Building Your New Dispensary: Avoiding Common Construction Mistakes as a New Illinois Licensee

So you’re planning a new Illinois cannabis dispensary – congratulations! Whether this dispensary is your entrepreneurial dream come true or you’ve been down this road before, once you confirm your license, you’ll want to begin building out your location as quickly as possible. Our teams, currently building dispensaries across Illinois and other States, can help steer you through the unique maze that is the Illinois cannabis construction process.

Building a new dispensary is not as simple as it sounds.  Dispensaries must offer the security of a bank branch, the compliance of a pharmaceutical company, and the aesthetic of a high-end retailer.

As Illinois-based experts in the design-build construction of cannabis facilities, our teams have been in the trenches building dispensaries, cultivation centers and processing labs since 2015, including a national flagship dispensary in Northbrook, currently under construction. We have been involved in more than 30 dispensary, cultivation center and processing lab projects in nine states since 2015. Currently, we are leading renovation projects that offer Illinois more than 35,000 new square feet of cannabis cultivation and dispensaries customized for the needs of both medical and recreational cannabis customers.

Here are a few ways you can jump ahead of the curve:

Differentiate the customer experience. Buying cannabis in a regulated dispensary should feel easy, welcoming and natural. Designing for the customer experience, creating welcoming sales environments, while remaining compliant with regulations, is where dispensaries differentiate themselves from the competition. One reason this is so important:  with strict supply chain rules in place, many cannabis products in Illinois are highly commoditized. If your product is a commodity, the customer experience becomes even more important.

Prioritize compliance or suffer the consequences. To maintain product supply and operational retail sales, stick to strict protocols and carefully follow building codes related to the handling, storage and distribution of cannabis throughout the supply chain.  In Illinois, building code inspections are unique to each municipality, with enormous differences from one community to another.  Be sure your design-build construction partner knows the right questions to ask, and the pitfalls that could come up at each inspection milestone.

Use a design-build approach.  Design-build integrates your design and construction teams from the beginning, reducing surprises and streamlining your budget throughout the process of envisioning and construction your dispensary.  When your architect and contractor are working together, you’ll find you have more time to focus on running your cannabis business, with less time spent in meetings about your space.  In addition, a design-build model allows for a single point of accountability. At CFC, we use our four-step design-build process to ensure alignment and high-touch customer service throughout your project.

Your contractor shouldn’t be learning on the job.  Your design-build construction partner should be respected in the industry and be able to speak to ‘tales from the trenches.’ While legalized recreational cannabis may be new to Illinois, there are companies like us that have been building for both medical and recreational cannabis for many years. You should never have to hear ‘let’s learn this together.’

Don’t let the pandemic get you down.  As an essential business, construction has been building Illinois cannabis facilities throughout the COVID-19 shut-down period and continues today.  With the right protocols in place, there’s no reason the construction of your dispensary can’t press forward.  To understand more about how our crews stay safe, you can read our National Cannabis Industry Association (NCIA) blog post from June 2020 on how to expand or renovate your cannabis facility while observing social distancing.

Choose a contractor with experience.  For nearly five years, CFC has worked with numerous cannabis companies, including vertically integrated multi-state operators (MSOs). “Partnering with CFC, we have been thoughtful about connecting the design/build process with our customer experience and compliance objectives,” said Mitch Kahn of Greenhouse Cannabis. “Together, we identified and solved potential issues early in the design/build process, so that the build-out is supportive of sales, security, and being good neighbors in our communities.”

Need more resources on the design-build dispensary construction process?  Here are a few suggestions:

NCIA PODCAST:

https://thecannabisindustry.org/podcasts/cannabis-facility-design-and-construction/

KNOW BEFORE YOU GROW:

https://rejournals.com/know-before-you-grow-secrets-of-successful-cannabis-facilities/

KEY SUCCESS FACTORS:

https://www.areadevelopment.com/construction-project-planning/Q1-2020/key-success-factors-for-building-cannabis-processing-center.shtml

While cannabis continues to be a fast-paced industry with changes on a daily and weekly basis, it’s no longer brand-new.  There’s no reason you shouldn’t have a guide who knows the right questions to ask and can keep you from repeating mistakes of the past.

For more information on working with our Cannabis Facility Construction experienced teams, you can request a consultation here and one of our team members will get back to you immediately.

