After serving as one of Illinois’ top cannabis regulators, Cook County Commissioner Bridget Degnen pitched herself as an expert last summer as she offered to write applications for a group seeking pot shop licenses, the Sun-Times has learned.
One applicant said it felt like Degnen, a Chicago Democrat representing the county’s 12th District, “knew what the application looked like before anyone else did.”
Details of Degnen’s mid-June meeting follow Gov. J.B. Pritzker’s announcement last week that state officials were holding up the lottery to determine the winners of the next 75 dispensary licenses. The first group of 21 finalists in the application process — which was supposed to prioritize social equity candidates in an attempt to diversify the largely white world of weed — ended up including individuals with deep pockets and connections to state politics. More than 900 applicants jilted in the first round will now have the opportunity to challenge their scores and revise their applications.
The Sun-Times has found that at least two firms that advanced to the lottery have hired former officials who worked for the Illinois Department of Financial and Professional Regulation, the agency that oversees cannabis dispensaries. Degnen also worked for nearly four years as the IDFPR’s deputy director of medical cannabis before leaving in 2017 to run for office.
The applicant who met with Degnen and asked not to be named out of fear of reprisal said she somehow “knew how these [applications] were going to get scored” — down to “every little detail.”
“She knew where the trick questions were, if you will, or the places where you might lose a point,” the applicant said of the meeting. “That was the way she described it, like, ‘I know the ins and outs. I know how to get this done.’”
The applicant said Degnen made it clear that “she was looking for the right group to get involved with” and signaled that she was potentially interested in “being a consultant.” One of the applicant’s partners, who also attended the meeting, recalled that Degnen specifically asked for a stipend for her work.
“In terms of the specifics, we never got deeper than that,” the applicant said.
Their applicant group ultimately chose not to work with her. And while they were both associated with multiple teams seeking licenses, none of them initially advanced to the lottery round.
The meeting came just over two months before Degnen and her chief of staff, Tara Meyer, quietly started a limited liability company out of the commissioner’s North Center home, according to records kept by the Illinois secretary of state’s office. Meyer had also worked as a cannabis regulator for the IDFPR and took on the same deputy director role when Degnen exited the agency. Meyer could not be reached for comment.
Degnen has refused to answer questions about the meeting, the nature of her private business and whether she’s involved with anyone applying for cannabis licenses.
“I’m not talking to you,” Degnen told a Sun-Times reporter late last week when she was asked about the company and whether she was involved with any cannabis applicants.
Looking back, the applicant who met with Degnen said the interaction “adds more color” to the concerns raised about the process.
Pot industry backing on county board
Degnen’s connections to state government and the cannabis industry proved valuable as she turned her attention to the county board.
Dan Hynes, the deputy governor for budget and economy, is Degnen’s neighbor and he supported her candidacy. Though Hynes was working in the private sector at the time and didn’t contribute to her campaign, records show that Pritzker’s campaign fund transferred $1,000 to Degnen a day before she was elected in an unopposed race in November 2018.
Companies and individuals tied to the state’s weed business have also flooded Degnen’s campaign coffers with at least $19,200 in donations, according to a Sun-Times analysis. In addition, she has collected another $25,000 from a political action committee tied to attorney Brendan Shiller, who is representing some of the lottery contestants, including a group led by his daughter.
Thousands more came from Degnen’s husband Mark, the chief financial officer at the Cinespace film studio, as well as various unions.
During the Democratic primary, Degnen promised to work “full-time” as an elected official — a clear shot at the incumbent John Fritchey, a lobbyist from Chicago.
“My problem with Fritchey is that he’s paid $85,000 to represent residents in the district, and also serves as a lobbyist for businesses within the district. I think it’s a real conflict of interest,” Degnen told Nadig Newspapers ahead of the March 2018 election.
Just over two years after beating Fritchey, Degnen filed a statement of economic interest in April that shows she received over $5,000 last year for professional services rendered to an unnamed LLC.
State records show the firm linked to Degnen and Meyer, TMBD LLC, was registered on Aug. 26, 2019, though it’s unclear whether it’s the same company cited in the statement. Applications for cannabis dispensary licenses were due Jan. 2, a day after the drug was legalized for recreational use.
TMBD’s listed agent, MS Registered Agent Services, shares the same Loop address as the law firm Much Shelist, which Global Health & Pharma magazine ranked as the country’s top cannabis practice earlier this year.
A spokeswoman for Much Shelist didn’t respond to requests for comment on the firm’s relationship to Degnen’s company.
Other ex-regulators have ties to finalists
Others involved in state government with ties to finalists in the pot lottery include State Rep. Bob Morgan, D-Deerfield, who previously worked as special counsel at Much Shelist after serving as Illinois’ statewide cannabis project coordinator when medical weed was legalized in 2014. Morgan is now a partner at Benesch, a law firm headquartered in Ohio with offices in the Loop.
Benesch’s statutory agent company, ACFB Incorporated, is listed in the state filings of three of the initial finalists for dispensary licenses. Those three groups submitted over one-third of the perfect applications needed to qualify for the delayed lottery.
Morgan, who’s touted on Benesch’s website as “one of the primary architects of [Illinois’] medical cannabis program,” said he has never worked on any pot-related applications in Illinois. Morgan added that he hasn’t practiced cannabis law in the state “in any way” since he launched his campaign for state representative in 2017.
Meanwhile, Jay Stewart, a former director at the IDFPR when medical weed was legalized, is consulting for GRI Holdings LLC, a clouted applicant group that counts restaurant mogul Phil Stefani and former Chicago Police Cmdr. Thomas Wheeler Jr. as registered managers.
And former IDFPR employee Jordan Matyas is lobbying for V3 Holdings Illinois LLC, the registered manager of one of the firms represented by ACFB Incorporated, state records show. Matyas, House Speaker Michael Madigan’s son-in-law and former assistant legal counsel, worked as a supervisor in the agency’s consumer credit section between 2005 and 2007, long before the medical cannabis program launched.