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HomeMy WebLinkAboutRetail Cannabis UpdateCannabis Legislation Update Amanda C. Jarratt, Deputy City Manager Hannah Sabo, Zoning Administrator July 7, 2026 1 Purpose •Provide an overview of the adopted Cannabis Legislation •Provide an overview of potential zoning regulations to be implemented in the City of Virginia Beach •Provide an overview of local taxation authority of cannabis •Provide an overview of next steps and proposed timeline of approvals CANNABIS LEGISLATION UPDATE 2 State Code Change CANNABIS LEGISLATION UPDATE 3 •Currently only medical cannabis sales are permitted •State Code change allows retail sales of cannabis starting July 1, 2027, with the state application process tentatively scheduled to begin February 1, 2027, and issuance beginning in May of 2027 Virginia Cannabis Control Authority Virginia Cannabis Control Authority •Issues licenses •Notifies local governments of a preliminary license approval and providing localities 30 days to issue any objections •Promulgate regulations that may include: •Setting a limit to the number of licenses that will be available in each locality •Setting a minimum distance required between retail establishments and between retail establishments and microbusinesses CANNABIS LEGISLATION UPDATE 4 Cultivation Authorizes the licensee to cultivate, label, and package marijuana. Five tiers ranging from a maximum canopy of 5,000 sq. ft. to 35,000 sq. ft. State Regulations include, but are not limited to: •Licensee shall track the marijuana it cultivates from seed or immature marijuana plant to the point at which the marijuana plant is transported or transferred or destroyed •Shall meet all sanitary and security standards specified in regulations adopted by the Board § 4.1-800. Marijuana cultivation facility license CANNABIS LEGISLATION UPDATE 5 Processing Authorizes the licensee to process, label, and package marijuana and marijuana products. State Regulations include, but are not limited to: •Licensee shall track all marijuana to the point at which the marijuana plant is transported or transferred or destroyed •Shall meet all sanitary and security standards specified in regulations adopted by the Board § 4.1-801. Marijuana processing facility license CANNABIS LEGISLATION UPDATE 6 Retail Use Permits the sale of: marijuana, marijuana products, marijuana paraphernalia, immature marijuana plants, or marijuana seeds to consumers in person or through a licensed marijuana delivery operator. State Regulations include, but are not limited to: •Must be 21 or older to purchase •No drive-through sales windows or vending machines •No sales of more than 2 ounces during a single transaction to one person •No internet sales platform operated by a third party •Cannot exceed 2,500 square fee of retail floor space § 4.1-802. Retail marijuana store license CANNABIS LEGISLATION UPDATE 7 Retail Use cont’d State Regulations continued: •Cannot be located within 1,000 feet of any hospital; public, private, or parochial school or institution of higher education; or child day program (locality may reduce the 1,000 feet limit, it cannot increase) •Cannot be located in an area that will adversely affect real property values or substantially interfere with tranquility of residential area 8CANNABIS LEGISLATION UPDATE 8 § § 4.1-02. Retail marijuana store license Microbusiness Authorizes marijuana cultivation, marijuana processing, and retail marijuana sales on the same premises. Cultivation of marijuana is limited to a canopy of 5,000 sq. ft. indoors and 10,000 sq. ft. outdoors. State Regulations include, but are not limited to: •Must follow all statutory requirements listed for individual licenses •Microbusiness licensee shall not hold or control any other license and may operate only one licensed premises § 4.1-803. Microbusiness license CANNABIS LEGISLATION UPDATE 9 Transporter Authorizes the licensee to transfer possession of marijuana, marijuana products, immature marijuana plants, and marijuana seeds from a licensed facility to another licensed facility State Regulations include, but are not limited to: •Licensee shall track all marijuana to the point at which the marijuana plant is transported, transferred, or destroyed •Shall meet all sanitary and security standards specified in regulations adopted by the Board § 4.1-804. Marijuana transporter license.CANNABIS LEGISLATION UPDATE 10 Delivery Authorize the licensee to take marijuana or marijuana products from a retail marijuana store or microbusiness and deliver such marijuana or marijuana products only in-person to consumers at any residence, including