Belleville approves tax break for city’s first cannabis dispensary
Belleville leaders anticipate getting hundreds of thousands in sales tax revenue from the city’s first cannabis dispensary and have agreed to give the business a sales tax rebate worth up to $300,000.
The tax break agreement approved by the city council on Monday is with Mystic Greenz, which celebrated its grand opening earlier this month at 360 S. Green Mount Road in a former bank building.
Cannabis dispensaries such as Mystic Greenz are required to collect a 3% city sales tax on marijuana products sold in the store. This city sales tax is separate from a state sales tax dispensaries also are required to collect.
The Belleville agreement with Mystic Greenz calls for one third of city’s sales tax to be rebated to the business up to a cap of $100,000 in any fiscal year. The agreement is good to a maximum of $300,000 or for up to five years, whichever comes first.
Mystic Greenz commits to producing annual sales of at least $3.5 million a year and spending $1.2 million to purchase and remodel the building, according to the development agreement.
Cliff Cross, director of economic development, zoning and planning for the city, gave this projection of how the deal could work:
▪ If Mystic Greenz has annual sales of $3.5 million in its first year, then the city’s 3% sales tax would amount to $105,000.
▪ The business would then get a rebate of one-third of the city’s sales tax, which would be $35,000. Under this scenario, Belleville would keep $70,000, or two-thirds, of the city’s sales tax.
The agreement does not call for the city to give any upfront money to Mystic Greenz, which is owned by Indus 365 Belleville LLC.
Along with the commitment to produce sales revenue of $3.5 million, Mystic Greenz also must create six full-time jobs with the first year of operation and stay in business for five years.
A penalty clause calls for Mystic Greenz to repay all public funds it received if it fails to meet its obligations.
A representative from Mystic Greenz could not be reached for comment.
Cross said it would be “great” if Mystic Greenz can outpace the goal of $3.5 million in annual sales revenue and he thinks the business is positioned to be profitable.
“Cannabis is one of those developments of the future,” he said. “We’re excited to have them in our community. I think they’re going to do very well out there.
“I think it’s a great location.”
A second dispensary
The Belleville City Council has previously agreed to give a $800,000 TIF 3 grant to Blounts & Moore Holdings LLC, which plans to open a cannabis dispensary and cultivation center in a former oncology center near the intersection of Illinois 15 and South 74th Street, but this site has not yet opened.
Cross said he expects the dispensary to open in January or February. This is later than initially anticipated because the building at 7300 Twin Pyramid Parkway needed more renovation work than expected.
A development agreement approved by the Belleville City Council earlier this year states Blounts & Moore must invest $1.8 million in the dispensary and that the store is expected to have $8.5 million in annual revenue.
Illinois began allowing marijuana sales for recreational use on Jan. 1, 2020.
Last year, dispensaries statewide had sales of over $1.6 billion, according to the Illinois Department of Financial and Professional Regulation. This resulted in $417.6 million in sales tax collections in 2023, state officials said.
