Those looking to light up in Virginia still don’t have a place to buy their supply within the state. Although the sale of recreational marijuana is now legal in the Commonwealth, the state has effectively upheld a prohibition on purchasing by sidestepping any opportunity to develop a market for retail sales.
The sale of recreational marijuana became legal on Jan. 1 under the Virginia Cannabis Control Act but there are still no regulatory provisions that would allow dispensaries to begin selling non-medical marijuana.
While the General Assembly passed the CCA in 2021, Republican House delegates blocked legislation that would provide a framework for the commercial sale of recreational cannabis products.
“We legalized the possession of cannabis by adults 21 and older but we did not at that time provide for a legal marketplace for cannabis,” Democratic state Sen. Adam Ebbin told FOX 5.
The contradictory policy left some Virginians confused and at the start of the year, many were still wondering: “Are non-medical sales to adults legal?”
According to the only frequently asked question on the Virginia Cannabis Control Authority’s (VCCA) website, when it comes to commercial sales: “No.”
The VCCA, which was established under the Cannabis Control Act, now oversees the state’s medical marijuana sales and would also be responsible for structuring commercial sales of marijuana and marijuana products. But when they will take up the task remains unclear.
“The General Assembly did not reenact the legislative framework for creating an adult-use retail market. It is possible the General Assembly may address this issue in future sessions,” the VCCA website reads.
VIRGINIA GENERAL ASSEMBLY BACK IN SESSION
“Right now, a lot of bills are being drafted and we’ve been part of that process,” said Jeremy Priess, Acting Head Officer of Regulatory, Policy and External Affairs for the VCCA.
One of those pieces of legislation is sponsored by Sen. Ebbin. He tells FOX 5 it’s being introduced Wednesday as the Virginia General Assembly convenes for the 2024 session.
“We’re trying to lay out the parameters for who would get a license on July 1 and incubate other businesses so that we can have more competition for those businesses starting on Jan. 1 and provide even more licenses starting July 1, 2025,” Ebbin said. “Cannabis has been legal to possess for several years. It should be legal to buy it.”
The senator says it’s time to develop a regulated market for cannabis sales to make sure that Virginians are getting safe products and to cut down on illegal sales and organized crime.
Under the Cannabis Control Act, adults are allowed to grow up to four plants for personal use in their homes. They are also allowed to “share.”
According to state law, “adult sharing” is “privately transferring one ounce or less of cannabis between people 21 years or older without exchanging anything else of value. The same goes for sharing seeds or starts for home growing.
What is considered illegal, however, is providing marijuana, seeds or starts to anyone for money, goods, services, or “anything else of value.” The legislation also explicitly prohibits “gifting” marijuana with the purchase of another item — a common workaround that legislators in D.C. have attempted to address as well.
The D.C. Council even took up legislation against gifting — which is when a store or business marks up the price of an item, like a sticker or a postcard, then “gives away” the marijuana with the purchase — back in 2022. Those who proposed the failed legislation argued that continuing to allow the practice left the market too open and unregulated.
“Until we can regulate the non-medical industry, we can’t allow people to come into the District to sell marijuana that’s not been tested,” Councilmember Charles Allen, a proponent of the bill, said back in 2022.
Two years later, Virginia’s Democratic legislators are making a similar argument, saying regulation is critical to public safety and market control.
“We’ve seen the health impacts of people buying cannabis or cannabis-like products that have been not tested and we want to keep it away from children,” Ebbin said. “We need to provide a means other than the black market for people to obtain a product that is tested and taxed and regulated.”
That testing and regulation is something the VCCA says it’s preparing to do. They tell FOX 5 that they plan to adopt tracking software that can ensure no illicit product enters the medical cannabis program.
“Seed-to-sell allows you — if in the event of a contaminated product — it allows you to identify that product, the source of that product, the origin of that product as quickly as possible so you can take it off the shelves, take it out of the supply chain,” Priess said.
HOW MUCH MONEY COULD VIRGINIA MAKE FROM MARIJUANA SALES?
The opportunity for the state to collect tax revenue is another key point those who want to see a marijuana market in Virginia will argue.
In neighboring Maryland, recreational marijuana sales began on July 1, 2023. The state taxes those sales at 9%, which is the same as the state’s tax on alcoholic beverage sales.
During the first weekend of legal recreational use — Friday, June 30, to Sunday, July 2 — the Maryland Cannabis Administration released a report revealing Marylanders spent over $10 million on marijuana, nearly tripling sales from the same dates in 2022 when it was only legal for medicinal use.
And the Q3 report from the Office of the Maryland Comptroller indicated that the state took in over $12 million in taxes on marijuana sales between July and September 2023.
The state’s comptroller says 35% of the revenue is used for community reinvestment and repairs, 5% goes to counties across the state, 5% to the cannabis public health fund, 5% to the cannabis business assistance fund and the remaining balance goes to the state’s general fund.
People have been flocking to Maryland to buy their buds — likely a number of Virginians among them — so for many, allowing recreational retail sales in the Commonwealth seems like a no-brainer.
“Ultimately, it’s hundreds of millions of dollars,” Ebbin said. “There was a JLARC — Joint Legislative Audit and Review Commission — study where they estimated the tax revenue could be as much as hundreds of millions of dollars a year. It was north of $200 million, I believe. But we’re going to lower the tax rate, so it would be less to start and ramp up as there are more sales.
COULD MARIJUANA SALES BECOME LEGAL IN VIRGINIA?
Despite the dollar signs some see when it comes to cannabis, Republican Gov. Glenn Youngkin’s administration has been decisively uninterested in legalizing marijuana sales.
The Daily Progress was the first to report on comments made at a Virginia Cannabis Public Health Advisory Council meeting in June 2023, stating in no uncertain terms that Youngkin has no interest in developing a market for marijuana in the state.
“Governor Youngkin has stated that he is not interested in any further moves towards legalization of adult recreational use marijuana,” said Joseph Guthrie, commissioner of the Virginia Department of Agriculture and Consumer Services. “So I wouldn’t expect that during his administration.”
The governor has said that any decision on marijuana legislation is in the hands of the General Assembly.
So, following the Democratic sweep of the state legislature in the November midterms, it’s possible that a new bill could quickly make its way to the governor’s desk. Whether he would sign off on it though, remains a big question.
“I think when a bill is on his desk he’ll have to engage in a discussion,” Ebbin said. “We’re disappointed that we’ve tried to engage him before his inauguration through now and we’re disappointed that he hasn’t really engaged on it. But when he has a bill on his desk hell have to make a decision.”
FOX 5 has reached out to Gov. Youngkin’s office for comment. We are waiting to hear back.
H/T: www.fox5dc.com
