Virginia Senate Advances Retail Cannabis Bill, Removes Criminal Penalties

Virginia's Senate moved forward with legislation to establish legal recreational marijuana sales Tuesday, stripping out controversial criminal penalties added earlier while setting up what promises to be complex negotiations with the House of Delegates over competing visions for the state's cannabis market.

The Senate Finance and Appropriations Committee advanced the amended bill without the enhanced criminal provisions that had drawn opposition from reform advocates. The measure now awaits a full Senate floor vote, likely within the next week according to legislative staff.

Virginia legalized personal possession and home cultivation of marijuana in 2021, but lawmakers have struggled for three years to agree on a framework for commercial sales. The current impasse centers on regulatory structure, tax rates, and social equity provisions—issues that have divided the Democratic-controlled Senate and Republican-led House.

The Numbers

The Senate version would establish a 10% excise tax on retail sales, with revenue split between public education, substance abuse treatment programs, and a social equity fund designed to support entrepreneurs from communities disproportionately impacted by cannabis prohibition. Economic analysts project the mature market could generate $300-400 million in annual sales, though those estimates assume a 2025 launch date that now appears unlikely.

The House version, by contrast, proposes a 15% tax rate and directs more revenue toward law enforcement and highway safety programs. That bill also includes stricter limits on the number of retail licenses available statewide—250 in the House version versus the Senate's proposed 400.

What Changed

The criminal penalty provisions removed from the Senate bill would have increased punishments for unlicensed sales and cultivation beyond personal limits. Reform advocates argued these measures contradicted the legislature's stated goal of ending marijuana criminalization.

"We've spent three years trying to undo the damage of prohibition," said Jenn Michelle Pedini, executive director of Virginia NORML, in testimony before the committee. "Adding new criminal penalties while we're supposedly creating a legal market makes no sense."

The Senate committee voted 10-6 to remove those provisions, with three Republicans joining Democrats in support of the amendment.

Industry groups have expressed frustration with Virginia's prolonged delay in establishing retail sales. Maryland, which shares a border with Virginia and legalized adult-use cannabis through a 2022 ballot measure, launched retail sales last July. Since then, Maryland dispensaries have reported steady business from Virginia residents willing to make the trip.

What Happens Next

Assuming the Senate passes its version of the bill, legislative leaders will need to convene a conference committee to reconcile differences between the chambers. That process typically takes several weeks, and there's no guarantee lawmakers will reach agreement before the session ends in late February.

Governor Glenn Youngkin, a Republican who has expressed skepticism about marijuana legalization, has not indicated whether he would sign a retail sales bill if it reaches his desk. His administration has raised concerns about public health impacts and impaired driving, though he hasn't explicitly threatened a veto.

Policy experts suggest the three-year delay has cost Virginia significant tax revenue while allowing illicit market operators to establish themselves. Connecticut, which legalized adult-use sales in 2021 and launched retail operations in 2023, collected $32 million in cannabis tax revenue during its first six months of legal sales.

The legislative calendar adds urgency to negotiations. Virginia's General Assembly operates on a strict 60-day session schedule during odd-numbered years, leaving lawmakers roughly four weeks to finalize any agreement. If they fail to pass a bill this session, the issue won't return until 2026—extending Virginia's legal limbo into its fifth year.

Both chambers have signaled willingness to negotiate, but the gap between their positions remains substantial. Senate Majority Leader Scott Surovell told reporters last week that finding common ground on social equity provisions would be "the heaviest lift" in conference committee discussions.

This article is based on original reporting by www.marijuanamoment.net.