more of, but not limited to, the
18following actions: (i) establishment of an incubator program
19designed to increase participation in the cannabis industry by
20persons who would qualify as Social Equity Applicants; (ii)
21providing financial assistance to substance abuse treatment
22centers; (iii) educating children and teens about the potential
23harms of cannabis use; or (iv) other measures demonstrating a
24commitment to the applicant's community. Bonus points will only
25be awarded if the Department receives applications that receive
26an equal score for a particular region.

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1 (c) Should the applicant be awarded a craft grower license,
2the information and plans that an applicant provided in its
3application, including any plans submitted for the acquiring of
4bonus points, shall be a mandatory condition of the license.
5Any variation from or failure to perform such plans may result
6in discipline, including the revocation or nonrenewal of a
7license.
8 (d) Should the applicant be awarded a craft grower license,
9the applicant shall pay a prorated fee of $40,000 prior to
10receiving the license, to be deposited into the Cannabis
11Regulation Fund. The Department of Agriculture may by rule
12adjust the fee in this Section after January 1, 2021.
13 Section 30-20. Issuance of license to certain persons
14prohibited.
15 (a) No craft grower license issued by the Department of
16Agriculture shall be issued to a person who is licensed by any
17licensing authority as a cultivation center, or to any
18partnership, corporation, limited liability company, or trust
19or any subsidiary, affiliate, or any other form of business
20enterprise having more than 10% legal, equitable, or beneficial
21interest, directly or indirectly, in a person licensed in this
22State as a cultivation center, or to any principal officer,
23agent, employee, or human being with any form of ownership or
24control over a cultivation center except for a person who owns
25no more than 5% of the outstanding shares of a cultivation

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1center whose shares are publicly traded on an exchange within
2the meaning of the Securities Exchange Act of 1934.
3 (b) A person who is licensed in this State as a craft
4grower, or any partnership, corporation, limited liability
5company, or trust or any subsidiary, affiliate, or agent
6thereof, or any other form of business enterprise licensed in
7this State as a craft grower shall not have more than 10%
8legal, equitable, or beneficial interest, directly or
9indirectly, in a person licensed as a cultivation center, nor
10shall any partnership, corporation, limited liability company,
11or trust or any subsidiary, affiliate, or any other form of
12business enterprise having any legal, equitable, or beneficial
13interest, directly or indirectly, in a person licensed in this
14State as a craft grower or a craft grower agent be a principal
15officer, agent, employee, or human being with any form of
16ownership or control over a cultivation center except for a
17person who owns no more than 5% of the outstanding shares of a
18cultivation center whose shares are publicly traded on an
19exchange within the meaning of the Securities Exchange Act of
201934.
21 Section 30-25. Denial of application. An application for a
22craft grower license must be denied if any of the following
23conditions are met:
24 (1) the applicant failed to submit the materials
25 required by this Article;

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1 (2) the applicant would not be in compliance with local
2 zoning rules;
3 (3) one or more of the prospective principal officers
4 or board members causes a violation of Section 30-20 of
5 this Article;
6 (4) one or more of the principal officers or board
7 members is under 21 years of age;
8 (5) the person has submitted an application for a
9 license under this Act that contains false information; or
10 (6) the licensee; principal officer, board member, or
11 person having a financial or voting interest of 5% or
12 greater in the licensee; or agent is delinquent in filing
13 any required tax returns or paying any amounts owed to the
14 State of Illinois.
15 Section 30-30. Craft grower requirements; prohibitions.
16 (a) The operating documents of a craft grower shall include
17procedures for the oversight of the craft grower, a cannabis
18plant monitoring system including a physical inventory
19recorded weekly, accurate recordkeeping, and a staffing plan.
20 (b) A craft grower shall implement a security plan reviewed
21by the Department of State Police that includes, but is not
22limited to: facility access controls, perimeter intrusion
23detection systems, personnel identification systems, and a
2424-hour surveillance system to monitor the interior and
25exterior of the craft grower facility and that is accessible to

