Illinois to Hold Lottery Specifically for Those Kept Out of the Industry

Illinois will launch a new lottery program specifically for the six applicants who did not make it, so that they will now have another shot at winning and being able to operate their own recreational cannabis stores. This official new lottery was announced this past Friday, and it already has the new market buzzing with possibilities. 

According to officials who commented on the new lottery process, those who were wrongly denied chances in the first three lotteries held this summer (lotteries that gave out 185 new licenses each) will now have another chance. The new licenses will be officially authorized by state law, which allows up to 500 new licenses total. 

While the applicants who were wrongly denied won’t be guaranteed licenses, the digital lottery is meant to be a more fair system than the original lottery held, and the goal is to re-create what the odds of winning should have been originally. 

When it comes to the former lotteries, a “clerical oversight in terms of data entry” led to the mistakes, according to Toi Hutchinson, senior adviser on cannabis to Governor J.B. Pritzker. This and other issues in the licensing system have delayed the official awarding of licenses by more than a year so far. 

This new announcement came as Illinois also unveiled the 51 winners from the previous three lotteries. However, the official licensing for those winners is still delayed, as seven challenges are currently pending in court that could impact who is truly awarded at the end of the process. Cook County Judge Moshe Jacobius has even gone so far as to order the state to not to award any licenses until he rules on a case that has to do with applicants and the scoring process. 

Illinois Struggles with Licensing Process

In total, 937 businesses submitted 4,518 applications last year. However, the issue arose when only 21 of those applicants earned the perfect scores necessary to qualify for the first lottery. Those who lost went on to file lawsuits on the basis that scoring, which was done by the consultant KPMG, gave varying scores to different applicants even when the same information was added. There were also other problems noted with the scoring system. 

In order to remedy this issue, the state passed a law that would create two more lotteries to make up for the problems with the first one. With this lottery system, the applicants only needed to score 85 percent or better to qualify. However, applicants still complained about this round of lotteries, saying that the process favored folks who were white, politically connected and wealthy, since it allowed unlimited applications attempts for those who could afford the $5,000 application fee multiple times.

Hutchinson admitted that there is an issue with the industry being mostly white-owned, but also claimed that Illinois is doing better than other states with getting licenses to those who are minorities or social equity applicants. In total, 79 new licenses have been given out in August, and 43 percent of those went to Black-owned businesses. 

She also claimed that each step along the way, regulators realized more errors and acted to correct them, helping to make the process more fair and equitable. She claimed the process was a “marathon and not a sprint.” 

However, she did admit it’s a marathon that went on for a while.

“It’s been painful to watch how long this has taken,” she said. “As we move forward, this could get better every single year.”

It remains to be seen if that is true, and if this new round of lottery will work out better for applicants, but it’s clear that Illinois isn’t giving up when it comes to perfecting the process.

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