State admits errors in pot shop lottery process, will now hold another one

State officials on Friday announced that a fourth lottery for cannabis dispensary licenses will now be held to give six applicant groups a chance to win additional permits after they were wrongfully excluded from drawings in an earlier lottery.

The latest development in the convoluted and acrimonious pot shop licensing process came just before the Illinois Department of Financial and Professional Regulation announced the final list of winners of the next 185 permits, which still can’t formally be issued due to a Cook County judge’s order.

Toi Hutchinson, Gov. J.B. Pritzker’s senior adviser on cannabis control, explained in a call with reporters that a “clerical oversight” led to some groups having less chances than they deserved and others having more shots in the July 29 lottery. The errors affected the drawings for five of the 17 regions where the licenses are designated.

The new lottery aims to give the affected firms the same odds of winning they would have had in the initial drawings, although it wasn’t immediately made clear how those odds will be determined. Additional licenses will be issued to the winners, but officials didn’t say how many could be dished out.

In a written announcement detailing the process, the IDFPR stated that other “corrective lotteries” would be used to address similar issues with the two others that have already been held. But for now, Pritzker spokeswoman Charity Greene said the only additional lottery that’s planned relates to the July 29 drawings. Given that the state’s plan has to be introduced in court, Greene said that language was included in case other problems arise and additional lotteries need to be held.

The IDFPR also acknowledged that several applicant groups “have alleged that their applications should have been eligible for one or more of the three lotteries and were incorrectly excluded.” The department, however, expects those issues to be resolved during the administrative review process.

Hutchinson noted that the rules for the planned corrective lottery would be laid out in a court order, but it’s unclear which of the seven pending lawsuits related to the licensing process would be affected or where the order would be issued.

In a hearing last month in the case in Cook County that has held up the issuance of the 185 pending licenses, Assistant Attorney General Richard Huszagh conceded that applicants were excluded from a lottery due to a “clerical error.” Huszagh added they would have to go through a supplementary process to determine if they “would have won,” which Judge Moshe Jacobius referred to as a “simulated lottery.”

During that hearing, Huzagh specifically acknowledged that one of the plaintiffs, WAH Group LLC, had lost out on a shot it deserved in the first lottery. Though Greene wouldn’t immediately provide a list of the new lottery contestants for “privacy reasons,” she said they’ll be made public before the drawings are held.

Hutchinson sought to spin the announcement of the lottery — the latest issue in a licensing rollout marked by controversy and delays — as an example of officials being “as fair as possible” throughout the process. Despite the myriad of issues, she claimed the state is making good on its push to diversify the lily white weed industry, citing the designated winners of the next batch of lucrative cannabis licenses.

“When we’re looking at the numbers that we’re getting right now, and the actual reality of how many Black and brown license opportunities have been afforded through this process, there’s no other state that comes anywhere near what Illinois has done,” said Hutchinson. “Technical problems have been absolute, and It’s been painful to watch how long this has taken.”

Now, as Hutchinson and other officials attempt to finalize the problematic rollout, the IDFPR noted in its announcement that the state plans to issue 50 more dispensary licenses next year under a new application process.