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1authorized law enforcement and the Department of Agriculture in
2real time.
3 (c) All cultivation of cannabis by a craft grower must take
4place in an enclosed, locked facility at the physical address
5provided to the Department of Agriculture during the licensing
6process. The craft grower location shall only be accessed by
7the agents working for the craft grower, the Department of
8Agriculture staff performing inspections, the Department of
9Public Health staff performing inspections, State and local law
10enforcement or other emergency personnel, contractors working
11on jobs unrelated to cannabis, such as installing or
12maintaining security devices or performing electrical wiring,
13transporting organization agents as provided in this Act, or
14participants in the incubator program, individuals in a
15mentoring or educational program approved by the State, or
16other individuals as provided by rule. However, if a craft
17grower shares a premises with an infuser or dispensing
18organization, agents from those other licensees may access the
19craft grower portion of the premises if that is the location of
20common bathrooms, lunchrooms, locker rooms, or other areas of
21the building where work or cultivation of cannabis is not
22performed. At no time may an infuser or dispensing organization
23agent perform work at a craft grower without being a registered
24agent of the craft grower.
25 (d) A craft grower may not sell or distribute any cannabis
26to any person other than a cultivation center, a craft grower,

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1an infuser organization, a dispensing organization, or as
2otherwise authorized by rule.
3 (e) A craft grower may not be located in an area zoned for
4residential use.
5 (f) A craft grower may not either directly or indirectly
6discriminate in price between different cannabis business
7establishments that are purchasing a like grade, strain, brand,
8and quality of cannabis or cannabis-infused product. Nothing in
9this subsection (f) prevents a craft grower from pricing
10cannabis differently based on differences in the cost of
11manufacturing or processing, the quantities sold, such as
12volume discounts, or the way the products are delivered.
13 (g) All cannabis harvested by a craft grower and intended
14for distribution to a dispensing organization must be entered
15into a data collection system, packaged and labeled under
16Section 55-21, and, if distribution is to a dispensing
17organization that does not share a premises with the dispensing
18organization receiving the cannabis, placed into a cannabis
19container for transport. All cannabis harvested by a craft
20grower and intended for distribution to a cultivation center,
21to an infuser organization, or to a craft grower with which it
22does not share a premises, must be packaged in a labeled
23cannabis container and entered into a data collection system
24before transport.
25 (h) Craft growers are subject to random inspections by the
26Department of Agriculture, local safety or health inspectors,

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1and the Department of State Police.
2 (i) A craft grower agent shall notify local law
3enforcement, the Department of State Police, and the Department
4of Agriculture within 24 hours of the discovery of any loss or
5theft. Notification shall be made by phone, in person, or
6written or electronic communication.
7 (j) A craft grower shall comply with all State and any
8applicable federal rules and regulations regarding the use of
9pesticides.
10 (k) A craft grower or craft grower agent shall not
11transport cannabis or cannabis-infused products to any other
12cannabis business establishment without a transport
13organization license unless:
14 (i) If the craft grower is located in a county with a
15 population of 3,000,000 or more, the cannabis business
16 establishment receiving the cannabis is within 2,000 feet
17 of the property line of the craft grower;
18 (ii) If the craft grower is located in a county with a
19 population of more than 700,000 but fewer than 3,000,000,
20 the cannabis business establishment receiving the cannabis
21 is within 2 miles of the craft grower; or
22 (iii) If the craft grower is located in a county with a
23 population of fewer the 700,000, the cannabis business
24 establishment receiving the cannabis is within 15 miles of
25 the craft grower.
26 (l) A craft grower may enter into a contract with a

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1transporting organization to transport cannabis to a
2cultivation center, a craft grower, an infuser organization, a
3dispensing organization, or a laboratory.
4 (m) No person or entity shall hold any legal, equitable,
5ownership, or beneficial interest, directly or indirectly, of
6more than 3 craft grower licenses. Further, no person or entity
7that is employed by, an agent of, or has a contract to receive
8payment from or participate in the management of a craft
9grower, is a principal officer of a craft grower, or entity
10controlled by or affiliated with a principal officer of a craft
11grower shall hold any legal, equitable, ownership, or
12beneficial interest, directly or indirectly, in a craft grower
13license that would result in the person or entity owning or
14controlling in combination with any craft grower, principal
15officer of a craft grower, or entity controlled or affiliated
16with a principal officer of a craft grower by which he, she, or
17it is employed, is an agent of, or participates in the
18management of more than 3 craft grower licenses.
19 (n) It is unlawful for any person having a craft grower
20license or any officer, associate, member, representative, or
21agent of the licensee to offer or deliver money, or anything
22else of value, directly or indirectly, to any person having an
23Early Approval Adult Use Dispensing Organization License, a
24Conditional Adult Use Dispensing Organization License, an
25Adult Use Dispensing Organization License, or a medical
26cannabis dispensing organization license issued under the

