New Buffalo could hurt Illinois marijuana sales
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One of many signs along I-94 between Chicago and Michigan advertising new and upcoming weed shops just over the Indiana border. Photo: Monica Eng/Axios
Cannabis megastores in New Buffalo, Michigan — just 70 miles from downtown — are luring Illinois pot consumers to Harbor Country with relatively cheap prices, freebies, large parking lots and big product selections.
Why it matters: Last year Illinois collected $417 million in cannabis taxes, which support state departments of health, agriculture and state police, as well as "communities harmed by ... the war on drugs," Illinois Department of Financial and Professional Regulation spokesperson Chris Slaby tells Axios.
- But Illinois' year-over-year cannabis sales dropped in September — from $139.5 million in 2023 to $136.5 million in 2024 — marking the first slippage since the state legalized recreational use in 2020.
- New Buffalo's recent explosion of less expensive cannabis stores could further endanger that tax revenue by tempting Illinoisans to cross state lines.
What they're saying: "Michigan continues to be a big challenge," Laura Jaramillo Bernal, COO of NuEra Cannabis, which operates several stores in Illinois, tells Crain's Chicago.
- "People are driving to Michigan to purchase. We're seeing price compression as there are more operators open here. We're all competing for a smaller piece of the pie."
State of play: Michigan legalized weed in 2019, but New Buffalo didn't start accepting dispensary applications until April 2023.
- In less than a year, the vacation town found itself inundated by 50 applications, leading to an emergency application halt in March.
- New Buffalo has granted at least two dozen preliminary approvals, and seven shops are already open in a township of about 2,500.
Monica's trip: On a recent Monday visit to JARS Cannabis in New Buffalo, the 50-car parking lot was full of vehicles bearing Illinois and Indiana license plates.
- At check-in I was asked for my driver's license and phone number and told the wait to get into the shopping area would be at least 25 minutes.
- I motored down US-12 to the smaller Pharmhouse Wellness dispensary, where the wait was just two minutes.
Price differences: Camino Midnight Blueberry gummies with 100 mg of THC cost:
- $14 at Pharmhouse in New Buffalo, plus 10% excise tax and 6% sales tax.
- $26 at Sunnyside dispensary in Wrigleyville, plus 20% excise tax and 16% recreational base tax.
Reality check: Transporting weed back to Illinois means driving at least 48 miles through Indiana where pot possession is illegal.
- But it's unclear if or how often Indiana police are catching travelers with marijuana.
- Indiana State Police told Axios reports for marijuana charges are considered "investigatory records" and thus "exempt from public disclosure under Indiana code."
The bottom line: New Buffalo's pot stores can be convenient and cheap, but shopping there could rob Illinois of much-needed tax revenue and potentially get you in trouble with Indiana police.
One sweet thing: The explosion of pot shops in the New Buffalo area coincided this summer with the opening of the town's very first Rainbow Cone shop. Coincidence?
