McHenry reduces number of marijuana dispensary permits it would allow

In hopes of attracting a marijuana dispensary, the McHenry City Council on Monday night changed its zoning ordinance to allow just one such business in the future.

“The idea is to secure one of these businesses” by making the city attractive to them, Community Development Director Ross Polerecky told the council.

A dispensary is currently talking to the city about a possible location there, and so Polerecky asked the council to change the number of allowed dispensaries from two to one, which it did in a unanimous vote.

Alderman Andrew Glab, who represents the 2nd Ward, asked what happened to the two companies that previously had sought to locate in the city.

Other marijuana companies have approached McHenry since 2020 about placing adult-use dispensaries in the city, Polerecky said. Neither of the previous dispensary companies ultimately received a state license, however.

As part of a license application, the state regulations suggest the dispensaries include where they would be located. It “helps the application” but is not a must-have for license approval, said Doug Martin, McHenry’s director of economic development.

The company now in talks with the city specifically asked for the one-dispensary limit, Polerecky said, noting that only Chicago currently has multiple marijuana dispensaries and two have been working with Crystal Lake but have not yet opened.

“We are working with one group that is interested. They have not secured a spot or told us for sure, but we are currently working on one,” Polerecky said.

In his department’s report to the council, Polerecky noted that the village of Richmond reduced the number of allowed dispensaries from two to one. The village of Richmond gave approval to its own dispensary Oct. 20. That location is expected to open in the spring.

“Staff is not opposed to limiting the total number of dispensaries from two to one since the city currently does not have single dispensing organization,” according to Polerecky’s report to the council.

McHenry has tried other enticements to bring a marijuana dispensary to the city, including making dispensaries a permitted use in its commercial highway district, following Lake in the Hill’s lead. That would mean the business would not require special-use permits or go through public hearings to open.

If a dispensary wanted to locate outside a commercial highway district, it would need a special-use permit and a public hearing, Polerecky said.

Changing the number of allowed dispensaries has no effect on McHenry’s marijuana infusion business at 3900 Mercy Drive, Polerecky said. That business is currently building out its facility, he said.

If a dispensary comes to McHenry, the ordinance calls for a 3% local sales tax, he added.

The change makes absolute sense, Mayor Wayne Jett said after the meeting.

“The pure fact that they are not having competition, with just one license in McHenry, will entice a cannabis company to come here,” he said.