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1Compassionate Use of Medical Cannabis Pilot Program Act, or to
2any person connected with or in any way representing, or to any
3member of the family of, the person holding an Early Approval
4Adult Use Dispensing Organization License, a Conditional Adult
5Use Dispensing Organization License, an Adult Use Dispensing
6Organization License, or a medical cannabis dispensing
7organization license issued under the Compassionate Use of
8Medical Cannabis Pilot Program Act, or to any stockholders in
9any corporation engaged in the retail sale of cannabis, or to
10any officer, manager, agent, or representative of the Early
11Approval Adult Use Dispensing Organization License, a
12Conditional Adult Use Dispensing Organization License, an
13Adult Use Dispensing Organization License, or a medical
14cannabis dispensing organization license issued under the
15Compassionate Use of Medical Cannabis Pilot Program Act to
16obtain preferential placement within the dispensing
17organization, including, without limitation, on shelves and in
18display cases where purchasers can view products, or on the
19dispensing organization's website.
20 (o) A craft grower shall not be located within 1,500 feet
21of another craft grower or a cultivation center.
22 (p) A graft grower may process cannabis, cannabis
23concentrates, and cannabis-infused products.
24 (q) A craft grower must comply with any other requirements
25or prohibitions set by administrative rule of the Department of
26Agriculture.

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1 Section 30-35. Craft grower agent identification card.
2 (a) The Department of Agriculture shall:
3 (1) establish by rule the information required in an
4 initial application or renewal application for an agent
5 identification card submitted under this Act and the
6 nonrefundable fee to accompany the initial application or
7 renewal application;
8 (2) verify the information contained in an initial
9 application or renewal application for an agent
10 identification card submitted under this Act and approve or
11 deny an application within 30 days of receiving a completed
12 initial application or renewal application and all
13 supporting documentation required by rule;
14 (3) issue an agent identification card to a qualifying
15 agent within 15 business days of approving the initial
16 application or renewal application;
17 (4) enter the license number of the craft grower where
18 the agent works; and
19 (5) allow for an electronic initial application and
20 renewal application process, and provide a confirmation by
21 electronic or other methods that an application has been
22 submitted. The Department of Agriculture may by rule
23 require prospective agents to file their applications by
24 electronic means and provide notices to the agents by
25 electronic means.

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1 (b) An agent must keep his or her identification card
2visible at all times when on the property of a cannabis
3business establishment, including the craft grower
4organization for which he or she is an agent.
5 (c) The agent identification cards shall contain the
6following:
7 (1) the name of the cardholder;
8 (2) the date of issuance and expiration date of the
9 identification card;
10 (3) a random 10-digit alphanumeric identification
11 number containing at least 4 numbers and at least 4 letters
12 that is unique to the holder;
13 (4) a photograph of the cardholder; and
14 (5) the legal name of the craft grower organization
15 employing the agent.
16 (d) An agent identification card shall be immediately
17returned to the cannabis business establishment of the agent
18upon termination of his or her employment.
19 (e) Any agent identification card lost by a craft grower
20agent shall be reported to the Department of State Police and
21the Department of Agriculture immediately upon discovery of the
22loss.
23 Section 30-40. Craft grower background checks.
24 (a) Through the Department of State Police, the Department
25of Agriculture shall conduct a background check of the

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1prospective principal officers, board members, and agents of a
2craft grower applying for a license or identification card
3under this Act. The Department of State Police shall charge a
4fee set by rule for conducting the criminal history record
5check, which shall be deposited into the State Police Services
6Fund and shall not exceed the actual cost of the record check.
7In order to carry out this Section, each craft grower
8organization's prospective principal officer, board member, or
9agent shall submit a full set of fingerprints to the Department
10of State Police for the purpose of obtaining a State and
11federal criminal records check. These fingerprints shall be
12checked against the fingerprint records now and hereafter, to
13the extent allowed by law, filed in the Department of State
14Police and Federal Bureau of Investigation criminal history
15records databases. The Department of State Police shall
16furnish, following positive identification, all conviction
17information to the Department of Agriculture.
18 (b) When applying for the initial license or identification
19card, the background checks for all prospective principal
20officers, board members, and agents shall be completed before
21submitting the application to the licensing or issuing agency.
22 Section 30-45. Renewal of craft grower licenses and agent
23identification cards.
24 (a) Licenses and identification cards issued under this Act
25shall be renewed annually. A craft grower shall receive written

