Illinois touts improvements in making marijuana industry equitable, but critics say more needed

CHICAGO (WLS) -- One of the goals of legalizing marijuana in Illinois was to repair the damage of mass cannabis convictions among people of color. And while some critics say not enough has been done to level the playing field, the state said it's proud of the steps it's made over the last four years to make the industry attainable for everyone.

"When cannabis was illegal, 80% of arrests were Black and brown people," said Matthew Brewer, owner of Grasshopper Club. "My brother was one of the people in the 80% arrested for cannabis possession."

His brother's arrest was one of the reasons Brewer wanted to get into the marijuana industry. He is now celebrating his first year as the proud owner of Grasshopper Club, the first independent Black-owned dispensary in Chicago.

"It was a full circle moment when we opened this location and the first purchase ever here was my brother," he said.

Brewer's co-owners for the Logan Square shop are his brother Chuck and his mother Dianne. She never could have imagined this venture in her wildest dreams as a Black woman.

When recreational marijuana became legal in Illinois in 2020, the first cannabis businesses to open were 100% majority white-owned, and the state caught a lot of flak for that. Critics argued the barriers to entry were so extreme and costly, people of color were finding it nearly impossible to break into the industry.

The following year, Illinois launched its social equity program, which connects people and communities that have been historically impacted by the criminalization of cannabis to business ownership opportunities in the legal cannabis industry.

Erin Johnson, who oversees marijuana operations in Illinois, said as of 2021, anyone in the state seeking marijuana business licenses must meet social equity criteria.

"You really qualify by living in a disproportionately impacted area. So, disproportionately low graduation rate. Disproportionately high use of SNAP benefits. Those markers that are race neutral but really get at the folks who were harmed by the war on drugs," Johnson said. "We are literally the most diverse industry in the country. We've led the way."

According to state data from 2020 to 2023, Black-owned cannabis companies in Illinois increased from 0% to 27%; Latino-owned companies went from 0% to 5%; and women-owned companies increased from 3% to 16%.

"So we're really doing things to make sure that our cannabis industry looks like Illinois," Johnson said.

But critics like Abrose Jackson, CEO of the minority-owned cannabis company The 1937 Group, said the state could do so much more.

"These social equity license owners that were promised a dream have had that dream either deferred or squashed. There are a numbers of barriers of entry for this industry that they still are not able to overcome," Jackson said.

Raising capital is a huge issues. Jackson said that to date, the state has not followed through on its legal obligation to provide funding to dispensary license holders via the Social Equity Cannabis Loan Program.

The state didn't say what was behind the delay for the release of funds, but said they hope to start accepting applications this week.

"And we think that will be game changing. It will give folks that last little push they need to get open and over the hurdles," said Johnson.

At Grasshopper Club, the owners are thankful to have not just one but two thriving dispensaries in Illinois, but Brewer wants to see more business owners who look like him.

"Frankly a little bit disappointing that it's not more," he said. "Navigating all of the requirements, the security requirements, the business plan, the purchasing and inventory, finding a space that's zone properly... So when you layer all of those factors on top of each other, it creates a very complicated maze that's tough to navigate."

Critics say other barriers include extremely high cannabis taxes, which are among the highest in the nation, and the tight deadline for license holders to get their businesses open.

The state said it's committed to ensuring the federal government passes the Safer Banking Act so that marijuana businesses can take advantage of the same loans other small businesses are able to access.

The loan program for social equity dispensaries was announced Thursday by DCEO. Their press release may be found here.

"While the first cannabis dispensaries in Illinois were all majority white-owned, that was because medical dispensary licensees (which were all majority white-owned) were given the opportunity to apply for dispensary licenses. The fees for those applications in turn funded the social equity program in the beginning. While the issuance of social equity dispensary licenses were delayed by court cases, the sequencing of these dispensary licenses was done purposefully and, given where Illinois now stands with its social equity program, it worked."