Trustees Vote to Legalize Recreational Cannabis Businesses
In December 2020, the Village Board voted to reverse the one-year moratorium it had placed on recreational cannabis businesses and adopted zoning regulations to allow cannabis establishments in non-residential zoning districts and to formalize restrictions on location, design, and operation of such businesses.
Any future cannabis dispensary in Lake Zurich would be required to be a minimum of 500 feet from a school, day care or group home, 250 feet from a park, and 1,500 feet away from another dispensary. The adopted regulations also reference State statutes that apply to this highly-regulated industry, such as security, storage and transportation requirements.
History and Background
On September 16, 2019, the Village Board approved an ordinance prohibiting recreational cannabis businesses from Lake Zurich with the intention to revisit the topic one year later.
On September 21, 2020 an initial discussion on this topic was delayed while providing direction to Staff, partly due to the lack of a full Board present during that meeting along with the desire to gather additional public feedback.
An informal public opinion poll on the possibility of recreational cannabis businesses in Lake Zurich was available over the last week, with 830 individual responses. Results of that poll available below.
The Village Board discussed permitting recreational cannabis during their October 5, 2020 meeting. The board directed staff to prepare materials for the Planning & Zoning Commission for a future public hearing on potential zoning regulations to facilitate a recreational cannabis establishment.
The Planning & Zoning Commission has scheduled a public hearing for November 18, 2020 to discuss potential amendments to the Zoning Code for recreational cannabis regulations. The Staff Report for that agenda item is available here.
Cannabis Regulation and Tax Act
On June 25, 2019, Governor Pritzker signed into law the Cannabis Regulation and Tax Act, making Illinois the 11th state in the nation to legalize recreational cannabis sale and use. The Act provides for the State licensure of a variety of adult-use cannabis business establishments, preserves the legalization of medical cannabis and includes a provision allowing "home grow" cannabis by medical cannabis program participants only. Recreational marijuana use by adults 21 and over has become legal on January 1, 2020.
It is a Local Decision
The State of Illinois is allowing municipalities to decide whether to prohibit recreational cannabis businesses from locating in their communities, or to allow these type of uses subject to local zoning restrictions.
In addition to granting or restricting the authority of adult-use recreational dispensaries, municipalities have the option of authorizing on-site consumption of cannabis (i.e. - cannabis cafes / smoke lounges), as well as the co-location of craft growers, infusers, and cultivation centers.
Local zoning regulation of State-licensed adult-use recreational dispensaries and related uses would most likely be controlled through Special Use Permits, which require a public hearing at the Planning & Zoning Commission with final approval by the Village Board. If the Village were to allow the possibility of a recreational cannabis dispensary, the Village could further regulate it by:
- Restricting the zoning districts that such a dispensary may operate in (i.e. - only in the industrial zoning district).
- Restricting the hours of operation.
- Regulating the proximity to other land uses like schools, parks, houses of worship, child care facilities, etc.
- Capping on the number of adult-use recreational dispensaries allowed in Lake Zurich.
Safety Concerns & Opportunities
The expansion of recreational use of cannabis products raises several concerns that municipalities will need to address starting January 1, 2020. Traffic safety, with a potential increase in the number of impaired drivers; underage access to cannabis products including edibles like gummy bears, brownies, and lollipops, and increase in overdose emergency calls are issues that will require attention regardless of whether there is a dispensary in Lake Zurich.
Staff have been monitoring how municipalities in other states with legal recreational cannabis have managed these issues, with mixed results to date. The presence of a dispensary in Lake Zurich may heighten the likelihood of these impacts locally.
Dispensaries, for both medical and recreational products, are also becoming destinations that drive economic activity and tax revenue for the municipality. With 372,000 people with an average household income of $163,000 living within a 20-minute radius, Lake Zurich may be an attractive location that brings potential customers to businesses beyond the dispensary itself. The State also allows the application of an extra 3% local sales tax, which could generate revenues for parks, storm water improvements or other service and infrastructure needs.
Existing Nearby Medical Dispensaries
State law does not allow the outright prohibition of medical cannabis dispensaries, but through strict zoning regulations, there are very limited potential sites – primarily within the industrial park on the north side of IL Route 22 – where one might open in Lake Zurich.
Medical marijuana was legalized in Illinois in 2014. Currently, there are more than 20 medical marijuana dispensaries operating in the Chicago-metro area. Some nearby communities that have allowed these dispensaries:
- Mundelein Highland Park Buffalo Grove
- Mount Prospect Addison St. Charles
- Schaumburg Rolling Meadows Evanston
- Naperville Oak Park North Aurora
Of 23 medical dispensaries identified in Chicago-metro, 13 are within an industrial park, 10 are within high-traffic major retail corridors, and 7 are adjacent to residential neighborhoods.
Medical dispensaries are expected to be given the first opportunity to apply to the State for recreational retail sales, if the municipality allows it. Many of the communities that have medical marijuana dispensaries are now considering whether to allow them to expand into recreational retail sales.