HB1438 Enrolled- 223 -LRB101 04919 JRG 49928 b
1or electronic notice 90 days before the expiration of its
2current license that the license will expire. The Department of
3Agriculture shall grant a renewal within 45 days of submission
4of a renewal application if:
5 (1) the craft grower submits a renewal application and
6 the required nonrefundable renewal fee of $40,000, or
7 another amount as the Department of Agriculture may set by
8 rule after January 1, 2021;
9 (2) the Department of Agriculture has not suspended the
10 license of the craft grower or suspended or revoked the
11 license for violating this Act or rules adopted under this
12 Act;
13 (3) the craft grower has continued to operate in
14 accordance with all plans submitted as part of its
15 application and approved by the Department of Agriculture
16 or any amendments thereto that have been approved by the
17 Department of Agriculture;
18 (4) the craft grower has submitted an agent, employee,
19 contracting, and subcontracting diversity report as
20 required by the Department; and
21 (5) the craft grower has submitted an environmental
22 impact report.
23 (b) If a craft grower fails to renew its license before
24expiration, it shall cease operations until its license is
25renewed.
26 (c) If a craft grower agent fails to renew his or her

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1identification card before its expiration, he or she shall
2cease to work as an agent of the craft grower organization
3until his or her identification card is renewed.
4 (d) Any craft grower that continues to operate, or any
5craft grower agent who continues to work as an agent, after the
6applicable license or identification card has expired without
7renewal is subject to the penalties provided under Section
845-5.
9 (e) All fees or fines collected from the renewal of a craft
10grower license shall be deposited into the Cannabis Regulation
11Fund.
12 Section 30-50. Craft grower taxes; returns.
13 (a) A tax is imposed upon the privilege of cultivating and
14processing adult use cannabis at the rate of 7% of the gross
15receipts from the sale of cannabis by a craft grower to a
16dispensing organization. The sale of any adult use product that
17contains any amount of cannabis or any derivative thereof is
18subject to the tax under this Section on the full selling price
19of the product. The proceeds from this tax shall be deposited
20into the Cannabis Regulation Fund. This tax shall be paid by
21the craft grower who makes the first sale and is not the
22responsibility of a dispensing organization, qualifying
23patient, or purchaser.
24 (b)In the administration of and compliance with this
25Section, the Department of Revenue and persons who are subject

HB1438 Enrolled- 225 -LRB101 04919 JRG 49928 b
1to this Section: (i) have the same rights, remedies,
2privileges, immunities, powers, and duties, (ii) are subject to
3the same conditions, restrictions, limitations, penalties, and
4definitions of terms, and (iii) shall employ the same modes of
5procedure as are set forth in the Cannabis Cultivation
6Privilege Tax Law and the Uniform Penalty and Interest Act as
7if those provisions were set forth in this Section.
8 (c)The tax imposed under this Act shall be in addition to
9all other occupation or privilege taxes imposed by the State of
10Illinois or by any municipal corporation or political
11subdivision thereof.
12
ARTICLE 35.
13
INFUSER ORGANIZATIONS
14 Section 35-3. Definitions. In this Article:
15 "Department" means the Department of Agriculture.
16 Section 35-5. Issuance of licenses.
17 (a) The Department of Agriculture shall issue up to 40
18infuser licenses through a process provided for in this Article
19no later than July 1, 2020.
20 (b) The Department of Agriculture shall make the
21application for infuser licenses available on January 7, 2020,
22or if that date falls on a weekend or holiday, the business day
23immediately succeeding the weekend or holiday and every January

