102ND GENERAL ASSEMBLY
State of Illinois
2021 and 2022
HB5570

 

Introduced 1/31/2022, by Rep. La Shawn K. Ford

 

SYNOPSIS AS INTRODUCED:
 
410 ILCS 705/Art. 43 heading new
410 ILCS 705/43-1 new
410 ILCS 705/43-5 new
410 ILCS 705/43-10 new
410 ILCS 705/43-15 new
410 ILCS 705/43-20 new
410 ILCS 705/43-25 new
410 ILCS 705/43-27 new
410 ILCS 705/43-30 new
410 ILCS 705/43-35 new
410 ILCS 705/43-40 new

    Amends the Cannabis Regulation and Tax Act. Requires the Department of Financial and Professional Regulation to issue cannabis delivery organization licenses. Contains provisions regarding applications for cannabis delivery organization licenses. Requires the Department to develop a system to score applications for cannabis delivery licenses. Provides that applicants must qualify as social equity applicants in order to be awarded a cannabis delivery organization license. Requires applicants to pay a $2,500 application fee and a prorated fee of $5,000 prior to receiving a license, to be deposited into the Cannabis Regulation Fund. Contains requirements and prohibitions for cannabis delivery organizations. Provides that cannabis delivery organizations may obtain cannabis products from any cannabis business organization licensed in the State. Contains requirements for the issuance of cannabis delivery agent identification cards. Requires the Department to conduct a background check through the Illinois State Police of specified individuals of cannabis delivery organizations. Contains provisions regarding the renewal of cannabis delivery organization licenses and agent identification cards. Contains other provisions.


LRB102 25088 CPF 34348 b

 

 

A BILL FOR

 

HB5570LRB102 25088 CPF 34348 b

1    AN ACT concerning health.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Cannabis Regulation and Tax Act is amended
5by adding Article 43, 43-1, 43-3, 43-5, 43-10, 43-15, 43-20,
643-25, 43-27, 43-30, 43-35, and 43-40 as follows:
 
7    (410 ILCS 705/Art. 43 heading new)
8
ARTICLE 43.
9
License and Regulation of
10
Cannabis Delivery Organizations.

 
11    (410 ILCS 705/43-1 new)
12    Sec. 43-1. Definitions.
13    In this Article:
14    "Cannabis courier" means a person or entity licensed to
15deliver cannabis, a cannabis-infused product, or cannabis
16paraphernalia from a dispensing organization directly to
17purchasers or directly to qualified registered medical
18cannabis patients and caregivers, but is not authorized to
19sell cannabis, a cannabis-infused product, or cannabis
20paraphernalia directly to purchasers or qualified registered
21medical cannabis patients and caregivers.
22    "Cannabis delivery operator" means a person or entity

 

 

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1licensed to purchase cannabis, cannabis-infused products, or
2cannabis paraphernalia from a cannabis business establishment
3and sell and deliver cannabis, cannabis-infused products, or
4cannabis paraphernalia from a cannabis business establishment
5directly to purchasers, but is not authorized to repackage
6cannabis, cannabis-infused products, or cannabis paraphernalia
7or operate a storefront under a cannabis delivery organization
8license. A "cannabis delivery operator" only performs the
9limited delivery of cannabis, cannabis-infused products, or
10cannabis paraphernalia directly to purchasers.
11    "Cannabis delivery organization license" means a license
12issued by the Department to a person or entity to operate as a
13cannabis courier licensee or a cannabis delivery operator
14licensee for the limited delivery of cannabis, a
15cannabis-infused product, or cannabis paraphernalia to
16purchasers.
17    "Cannabis delivery organization licensee" means either a
18cannabis courier or a cannabis delivery operator licensed by
19the Department to deliver cannabis, cannabis-infused products,
20or cannabis paraphernalia directly to consumers, and, as
21permitted by the Department, to patients and caregivers.
22    "Department" means the Department of Financial and
23Professional Regulation.
 
24    (410 ILCS 705/43-5 new)
25    Sec. 43-5. Issuance of licenses.

 

 

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1    (a) The Department shall issue cannabis delivery
2organization licenses through a process provided for in this
3Article and by rule.
4    (b) The Department shall make the application for cannabis
5delivery organization licenses at a time set by rule.
 
