Illinois regulators have proposed new rules to issue at least 45 marijuana-infuser licenses by January 1, 2027, establishing a licensing process that would give qualifying hemp businesses an additional chance to win a license through a lottery.
The Illinois Department of Agriculture outlined the proposal in the October 16 edition of the Illinois Register, implementing requirements established under Public Act 104-463, which became law in June. The licenses would authorize businesses to manufacture marijuana-infused products, including edibles, beverages and other products sold through licensed dispensaries.
Under the proposal, applicants would first submit a preliminary application confirming they meet the state’s social equity requirements. If more than 45 applications are received, the department would conduct a lottery to determine which businesses advance through the licensing process. Applicants with qualifying experience in the hemp industry would receive an additional lottery entry, increasing their chances of selection.
To qualify for the additional entry, applicants must demonstrate that, by May 1, 2026, they were registered as an industrial hemp processor, held an Illinois hemp cultivation license, or operated an Illinois business that generated most of its gross receipts from selling or manufacturing hemp or hemp-derived cannabinoid products. Businesses could establish eligibility through tax returns, sales receipts, invoices or other supporting documentation.
All applicants must also satisfy social equity requirements. Businesses must be at least 51% owned by individuals meeting specified geographic and social equity criteria, including residency in qualifying economically disadvantaged areas and certain experiences involving previous marijuana offenses, justice-impacted family members or firearm-related injuries.
The proposed rules establish a nonrefundable $2,500 application fee and require the initial application window to remain open for at least 10 business days. Applicants selected through the lottery would have 45 days to submit documentation establishing eligibility. Once verified, businesses would submit a complete application covering security, employee training, product safety, manufacturing operations and financial planning.
The legislation also authorizes the department to issue up to 100 additional marijuana-infuser licenses beginning January 1, 2028, potentially expanding the number of businesses authorized to manufacture infused products in Illinois.
The proposed regulations are subject to a 45-day public comment period that began October 16. The department will review feedback before finalizing the rules governing the new licensing process.
