Virginia Law

A. The Authority shall announce the commencement of a licensing period in advance of accepting applications for marijuana establishment licenses. At a minimum, the announcement shall include:

1. The types of licenses that will be available during the licensing period;

2. If the Board limits the number of a type of license that will be available, the number of that type of license available in the licensing period;

3. The date on which the Authority will begin accepting applications; and

4. The date on which the Authority will no longer accept applications.

B. Every person intending to apply for any license authorized by this subtitle shall file with the Board an application on forms provided by the Board and a statement in writing by the applicant swearing and affirming that all of the information contained therein is true.

C. Such applications, including applications for renewal, shall include any information necessary for the Board to determine whether the applicant meets or continues to meet the criteria set forth in subdivision B 13 of § 4.1-606. If the Authority receives an application that fails to include such required information or an applicant fails to pay the applicable application fee as required by subsection K, the Authority shall issue a deficiency notice to the applicant. The applicant may submit the required information or pay the required application fee within 10 calendar days from the date of the deficiency notice. Failure by an applicant to submit all required information or pay the application fee within such 10-day period shall result in the application being rejected.

D. After an applicant submits an application that contains all required information and pays the applicable application fee, the Authority shall review the application. The Authority may deny an application if:

1. The application is incomplete;

2. The application contains a materially false statement about the applicant or omits information required;

3. The applicant meets any condition set forth in § 4.1-810;

4. The applicant is prohibited from holding the license under this subtitle;

5. The applicant fails to pay the applicable application fee;

6. The application was not submitted by the application deadline;

7. The applicant submitted more than one application for a license type; or

8. The Authority determines that the applicant would be prohibited from holding a license for any other reason.

If the Authority denies an application, the Authority shall notify the applicant of the denial and the basis for the denial. The Authority may request additional information from any applicant if the Authority determines that the information is necessary to review or process the application. If the applicant does not provide the additional requested information within 10 calendar days of the Authority's request for information, the Authority may deny the application. An applicant whose application is not denied pursuant to this subsection is a qualified applicant.

E. If the number of qualified applicants seeking a type of license exceeds the number of licenses of that type that are made available, the Authority shall first conduct a lottery to select qualified applicants for preliminary license approval. If the number of impact licensee applicants seeking a type of license exceeds the number of licenses made available for impact licensee applicants, the Authority shall first conduct a lottery consisting of impact licensee applicants to select applicants for preliminary license approval. If an impact licensee applicant is not selected in a lottery conducted under this subsection, the Authority shall include the impact licensee applicant in the pool of qualified applicants for licenses of that type that are made available to all applicants. A lottery conducted pursuant to this subsection shall be impartial, random, and in a format determined by the Authority.

F. Following the completion of any lottery conducted pursuant to subsection E, the Authority shall notify each applicant entered in the lottery that the applicant was either selected in the lottery for preliminary license approval or not selected in the lottery. Within 18 months of receiving notice that an applicant was selected in the lottery for preliminary license approval, such applicant shall provide:

1. The address and legal property description of the location where the marijuana establishment will operate;

2. The name of the local governing body where the marijuana establishment will be located;

3. If applicable, an updated description of the location where the marijuana establishment will operate, an updated security plan, and any other additional information required by the Authority; and

4. For applicants for licenses for establishments that are otherwise required to obtain an inspection by the Department of Agriculture and Consumer Services, proof of inspection or proof of a pending request for such inspection.

A preliminary license approval expires after 18 months unless the Authority revokes the preliminary license approval or grants an extension. The Authority may grant a one-time extension of up to six months if an applicant has made good faith efforts to convert a preliminary license approval into a license. The Authority shall not issue a license to an applicant whose preliminary license approval has expired. If the Authority determines that an applicant is not eligible for a license, the Authority may revoke a preliminary license approval. The Authority shall notify an applicant if the Authority revokes the applicant's preliminary license approval or if the applicant's preliminary license approval expires.

G. Upon receipt of the information required under subsection F from an applicant that has received preliminary license approval, the Authority shall (i) notify the local governing body of the applicant through the town manager, city manager, county administrator, or other designee of the locality; (ii) schedule a site inspection; and (iii) require the applicant to pay the applicable license fee established pursuant to § 4.1-1002. Local governing bodies notified pursuant to clause (i) shall submit any objections to the granting of a license within 30 days of the Authority's notification;

H. The Authority may deny final authorization of a license if:

1. An applicant fails to submit any required information;

2. The applicant submits a materially false statement about the applicant or fails to provide any required information;

3. The Authority confirms that the marijuana establishment for which the Authority granted preliminary license approval does not meet local zoning and land use laws;

4. The applicant fails to pay the applicable license fee;

5. The applicant meets any condition set forth in § 4.1-810; or

6. The Authority determines that the applicant is disqualified from holding the license or would operate in violation of the provisions of this subtitle.

