Cannabis sales tax OK'd in North Riverside

Village still needs to amend zoning code to allow it, restrict location

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By Bob Skolnik

Contributing Reporter

If a recreational marijuana dispensary opens up in North Riverside, it will have to pay a local tax of 3 percent of gross receipts to the village. At a special meeting of the village board on Sept. 23 trustees unanimously approved a three percent municipal cannabis retailers' occupation tax.

While there is no guarantee that a marijuana dispensary will locate in North Riverside when the sale of recreational marijuana becomes legal in Illinois on Jan. 1, Mayor Hubert Hermanek said that three businesses are considering applying for a license to sell marijuana in North Riverside.

"If we get one, we're lucky," said Hermanek said.

Only 75 new recreational marijuana dispensaries not linked to an existing medical marijuana dispensary will be allowed in Illinois in 2020. In addition, the existing 55 medical marijuana dispensaries in Illinois will be allowed to sell recreational marijuana and also open a second location to sell recreational pot. The state will award the licenses. 

The Illinois Department of Revenue recommended that municipalities pass a resolution imposing the tax or otherwise indicate their intention to do so prior to Oct. 1 in order to give them time to work out the process for collecting the tax and redistributing it back to municipalities where it was levied once the sale of recreational cannabis becomes legal.  

"This is kind of a preemptive strike in getting an ordinance on the books and filed with the Department of Revenue," said North Riverside Village Attorney Burt Odelson.

For a dispensary to open in North Riverside, the village will also have to approve a zoning change to make it a permitted or special use and then also vote to issue a business license. The village will have to right to impose a wide range of restrictions on the dispensary.

Hermanek told the Landmark that the Plan Commission likely would take up the matter "in the next month."

The North Riverside Economic Development Commission, an advisory group of residents and business representatives formed earlier this year by the village board, has been on record supporting the introduction of a cannabis dispensary to the village.

In June, during a presentation on the commission's vision for North Riverside's future economic redevelopment, commission chairman Jason Bianco said "it would be ridiculous for us not to pursue" a cannabis dispensary.

Hermanek in an interview last week, said that while he might not have agreed with the decision by the Illinois General Assembly to legalize the sale of cannabis for recreational use, he's not going to approach the dispensary issue from the standpoint of individual morality.

"I'm not the morals police," Hermanek said. "I'm here to keep the taxes as low as I can for the residents and keep the services as high as I can."

Hermanek said that unlike Riverside, where residential neighborhoods are immediately adjacent to commercial districts, North Riverside officials would be able to restrict the location of cannabis dispensaries to commercial districts that are more isolated from residential areas of the village.

He identified examples of such locations as the long-vacant bank building at the corner of Cermak Road and First Avenue and the strip shopping center along 25th Street, east of North Riverside Park Mall.

"We can zone it to keep that away from residents," Hermanek said.

Members of the audience at the Sept. 23 special meeting seemed to be in support of allowing recreational marijuana sales. They applauded when the cannabis tax was passed. Any revenue generated from the cannabis tax would go into the village's general fund.

One member of the audience said she thought the village should use any revenue gained from the tax to support Komarek School and the west side of North Riverside.

"The village can decide how they want to use that money," said Margaret McClellan. "The village needs to start finding tax revenue for Komarek. Komarek has been neglected by this village. It hasn't been updated since the 1970s.

Komarek School District 94 and the village of North Riverside are separate governmental entities.

Bob Uphues contributed to this report.

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