Why Virginia's 2024 Cannabis Legalization Delay is a Curious Outlier

On Sunday, February 28th, the both of Virginia's legislative chambers passed recreational cannabis legislation. This would make Virginia the first Southern state to legalize cannabis, so long as Democratic Gov. Ralph Northam's signs the bill (all indications are he will). However, this is an unusual case. Normally, when cannabis is legalized through the legislature—as opposed to a ballot initiative—legalization happens within a year of the governor signing the bill. Virginia's adult use regime won't go into effect until 2024—three years delayed.

Lawmakers defended the three-year runway by arguing they need the time to establish and ramp-up the regulatory agency responsible for overseeing its cannabis program.

The 3-year delay isn't just sales, but also legalizing possession. When asked why that delay as well, Virginia lawmakers insisted that legalizing possession before there is a legal marketplace would expand the black market. Cannabis activists point to a Virginia government study, from 2010–19 Black people on average were arrested 3.5 times more than white people for marijuana possession.

The Virginia case is interesting because it is the most delayed rollout of any legalization program through legislative action. Of the two routes to achieve legalization—legislative action and ballot initiative—legislative action is supposed to be faster and cheaper, and traditionally comes fully into effect within about a year of passing.

Take a look at some examples for adult use legalization through legislative action:

New Jersey Governor Phil Murphy just signed into legislation his states adult use laws. Decriminalization in New Jersey began immediately, and sales will begin in mid-2021.

Both Michigan and Illinois legalized adult use in 2018 and 2019 respectively, and recreational stores opened for both in 2019 and 2020.

The Vermont legislature passed possession and in-home cultivation in 2017, and the bill went into effect in 2019. Governor Phil Scott signed Vermont's adult sales legislation at the end of 2020, with stores set to open some time in 2022.

Ballot Initiatives are where we see longer delays, which are at most two years. This is because voters are asked generically whether or not they are in favor of adult use, and then the legislature needs to act within the subsequent year with enabling legislation, followed by another year when the newly created regulators create rules. In contrast to legislative action, where the bills include details.

This was the case in both Colorado and California. In Colorado, the voters passed Amendment 64 in 2012 and sales began in 2014. In California there was a 2 year delay between when Proposition 64 passed (2016) and when sales began (2018). In both cases cannabis was legal to possess when the initiatives were passed.

It is unclear what the policy motivations could be for this. Contributing to lawmakers' patience is probably its growing economy, which has risen 6x's higher than their initial fiscal year growth projections. Culturally, cannabis is still taboo in the South, and so while those in legal states view Virginia as going slow, Virginia lawmakers may view a 3-year delay as going fast. And finally, there are other elements of Virginia's legalization that need to be determined in future legislative and regulatory action, and it would be advantageous to see how the industry grows in the many other states it is legal in before making policy decisions.

With the change in the Presidential Administration adding rocket fuel to industry growth, and potential federal legalization, Virginia could better calibrate its laws to where “the puck is going."

However, the disproportionate impact of cannabis prohibition on minority and low-income Virginians should be addressed today. There is no reason to wait on implementing expungements, commuting sentences, and taking away cannabis as a predicate search or arrest from law enforcement.

We will continue to watch Virginia as it joins the community of adult-use states. To be the first Southern state to legalize cannabis is exciting, and hopefully will encourage its neighboring states to join them.