“We need a formalized, legal, emerging cannabis market.”
By Marlin Adams, VCU Capital News Service
Gov. Glenn Youngkin (R) vetoed legislation to legalize retail marijuana for the second year in a row, reaffirming his opposition as the state heads into a pivotal election season.
“Anybody who thinks I’m gonna sign that legislation must be smoking something,” Youngkin said in 2024.
General Assembly lawmakers in both chambers have attempted unsuccessfully to create the retail market since 2021. Different measures have been delayed, blocked or vetoed.
As Youngkin nears the end of his term, Virginia voters will have the opportunity to decide the direction of marijuana policy in the state. The outcome of this year’s gubernatorial race, between Republican Lt. Gov. Winsome Earle-Sears and Democratic former Rep. Abigail Spanberger, could determine if marijuana retail sales are implemented.
JM Pedini, executive director of the Virginia chapter of the National Organization for the Reform of Marijuana Laws, or NORML, worked with lawmakers to help move the bills through the General Assembly.
Pedini pointed out the stakes of electing a governor who would sign an adult-use retail measure into law. Essentially, any bill could continue to get vetoed and the next gubernatorial election would be four years away.
“Then the next opportunity to enact such a measure will not be until 2030,” Pedini said.
A governor’s exit, and a key choice for voters
Earle-Sears echoed Youngkin’s views on recreational marijuana sales when he campaigned in 2021, saying “there’s no hope in that.” She said marijuana is a gateway drug, and also that she had fired a previous employee for their use of it.
Spanberger, meanwhile, has voiced support for a regulated retail market.
“We also need to make sure that [tax] revenues flow into Virginia and are used to strengthen our communities and public schools,” Spanberger told RVA Mag. “We need a formalized, legal, emerging cannabis market.”
Neither Earle-Sears nor Spanberger responded to two email requests for an interview about marijuana policy and financial impact.
What the bill proposed
The proposed bill placed a 1.125 percent sales tax and a 8 percent excise tax on any retail marijuana, marijuana-related products and paraphernalia sold. The bill would have also allowed localities the option to add up to a 2.5 percent excise tax.
The tax structure would have generated around $1.5 million in revenue in fiscal year 2026, but would have grown to $74 million over five years, according to the state fiscal impact statement.
Del. Paul Krizek (D-Fairfax), who sponsored House Bill 2485, is running for reelection and has said he plans to reintroduce the bill if Democrats regain power in the House. His counterpart in the Senate, Sen. Aaron Rouse (D-Virginia Beach), carried the companion bill. Rouse is one of six candidates vying for lieutenant governor in the Democratic primary.
Political momentum and public support
Despite the failure of multiple attempts to pass legislation, public opinion may be shifting. A Wason Center poll found last year that 57 percent of Virginia likely voters support the retail sale of marijuana.
Political expert Stephen Farnsworth, a professor of political science at the University of Mary Washington and the director of its Center for Leadership and Media Studies, is skeptical that cannabis policy alone will drive voter turnout. However, he predicts Democrats will retain their majority in the House.
“Normally, angry voters decide elections in Virginia,” Farnsworth said. “And the people who are usually the angriest the year after a presidential election are the people whose party lost the White House.”
A medical market that leaves many behind
Currently, Virginia permits medical marijuana sales through 23 licensed dispensaries.
There was a monthly average of 46,166 medical patients making a purchase in fiscal year 2024, according to data shared by the Cannabis Control Authority. The agency tracks sales by “dispensations” to customers. There was an average monthly dispensation of 314,061 in that same year.
But not all areas of the state are served equally. Health Service Area 1, which includes Shenandoah, Fredericksburg, Charlottesville, Harrisonburg and Rappahannock, has no licensed dispensary yet.
Tanner Johnson, CEO of family-owned CBD and hemp company Pure Shenandoah, hoped to change that. His company, along with 40 other companies, applied last year for a pharmaceutical processor license for HSA 1. Although 33 applicants advanced to the lottery, Florida-based company, AYR Wellness received conditional approval.
If Johnson’s company had been chosen, he said they would have been the only Virginia-based company to currently hold a pharmaceutical processor license.
“We just know a lot about this area and a lot about the patients, what their needs are,” Johnson said. “So we just thought we were a good candidate for that license.”
The CCA provides medical cannabis oversight in Virginia. It allows one pharmaceutical processor permit per each of the five HSAs. Each processor can open up to five shops to sell cannabis, with an additional shop for cultivation allowed, if approved.
Johnson said a lack of access has pushed people to find alternatives.
“Anyone from our area has to drive two hours to go to a dispensary and pay triple the price for a similar product,” Johnson said. “We’re getting a lot of those customers to come to us.”
A 2023 CCA survey found nearly 12 percent of medical patients traveled to another jurisdiction to purchase cannabis. Many cited high prices, limited products and poor access as the reason for not using state dispensaries.
Virginia has the highest price per gram among similarly situated states with medical marijuana sales, at $14 on average, according to the 2023 Cannabis Public Policy Consulting report. By comparison the price per gram was $8.73 in Washington D.C. and $9.27 in Maryland.
Many medical patients head to Washington or Maryland to purchase cannabis, although the process is different in each. Virginia patients can use their medical card in Washington but not Maryland. Adults may purchase cannabis recreationally in Maryland but they have to be 21 or older.
Why Youngkin vetoed the bill
In his recent veto message, Youngkin cited concerns about the illicit market, harm to children and potential increases in crime and psychiatric disorders.
“Attempting to rectify the error of decriminalizing marijuana by establishing a safe and regulated marketplace is an unachievable goal,” Youngkin wrote. “The more prudent approach would be to revisit the issue of discrepancies in enforcement.”
Krizek disagreed and said limiting a retail market allows criminals to benefit.
“The Governor doesn’t get it. We’ve worked hard to craft sensible, effective legislation,” Krizek wrote in an email. “They know it’s wrong to allow criminals to reap hundreds of millions of dollars while pushing dangerous unregulated products.”
With all House of Delegate seats on the ballot in addition to the governor’s race, the November election could be pivotal for marijuana policy and more. This year’s contest is also historic because both major-party nominees for governor are female.
Capital News Service is a program of Virginia Commonwealth University’s Robertson School of Media and Culture. Students in the program provide state government coverage for a variety of media outlets in Virginia.
Virginia Lawmakers Reject Governor’s Move To Limit Medical Marijuana Delivery, But Uphold Other Cannabis Bill Vetoes