I. Within 90 days of receiving the information required under subsection F and the results of any required background check pursuant to subsection J, the Authority shall grant final authorization and issue the appropriate license or send the applicant a notice of rejection setting forth the specific reasons that the Authority did not issue the license. If final authorization is granted and a license is issued to an establishment that is otherwise required to obtain an inspection by the Department of Agriculture and Consumer Services and such licensee provided proof of a pending request for such inspection pursuant to subdivision F 4, such license shall authorize the licensee to purchase marijuana, marijuana products, immature marijuana plants, or marijuana seeds in accordance with the provisions of this subtitle; however, the licensee shall not sell marijuana, marijuana products, immature marijuana plants, or marijuana seeds until an inspection is completed.

J. The Board, in conjunction with an accredited law-enforcement agency, shall conduct a background investigation, including a criminal history records check and fingerprinting, of the following individuals: (i) every individual applying for a license or permit pursuant to this subtitle; (ii) every individual who is an officer, director, or principal of a licensee or applicant for a license; and (iii) all permit holders and officers, directors, and principals. Each such individual shall submit his fingerprints and personal descriptive information to the Central Criminal Records Exchange to be forwarded to the Federal Bureau of Investigation for a national criminal records search and to the Department of State Police for a Virginia criminal history records check. The results of the background check and national and state criminal records check shall be returned to the Board. Notwithstanding the foregoing, the Board may accept a third-party local and national criminal background check submitted by any such individual specified in clause (i), (ii), or (iii) in lieu of a fingerprint-based national criminal history records check. Any such third-party background check shall (a) be conducted by a third-party consumer reporting agency or background screening company that is in compliance with the federal Fair Credit Reporting Act (15 U.S.C. § 1681 et seq.) and accredited by the Professional Background Screening Association and (b) include a multistate and multi-jurisdiction criminal record locator or other similar commercial nationwide database with validation and other such background screening as the Board may require. The applicant shall request such background check not more than 60 days prior to submission of the application.

In considering criminal history record information, subject to the provisions of subdivision B 1 b of § 4.1-810, the Board shall not disqualify an applicant because of a past conviction for a marijuana-related offense.

K. Each applicant shall pay the required application fee at the time the application is filed. The license application fee shall be determined by the Board and shall be in addition to the actual cost charged to the Department of State Police by the Federal Bureau of Investigation or the Central Criminal Records Exchange for processing any fingerprints through the Federal Bureau of Investigation or the Central Criminal Records Exchange for each criminal history records search required by the Board. Application fees shall be in addition to the state license fee required pursuant to § 4.1-1001 and shall not be refunded.

L. Subsection B shall not apply to the continuance of licenses granted under this subtitle; however, all licensees shall file and maintain with the Board a current, accurate record of the information required by the Board pursuant to subsection C and notify the Board of any changes to such information in accordance with Board regulations.

M. Every application for a permit granted pursuant to § 4.1-808 shall be on a form provided by the Board. Such permits shall confer upon their holders no authority to make solicitations in the Commonwealth as otherwise provided by law.

The fee for a temporary permit shall be one-twelfth of the combined fees required by this section for applicable licenses to sell marijuana or marijuana products computed to the nearest cent and multiplied by the number of months for which the permit is granted.

N. If the Authority holds a lottery as provided in subsection E, the Authority shall retain the applications of any applicant not selected in the lottery for one year. The Authority shall consider a retained application during any licensing periods that begin within the year and, except as otherwise provided in this chapter, the Authority shall treat a retained application as if the application were submitted during the licensing period.

At the beginning of a subsequent licensing period, the applicant may amend an application or provide additional information to the Authority and the Authority may request additional information from any applicant whose application is retained to determine if the applicant meets the requirements for a subsequent licensing period. If the applicant does not provide the requested information to the Authority within 14 calendar days of the Authority's request, the Authority may deny the application. The Authority shall not charge an additional application fee to an applicant whose application was retained.

An applicant may withdraw a retained application at any time. If the applicant withdraws a retained application, the applicant may submit a new application during a licensing period. An applicant that withdraws a retained application and submits a new application shall pay the applicable application fee. The Authority may disqualify an application from retention if the Authority is authorized to deny the application pursuant to subsection D.

