Chicago Suburb to Use Cannabis Tax to Fund Reparations Program

The decision with what to do with the money comes as the nation debates reparations for black Americans affected by the negative institutional effects of slavery and racism. 

chicago illinois iStock / Sean Pavone

With Illinois less than a month away from the beginning of a new era with recreational cannabis, one Chicago suburb has already decided what to do with the money.

When recreational marijuana comes to Evanston, Illinois in January, the money collected from the sales tax will go toward a reparations program that is going to be set up in the city.

Reparations in Illinois

Lawmakers in Evanston have approved the use of recreational marijuana sales tax to go toward a reparations program.

The vote, which took place in November, took place with a proposal to help reinvest the new revenue streams back into the suburban community, specifically, the black community. The bill passed an 8-1 vote, with Ald. Tom Suffredin of the 6th Ward, voting against it.

“We can implement funding to directly invest in black Evanston,” said Alderman Robin Rue Simmons, a black alderman who represents the city’s historically black Fifth Ward and also who proposed the reparations bill.

The money from the program will be used in the community in various ways to help not only keep the dwindling black community of Evanston but to help repay those who have suffered from The War on Drugs and those who have been affected by institutional racism. 

The new program will not only include the descendants of former slaves but to people of color who have been affected in the city. The primary goal of the program is to ensure that those who have suffered get another chance.

“Our community was damaged due to the war on drugs and marijuana convictions. This is a chance to correct that,” Simmons told The Washington Post. “Our disadvantage and discrimination has continued beyond outlawing Jim Crow and beyond enslavement.”

The training and jobs that the cannabis sales tax will fund will go back into the black Evanston community, which has decreased over the last couple of decades from 22.5 percent of the population in 2000 to 16.9 percent in 2017.

The fund will cap at $10 million dollars but could see more than $500,000 dollars enter the city annually in the next couple of years.

A committee of residents in Evanston is currently deciding on how the money will be given out. There is expected to be an emphasis on job training and housing.

The committee, known as the Equity and Empowerment Commission, “recommended property tax relief for the city’s African American longtime owners of residential property; housing repair and rehabilitation assistance for African American property owners in Evanston; down payment assistance for income-qualified African American home buyers in Evanston; and housing rental assistance for income-qualified, African American residents” and “investing in workforce training for the city’s African American Evanston residents and providing low-interest loans to African American entrepreneurs.” 

While the program will take effect in the near future, some like Simmons are hoping that the program could be used to jumpstart the conversation around reparations locally in America.

The debate over reparations have been present in America since the slave trade ended, but little has been done to actually give back.

Cannabis in Illinois

While the debate over marijuana money continues, there is still the wait for the actual marijuana.

Earlier this June, the Illinois General Assembly and Governor J.B. Pritzker signed the Cannabis Regulation and Tax Act into law, which formally authorized recreational marijuana in the state come 2020, making the state the 11th in the nation to adopt recreational cannabis.

Like other states so far, the businesses will be cash-based and only available to those above the age of 21. No public consumption is allowed and businesses will not allow customers to use any marijuana in their buildings.

Illinois became the first state to legalize marijuana through the legislature rather than through a vote, however, the state has had a medical program since 2013. With the election of Gov. Pritzker, the list of eligible illnesses increased in 2018.

The new bill put up new regulations for the plant, with personal possession of under 30 grams now being allowed, as well as new systems set for record expungement.

Illinois has previously decriminalized certain amounts, with the penalty for under 10 grams being changed to around a $100 dollar fine in 2016. 

There are 55 medical dispensaries open in the state, which have raised nearly $500 million dollars in sales since 2015. Those dispensaries already open will get the first chance to buy a permit for recreational marijuana.

By next summer, an additional 75 dispensaries are expected to open with another 110 allowed to open by 2021.

Medical patients will also get the first chance to buy cannabis come selling time, as there is expected to be shortages early on. 

Medical patients will also get to pay less with “a $50 dollar flower product and $50 edible product, it will cost medical patients $104.75, which includes state and local tax. Recreational users will pay an additional 45% in taxes, making their total price $132.50,” according to ABC7 Chicago

Taxes for marijuana products will vary on the amount of THC and the product itself. Buying any marijuana with 35 percent or lower THC will be taxed at 10 percent of the total price. Anything above 35 percent THC, will be taxed at 25 percent, while a cannabis-infused product will be taxed at 20 percent.

The program is expected to be a big moneymaker and source of income for the state which plans to generate over $58 million in general revenue in the coming budget year. In the second year, there would be $140 million in revenue and up to $500 million when the program is “fully mature,” according to lawmakers.

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