Illinois warns shops against stockpiling marijuana amid shortages

CHICAGO - Illinois regulators say they are investigating apparent violations of a rule intended to prevent marijuana shops statewide from stockpiling weed from a single cultivator while also reminding retailers that they are required by law to keep enough product on hand for medical patients.

Just over a week after the state’s recreational pot sales kicked off on Jan. 1, the Illinois Department of Financial and Professional Regulation sent a letter to dispensaries on Friday saying they were aware of violations and probing whether stores were illegally sourcing more than 40% of their product from one grower. The law is aimed at preventing pot growers from entering into exclusive agreements with specific shops and making sure all stores have a diversity of products from various sources.

The warning comes as some dispensaries struggling with the pervasive supply deficit said they were worried that some companies that own both dispensaries and cultivation sites could be attempting to control the market by limiting product available to competitors. A key sponsor of the marijuana law in Illinois said pot firms were bringing those issues to the Illinois attorney general’s office, which investigates antitrust matters.

“We need to make sure that everyone’s getting access to product,” said state Sen. Heather Steans, a Chicago Democrat.

While the letter was intended to merely put the shops on notice that they need to correct any infractions, they could potentially face fines and penalties of up to $20,000 if the situation persists.

“The department is currently investigating the scope and extent of those potential violations,” wrote Bret Bender, deputy director of the state agency’s cannabis control section. “In addition, it has been reported that many dispensaries are experiencing a shortage of cannabis products, including products for medical cannabis patients.”

The acknowledgment that the medical supply has been depleted is especially concerning given that dispensaries are mandated by law to keep an dedicated stash of pot products reserved for those patients.

Toi Hutchinson, the senior adviser to Gov. J.B. Pritzker on cannabis control, declined to give the names of the dispensaries referenced in the letter. She noted that the administration will continue to “watch and track” the budding marijuana industry as it develops.

“We were serious when we said that we embedded patient protections into the law and we would use all tools to get to the bottom of what’s happening and trying to help right the system,” said Hutchinson, a former state senator who co-sponsored the law.