2026, Sp. Sess. I, c. 1.

A. For purposes of this section:

"Bona fide labor organization" means a labor organization, as defined by 29 U.S.C. § 402(i), that is actively seeking to represent marijuana establishment employees in the Commonwealth. In determining whether a labor organization is a bona fide labor organization, the Authority shall consider each of the following as indicative, but not determinative, of a finding that a labor organization is a bona fide labor organization:

1. The labor organization has been recognized or certified as the bargaining representative for marijuana establishment employees in the Commonwealth;

2. The labor organization has executed current collective bargaining agreements with marijuana establishment employers in the Commonwealth;

3. The labor organization has spent resources as part of current and active attempts to organize and represent marijuana establishments in the Commonwealth;

4. The labor organization has filed the annual report required by 29 U.S.C. § 431(b) for the three years immediately preceding;

5. The labor organization has audited financial reports covering the three years immediately preceding;

6. The existence of written bylaws or a constitution for the three years immediately preceding; and

7. The labor organization's affiliation with any regional or national association of unions, including central labor councils.

"Labor peace agreement" means an agreement between a marijuana establishment and a bona fide labor organization that, at a minimum, protects the Commonwealth's proprietary interests by prohibiting the labor organization from engaging in picketing, work stoppages, or boycotts against the marijuana establishment.

B. All marijuana establishment license applicants, renewal applicants, and license holders shall have entered into, maintained, and abided by the terms of a labor peace agreement. Such labor peace agreement requirement is an ongoing material condition of the license, of which a violation may result in denial, suspension, or revocation of the license.

C. All initial marijuana establishment license applicants shall submit a labor peace agreement attestation (LPA attestation) signed by both the applicant and the bona fide labor organization stating that the applicant meets this section's requirements and has entered into, maintained, and abided by the terms of the LPA attestation. All renewal applicants must submit a new LPA attestation executed within 10 days of the submission date of the renewal application. An applicant's failure to submit a timely LPA attestation shall result in a denial of the initial or renewal license.

D. The Authority shall be required to determine a schedule establishing the ongoing review of the status and maintenance of a labor peace agreement to assess eligibility of license holder. Upon review and findings of unsatisfactory status or the insufficient maintenance of a labor peace agreement, the Authority shall suspend a licensee for a marijuana establishment.

2026, Sp. Sess. I, c. 1.

A. Annual fees on state licenses shall be established by the Board in an amount sufficient to cover the costs of regulating the marijuana establishment.

B. Nothing in this subtitle shall exempt any licensee from any state merchants' license or state restaurant license or any other state tax. Every licensee, in addition to the taxes and fees imposed by this subtitle, shall be liable to state merchants' license taxation, state restaurant license taxation, and other state taxation.

2026, Sp. Sess. I, c. 1.

A. The Board may (i) correct erroneous assessments made by it against any person, (ii) refund any amounts collected through erroneous assessments or collected as fees on license applications that are subsequently refused or withdrawn, and (iii) allow credit for any license fees paid for any license that is subsequently merged or changed into another license during the same license period. No refund shall be made of any such amount, however, unless made within three years from the date of collection of the same.

B. In any case where a licensee has changed its name or form of organization during a license period without any change being made in its ownership, and because of such change is required to pay an additional license fee for such period, the Board shall refund to such licensee the amount of such fee so paid in excess of the required license fee for such period.

C. The Board shall make refunds, prorated according to a schedule of its prescription, to licensees of state license fees paid pursuant to subsection A of § 4.1-1002 if the place of business designated in the license is destroyed by an act of God, including a fire, earthquake, hurricane, storm, or similar natural disaster or phenomenon.

D. Any amount required to be refunded under this section shall be paid by the State Treasurer out of moneys appropriated to the Board and in the manner prescribed in § 4.1-614.

2026, Sp. Sess. I, c. 1.

A. A tax is levied on the sale in the Commonwealth of any marijuana or marijuana products at the rate of six percent before July 1, 2029, and at the rate of eight percent on and after July 1, 2029. Subject to the provisions of subsection C, the tax shall be in addition to any tax imposed under the Virginia Retail Sales and Use Tax Act (§ 58.1-600 et seq.) or any other provision of federal, state, or local law. The tax shall not apply to any sale:

1. From a marijuana establishment to another marijuana establishment.

2. Of cannabis products for treatment under the provisions of Chapter 16 (§ 4.1-1600 et seq.).

3. Of industrial hemp by a grower, processor, or handler under the provisions of Chapter 41.1 (§ 3.2-4112 et seq.) of Title 3.2.

