Virginia Lawmakers Enact Plan for Legal Cannabis Sales

RICHMOND – The Virginia Senate and House of Delegates gave final approval Monday to a budget bill that legalizes recreational Cannabis sales. Lawmakers adopted Gov. Abigail Spanberger’s proposed amendments in full, meaning the measure is now law without further action required from her office.

The outcome follows Spanberger’s veto last month of an earlier sales bill, after legislators had declined to take up her first round of proposed changes. She later worked directly with Sen. Lashrecse Aird and Del. Paul Krizek, the bills’ original sponsors, on a compromise that was written into the budget package.

Under the agreement, adults will be able to buy up to two ounces of Cannabis per transaction, double the current one-ounce possession limit. State regulators will open the application process for retail licenses on February 1. However, retail sales cannot begin before July 1, 2027, which is the later of the two dates that lawmakers and the governor debated.

The plan sets a 6% state excise tax, rising to 8% in 2029, on top of the standard 5.3% retail sales tax and a local tax option of up to 3.5 percent. Revenue is directed to the Cannabis Equity Reinvestment Fund, early childhood education, behavioral health services and public health programs, though the final language drops the fixed percentages lawmakers originally proposed for each program.

The Virginia Cannabis Control Authority will regulate the new market. Up to 350 retail licenses will be issued statewide, and localities will not have the option to bar Cannabis businesses from operating. Existing medical Cannabis operators can enter the adult-use market by paying a $10 million conversion fee.

One change has drawn pushback from advocacy groups – the civil fine for public Cannabis use rises from $25 to $250. The ACLU of Virginia, NORML, the Marijuana Policy Project and other organizations had asked Spanberger to remove the increase, pointing to Virginia Freedom of Information Act data showing Black residents are charged with public consumption at more than three times the rate of white residents relative to population. The governor’s amendments left that penalty unchanged.

Personal possession and home cultivation of Cannabis have been legal for adults in Virginia since 2021, but neither Gov. Glenn Youngkin nor Spanberger had previously signed off on a retail sales system.

For an industry that watched Virginia stall through two administrations, this agreement delivers something rarer than a launch date – a fixed planning horizon. The market that emerges in 2027 will be smaller and more heavily taxed than the version lawmakers first sent to the governor’s desk, but operators, investors and equity applicants now have defined terms to build against.