Buzzkill: Clouted pot company can’t legally move dispensary to site of old Rainforest Cafe

State law prohibits the shop from opening at 605 N. Clark St. because three other dispensaries are already nearby.

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Palatine-based PTS has teamed with a social equity firm in a bid to open a cannabis dispensary at the site of the old Rainforest Cafe, 605 N. Clark St.

The Rainforest Cafe, at 605 N. Clark St., has been empty since August 2020.

Brian Rich / Sun-Times

A cannabis firm with deep ties to city government can’t legally follow through on its plan to move a Norwood Park dispensary to the site of the former Rainforest Cafe on the Near North Side.

Palatine-based Progressive Treatment Solutions, or PTS Corp., first notified the city’s zoning administrator of its plans last December, setting in motion the process for seeking the required special-use permit from the Zoning Board of Appeals. 

PTS, which currently operates four Consume dispensaries and a cultivation center in Illinois, wants to move a dual-use pot shop from 6428 N. Milwaukee Ave. to 605 N. Clark St., which previously housed the colorful Rainforest Cafe until it closed amid the pandemic in August 2020. Block Club Chicago first reported on the company’s effort to relocate.

However, the plan appears to be a non-starter without changes to state law.

A dispensary can’t open within 1,500 feet of an existing pot shop unless it’s owned by a so-called social equity applicant, according to Chris Slaby, a spokesman for the Illinois Department of Financial and Professional Regulation. 

There are at least three dispensaries that appear to be within that distance. PTS, one of the original firms to get approval to sell pot in Illinois, does not have social equity status, a designation created to diversify the white-dominated weed business.

Dispensaries that sell medical and recreational weed, like Consume in Norwood Park, also can’t legally move outside their designated medical district, Slaby said. But PTS would need to do just that to move to the shuttered Rainforest Cafe building.

CTA_112917_13.JPG

The new CEO of cannabis firm Progressive Treatment Solutions is former CTA Board Chairman Terry Peterson (right), seen here with then-CTA President Dorval Carter (left) during a Sun-Times Editorial Board meeting in 2017.

Cannabis firm taps Terry Peterson as CEO

The company’s newly installed chief executive is Terry Peterson, a former 17th Ward alderperson who has held various roles in city government. Peterson served as an aide to former Mayor Richard M. Daley, led the Chicago Housing Authority and was chairman of the Chicago Transit Authority’s board. 

Peterson is Black, which is extremely rare among cannabis executives at businesses currently selling marijuana in Illinois. A recent IDFPR report showed that only one African American had an ownership stake in a dispensary over the past two years.

PTS has also been led in part by David Flood, a businessman whose family owns Flood Brothers Disposal, a trash-hauling company that has held lucrative contracts with city agencies. Flood previously served as the treasurer and principal officer of the influential and deep-pocketed Medical Cannabis Alliance of Illinois, which is now known as the Cannabis Business Association of Illinois. 

State records show PTS and Consume have donated at least $139,500 to state lawmakers, and PTS currently has two high-powered lobbyists working on its behalf in Springfield although it’s unclear whether any change will be made to the distance requirement during this legislative session.

In Chicago, cannabis has remained a charged issue for years. As many people of color have effectively been shut out of the industry, alderpersons have sought ways to accelerate the state’s diversity efforts — with marginal success.

Ald. Brendan Reilly, whose 42nd Ward includes the old Rainforest Cafe, didn’t respond to a request for comment on PTS’ proposed move. His wife works at a Sunnyside dispensary owned by Cresco Labs and located at 436 N. Clark St., which appears to be less than 1,500 feet from PTS’ desired location.

There is also a PharmaCann Verilife dispensary at 60 W. Superior St. and Ascend’s MOCA dispensary at 216 W. Ohio St.

Although three state-run lotteries named the winners of 185 permits that could constitute the next round of pot shops in Illinois, a Cook County judge’s order continues to block their issuance. Nevertheless, some of the winners have begun seeking zoning approval in Chicago.

One of those companies, GRI Holdings, also has considerable clout and connections to the state’s early medical cannabis industry and is also seeking to open a shop in the area once the legal issues are resolved. 

The company’s registered managers include restaurant mogul Phil Stefani, former high-ranking Chicago cop Thomas Wheeler Jr., and John Trotta, the CTA’s former vice president of purchasing and warehousing. Ashley Barry, the former director of operations for the Illinois House Republican Organization, is also serving as GRI’s community outreach coordinator.

Throughout the application process, GRI was guided by two consultants with close ties to Springfield: Ross Morreale, the co-founder of one of the state’s highly lucrative marijuana cultivation sites and brother-in-law of former state Rep. Michael McAuliffe, R-Chicago, and Jay Stewart, a former director of the Illinois Department of Financial and Professional Regulation, the agency that will issue the new pot shop licenses.

GRI earned social equity status by hiring a workforce of at least six people that meet various requirements, like living in an area that’s been harmed by the drug war or having an expungable cannabis arrest or conviction.

GRI intends to set up shop inside The Blanc, a condominium and retail space located at 612 N. Wells St. that’s apparently less than 1,500 feet from the former Rainforest Cafe. They applied for zoning approval earlier this year.

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