4. Of a hemp product.

B. 1. Each locality shall by ordinance levy an additional local tax on any sale taxable under subsection A at a rate not less than one percent but not greater than three and one-half percent. Other than the tax authorized and identified in this subsection, a locality shall not impose any other tax on a sale taxable under subsection A. The tax imposed by a surrounding county under this subsection shall not apply within the limits of any town. Each locality shall, within 30 days, notify the Authority and any retail marijuana store and microbusiness in such locality of the ordinance enacted pursuant to this subsection. The ordinance shall take effect on the first day of the second month following its enactment and such rate shall be effective for at least three years.

2. Nothing in this subsection shall be construed to (i) prohibit a locality from imposing any tax authorized by law on a person or property regulated under this subtitle or (ii) limit the authority of any locality to impose a license or privilege tax or fee on a business engaged in whole or in part in sales taxable under subsection A if such tax or fee is (a) based on an annual or per-event flat fee authorized by law or (b) an annual license or privilege tax authorized by law and such tax includes sales or receipts taxable under subsection A in its taxable measure.

C. The provisions of Chapter 6 (§ 58.1-600 et seq.) of Title 58.1 shall apply to all sales taxable under subsection A, mutatis mutandis.

D. All revenues remitted to the Authority under this subsection shall be disposed of as provided in § 4.1-614.

2026, Sp. Sess. I, c. 1.

A. For any sale taxable under § 4.1-1004, the seller shall be liable for collecting any taxes due. All taxes collected by a seller shall be deemed to be held in trust for the Commonwealth. The buyer shall not be liable for collecting or remitting the taxes or filing a return.

B. On or before the tenth day of each month, any person liable for a tax due under § 4.1-1004 shall file a return under oath with the Authority and pay any taxes due. Upon written application by a person filing a return, the Authority may, if it determines good cause exists, grant an extension to the end of the calendar month in which the tax is due, or for a period not exceeding 30 days. Any extension shall toll the accrual of any interest or penalties under § 4.1-1008.

C. The Authority may accept payment by any commercially acceptable means, including cash, checks, credit cards, debit cards, and electronic funds transfers, for any taxes, interest, or penalties due under this subtitle. The Board may assess a service charge for the use of a credit or debit card.

D. Upon request, the Authority may collect and maintain a record of a person's credit card, debit card, or automated clearinghouse transfer information and use such information for future payments of taxes, interest, or penalties due under this subtitle. The Authority may assess a service charge for any payments made under this subsection. The Authority may procure the services of a third-party vendor for the secure storage of information collected pursuant to this subsection.

E. If any person liable for tax under § 4.1-1004 sells out his business or stock of goods or quits the business, such person shall make a final return and payment within 15 days after the date of selling or quitting the business. Such person's successors or assigns, if any, shall withhold sufficient of the purchase money to cover the amount of such taxes, interest, and penalties due and unpaid until such former owner produces a receipt from the Authority showing payment or a certificate stating that no taxes, penalties, or interest are due. If the buyer of a business or stock of goods fails to withhold the purchase money as provided in this subsection, such buyer shall be liable for the payment of the taxes, interest, and penalties due and unpaid on account of the operation of the business by any former owner.

F. When any person fails to timely pay the full amount of tax due under § 4.1-1004, interest at a rate determined in accordance with § 58.1-15 shall accrue on the tax until it is paid. Any taxes due under § 4.1-1004 shall, if applicable, be subject to penalties as provided in §§ 4.1-1205 and 4.1-1206.

2026, Sp. Sess. I, c. 1.

The Authority may, when deemed necessary and advisable to do so in order to secure the collection of the taxes levied under § 4.1-1004, require any person subject to such tax to file a bond, with such surety as it determines is necessary to secure the payment of any tax, penalty, or interest due or that may become due from such person. In lieu of such bond, securities approved by the Authority may be deposited with the State Treasurer, which securities shall be kept in the custody of the State Treasurer, and shall be sold by the State Treasurer at the request of the Authority at public or private sale if it becomes necessary to do so in order to recover any tax, interest, or penalty due the Commonwealth. Upon any such sale, the surplus, if any, above the amounts due shall be returned to the person who deposited the securities.

2026, Sp. Sess. I, c. 1.

In the event purchases are returned to the seller by the buyer after a tax imposed under § 4.1-1004 has been collected or charged to the account of the buyer, the seller shall be entitled to a refund of the amount of tax so collected or charged in the manner prescribed by the Authority. The amount of tax so refunded to the seller shall not, however, include the tax paid upon any amount retained by the seller after such return of merchandise. In case the tax has not been remitted by the seller, the seller may deduct the same in submitting his return.