HB1438 Enrolled- 226 -LRB101 04919 JRG 49928 b
17 or succeeding business day thereafter, and shall receive such
2applications no later than March 15, 2020, or, if that date
3falls on a weekend or holiday, the business day immediately
4succeeding the weekend or holiday and every March 15 or
5succeeding business day thereafter.
6 (c) By December 21, 2021, the Department of Agriculture may
7issue up to 60 additional infuser licenses. Prior to issuing
8such licenses, the Department may adopt rules through emergency
9rulemaking in accordance with subsection (gg) of Section 5-45
10of the Illinois Administrative Procedure Act, to modify or
11raise the number of infuser licenses and modify or change the
12licensing application process to reduce or eliminate barriers.
13The General Assembly finds that the adoption of rules to
14regulate cannabis use is deemed an emergency and necessary for
15the public interest, safety, and welfare.
16 In determining whether to exercise the authority granted by
17this subsection, the Department of Agriculture must consider
18the following factors:
19 (1) the percentage of cannabis sales occurring in
20 Illinois not in the regulated market using data from the
21 Substance Abuse and Mental Health Services Administration,
22 National Survey on Drug Use and Health, Illinois Behavioral
23 Risk Factor Surveillance System, and tourism data from the
24 Illinois Office of Tourism to ascertain total cannabis
25 consumption in Illinois compared to the amount of sales in
26 licensed dispensing organizations;

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1 (2) whether there is an adequate supply of cannabis and
2 cannabis-infused products to serve registered medical
3 cannabis patients;
4 (3) whether there is an adequate supply of cannabis and
5 cannabis-infused products to sere purchasers:
6 (4) whether there is an oversupply of cannabis in
7 Illinois leading to trafficking of cannabis to any other
8 state;
9 (5) population increases or shifts;
10 (6) changes to federal law;
11 (7) perceived security risks of increasing the number
12 or location of infuser organizations;
13 (8) the past security records of infuser
14 organizations;
15 (9) the Department of Agriculture's capacity to
16 appropriately regulate additional licenses;
17 (10) the findings and recommendations from the
18 disparity and availability study commissioned by the
19 Illinois Cannabis Regulation Oversight Officer to reduce
20 or eliminate any identified barriers to entry in the
21 cannabis industry; and
22 (11) any other criteria the Department of Agriculture
23 deems relevant.
24 (d) After January 1, 2022, the Department of Agriculture
25may by rule modify or raise the number of infuser licenses, and
26modify or change the licensing application process to reduce or

HB1438 Enrolled- 228 -LRB101 04919 JRG 49928 b
1eliminate barriers based on the criteria in subsection (c).
2 Section 35-10. Application.
3 (a) When applying for a license, the applicant shall
4electronically submit the following in such form as the
5Department of Agriculture may direct:
6 (1) the nonrefundable application fee of $5,000 or,
7 after January 1, 2021, another amount as set by rule by the
8 Department of Agriculture, to be deposited into the
9 Cannabis Regulation Fund;
10 (2) the legal name of the infuser;
11 (3) the proposed physical address of the infuser;
12 (4) the name, address, social security number, and date
13 of birth of each principal officer and board member of the
14 infuser; each principal officer and board member shall be
15 at least 21 years of age;
16 (5) the details of any administrative or judicial
17 proceeding in which any of the principal officers or board
18 members of the infuser (i) pled guilty, were convicted,
19 fined, or had a registration or license suspended or
20 revoked, or (ii) managed or served on the board of a
21 business or non-profit organization that pled guilty, was
22 convicted, fined, or had a registration or license
23 suspended or revoked;
24 (6) proposed operating bylaws that include procedures
25 for the oversight of the infuser, including the development

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1 and implementation of a plant monitoring system, accurate
2 recordkeeping, staffing plan, and security plan approved
3 by the Department of State Police that are in accordance
4 with the rules issued by the Department of Agriculture
5 under this Act; a physical inventory of all cannabis shall
6 be performed on a weekly basis by the infuser;
7 (7) verification from the Department of State Police
8 that all background checks of the prospective principal
9 officers, board members, and agents of the infuser
10 organization have been conducted;
11 (8) a copy of the current local zoning ordinance and
12 verification that the proposed infuser is in compliance
13 with the local zoning rules and distance limitations
14 established by the local jurisdiction;
15 (9) proposed employment practices, in which the
16 applicant must demonstrate a plan of action to inform,
17 hire, and educate minorities, women, veterans, and persons
18 with disabilities, engage in fair labor practices, and
19 provide worker protections;
20 (10) whether an applicant can demonstrate experience
21 in or business practices that promote economic empowerment
22 in Disproportionately Impacted Areas;
23 (11) experience with infusing products with cannabis
24 concentrate;
25 (12) a description of the enclosed, locked facility
26 where cannabis will be infused, packaged, or otherwise

