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CHAMPAIGN — Two years after the sale of cannabis for recreational use became legal in Illinois, state dispensaries are still seeing a lot of green.

Illinois’ 110 dispensaries sold a total of $1.38 billion in recreational-marijuana products in 2021, more than doubling 2020’s sales total of $669 million.

Recreational sales hit a record high in December 2021, with $138 million in sales last month, according to the Illinois Department of Financial and Professional Regulation.

Local dispensaries felt the effects.

Sunnyside Dispensary in Champaign has seen a “steady month-over-month increase in sales for nearly the entire year,” said Jason Erkes, spokesman for parent company Cresco Labs.

Sunnyside locations closed out the year with “really strong numbers,” thanks to customers taking advantage of end-of-year promotions and buying weed-centered gifts and “using it as a way to manage spending so much time with family members at holiday gatherings,” Erkes added.

It was a similar story for NuEra’s five Illinois dispensaries. Its three original medical/recreational stores in Urbana, Chicago and East Peoria posted a 22 percent increase in revenue this year, marketing director Jason Rapino said.

Counting newly opened locations in Pekin and Campustown, NuEra’s revenue grew by 44 percent in 2021. It opened a location in Aurora in late December.

Rapino and Erkes agree that the stresses of the pandemic have led to more “canna-curiosity,” where new customers seek out weed products to ease anxiety, new sleep issues, smaller appetites and more.

“People got used to that in 2020, and they became loyal customers when they think, ‘This is really working for us,’” Rapino said. “Then 2021 comes along. More dispensaries are opening up, more products are being made by cultivators in Illinois, and you have a new, excited customer base, which leads to explosive growth.”

NuEra’s Campustown location opened in April, right next to the new Kam’s at First and Green streets. Rapino said business ebbs and flows with the 21-plus crowd on campus, with lighter sales when University of Illinois students are on break.

“Champaign is still so new, we’re still doing marketing campaigns just to let people know that we have a location in Champaign,” he said. “A lot of people in that area still don’t even know.”

Getting the Champaign sales up to par with the flagship Urbana location is a “big goal for 2022,” he added.

Getting down to grass tax

Statewide, marijuana was more profitable than alcohol in 2021.

Overall, tax revenue from sales of cannabis totaled $387.7 million in 2021, nearly $100 million more than tax revenue from liquor sales.

Illinois broke its statewide sales records despite having some of the highest marijuana taxes in the nation.

Wholesale cannabis is taxed at 7 percent when sold by cultivators.

Retail products are taxed based on their THC content. The rate is 10 percent for THC concentrations below 35 percent and 25 percent for concentrations above that. Products infused with cannabis, such as edibles, are taxed at 20 percent.

Products are also subject to the state’s 6.25 percent sales tax and local taxes: Champaign and Urbana each apply a 3 percent tax to cannabis products.

Neither of the cities’ finance departments can disclose this year’s revenue from the cannabis tax. The Illinois Department of Revenue doesn’t allow them to share the data unless it concerns five or more dispensaries.

However, the state does distribute 8 percent of of Cannabis Regulation Fund revenues among local governments. Since March 2020, Champaign has received $160,303.71.

About 25 percent of the state’s cannabis taxes fund grants in the Restore, Reinvest, Renew program for communities negatively impacted by drug-war-era policies. Another 20 percent is pledged toward substance-abuse prevention and mental-health care.

Rapino said higher taxes allow for “legacy” or black-market weed to remain a stiff competitor for many dispensaries, especially in college towns.

“If you had a drop in taxes, I think you would see an explosion in the number of customers coming to cannabis dispensaries,” he said.

Ethan Simmons is a reporter at The News-Gazette covering the University of Illinois. His email is esimmons@news-gazette.com, and you can follow him on Twitter (@ethancsimmons).

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