Vermont Legalizes Recreational Cannabis Market

October 8th, 2020, Adult-use, Regulatory, Retail, State

Yesterday, Governor Scott allowed S.B. 54 to become law, an act relating to the regulation of cannabis. This law establishes a comprehensive regulatory system for the production and sale of cannabis in Vermont. Businesses wishing to enter the cannabis retail market may apply for one of five types of licenses: cultivator, product manufacturer, wholesaler, retailer, and testing laboratory. Applicants may only hold one of each type of license. Applicants are not required to be Vermont residents. Licenses shall start being issued in 2022.

The law establishes a system of priorities for license applicants, taking into consideration the following factors:

  • Whether the applicants have an existing medical cannabis dispensary license in good standing;
  • Whether the applicants would foster social justice and equity in the cannabis industry by being a minority or women-owned business;
  • Whether the applicants propose specific plans to recruit, hire, and implement a development ladder for minorities, women, or individuals who have historically been disproportionately impacted by cannabis prohibition;
  • Whether applicants propose specific plans to pay employees a living wage and offer benefits;
  • Whether the project incorporates principles of environmental resiliency or sustainability, including energy efficiency; and
  • The geographic distribution of cannabis establishments based on population and market needs.

The law also establishes the Cannabis Control Board as the independent regulatory authority for a commercial cannabis market. The Board will be tasked with adopting regulations concerning license applications, oversight, inspections, employment and training, security requirements, procedures for renewal, suspension, or revocation of licenses, requirements for banking and financial transactions, and policies and procedures for conducting outreach and promoting participation by diverse groups of individuals, including those who have been disproportionally  harmed by cannabis prohibition.

Municipalities may permit cannabis licensees to locate within their borders through an affirmative majority vote of those present at an annual or special meeting warned for that purpose; in other words, municipalities must “opt-in” for a cannabis retailer or other licensee to locate in that municipality.

Vermont will be the second state in the nation to legalize a regulated cannabis market through the legislative process.