Vermont became the first state in the country to legalize marijuana through the legislative process (and not by voter initiatives) back in 2018. In October of 2020, Governor Scott decided not to sign Bill S.54 (Act 164) and the law went into effect without his signature. That made Vermont the 11th state to legalize the recreational sale of marijuana. However, Vermont residents and visitors won’t be walking into a retail cannabis store any time soon.
According to the timeline for Act 164, the application period for recreational retail cannabis stores will begin “on or before” April 1, 2022 and the sale of recreational cannabis to persons 21 and older will begin “on or before” October 1, 2022. Among the pages and pages of new statutes is the requirement that the Cannabis Control Board must initiate the rule-making procedures for cannabis establishments on or before June 1, 2021. The Cannabis Control Board has a March 1, 2022 deadline for the final adoption of rules for cannabis establishments. This means that the Cannabis Control Board, at most, would have nine months to adopt new rules for cannabis establishments and revise the rules for the medical marijuana and dispensary program.
The Cannabis Control Board is statutorily directed to implement and administer rules for the seven different cannabis establishment applicants: 1) cannabis establishments; 2) cannabis cultivators; 3) cannabis product manufacturers; 4) cannabis “wholesalers” which are not covered in the cannabis establishments portion; 5) cannabis retailers; 6) cannabis testing laboratories; and 7) and “integrated licensees” (7 V.S.A. chapter 33 §881) (meaning vertically integrated businesses). Integrated licenses are limited to the five registered marijuana dispensaries (currently operating vertically integrated businesses in the medical market) which are registered by April 1, 2022.
While industry leaders wait in anticipation of the final rules for the recreational cannabis program – one key provision in the statutes will dictate decision-making for those individuals and businesses trying to break into Vermont’s legal cannabis landscape: local government regulation.
The “opt-in” provision for municipalities is found in 7 V.S.A. chapter 33 §863. This portion of the statute requires that prior to operating a cannabis retail store or integrated license, a municipality must “affirmatively permit the operation of such cannabis establish by majority vote of those present and voting” at the next annual meeting or special meeting of that municipality.
Unlike the opt-in provisions built into Maine’s adult-use program, which allows the towns to choose which cannabis establishments to permit, the Vermont version only requires an opt-in by municipalities for cannabis retail stores or integrated licensees. This means (generally speaking) that individuals and businesses in Vermont do not need municipal approval under §863 to operate cultivation facilities, product manufacturing facilities, wholesalers, or testing laboratories.
We will see Vermont’s cannabis regulatory framework take shape in the next two to six months – stay tuned into our blog for more updates on municipalities that have opted-in as well as draft rulemaking.