In 2020, when Illinois legalized recreational marijuana sales, its process for dispensing licenses included a promise to favor “social equity” applicants—businesses that are at least 51 percent owned by someone who (or whose family member) had a prior cannabis conviction, and businesses that planned to hire people with such convictions. Moncheri Robinson and her family jumped at the opportunity.
Three years and tens of thousands of dollars later, the family still doesn’t have a license.
Robinson and four family members emptied their savings to pay a team of legal writers $85,000 to craft a competitive application for the first round of applications. They also paid $2,500 for the application fee. Multiple applicants the Reader spoke to also described spending upwards of $100,000 for similar services.
Robinson and her family felt confident about their odds. Their writers had recently won other competitive markets in Arkansas and Oklahoma, which are similar to how Illinois is set up, and the family assumed their social equity designation would give them a leg up.
“We’re literally everyday people,” Robinson said. “My aunt was a store clerk; my husband, a school teacher, so I work in student affairs in higher ed . . . my cousin is a nurse, my brother is a nurse.” She said it was understood that if you weren’t able to qualify for social equity, you weren’t gonna win.
Their business concept was designed to resemble a gas station, carrying the items one would expect at a convenience store, plus dank bud. They submitted their application in January 2020, and waited.
“I’ll never forget checking that email every single day,” Robinson said. “And it was September 3, 2020. I’m on the Dan Ryan . . . and I’ll never forget [when] that email came through. And gosh, I just remember just reading it over and over, I was shaking so bad. Thank God, I wasn’t driving and my husband was. We didn’t see our name on that list. It was just like, ‘Wait a minute. This can’t be happening.’ Like, ‘I know we had a good application.’”
Frustrated, Robinson responded to the email to request her application’s score—the total number of points awarded based on criteria such as the planned facilities, employee training plans, security and product safety, and social equity status, which gave qualified applicants an additional 50 points out of a maximum 250.
Her family’s application hadn’t been allotted the 50 social equity points, nor had it gotten points for being an Illinois-based business. “I’m not a sore loser,” Robinson said, “but it’s another thing to get cheated. . . . It was basic, surface-level mistakes in the grading.”
In February 2021, following litigation and protests, state regulators allowed applicants to submit supplemental information and request their applications be reevaluated. Robinson’s recalculated score was 245 points, a near-perfect application, and qualified for the lottery. When the day of the lottery came, Robinson said that to her confusion, bigger companies were able to submit multiple applications and obtain more chances in the lottery; one such company, Cresco Labs, won three dispensary licenses.
Ultimately, Robinson’s family did not win a dispensary license, and she expressed frustration that this process was stacked against social equity applicants who didn’t have hundreds of thousands of dollars to submit multiple applications. “If you were truly social equity, could you truly afford to stuff the box with essentially 100 applications at $2,500 a whop?”
On September 27—the first bitterly cold morning of fall—an alliance of social-equity business owners and cannabis advocates held a press conference outside the governor’s West Loop high-rise to demand immediate relief for businesses that were awarded social equity licenses in the past year. Such businesses have 180 days to begin operations, after which the state may revoke their licenses. The social equity license winners described the struggles they’ve encountered in meeting that deadline.
The speakers shivered in the brisk weather as they described feeling unsupported by the state. Licensees floundered to compete with multistate operations (MSOs)—large cannabis companies like Cresco, many of whom profited early from medical marijuana sales and have more cash than small business owners to pay for recreational applications and navigate the state’s expensive and arduous hurdles.
In an interview with the Reader, Paul Pearson, who created the first Illinois Cannabis Law program with the City of Chicago Colleges and is currently running for 4th Ward alderperson, explained that MSOs saturate the licensing process by submitting many applications. MSOs can also afford lobbyists to advocate on their behalf. And, under state guidelines, these companies can qualify as social equity applicants if they hire employees from areas disproportionately impacted by cannabis arrests.
Kalee Hooghkirk, a partner at a small business licensed to infuse products with distilled THC, said the state must mandate pricing controls for the distillate MSOs sell to infusers. “The same multistate operators who have lobbied against our interests and delayed this program are the same ones we are being asked to depend on for the very core of our business,” Hooghkirk said. “Infusers are being asked to pay $20,000 for liters [of distillate] that cost four to $7,000 in states with similar programs. “
Lisbeth Vargas Jaimes, the executive director of the Illinois Independent Craft Growers Association, said the state’s canopy rules, which limit the square footage of grow operations, “are the reason why there aren’t many financial opportunities afforded to social equity businesses in this market.”
Craft growers currently can only grow a maximum of 5,000 square feet of cannabis; the association is asking for that maximum to be upped to 14,000 square feet. Jordan Melendez, an organizer with the Southwest Side Coalition for Change, said canopy limitations force small business owners to give a large percentage of ownership to financiers.
Debt financing options in the cannabis industry are often punitively priced, Melendez said.
Willie “J.R.” Fleming, representing the Southwest Side of Chicago Couriers, spoke on behalf of those with transportation license grievances. He urged the governor to delay the release of new transportation licenses until the current licensees can find business. “The existing multistate operators in Illinois have not produced opportunities in the contract for transporters to be successful,” Fleming said in an interview with the Reader. “It is imperative that legislation include a requirement for existing cultivators to contract with a transportation licensee for at least 75 percent of their business.”
At the press conference, speakers also said that the Department of Commerce & Economic Opportunity loan program created to assist small businesses has yet to release any of the funds. One speaker noted that there are too many stipulations on the money regardless. The funds can only be used to be “operational,” but many businesses need the money for construction or for acquisition.