HB1438 Enrolled- 230 -LRB101 04919 JRG 49928 b
1 prepared for distribution to a dispensing organization or
2 other infuser;
3 (13) processing, inventory, and packaging plans;
4 (14) a description of the applicant's experience with
5 operating a commercial kitchen or laboratory preparing
6 products for human consumption;
7 (15) a list of any academic degrees, certifications, or
8 relevant experience of all prospective principal officers,
9 board members, and agents of the related business;
10 (16) the identity of every person having a financial or
11 voting interest of 5% or greater in the infuser operation
12 with respect to which the license is sought, whether a
13 trust, corporation, partnership, limited liability
14 company, or sole proprietorship, including the name and
15 address of each person;
16 (17) a plan describing how the infuser will address
17 each of the following:
18 (i) energy needs, including estimates of monthly
19 electricity and gas usage, to what extent it will
20 procure energy from a local utility or from on-site
21 generation, and if it has or will adopt a sustainable
22 energy use and energy conservation policy;
23 (ii) water needs, including estimated water draw,
24 and if it has or will adopt a sustainable water use and
25 water conservation policy; and
26 (iii) waste management, including if it has or will

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1 adopt a waste reduction policy;
2 (18) a recycling plan:
3 (A) a commitment that any recyclable waste
4 generated by the infuser shall be recycled per
5 applicable State and local laws, ordinances, and
6 rules; and
7 (B) a commitment to comply with local waste
8 provisions. An infuser commits to remain in compliance
9 with applicable State and federal environmental
10 requirements, including, but not limited to, storing,
11 securing, and managing all recyclables and waste,
12 including organic waste composed of or containing
13 finished cannabis and cannabis products, in accordance
14 with applicable State and local laws, ordinances, and
15 rules; and
16 (19) any other information required by rule.
17 (b) Applicants must submit all required information,
18including the information required in Section 35-15, to the
19Department of Agriculture. Failure by an applicant to submit
20all required information may result in the application being
21disqualified.
22 (c) If the Department of Agriculture receives an
23application with missing information, the Department of
24Agriculture may issue a deficiency notice to the applicant. The
25applicant shall have 10 calendar days from the date of the
26deficiency notice to resubmit the incomplete information.

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1Applications that are still incomplete after this opportunity
2to cure will not be scored and will be disqualified.
3 Section 35-15. Issuing licenses.
4 (a) The Department of Agriculture shall by rule develop a
5system to score infuser applications to administratively rank
6applications based on the clarity, organization, and quality of
7the applicant's responses to required information. Applicants
8shall be awarded points based on the following categories:
9 (1) Suitability of the proposed facility;
10 (2) Suitability of the employee training plan;
11 (3) Security and recordkeeping plan;
12 (4) Infusing plan;
13 (5) Product safety and labeling plan;
14 (6) Business plan;
15 (7) The applicant's status as a Social Equity
16 Applicant, which shall constitute no less than 20% of total
17 available points;
18 (8) Labor and employment practices, which shall
19 constitute no less than 2% of total available points;
20 (9) Environmental plan as described in paragraphs (17)
21 and (18) of subsection (a) of Section 35-10;
22 (10) The applicant is 51% or more owned and controlled
23 by an individual or individuals who have been an Illinois
24 resident for the past 5 years as proved by tax records;
25 (11) The applicant is 51% or more controlled and owned

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1 by an individual or individuals who meet the qualifications
2 of a veteran as defined by Section 45-57 of the Illinois
3 Procurement Code; and
4 (12) A diversity plan that includes a narrative of not
5 more than 2,500 words that establishes a goal of diversity
6 in ownership, management, employment, and contracting to
7 ensure that diverse participants and groups are afforded
8 equality of opportunity; and
9 (13) Any other criteria the Department of Agriculture
10 may set by rule for points.
11 (b) The Department may also award up to 2 bonus points for
12the applicant's plan to engage with the community. The
13applicant may demonstrate a desire to engage with its community
14by participating in one or more of, but not limited to, the
15following actions: (i) establishment of an incubator program
16designed to increase participation in the cannabis industry by
17persons who would qualify as Social Equity Applicants; (ii)
18providing financial assistance to substance abuse treatment
19centers; (iii) educating children and teens about the potential
20harms of cannabis use; or (iv) other measures demonstrating a
21commitment to the applicant's community. Bonus points will only
22be awarded if the Department receives applications that receive
23an equal score for a particular region.
24 (c) Should the applicant be awarded an infuser license, the
25information and plans that an applicant provided in its
26application, including any plans submitted for the acquiring of

