Naperville Officially Opts Out of Recreational Marijuana Sales…For Now
September 5, 2019

At a meeting on Tuesday night that spanned over three hours and was attended by hundreds of individuals wearing “opt out” t-shirts, the Naperville City Council officially voted (6-3) to opt out of recreational marijuana sales in Illinois’s fourth largest city. This is not the final resolution of the issue, however, despite some reporting to the contrary.

At the hearing, all of the council members indicated that they were in favor of putting the issue to the people of Naperville via a non-binding referendum, and most agreed to cast their ultimate vote consistent with the will of the people. The majority also agreed to have the referendum take place in March 2020, although that generated some pushback. Accordingly, while Naperville is opting out of recreational marijuana sales in the short term, the issue will likely be put to the voters in 2020, perhaps as early as March 2020.

While the issue is in no way finally decided, Tuesday’s vote was still a bit of a shock to the Illinois recreational marijuana industry. On July 2, 2019 the council preliminarily voted (5-4) in favor of banning recreational marijuana sales within the city’s borders. After that initial vote, however, comments from members of the council regarding tax revenue, neighboring cities not opting out, and the risk of losing oversight over dispensaries serving Naperville citizens suggested that the council would reverse course.

For the time being, however, that has not happened, and Tuesday’s vote is going to have real world consequences. The 3C Compassionate Care Center, operated by Green Thumb Industries (“GTI”), was recently awarded a “dual-use” license that would have allowed it to sell recreational marijuana at its Naperville medicinal marijuana dispensary starting January 1, 2020. As a result of Tuesday’s vote, the 3C dispensary will not be allowed to sell recreational marijuana on New Year’s Day. Further, according to an article in the Chicago Sun-Times, unless the citizens of Naperville vote to opt in for recreational sales in the upcoming referendum, 3C’s dual license will be effectively useless because Governor Pritzker has no plans to “direct the IDFPR to allow GTI to relocate [the 3C dispensary] and operate as a dual-use dispensary.” Considering how hefty the application fees are for dual-use licenses, that seems problematic and is potentially an issue that will be taken up by legislators in a “trailer bill” during the upcoming congressional veto session.

It is important to understand that Naperville’s ultimate decision remains up in the air, despite numerous news outlets reporting that Naperville has completely opted out of recreational marijuana sales. The bigger question is what is going to come next. What will Naperville ultimately do? Will neighboring cities now chose to opt out, or will they try to take advantage of the vacuum created by Naperville? How quickly will other companies planning to place recreational dispensaries in Naperville pivot and find new locations? Can they afford to wait until March in hopes that Naperville residents vote to opt in? With less than four months to go until the recreational marijuana market goes live, there are more questions than answers.

Make sure to check back with our blog and subscribe to our podcast, The Joint Status Report, on iTunes or Spotify to stay up to date on this issue and other issues impacting the cannabis industry.

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