6    (410 ILCS 705/43-10 new)
7    Sec. 43-10. Application.
8    (a) When applying for a cannabis delivery organization
9license, the applicant shall submit the following in such form
10as the Department may direct:
11        (1) the nonrefundable application fee of $2,500 or,
12    after January 1, 2023, another amount as set by rule by the
13    Department, to be deposited into the Cannabis Regulation
14    Fund;
15        (2) the legal name of the cannabis delivery
16    organization;
17        (3) the proposed physical address of the cannabis
18    delivery organization, if one is proposed;
19        (4) the name, address, social security number, and
20    date of birth of each principal officer and board member
21    of the cannabis delivery organization; each principal
22    officer and board member shall be at least 21 years of age;
23        (5) the details of any administrative or judicial
24    proceeding in which any of the principal officers or board
25    members of the cannabis delivery organization (i) pled

 

 

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1    guilty, were convicted, fined, or had a registration or
2    license suspended or revoked, or (ii) managed or served on
3    the board of a business or nonprofit organization that
4    pled guilty, was convicted, fined, or had a registration
5    or license suspended or revoked;
6        (6) verification from the Illinois State Police that
7    all background checks of the prospective principal
8    officers, board members, and agents of the cannabis
9    delivery organization have been conducted;
10        (7) a copy of the current local zoning ordinance or
11    permit and verification that the proposed cannabis
12    delivery organization is in compliance with the local
13    zoning rules and distance limitations established by the
14    local jurisdiction, if the cannabis delivery organization
15    has a business address;
16        (8) proposed employment practices, in which the
17    applicant must demonstrate a plan of action to inform,
18    hire, and educate minorities, women, veterans, and persons
19    with disabilities, engage in fair labor practices, and
20    provide worker protections;
21        (9) whether an applicant can demonstrate experience in
22    or business practices that promote economic empowerment in
23    Disproportionately Impacted Areas;
24        (10) the identity of every person having a financial
25    or voting interest of 5% or more in the cannabis delivery
26    organization with respect to which the license is sought,

 

 

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1    whether a trust, corporation, partnership, limited
2    liability company, or sole proprietorship, including the
3    name and address of each person; and
4        (11) any other information required by rule.
5    (b) Applicants must submit all required information,
6including the information required in Section 43-35, to the
7Department. Failure by an applicant to submit all required
8information may result in the application being disqualified.
9    (c) If the Department receives an application with missing
10information, the Department may issue a deficiency notice to
11the applicant. The applicant shall have 10 calendar days from
12the date of the deficiency notice to resubmit the incomplete
13information. Applications that are still incomplete after this
14opportunity to cure will not be scored and will be
15disqualified.
 
16    (410 ILCS 705/43-15 new)
17    Sec. 43-15. Issuing licenses.
18    (a) The Department shall by rule develop a system to score
19cannabis delivery applications to administratively rank
20applications based on the clarity, organization, and quality
21of the applicant's responses to required information.
22Applicants shall be awarded points based on the following
23categories:
24        (1) suitability of employee training plan;
25        (2) security and recordkeeping plan;

 

 

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1        (3) business plan;
2        (4) labor and employment practices, which shall
3    constitute no less than 2% of total available points;
4        (5) environmental plan that demonstrates an
5    environmental plan of action to minimize the carbon
6    footprint, environmental impact, and resource needs for
7    the cannabis delivery organization.
8        (6) the applicant is 51% or more owned and controlled
9    by an individual or individuals who have been an Illinois
10    resident for the past 5 years as proved by tax records or 2
11    of the following:
12            (A) a signed lease agreement that includes the
13        applicant's name;
14            (B) a property deed that includes the applicant's
15        name;
16            (C) school records;
17            (D) a voter registration card;
18            (E) an Illinois driver's license, an Illinois
19        Identification Card, or an Illinois Person with a
20        Disability Identification Card;
21            (F) a paycheck stub;
22            (G) a utility bill; or
23            (H) any other proof of residency or other
24        information necessary to establish residence as
25        provided by rule; and
26        (7) a diversity plan that includes a narrative of not

 

 

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1    more than 2,500 words that establishes a goal of diversity
2    in ownership, management, employment, and contracting to
3    ensure that diverse participants and groups are afforded
4    equality of opportunity; and
5        (8) any other criteria the Department may set by rule
6    for points.
7    (b) Applicants must qualify as a social equity applicant
8in order to be awarded a cannabis delivery organization
9license.
10    (c) Should an applicant be awarded a cannabis delivery
11organization license, the information and plans that the
12applicant provided in its application, including any plans
13submitted for the acquiring of bonus points, shall be a
14mandatory condition of the permit. Any variation from or
15failure to perform such plans may result in discipline,
16including the revocation or nonrenewal of a license.
17    (d) Should an applicant be awarded a cannabis delivery
18organization license, the applicant shall pay a prorated fee
19of $5,000 prior to receiving the license, to be deposited into
20the Cannabis Regulation Fund. The Department may by rule
21adjust the fee in this Section after January 1, 2023.
 
