Update: Virginia Legalizes Adult-Use Cannabis

On April 7, 2021, Virginia legalized adult-use cannabis, allowing adults 21 and over to possess up to an ounce of cannabis beginning July 1, 2021.  Individuals will also be permitted to cultivate plants for personal use beginning on July 1, 2021.  Previously, the State Senate and House of Delegates reached a compromise between their two bills (S.B. 1406 and H.B. 2312, respectively) on Saturday, February 27, 2021.  This compromise originally would not allow for legal sales or possession until January 1, 2024.  Governor Northam initially did not sign the bill, and sent the bill back to the Virginia legislature requesting that they change the date on which possession and cultivation would be legalized to July 1, 2021.  The legislature adopted Governor Northam’s amendment, paving the way for legalization.  Sales will not begin until January 1, 2024.  The law provides for:

• Possession by adults 21 and over of up to one ounce of cannabis beginning July 1, 2021;
• The cultivation of up to four plants per household, of which at most two plants can be mature beginning July 1, 2021;
• The expungement and sealing of certain cannabis-related convictions, and adjustment of sentences for other cannabis-related convictions;
• The implementation of a 21% retail tax, as well as empowering localities to levy an additional 3% tax. Of the 21% excise tax, 40% will be dedicated to pre-school for at-risk children, 30% will be dedicated to an equity reinvestment fund, 25% will be dedicated to addiction prevention and treatment services; and 5% will be dedicated to public health;
• The establishment the Virginia Cannabis Control Authority in order to regulate sales, cultivation, and manufacture of cannabis products;
• Localities may opt-out of allowing retail establishments by referendum before December 31, 2022.

However, quite a lot of work has been left undone.  Decisions as to how the retail marketplace will operate have not-yet been made, nor have decisions regarding criminal penalties for underage possession and unlicensed cultivation and sale been finalized.  Additional action will need to be taken by the legislature to allow for licenses to be issued in time for retail sales to begin January 1, 2024.  The law received no votes from Republican legislators, and ultimately required Lt. Gov. Fairfax to cast a tie-breaking vote in the Senate, leading some to fear that if Democrats lose seats in this year’s elections Virginia will be unable to pass the needed legislation next year.  We will continue to monitor Virginia’s legalization process.