Illinois Recreational Cannabis: What You Need to Know

“In the interest of equity and criminal justice reform, I look forward to signing this monumental legislation,” said Illinois Governor, J.B. Pritzker, following the passage of House Bill 1438 on Friday, May 31, 2019. The 66-47 vote made Illinois the 11th state to legalize adult-use cannabis and the first to do so through the state legislature. Vermont’s program was approved through its legislature but does not permit commercial sales. Approval in other states occurred via referendum.

The bill, which passed 38-17 in the state Senate two days earlier, focuses on social equity and addressing Illinois’ financial deficit. Chicago Crain’s Business reports that, “Illinois expects sales to eventually reach $1.5 billion to $2 billion a year, producing $500 million in revenue for the cash-strapped state.”

Following the November, 2018 midterm elections, we commented on what Governor Pritzker’s election victory would portend for the future of cannabis in Illinois. Once he signs the bill, it will be the law of the land.

Here’s what you need to know about the new law:

Growing and Selling
Recreational sales will begin on January 1, 2020, with priority given to businesses with current medical licenses. They will be eligible to start cultivating, producing, and selling cannabis for retail use.

According to the Chicago Tribune, “Only the 20 existing licensed medical marijuana cultivation facilities will be licensed to grow it initially. Next year, craft growers may apply for licenses to cultivate up to 5,000 square feet, with preference given to applicants from minority areas disproportionately affected by the war on drugs, such as the South and West sides of Chicago. Medical marijuana dispensaries and new retail stores will be licensed to sell it.”

Buying
The bill allows for Illinois residents 21 and older to possess up to 30 grams or roughly one ounce of cannabis flower or bud. They are also allowed five grams of cannabis concentrate or 500 milligrams of THC in a cannabis-infused product. Adults visiting the state can possess up to 15 grams of cannabis. Growing plants at home will remain illegal except for certified medical patients.

Impact on Convictions

Central to the bill was the expungement of cannabis convictions.

“While the usage of cannabis has been the same across all racial groups, the actual incarceration charges have been shown to be seven times more likely for people of color than Caucasians,” said Illinois State Senator. Heather Steans (D-Chicago), the Senate bill’s main sponsor. “This bill is going to set the model, I believe, the gold standard, for how to approach social equity issues related to cannabis legalization.”

Here’s what’s at stake for convicted felons, according to the Chicago Tribune: “The governor will pardon past convictions for possession of up to 30 grams, with the attorney general going to court to expunge or delete public records of a conviction or arrest. For possession of 30 to 500 grams, an individual or a state’s attorney may petition the court to vacate and expunge the conviction, but prosecutors may object, with a judge to make the decision.”

Taxation

Per ABC News and the Chicago Tribune, consumers will be taxed in the following way:

  • A 10% tax will be levied on cannabis products containing less than 35% THC
  • 20% for cannabis-infused products like edibles
  • 25% for THC concentrations of more than 35%

Additional state and local taxes apply and can be as high as 9.75%, including:

  • 3% municipality
  • 3.75% county in unincorporated areas
  • 3% in Cook County (Chicago)

Opting In or Out
Similar to other adult use programs, local governments may opt in or out. According the Chicago Tribune, “Municipalities and counties may ban cannabis businesses within their boundaries, but may not ban individual possession. Any person, business or landlord may prohibit use on private property. Colleges and universities may continue to prohibit marijuana use.”


Where You Can and Cannot Consume
Usage at home is permitted as long as it’s out of view of the public. Places where use is strictly prohibited include: public areas, school grounds, in any motor vehicle, in a correctional facility, around someone under 21, while driving a boat or flying a plane, or by a school bus driver, police, fire or corrections officer while on duty.What Else?

Cannabis remains a Schedule 1 illegal drug by the federal government; however, federal law enforcement tends not to prosecute possession of small amounts or businesses complying with state programs.

Medical cannabis was also a winner at the eleventh hour of the legislative session. The House passed the bipartisan SB 2023, which will make the Compassionate Use of Medical Cannabis Pilot Program Act permanent while broadening its scope. Illinois State Representative Bob Morgan’s (D) reauthorization bill removes the program’s July, 2020 sunset and adds more patient qualifying conditions, including chronic pain and autism.

The bill also permits advanced practice nurses and physician assistants to recommend medical cannabis in addition to physicians and increases the number of caregivers that patients can use to access the program. Similar to the adult-use program, the reauthorization bill emphasizes equity standards and will award five dispensary licenses to ensure equal opportunity.

“It is critical for the state that the pilot program be reauthorized and revised,” said Morgan in a press release. “The initial program placed a significant regulatory burden on patients. With the passage of SB2023, the new program will streamline the process and help patients suffering from debilitating medical conditions.”