a temporary residence, or business. State Regulations include, but are not limited to: •Delivery is not permitted to: (i) any military base, child day center, school, or correctional facility; (ii) the State Capitol; (iii) hospital; (iv) marine terminal under the supervision of the Virginia Port Authority; or (v) any public gathering places, including sporting events, festivals, fairs, races, concerts, and terminals of public transportation companies •Licensee shall track all marijuana to the point at which the marijuana plant is transported, transferred, or destroyed § 4.1-805. Marijuana delivery operator license. CANNABIS LEGISLATION UPDATE 11 Testing Facility Authorizes the licensee to develop, research, transport, or test marijuana, marijuana products, and other substances. State Regulations include, but are not limited to: •Licensee shall track all marijuana to the point at which the marijuana plant is transported, transferred, or destroyed •Shall meet all sanitary and security standards specified in regulations adopted by the Board § 4.1-806. Marijuana testing facility license.CANNABIS LEGISLATION UPDATE 12 Regulation Options Most restrictive option: Require a Conditional Use Permit (CUP) in each proposed district Least restrictive option: Allow uses by-right in each proposed district Zoning regulation options: •Hours of operation •Distance from other uses •Location in districts •Signage •Building footprint and location •Security plan •How the use is permitted CANNABIS LEGISLATION UPDATE 13 Staff’s Recommendation- Cultivation By-Right: •AG-1 Agricultural District •AG-2 Agricultural District •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 14 Staff’s Recommendation - Cultivation 15CANNABIS LEGISLATION UPDATE 15 Proposed regulations: 1.Any outdoor signs placed on the property of a marijuana establishment shall not •display imagery of marijuana or the use of marijuana or •draw undue attention to the facility, but may be designed to assist consumers to find the marijuana establishment 2.Compliance with all state regulations 3.A security plan will be submitted for review and approval by the Virginia Beach Police Department Staff’s Recommendation- Processing By-Right: •AG-1 Agricultural District •AG-2 Agricultural District •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 16 Staff’s Recommendation - Processing CANNABIS LEGISLATION UPDATE 17 Proposed regulations: 1.Any outdoor signs placed on the property of a marijuana establishment shall not •display imagery of marijuana or the use of marijuana or •draw undue attention to the facility, but may be designed to assist consumers to find the marijuana establishment 2.Compliance with all state regulations 3.A security plan will be submitted for review and approval by the Virginia Beach Police Department Staff’s Recommendation- Retail Conditional Use Permit: •B-1A Limited Community Business •B-2 Community Business •B-3 Central Business •B-4 Mixed Use By-Right: •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 18 Staff’s Recommendation - Retail 19CANNABIS LEGISLATION UPDATE 19 Proposed regulations: 1.Hours of retail operation limited to Monday – Saturday 10 a.m. – 9 p.m. Sunday 10 a.m. – 6 p.m. 2.Not permitted within 1,000 ft of a hospital, school, higher education, child day program, or another retail cannabis establishment 3.Limitations on signage 4.Drive-through facilities not permitted 5.The allowable square footage of retail floor space shall not exceed 2,500 sq. ft. 6.Compliance with all state regulations 7.A security plan will be submitted for review and approval by the Virginia Beach Police Department Proposed Standard CUP Condition: 1.State licensure must be obtained within 365 days of the CUP approval Staff’s Recommendation- Microbusiness Conditional Use Permit: •B-1A Limited Community Business •B-2 Community Business •B-3 Central Business •B-4 Mixed Use By-Right: •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 20 Staff’s Recommendation - Microbusiness CANNABIS LEGISLATION UPDATE 21 Proposed regulations: 1.Hours of retail operation limited to Monday – Saturday 10 a.m. – 9 p.m. Sunday 10 a.m. – 6 p.m. 2.Not permitted within 1,000 ft of a hospital, school, higher education, child day program, or another retail cannabis establishment 3.Limitations on signage 4.Drive-through facilities not permitted 5.The allowable square footage of retail floor space shall not exceed 2,500 sq. ft. 6.Compliance with all state regulations 7.A security plan will be submitted for review and approval by the VB Police Department Proposed Standard CUP Condition: 1.State licensure must be obtained within 365 days