Virginia Senate Lawmakers Choose Between Competing Marijuana Bills, Weighing Speed Of Sales Launch Against Equity

A Senate panel in Virginia met Thursday to begin hammering out differences between two separate bills that would legalize commercial marijuana sales in the state, hearing public testimony and digging into issues such as social equity, licensing and regulatory enforcement.

While both measures—SB 423 from Sen. Adam Ebbin (D) and SB 448 from Sen. Aaron Rouse (D)—would establish frameworks allowing retail cannabis sales to begin, the proposals represent slightly different policy priorities.

Ebbin’s bill, for example, prioritizes opening the legal market quickly, by allowing the state’s existing medical marijuana operators to sell recreational products almost immediately. Rouse’s measure, by contrast, would take longer to implement legal sales, but supporters say it would put businesses on a fairer footing by not giving any one group of operators a head start.

“In this bill, no one applicant is preferred over another,” Rouse said of his legislation. “SB 448 is the only option to prevent multi-state operators from monopolizing the market and ensure that all licensees have an equal and meaningful opportunity to participate in this market.”

Sen. Scott Surovell (D), who chairs the Senate Rehabilitation and Social Services Committee’s Cannabis Subcommittee, began the meeting by asking members to choose one of the two measures to serve as the overarching framework for the proposal. While specific provisions in either bill could be amended later, he said, “we have to choose which bill to move forward with.”

Surovell also cautioned that the subcommittee would not be considering every aspect of the proposals at Thursday’s initial hearing, noting that other House panels would be better venues for certain issues.

“Number one, we’re not going to talk about the tax rate. We’re not going to talk about the revenue,” he said. “That’s for the Finance Committee.” Criminal justice matters, in turn, are set to be considered by the Courts of Justice Committee.

“And the mission of this subcommittee of the Rehabilitation and Social Services Committee,” he said, “is to talk about everything else.”

After a brief public comment round, lawmakers opted to proceed with Rouse’s SB 448 as the vehicle that will move forward, rolling Ebbin’s measure into that legislation.

The panel also accepted a substitute Rouse offered to his own bill, which a Senate staffer said was largely the same as the original version in terms of substance but was edited to be shorter in length. At 175 pages, however, it’s still a sweeping proposal.

Surovell said the panel’s goal was to hear testimony and “hopefully send something out to the full committee,” which is set to meet on Friday. If it’s received favorably, he told colleagues, the Senate Courts and Justice Committee could consider the measure as soon as next week. It would need to be advanced to the Senate Finance Committee by February 5 to stay in play this session, he added.

Marijuana Justice’s Chelsea Higgs Wise, who’s consistently called for lawmakers to prioritize equity in the legal sales plan, cheered the subcommittee’s decision to proceed with Rouse’s offered bill.

“I am excited that this is the first time since 2021 where we are not prioritizing the carveout for early sales to medical operators,” she told Marijuana Moment after the hearing. “We want to keep working to include people directly impacted within special licensing that also includes upfront capital.”

For their part, some medical marijuana operators dismissed the idea that Ebbin’s bill would have given them a leg up.

“It’s not a head start. It’s what’s necessary to launch an effective program,” said a representative for Jushi Holdings, a multi-state operator that currently does business in Virginia and at least seven other states.

Introduced two weeks ago, Ebbin’s measure would have established a microbusiness licensing program instead of a specific social equity system.

The program would offer small business licenses exclusively to eligible individuals, including veterans or people in the state from areas impacted by marijuana policing historically, and would provide technical assistance and other benefits to qualifying applicants. Medical marijuana operators would need to pay a million-dollar licensing fee to enter the legal market early and would be required to provide business incubation services to six microbusinesses.

After deciding on which bill would be the vehicle for the Senate reform, the panel on Thursday turned to more detailed aspects of equity and licensing. Wise, for example, encouraged lawmakers to consider adding a so-called “impact license” that would allow people directly harmed by the drug war to have priority access to some licenses.

She noted that under the current proposal, applicants need only to have lived or attended schools in neglected, low-income or over-policed areas. There’s no priority for people hurt directly by prohibition.

Only a minor changes were made to Rouse’s substitute bill at Thursday’s hearing, such as specifying that veterans seeking priority licensing must not have been dishonorably discharged. Most of the roughly three hours of discussion consisted of public comment on the proposal.

Among the issues that arose were THC serving sizes in edible products, the type and number of business licenses, how many a license types single person could control, how to regulate hemp-derived cannabinoids and whether law enforcement or legislators would be permitted to be licensed operators in the regulated industry.

Through another amendment, the panel nixed a provision that would have prevented lawmakers in the General Assembly from seeking cannabis licenses for a period of five years. “That is not a precedent we’re going to set up,” Surovell said. Another member also pointed out that Virginia doesn’t typically prohibit lawmakers from participating in other legal, regulated markets.

A representative from the United Food and Commercial Workers (UFCW) union said she wanted to see mandatory labor agreements required in the bill to protect workers in the cannabis industry.

“We are concerned about the lack of worker protections in this bill, specifically with labor peace agreements,” she said. “This has been in previous iterations of the bill. It’s been used in this industry in other states with great success.”

A topic raised by several speakers was opt-out language that would allow local governments to ban marijuana establishments with voter approval. Some said an opt-in provision would better respect municipal autonomy, while others recommended changes in how the ballot question would be worded.

Significant further changes are expected as Rouse’s revised SB 448 continues to make its way through the Senate. Meanwhile, a House of Delegates companion bill to Ebbin’s Senate measure—HB 698, from Rep. Paul Krizek (D)—remains in play in that chamber.

Use, possession and limited personal cultivation of cannabis by adults is already legal in Virginia, the result of a Democrat-led proposal approved by lawmakers in 2021. But Republicans, after winning control of the state House and governor’s office in the 2021 elections, later blocked the required reenactment of a regulatory framework for retail sales. In the interim, the unlicensed market has expanded.

Democrats’ victories last November to clinch control of both legislative chambers, however, have some cannabis advocates hopeful that the state could enact cannabis sales provisions this year. But that path requires building consensus among Democrats in the legislature while also passing a bill that can avoid a possible veto from Virginia Gov. Glenn Youngkin (R)—or galvanizing enough lawmakers in the polarized state to overcome a veto.

With Thursday’s meeting, that process of reconciliation is now underway.

Regardless of what specifics end up in the legal sales bill, faces a skeptical reception from Youngkin, who said earlier this month that he doesn’t have “any interest” in legalizing sales under the Democrat-led bills.

“I just don’t have a lot of interest in pressing forward with marijuana legislation,” he told reporters following his latest State of the Commonwealth address.

House Majority Leader Charniele Herring (D) said at the time that it’s “an important public safety matter that we have a regulated market.”

“The governor should be careful,” she said. “A bill gets to his desk, and he vetoes it, I’m not sure what that communication is going to be to the public about their safety.”

Youngkin’s disinterest in marijuana reform isn’t necessarily a surprise. Advocates were relieved that he committed to simply not attempt to overturn the noncommercial legalization law enacted by his Democratic predecessor in 2021.

Youngkin said he was “not against” allowing commercial sales, per se when he was first elected. He expressed that there were certain Democratic “non-starters” such as provisions setting labor union requirements for marijuana businesses—and he wanted to address concerns from law enforcement—but he generally indicated that he did believe there was a bill he could support.

That expectation has been tempered during the beginning of the new year, however.

Last session, a cannabis sales bill did advance through the Democratic-controlled Senate, but it stalled out in committee in the House, which at the time had a GOP majority.

Multiple States Across The Country See Record-Breaking Marijuana Sales To Close Out 2023