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1bonus points, becomes a mandatory condition of the permit. Any
2variation from or failure to perform such plans may result in
3discipline, including the revocation or nonrenewal of a
4license.
5 (d) Should the applicant be awarded an infuser organization
6license, it shall pay a fee of $5,000 prior to receiving the
7license, to be deposited into the Cannabis Regulation Fund. The
8Department of Agriculture may by rule adjust the fee in this
9Section after January 1, 2021.
10 Section 35-20. Denial of application. An application for an
11infuser license shall be denied if any of the following
12conditions are met:
13 (1) the applicant failed to submit the materials
14 required by this Article;
15 (2) the applicant would not be in compliance with local
16 zoning rules or permit requirements;
17 (3) one or more of the prospective principal officers
18 or board members causes a violation of Section 35-25.
19 (4) one or more of the principal officers or board
20 members is under 21 years of age;
21 (5) the person has submitted an application for a
22 license under this Act or this Article that contains false
23 information; or
24 (6) if the licensee; principal officer, board member,
25 or person having a financial or voting interest of 5% or

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1 greater in the licensee; or agent is delinquent in filing
2 any required tax returns or paying any amounts owed to the
3 State of Illinois.
4 Section 35-25. Infuser organization requirements;
5prohibitions.
6 (a) The operating documents of an infuser shall include
7procedures for the oversight of the infuser, an inventory
8monitoring system including a physical inventory recorded
9weekly, accurate recordkeeping, and a staffing plan.
10 (b) An infuser shall implement a security plan reviewed by
11the Department of State Police that includes, but is not
12limited to: facility access controls, perimeter intrusion
13detection systems, personnel identification systems, and a
1424-hour surveillance system to monitor the interior and
15exterior of the infuser facility and that is accessible to
16authorized law enforcement, the Department of Public Health,
17and the Department of Agriculture in real time.
18 (c) All processing of cannabis by an infuser must take
19place in an enclosed, locked facility at the physical address
20provided to the Department of Agriculture during the licensing
21process. The infuser location shall only be accessed by the
22agents working for the infuser, the Department of Agriculture
23staff performing inspections, the Department of Public Health
24staff performing inspections, State and local law enforcement
25or other emergency personnel, contractors working on jobs

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1unrelated to cannabis, such as installing or maintaining
2security devices or performing electrical wiring, transporting
3organization agents as provided in this Act, participants in
4the incubator program, individuals in a mentoring or
5educational program approved by the State, local safety or
6health inspectors, or other individuals as provided by rule.
7However, if an infuser shares a premises with a craft grower or
8dispensing organization, agents from these other licensees may
9access the infuser portion of the premises if that is the
10location of common bathrooms, lunchrooms, locker rooms, or
11other areas of the building where processing of cannabis is not
12performed. At no time may a craft grower or dispensing
13organization agent perform work at an infuser without being a
14registered agent of the infuser.
15 (d) An infuser may not sell or distribute any cannabis to
16any person other than a dispensing organization, or as
17otherwise authorized by rule.
18 (e) An infuser may not either directly or indirectly
19discriminate in price between different cannabis business
20establishments that are purchasing a like grade, strain, brand,
21and quality of cannabis or cannabis-infused product. Nothing in
22this subsection (e) prevents an infuser from pricing cannabis
23differently based on differences in the cost of manufacturing
24or processing, the quantities sold, such volume discounts, or
25the way the products are delivered.
26 (f) All cannabis infused by an infuser and intended for

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1distribution to a dispensing organization must be entered into
2a data collection system, packaged and labeled under Section
355-21, and, if distribution is to a dispensing organization
4that does not share a premises with the infuser, placed into a
5cannabis container for transport. All cannabis produced by an
6infuser and intended for distribution to a cultivation center,
7infuser organization, or craft grower with which it does not
8share a premises, must be packaged in a labeled cannabis
9container and entered into a data collection system before
10transport.
11 (g) Infusers are subjec