of the CUP approval Staff’s Recommendation- Transporter By-Right: •AG-1 Agricultural •AG-2 Agricultural •O-1 Office •O-2 Office •B-2 Community Business •B-3 Central Business •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 22 Staff’s Recommendation - Transporter 23CANNABIS LEGISLATION UPDATE 23 Proposed regulations: 1.Sign regulations 2.Compliance with all State regulations 3.A security plan will be submitted for review and approval by the Virginia Beach Police Department Staff’s Recommendation-Delivery Operator By-Right: •B-1A Limited Community Business •B-2 Community Business •B-3 Central Business •B-4 Mixed Use •B-4C Central Business Mixed Use •B-4K Historic Kempsville Area Mixed Use CANNABIS LEGISLATION UPDATE 24 Staff’s Recommendation – Delivery Operator Proposed regulations: 1.Sign regulations 2.Compliance with all state regulations 3.A security plan will be submitted for review and approval by the Virginia Beach Police Department CANNABIS LEGISLATION UPDATE 25 Staff’s Recommendation- Testing Facility Conditional Use Permit: •AG-1 Agricultural •AG-2 Agricultural •O-1 Office •O-2 Office By-Right: •I-1 Light Industrial •I-2 Heavy Industrial CANNABIS LEGISLATION UPDATE 26 Staff’s Recommendation – Testing Facility Proposed regulations: 1.Sign regulations 2.Compliance with all state regulations 3.A security plan will be submitted for review and approval by the Virginia Beach Police Department Proposed Standard CUP Condition: 1.State licensure must be obtained within 365 days of the CUP approval CANNABIS LEGISLATION UPDATE 27 Consumption •No Public Consumption is permitted in the Commonwealth •Fine increases from $25 to $250 (effective date July 1, 2027) •Locality may adopt an ordinance that prohibits use in public parks, playgrounds, public streets, or any sidewalk adjoining a public street and the locality may prescribe a violation of such ordinance •Operating a vehicle while under the influence is not permitted in the Commonwealth •Consumption is only allowed on private property with the owner's permission •Virginia will be the 24th State, and Washington D.C., to allow recreational use of marijuana •Out of the 23 states and D.C., all but 4 do not allow public consumption •The 4 that allow public consumption have limited areas, which normally relate to areas where tobacco can be used CANNABIS LEGISLATION UPDATE 28 Messaging Current Messaging CANNABIS LEGISLATION UPDATE 29 Messaging cont'd Communications Strategy & Rollout •Create a unified messaging framework for all City communications •Develop a timeline and strategy for public updates leading up to 2027 and beyond •Ensure consistent messaging across departments and platforms Key Messages •Preparing our City for a safe, responsible and community-aligned cannabis future •As cannabis retail approaches, our City is committed to a rollout that protects residents and supports local opportunity •The City of Virginia Beach is planning ahead for community-aligned ongoing messaging with thoughtful zoning, coordinated services and policies that support orderly and responsible growth CANNABIS LEGISLATION UPDATE 30 Messaging cont'd 2 Overall Goal •To develop and communicate a comprehensive local framework that ensures the safe, orderly and community-aligned integration of cannabis businesses into the City once statewide retail sales begin in 2027. Campaign Tactics (Not All) •Webpage with ongoing updates •Blog Post/FAQ page •Social media content (Instagram Reels, Facebook) •Press release/Media Advisory •Media Interviews •Collaboration with Virginia Beach Police Department, Virginia Beach Fire Department, Code Enforcement and other relevant departments •Generic flyer •Community organization outreach CANNABIS LEGISLATION UPDATE 31 Taxation Authority 32 •The adopted legislation implements a 6% State cannabis tax before July 1, 2029 and at the rate of 8% after July 1, 2029 •The distribution of state generated revenue will be restricted to the following categories as part of the Commonwealth's budget process: •Early childhood care and early childhood education •Cannabis Equity Reinvestment Fund •Department of Behavioral Health and Developmental Services •Public health programs •Localities are authorized to adopt an additional 1%-3.5% local tax •The City of Virginia Beach intends to recommend the adoption of a tax rate at 3.5% CANNABIS LEGISLATION UPDATE 32 Next Steps •Update various City Boards, Commissions and Public Outreach •Planning Commission Vote •City Council Vote •Adoption prior to February 1, 2027 •New ordinance effective July 1, 2027 CANNABIS LEGISLATION UPDATE 33 DISCUSSION THANK YOU CANNABIS LEGISLATION UPDATE 34