Former state senator Rickey Hendon and State representative La Shawn Ford spoke last.
“The governor, who I love, needs to know what we’re going through,” Hendon said. “We wouldn’t be out here freezing our ass off if this wasn’t serious. We’re asking for an additional 180 days for true social equity. . . . Because if you don’t open in 180 days, you’ll lose your license. They set us up for failure, and they don’t even know it.”
“These are not nonprofit entities,” said Ford, who was in his shirtsleeves despite the bracing cold. “These are business people that have put their life savings on the line in order to help the state, reduce unemployment, and rebuild communities.”
Fleming co-owns several cannabis equity companies in Illinois, including Public Square LLC and South and West Side Carriers LLC.
Fleming said he strategically partnered with different cannabis companies and teams to submit multiple applications. He won a dispensary license with Justice Grown, run by two civil rights law partners in Chicago.
He sold weed in his younger days in the Chicago “legacy,” or underground, market. He said he’s been arrested and charged with multiple counts of possession with intent to deliver cannabis, but never convicted. “That’s the legal way to say I was selling weed,” he laughed. When he heard the state was legalizing medical marijuana in 2013, he started organizing to prepare his people to participate in the market.
Fleming and his teammates were awarded transportation, cultivation, and infusion licenses in Illinois, but he spoke on behalf of transportation because it’s the license he hasn’t been able to monetize. Ironically, these licenses have the lowest application fees and need the least additional infrastructure and partners to monetize.
But Fleming said they’re the least valuable licenses right now because you must transport marijuana from a legal Illinois entity, and the big MSOs will not give anyone a contract to begin. “You’d be a fool to believe that they’re gonna give you a contract,” he chuckled, “You really think these white people gonna let you move they drugs?”
As a social equity business owner, he said that it’s hard to find locations on the southwest side because those facilities don’t exist there already, and his team doesn’t have the capital to build them. The only people in this industry who would lend money to cannabis start-ups are hedge funds and other financial interests, he said. To try to lessen the widespread dependence on white investors, Fleming has reached out to Black athletes and Black entertainers to invest.
“There should be more opportunities and resources put forth by the government to support social equity winners,” he said. “We feel like the city [and] the state, they should be providing the same resources that they do for big corporations coming to Illinois, to social equity winners.”
Elijah Hamilton is the CEO and Founder of Chummy’s Organix, a Chicago-based cannabidiol (CBD, a legal, nonpsychoactive by-product of cannabis) brand. “That’s the one that’s actually functioning, up and running right now,” Hamilton said. “And then I have Chummy’s Edibles, which was the brand that we attempted to get into the mainstream cannabis market . . . we went through that whole tumultuous process back in 2020. You know, going through the rush of trying to get into the game, so to speak.”
Long before being a business owner, Hamilton worked in the consumer packaged goods industry for a decade as a district manager of PepsiCo and Frito-Lay. “That’s pretty much where I got most of my skills from . . . market strategy, direct store delivery, how to IRI data, Nelson statistics planograms, how to structure route delivery.” By the time he considered making a dime off the cannabis industry, he was nearly bankrupt. A former friend showed him how to make edibles, and he started selling those casually to help him get back on his feet.
“I got pretty good at it. And then when I found Illinois was about to become recreational, we had decided, ‘Hey, let’s go ahead, start out.’”
Hamilton vertically integrated his company with seven others, and Chummy’s was the flagship brand because it already had recognition due to its success in the legacy market. But he said that once he saw how the state was dealing with the first round of dispensary licenses, he decided to pivot and start a CBD brand just in case it didn’t happen.
“Turns out I was right.”
Hamilton ultimately left the dispensary license application process because Illinois kept adding stipulations. He found the cost of writing and submitting a social equity application—which he said could be more than $100,000—unreasonably high.
He added that commercial property owners have raised rents by thousands of dollars after learning spaces would be used as a cannabis kitchen or for a craft grower. And businesses require aldermanic approval before they can set up a dispensary. As he watched people around him go bankrupt in hopes of creating generational wealth, Hamilton pivoted to developing his CBD brand.
“I didn’t want to throw all my eggs in one basket,” he said, “and then just kind of be left holding nothing.”
Since applying, both Robinson and Hamilton have become advocates with the Social Equity Empowerment Network (SEEN), which serves the Black community nationally by helping cannabis sellers move from the legacy to the legal market. Robinson has also worked to change state laws to prevent their experiences from being replicated. Hamilton uses his business as a model for other legacy businesses to move into the mainstream market. “The goal is to get [them] above ground,” he said.
Robinson lives in Virginia now. She joined a few fruitless class-action lawsuits against the state of Illinois before moving there. She says the Illinois market is too unstable for her to encourage anyone to get involved now. “They’ve been guessing this whole process,” she said. “They’ve been putting pieces in place in real time instead of having these things in place prior” to opening the application process.
Sometimes she regrets that she wasn’t able to afford more applications, but she comes back to the fact that her business may not have gotten the necessary governmental support to succeed regardless. “These people still out here having press conferences with the governor, that’s like the fifth press conference that they done had, to petition the governor to do something to continue to fix our open wounds with a Band-Aid.”
The process caused friction between her and her family members, and one of her family members who invested $20,000 while close to retirement won’t speak to her anymore.
“To not even have a relationship with truly one of my favorite [family members] in the world is hurtful,” Robinson said. “They don’t understand the devastation that they brought to just not only individuals, but families.”
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