Medical marijuana companies compete for Urbana facility

When Illinois became the 20th state to legalize cannabis for medical purposes earlier this year, it was only a matter of time until medical marijuana dispensary facilities would arrive in Urbana, said Alderman Diane Marlin, Ward 7, in an interview in November.

The Compassionate Use of Medical Cannabis Pilot Program Act went into effect Jan. 1, allowing for the legal sale and use of medical marijuana. 

Four companies in Urbana are still waiting to hear back after submitting their applications for medical marijuana dispensary licenses on Sept. 22. The licenses would allow them to sell cannabis to patients diagnosed with any of the 37 debilitating medical conditions.

Libby Tyler, community development director and city planner of Urbana, said in a November interview the city received applications from Green Thumb Wellness, Phoenix Farms of Illinois LLC, The Med Men of Illinois LLC and Nu Med RX LLC.  

Despite marijuana legalization, Marlin said there is an underlying conflict between what the states are doing and what the federal government considers to be illegal activity.

The federal government still considers the selling of medical cannabis to be a drug transaction, which banks do not want to be involved with, so payments must be done with cash only, Marlin said. Once the businesses receive a response, she added, those that are approved will have to figure out how they will work under a cash basis. 

Marlin said dispensaries will charge $300 to $400 per ounce and qualifying patients can obtain up to 2.5 ounces every two weeks. She added medical marijuana will be expensive because insurance will not cover it. 

Location guidelines based on zoning ordinance amendment

The Urbana City Council unanimously voted in early August to pass a zoning ordinance amendment that specifically stated where dispensaries would be allowed.

The Illinois Department of Professional Regulations will award up to 60 medical marijuana dispensary licenses in Illinois. The four prospective businesses in Urbana have applied for licenses and are undergoing a competitive application process. Licenses are divided between the 21 police districts in Illinois based on the district’s population size.

The Champaign County police district can have up to two dispensary facilities and one cultivation center, where business owners can actively grow cannabis to be shipped to the dispensary locations, Marlin said. 

Alderman Bill Brown, Ward 4, said in a November interview the Champaign County police district extends from Decatur to Danville. Marlin said she expects one of the two dispensary facilities will be in Urbana. 

A zoning analysis of the city in the amendment requires the dispensaries to be 1,000 feet away from areas containing schools and daycare centers.

Because the product will be serving a large population, Tyler said, the city compared similar types of services in the area, such as pharmacies and clinics, when setting the parameters.

Tyler believes the dispensaries are an opportunity for economic development in Urbana.

Although there is no set deadline for license awards, Stephen Morrill, attorney at Morrill & Associates PC and representative of Phoenix Farms, said in an interview in November they are expecting to hear back some time between December and January.

Phoenix Farms was created to own and operate a medical marijuana business when the pilot program was enacted in early January 2014.

“If we are fortunate to obtain a license, medical cannabis would be available to patients some time in mid 2015, after the initial growing cycle of new cultivation centers,” Morrill said. “When the product is ready for the market, the available inventory will be sold to retail establishments.”

Morrill said the team at Phoenix Farms is looking forward to creating a positive and long-term relationship with the city of Urbana if awarded the medical cannabis dispensary license.

“We are excited to participate in a highly professional manner in this new medical market,” he said. Brown said the state has strict guidelines as to how medical cannabis can be dispensed within these facilities, but he said he is not worried the drug will be used for the wrong purposes.

As of December, Phoenix Farms and Libby Tyler said there have been no updates on the Urbana dispensary locations.

Walbert can be reached at [email protected].