22    (410 ILCS 705/43-20 new)
23    Sec. 43-20. Denial of application.
24    An application for a cannabis delivery organization
25license shall be denied if any of the following conditions are

 

 

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1met:
2        (1) the applicant failed to submit the materials
3    required by this Article;
4        (2) the applicant would not be in compliance with
5    local zoning rules or permit requirements;
6        (3) one or more of the prospective principal officers
7    or board members causes a violation of Section 43-25;
8        (4) one or more of the principal officers or board
9    members is under 21 years of age;
10        (5) the person has submitted an application for a
11    license under this Article that contains false
12    information; or
13        (6) the licensee, principal officer, board member, or
14    person having a financial or voting interest of 5% or
15    greater in the licensee is delinquent in filing any
16    required tax returns or paying any amounts owed to the
17    State of Illinois.
 
18    (410 ILCS 705/43-25 new)
19    Sec. 43-25. Cannabis delivery organization requirements;
20prohibitions.
21    (a) The operating documents of a cannabis delivery
22organization shall include procedures for the oversight of the
23organization, an inventory monitoring system including a
24physical inventory recorded weekly, accurate recordkeeping,
25and a staffing plan.

 

 

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1    (b) All cannabis delivered by a cannabis delivery
2organization must be entered into a data collection system and
3placed into a cannabis container for transport.
4    (c) Cannabis delivery organizations are subject to random
5inspections by the Department, the Department of Public
6Health, and the Illinois State Police.
7    (d) A cannabis delivery organization agent shall notify
8local law enforcement, the Illinois State Police, and the
9Department of Agriculture within 24 hours of the discovery of
10any loss or theft. Notification shall be made by phone, in
11person, or by written or electronic communication.
12    (e) No person under the age of 21 years shall be in a
13vehicle transporting cannabis goods.
14    (f) No person or individual who is not a cannabis delivery
15organization agent shall be in a vehicle while transporting
16cannabis goods.
17    (g) A cannabis delivery organization agent must keep his
18or her identification card visible at all times when on the
19property of a cannabis business establishment and during the
20transportation of cannabis when acting under his or her duties
21as a cannabis delivery organization agent. During these times,
22the cannabis delivery organization agent must also provide the
23identification card upon request of any law enforcement
24officer engaged in his or her official duties.
25    (h) A copy of the cannabis delivery organization's
26registration and a manifest for the delivery shall be present

 

 

HB5570- 10 -LRB102 25088 CPF 34348 b

1in any vehicle transporting cannabis.
2    (i) Cannabis shall be transported so it is not visible or
3recognizable from outside the vehicle.
4    (j) A vehicle transporting cannabis must not bear any
5markings to indicate the vehicle contains cannabis or bear the
6name or logo of the cannabis business establishment.
7    (k) Cannabis must be transported in an enclosed, locked
8storage compartment that is secured or affixed to the vehicle.
9    (l) The Department may, by rule, impose any other
10requirements or prohibitions on the transportation of
11cannabis.
 
12    (410 ILCS 705/43-27 new)
13    Sec. 43-27. Procurement of cannabis products. A cannabis
14delivery organization may obtain cannabis products from any
15cannabis business organization licensed in the State.
 
16    (410 ILCS 705/43-30 new)
17    Sec. 43-30. Cannabis delivery agent identification card.
18    (a) The Department shall:
19        (1) establish by rule the information required in an
20    initial application or renewal application for an agent
21    identification card submitted under this Article and the
22    nonrefundable fee to accompany the initial application or
23    renewal application;
24        (2) verify the information contained in an initial

 

 