2026, Sp. Sess. I, c. 1.

A. The taxes imposed under § 4.1-1004 shall be assessed within three years from the date on which such taxes became due and payable. In the case of a false or fraudulent return with intent to defraud the Commonwealth, or a failure to file a return, the taxes may be assessed, or a proceeding in court for the collection of such taxes may be begun without assessment, at any time within six years from such date. The Authority shall not examine any person's records beyond the three-year period of limitations unless it has reasonable evidence of fraud or reasonable cause to believe that such person was required by law to file a return and failed to do so.

B. If any person fails to file a return as required by this section, or files a return that is false or fraudulent, the Authority may make an estimate for the taxable period of the taxable sales of such person and assess the tax, plus any applicable interest and penalties. The Authority shall give such person 10 days' notice requiring such person to provide any records as it may require relating to the business of such person for the taxable period. The Authority may require such person or the agents and employees of such person to give testimony or to answer interrogatories under oath administered by the Authority respecting taxable sales, the filing of the return, and any other relevant information. If any person fails to file a required return, refuses to provide required records, or refuses to answer interrogatories from the Authority, the Authority may make an estimated assessment based upon the information available to it and issue a memorandum of lien under subsection C for the collection of any taxes, interest, or penalties. The estimated assessment shall be deemed prima facie correct.

C. 1. If the Authority assesses taxes, interest, or penalties on a person and such person does not pay within 30 days after the due date, taking into account any extensions granted by the Authority, the Authority may file a memorandum of lien in the circuit court clerk's office of the county or city in which the person's place of business is located or in which the person resides. If the person has no place of business or residence within the Commonwealth, the memorandum may be filed in the Circuit Court of the City of Richmond. A copy of the memorandum may also be filed in the clerk's office of all counties and cities in which the person owns real estate. Such memorandum shall be recorded in the judgment docket book and shall have the effect of a judgment in favor of the Commonwealth, to be enforced as provided in Article 19 (§ 8.01-196 et seq.) of Chapter 3 of Title 8.01, except that a writ of fieri facias may issue at any time after the memorandum is filed. The lien on real estate shall become effective at the time the memorandum is filed in the jurisdiction in which the real estate is located. No memorandum of lien shall be filed unless the person is first given 10 or more days' prior notice of intent to file a lien; however, in those instances where the Authority determines that the collection of any tax, penalties, or interest required to be paid pursuant to law will be jeopardized by the provision of such notice, notification may be provided to the person concurrent with the filing of the memorandum of lien. Such notice shall be given to the person at his last known address.

2. Recordation of a memorandum of lien under this subsection shall not affect a person's right to appeal under § 4.1-1009.

3. If after filing a memorandum of lien the Authority determines that it is in the best interest of the Commonwealth, it may place padlocks on the doors of any business enterprise that is delinquent in filing or paying any tax owed to the Commonwealth. The Authority shall also post notices of distraint on each of the doors so padlocked. If, after three business days, the tax deficiency has not been satisfied or satisfactory arrangements for payment have not been made, the Authority may cause a writ of fieri facias to be issued. It shall be a Class 1 misdemeanor for anyone to enter the padlocked premises without prior approval of the Authority. In the event that the person against whom the distraint has been applied subsequently appeals under § 4.1-1009, the person shall have the right to post bond equaling the amount of liability in lieu of payment until the appeal is resolved.

4. A person may petition the Authority after a memorandum of lien has been filed under this subsection if the person alleges an error in the filing of the lien. The Authority shall make a determination on such petition within 14 days. If the Authority determines that the filing was erroneous, it shall issue a certificate of release of the lien within seven days after such determination is made.

2026, Sp. Sess. I, c. 1.

Any person aggrieved by a refusal of the Board to issue any license or permit, the suspension or revocation of a license or permit, the imposition of a fine, or any other penalty may seek review of such action in accordance with Board regulations and Article 3 (§ 2.2-4018 et seq.) of the Administrative Process Act in the Circuit Court of the City of Richmond. Further appeals shall also be in accordance with Article 5 (§ 2.2-4025 et seq.) of the Administrative Process Act.

2026, Sp. Sess. I, c. 1.

The Authority may apply to the appropriate circuit court for an injunction against any person who has violated or may violate any provision of this chapter or any regulation or final decision of the Board. The order granting or refusing such injunction shall be subject to appeal as in other cases in equity.

2026, Sp. Sess. I, c. 1.