Virginia General Assembly Approves Legislation to More Tightly Regulate Hemp-Derived THC Products

Virginia lawmakers couldn’t agree on legislation to launch commercial adult-use cannabis sales this year, but instead approved a bill last week that would more tightly regulate hemp-derived THC products in the state.

Both chambers of the Virginia General Assembly voted Feb. 24 to send House Bill 2294 to Gov. Glenn Youngkin.

The 36-page bill establishes license requirements and stricter labeling rules for hemp-derived THC products, which are now largely unregulated and sold at gas stations and convenience stores throughout the state.

Supporters of the legislation say it is the first step toward ensuring consumer safety, the Virginia Mercury reported.

“I think this will go a long way in making sure that our communities are safe and that folks are buying what they purport to buy,” House of Delegates Majority Leader Terry Kilgore, R-Scott, said before the House vote on H.B. 2294, according to the news outlet.

In the Senate, some lawmakers cautioned that the bill could lead to an even more complex regulatory framework for cannabis in Virginia, where the Republican-controlled House of Delegates voted earlier this month to kill a bill that would have allowed a commercial adult-use market to launch in 2024.

“This is a first step toward a complete mess,” Sen. Scott Surovell, D-Fairfax, said when H.B. 2294 cleared the Senate Friday, according to the Virginia Mercury. He noted that the legislation seems to divide regulatory authority between the Virginia Department of Agriculture and Consumer Services (VDACS) and a new agency called the Virginia Cannabis Control Authority. “And the reason we’re doing this is because somebody upstairs doesn’t want to talk about it.”

Former Virginia Gov. Ralph Northam signed an adult-use cannabis legalization bill into law in April 2021, allowing adults 21 and older to possess up to an ounce of cannabis and grow up to four plants at home, but there is no way to purchase cannabis for recreational use in the state.

While the 2021 legislation set a 2024 target date to launch a commercial adult-use market, it also included a reenactment clause that requires the Virginia General Assembly to reauthorize certain provisions, including a regulatory framework for commercial sales.

RELATED: New Governor, Reenactment Clause Could Mean Changes to Virginia’s Adult-Use Cannabis Law

The Virginia House of Delegates shot down legislation sponsored by Sen. Adam Ebbin, D-Alexandria, on Feb. 14 that would have allowed the state’s licensed medical cannabis dispensaries to begin adult-use sales on Jan. 1, 2024. The bill, which was similar to legislation Ebbin proposed last year that also died in the House, would have also allowed regulators to issue adult-use retail licenses to businesses owned by those who reside in disadvantaged communities.

Youngkin backed H.B. 2294 and is expected to sign the bill into law, according to the Virginia Mercury, but Ebbin has said that he would prefer to see adult-use cannabis sales launch at state-licensed dispensaries, which he said would reduce consumer demand for “cheap substitutes at gas stations and convenience stores.”

In addition, a few lawmakers in Richmond noted that some hemp industry stakeholders might also be less than pleased with the legislation.

“We’re putting in place a mechanism to get them off the shelves,” Sen. Emmett Hanger, R-Augusta, said, according to the news outlet.

Last year, the Virginia General Assembly created a 16-member task force to study the issue of delta-8 and other hemp-derived THC products being sold in the state. The task force issued a report in December that recommended policy changes to better regulate these products, including requiring businesses selling them to have a state-issued license.

RELATED: Virginia Task Force Recommends Stricter Rules on Hemp-Derived Delta-8 THC

Lawmakers seem to have taken that recommendation to heart, as H.B. 2294 would require all businesses selling “an industrial hemp extract or food containing an industrial hemp extract” to hold a valid state-issued permit, the Virginia Mercury reported. The permit holders would then be allowed to sell products containing up to 0.3% THC and 2 mg of THC per package.

H.B. 2294 also includes new labeling regulations for hemp-derived THC products that would require both the percentage and milligrams of THC per package and per serving to be listed on the labels, according to the Virginia Mercury.

The new labeling rules would also bar any hemp-derived THC products from being marketed as curing, treating or preventing any disease, the news outlet reported.

The bill proposes fines of up to $10,000 per day for violations.

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