HB5570- 11 -LRB102 25088 CPF 34348 b

1    application or renewal application for an agent
2    identification card submitted under this Article and
3    approve or deny an application within 30 days of receiving
4    a completed initial application or renewal application and
5    all supporting documentation required by rule;
6        (3) issue an agent identification card to a qualifying
7    agent within 15 business days of approving the initial
8    application or renewal application;
9        (4) enter the license number of the cannabis delivery
10    organization where the agent works; and
11        (5) allow for an electronic initial application and
12    renewal application process and provide a confirmation by
13    electronic or other methods that an application has been
14    submitted. The Department may by rule require prospective
15    agents to file their applications by electronic means and
16    provide notices to the agents by electronic means.
17    (b) An agent must keep his or her identification card
18visible at all times when on the property of a cannabis
19business establishment, including the cannabis delivery
20organization for which he or she is an agent.
21    (c) The agent identification cards shall contain the
22following:
23        (1) the name of the cardholder;
24        (2) the date of issuance and expiration date of the
25    identification card;
26        (3) a random 10-digit alphanumeric identification

 

 

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1    number containing at least 4 numbers and at least 4
2    letters that is unique to the holder;
3        (4) a photograph of the cardholder; and
4        (5) the legal name of the cannabis delivery
5    organization employing the agent.
6    (d) An agent identification card shall be immediately
7returned to the cannabis delivery organization of the agent
8upon termination of his or her employment.
9    (e) Any agent identification card lost by a cannabis
10delivery agent shall be reported to the Department of State
11Police and the Department immediately upon discovery of the
12loss.
13    (f) An application for an agent identification card shall
14be denied if the applicant is delinquent in filing any
15required tax returns or paying any amounts owed to the State of
16Illinois.
 
17    (410 ILCS 705/43-35 new)
18    Sec. 43-35. Cannabis delivery organization background
19checks.
20    (a) Through the Illinois State Police, the Department
21shall conduct a background check of the prospective principal
22officers, board members, and agents of a cannabis delivery
23organization applying for a license or identification card
24under this Article. The Illinois State Police shall charge a
25fee set by rule for conducting the criminal history record

 

 

HB5570- 13 -LRB102 25088 CPF 34348 b

1check, which shall be deposited into the State Police Services
2Fund and shall not exceed the actual cost of the record check.
3In order to carry out this provision, each cannabis delivery
4organization's prospective principal officer, board member, or
5agent shall submit a full set of fingerprints to the Illinois
6State Police for the purpose of obtaining a State and federal
7criminal records check. These fingerprints shall be checked
8against the fingerprint records now and hereafter, to the
9extent allowed by law, filed in the Illinois State Police and
10Federal Bureau of Investigation criminal history records
11databases. The Illinois State Police shall furnish, following
12positive identification, all conviction information to the
13Department.
14    (b) When applying for the initial license or
15identification card, the background checks for all prospective
16principal officers, board members, and agents shall be
17completed before submitting the application to the Department.
 
18    (410 ILCS 705/43-40 new)
19    Sec. 43-40. Renewal of cannabis delivery organization
20licenses and agent identification cards.
21    (a) Licenses and identification cards issued under this
22Article shall be renewed annually. A cannabis delivery
23organization shall receive written or electronic notice 90
24days before the expiration of its current license that the
25license will expire. The Department shall grant a renewal

 

 

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1within 45 days of submission of a renewal application if:
2        (1) the cannabis delivery organization submits a
3    renewal application and the required nonrefundable renewal
4    fee of $5,000, or after January 1, 2023, another amount
5    set by rule by the Department, to be deposited into the
6    Cannabis Regulation Fund;
7        (2) the Department has not suspended or revoked the
8    license of the cannabis delivery organization for
9    violating this Act or rules adopted under this Act;
10        (3) the cannabis delivery organization has continued
11    to operate in accordance with all plans submitted as part
12    of its application and approved by the Department or any
13    amendments thereto that have been approved by the
14    Department; and
15        (4) the cannabis delivery organization has submitted
16    an agent, employee, contracting, and subcontracting
17    diversity report as required by the Department.
18    (b) If a cannabis delivery organization fails to renew its
19license before expiration, it shall cease operations until its
20license is renewed.
21    (c) If a cannabis delivery organization agent fails to
22renew his or her identification card before its expiration, he
23or she shall cease to work as an agent of the cannabis delivery
24organization until his or her identification card is renewed.
25    (d) Any cannabis delivery organization that continues to
26operate, or any cannabis delivery organization agent who

 

 

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1continues to work as an agent, after the applicable license or
2identification card has expired without renewal is subject to
3the penalties provided under Section 45-5.
4    (e) The Department shall not renew a license or an agent
5identification card if the applicant is delinquent in filing
6any required tax returns or paying any amounts owed to the
7State of Illinois.