Five years after lawmakers legalized cannabis, Virginia is poised to establish a regulated marijuana market. Legislators approved a bill creating a licensed framework for cannabis sales, which Gov. Abigail Spanberger is expected to sign.
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Virginia’s HB 642 establishes a regulated adult-use cannabis retail market for adults 21 and older. The bill permits the purchase of up to 2.5 ounces of flower or the equivalent in finished products, as defined by regulations to be developed. Edibles will be capped at 10 mg of THC per serving and 100 mg per package.
The bill caps retail licenses at 350 initially, with sales beginning Jan. 1, 2027. Existing medical operators can convert their licenses to adult-use for a $10 million fee.
Cannabis sales will be subject to a 6 percent excise tax, plus a 5.3 percent retail sales and use tax. Municipalities may add a local tax of up to 3.5 percent, though they cannot opt out of sales. They can set their own zoning limits.
The bill creates a Cannabis Equity Reinvestment Fund to support communities disproportionately affected by past cannabis enforcement through grants and economic development initiatives. Roughly 30 percent of cannabis revenue will go toward the fund, while the remaining 70 percent will support early childhood education, mental health care, and other public health initiatives.
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State lawmakers also approved separate legislation dedicated to restorative justice. The bill establishes a pathway for the resentencing or review of past cannabis-related convictions. People with criminal records, on probation, or still incarcerated may apply for review in court.
Simple possession and home grow of up to four plants have been legal since 2021. However, adults had nowhere to legally obtain regulated cannabis. Spanberger endorsed creating an adult-use market on the campaign trail and made it a priority after taking office earlier this year.
The governor has 30 days to sign or veto the bill. Given her vocal support, Spanberger is expected to sign the bill, allowing the state to move forward. The Virginia cannabis market is projected to generate $780 million in the first full year of sales and reach $1.09 billion by year two.
