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How to Open a Dispensary in Virginia
Did you know that the Virginia General Assembly is the oldest continuous law-making body in the New World? Virginia is the next state we want to draw your attention to. However, this blog tells you not about the Virginia General Assembly but, as usual, guides you on how to open a dispensary in Virginia. We have tried to give you comprehensive information and keep you updated on the latest news regarding the state’s current status, types of cannabis licenses, the costs you will have to consider before you open a dispensary in Virginia, etc.
Virginia is the 17th American state and the first state in the South to legalize adult cannabis consumption. The Virginia Cannabis Control Authority was established on July 1, 2021. According to House Bill 2312 retail sales will be due to begin in 2024. The Board will set up and regulate the recreational cannabis program in the state. It will take time to get implemented since the law won’t allow the existing dispensaries to start selling to adults immediately.
The state is open to a medical marijuana business. So, If you have plans to open a cannabis business, you might be searching for ways of how to open a dispensary in Virginia. While the state continues to eliminate the shortcomings of its legislation, Virginia has a real potential for the development of the cannabis business.
What Are the Current Cannabis Laws in Virginia?
Here is the list of primary regulations related to adult use cannabis in Virginia. For more detailed information about Marijuana laws in Virginia, click here.
- Adults 21 years and older may possess, consume, and grow cannabis in Virginia after a doctor has signed off on a prescription.
- Adults who are caught with more than an ounce but less than a pound of cannabis will be fined $25.
- Adults caught possessing more than a pound of cannabis face a felony charge that carries a sentence of 1 to ten years and a fine of up to $250,000.
- Starting July, 2022 Virginia residents do not need a medical marijuana card to buy marijuana from stores.
- It is illegal to smoke cannabis in public.
- Cannabis seeds may not be purchased or sold legally, but they may be shared.
- Cannabis cannot be consumed or transported in vehicles in open or easily accessible containers by drivers or passengers.
- Cannabis-related products are only available for purchase or sale at dispensaries that are part of the state’s medicinal marijuana program.
How to Apply for a Dispensary License in Virginia?
If you want to apply for a dispensary license in Virginia, you must first apply for a Pharmaceutical processor Permit.
To get a cannabis medical license you will have to take the following point system criteria into consideration:
- Financial stability
- Security strategy and plan
- Marketing Plan
- Permission to conduct business
- Cultivation, manufacturing, dispensing expertise, and many more.
Find here detailed instructions.
As to the types of cannabis licenses in Virginia they are as follows:
Medical Marijuana Licenses
Virginia Medical Cannabis Processor is a vertically integrated license that permits license holders to cultivate medical cannabis plants and extract, process, produce and dispense CBD and THC-A oils to qualified patients.
The state of Virginia allows just five business licenses for Virginia Medical Cannabis Processors.
Recreational Marijuana License Types
Based on the Cannabis Control Authority, the recreational marijuana application process will take place in 2023. However, this may be subject to change. There will be the following license types issued in Virginia:
- Cultivation Class A (regulating a certain amount of plants per square feet)
- Cultivation Class B (regarding 1% THC)
- Dispensary License
- Wholesale License
- Manufacturer License
- Cannabis Lab
- Hemp Dealers
The priority will be granted to Social Equity Applicants. The social equity criteria in Virginia include anyone who graduated from an HBCU in Virginia; anyone with a marijuana conviction; and anyone who has lived in an area determined to be disproportionately policed for marijuana crimes. All social equity applicants will also waive a percentage of the license application fee. Applicants who match these terms will receive licensing priority from July 1st, 2023, to December 31st, 2023.
Individuals are to consider some restrictions imposed on retail establishments in the following ways:
- Only sell to customers in a direct, face-to-face setting.
- Cannot sell through:
- an automated dispensing or vending machine
- a drive-through sales window
- an Internet-based sales platform
- a delivery service
Each transaction is limited to the sale of one ounce of cannabis or its equivalent products to a single person. Also, they cannot give away cannabis.
Recreational License Requirements
The Virginia Cannabis Control Authority will set up standards to evaluate new licensees depending on Virginia’s density of retail stores. It will also clarify the adverse effects cannabis may have on public health. From July 1, 2023, to December 31, 2023, the Virginia Cannabis Control Authority will likely accept license applications. Priority will be given to:
- Qualified social equity applicants.
- Individuals with a prior cannabis conviction or a close relative with a cannabis conviction.
- Applicants living in an area with disproportionate cannabis arrests or under economic distress.
- Individuals who are graduates from a Virginia HBCU(Historically Black College or University).
Seed to Sale Tracking System
However, the cannabis dispensary license period has yet to take place, some guidelines have been made clear, including the need that marijuana dispensary businesses must use seed-to-sale software to track cannabis sales in Virginia and follow specific regulations for distribution, transportation, record keeping, security, and surveillance.
At this point, the State has not made a decision associated with cooperating with the existing seed-to-sale tracking options in the states.
How Much Does It Cost to Open a Dispensary in Virginia?
The applicants willing to open a cannabis dispensary in Virginia will have to submit:
- Application fee: $10,000 non-refundable;
- The initial permit fee is $60,000, with the application and other required documentation.
An application for an initial permit requires documentation and some reinspection fees (if applicable) and must be submitted to the Board before the inspection.
How Does the Virginia Cannabis Market Look Like Today?
The legalization of adult-use marijuana in Virginia will generate about $300 million in annual state tax revenue and create 11,000 jobs, according to a joint Legislative Audit & Revenue commission. However, legalizing recreational cannabis would not be without obstacles.
As it was said, General Assembly actions to completely legalize marijuana or establish a well-regulated commercial market to sell cannabis and cannabis products would take two or more years to get up and running. And this process will cost between $8 million and $20 million, including prevention efforts and social equity programs.
JLARC recommended that the General Assembly consider legislation to issue licenses for marijuana cultivation, processing, distribution, retail sales, and testing, among other recommendations concerning public health and safety in terms of marijuana use. To achieve this, JLARC recommends that the state license all commercial marijuana operations. It could be done using one of three models: a government-controlled distribution and retail model; a model in which vertical integration of operations is allowed; and one in which vertical integration of operations is prohibited.
A government-controlled model would leave an authority in charge of distribution and retail sales, similar to how the Alcoholic Beverage Control (ABC) operates in Virginia. Since the legal market would compete with the existing illegal market, a vertical integration market could work best for competition, JLARC notes.
Cannabis Dispensary Location
However, we don’t know the exact standards for recreational dispensary licenses in Virginia, there are a few known components that you should consider. Dispensary location is a crucial factor in opening a business in Virginia.
Like other states, there are some restrictions that you must follow regarding the location of your dispensary in Virginia. You should start by researching the areas which will likely cover the cannabis zoning ordinance. After you have found a few districts looking auspicious, you should examine specifics such as property costs, rental rates, and consumer demographics. You can prepare a list of several dispensary locations in Virginia and wait for the legislation’s feedback.
Note: Applications are currently closed for medical and adult-use cannabis licenses in Virginia. Although recreational marijuana was legalized in 2021, the 2022 General Assembly did not reenact the legislative framework for creating an adult-use market that would have allowed sales later this year. The state’s recreational market is scheduled to begin in 2024, but the timeline for the release of adult-use licensing applications is currently unknown. The Department of Health is not accepting any additional applications for medical cannabis.
Marijuana is legal in Virginia, but recreational sales are not. This leaves people to smoke with few legal options, like getting their hands on buds or entrepreneurs willing to operate under the law and come out from the shadows. Therefore, we hope that we’ve made it easy for you to determine how you may come out from the cloud of the Virginia gray area and best establish the framework for a legal market.