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Liberrtyville bans recreational marijuana sales but OKs tax in case state forces a change

Marijuana for recreational use can't be sold in Libertyville. But if that ever changes, the village will be prepared to get its cut.

State law legalized the production, sale and use of recreational marijuana for those 21 and older in January 2020, but towns also can opt out and ban sales.

That's what happened in Libertyville. Saying the uncertain monetary benefit wasn't worth the potential pitfalls, the village board in October 2019 voted 7-0 to prohibit the sale of recreational marijuana in town.

That stance has not changed and there are no planned cannabis dispensaries in the village.

But as a hedge against potential future directives, the village board agreed to impose a 3% tax - the maximum allowed - on gross receipts of recreational cannabis sold in the village.

Village Administrator Kelly Amidei described the 4-0 vote Tuesday as a clerical action to be proactive.

Finance Director Nick Mostardo advised the board to take the step as insurance against future state action.

The state is known for imposing rules on non-home rule communities, he said, and there may come a time the village is directed to allow marijuana sales.

"We want to stress this doesn't mean we're allowing recreational cannabis sales in Libertyville," he said. "We just want to be good financial stewards."

Mostardo said there is up to a six-month delay between filing the tax ordinance with the Illinois Department of Revenue and when it goes into effect. Waiting to adopt the tax until it was needed would pose a risk that early tax revenues would be forfeited, he said. Ordinances adopted and certified on or before Oct. 1 of a given year are enforced the following Jan. 1.

"We are just being prepared in case one day the General Assembly preempts us," Mostardo said. "We want that tax to be on the books so we can be collecting it Day 1."

He introduced it to the village board's finance committee in July, after learning of a modification to the state law regarding medical cannabis dispensaries.

Mostardo said it was impossible to provide a specific revenue forecast. But using the average revenue reported to the state last year by recreational dispensaries, Libertyville might expect about $250,000 in new taxes, he said.

Dispensaries for medical use are not subject to local sales taxes. Medical marijuana dispensaries are allowed in the village's industrial zoning district, but applications require review and approval by the village board.

The Lake County Board in May approved recreational marijuana sales in unincorporated areas. Communities are split on the issue, according to the county's most recent map of cannabis regulation.

According to the Illinois Department of Financial and Professional Regulation, four of the 55 dispensaries licensed to sell medical marijuana and five of the 110 licensed to sell adult use cannabis are in Lake County.

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