RICHMOND, Va. (AP) — Five years after becoming the first Southern state to legalize possession of marijuana, Virginia has approved a legal way to sell it to recreational users.

State budget legislation enacted Monday will allow up to 350 cannabis shops to open across Virginia beginning July 1, 2027. The move marks the latest expansion of access to the drug — which remains illegal at the federal level — through state-level policymaking.

“Virginia legalized adult possession years ago, but without a regulated retail market, we left the illicit market to fill the gap,” state Sen. Lashrecse Aird, a Democrat and legislative leader on the issue, said in a statement earlier this month. “This compromise gives us a smarter and safer path forward — one that protects consumers, keeps products tested and accurately labeled, and creates a legal marketplace that is affordable and accessible enough to actually compete.”

Here’s what to know about Virginia’s new law, the long process of enabling retail sales and how the state’s changes fit into the national picture:

Virginia’s law allows new stores, higher possession limit
Virginia already had a medical marijuana program that allowed patients to purchase the drug through dispensaries. Now, state regulators will begin accepting applications for retail licenses on Feb. 1, ahead of the July 1, 2027, start date for recreational sales to adults 21 and older.

The law increases the state’s possession limit from 1 ounce to 2 ounces (28 grams to 57 grams) and it will continue to allow people to cultivate a small number of plants at home.

The state will levy an excise tax on top of its sales tax, and that mix is expected to generate about $51 million in revenue for the state in the program’s first year, according to legislative budget documents.

Advocates of legalization are heralding the changes
Democrats have driven the state’s push toward legalization and recreational retail sales. They have cast the issue as a matter of equity after state data found Black Virginians were disproportionately policed and convicted of using marijuana. Only a sliver of the state’s Republican lawmakers have backed legalization, and many have raised public safety and health concerns.

Legalization advocates have generally cheered Virginia’s legislation, though many objected to a provision increasing the civil fine for public consumption, arguing it could again lead to disproportionate enforcement based on race.

Chelsea Higgs Wise, a grassroots organizer whose group Marijuana Justice was among those that called on Democratic Gov. Abigail Spanberger to rethink the increased fine, said the legislation was still an exciting development after years of uncertainty.

For the past five years, “Adults that want to reasonably consume have been confused, rightfully so,” she said.

Virginia is an outlier in the South
Marijuana is legal in most U.S. states for either medicinal or recreational use, with about half allowing it for recreational use, according to the Marijuana Policy Project, which advocates for legalization and tracks policy developments around the country.

Virginia remains an outlier in the South for its permissive approach.

Federal laws are at odds with state changes
Despite the fact that nearly all states permit some form of cannabis use, the U.S. government maintains its longstanding prohibition on the drug.

But in a major policy shift, the Trump administration in April announced it was reclassifying state-licensed medical marijuana as a less dangerous drug and accelerating the process for a broader reclassification.

How Virginia got here
During the 2010s, Virginia gradually expanded access to marijuana for medical treatment. Then, in 2021, Virginia became the first Southern state to legalize marijuana with the passage of a law that allowed adults 21 and over to possess and cultivate the drug.

But lawmakers didn’t fully enact a framework for retail sales outside of the state’s medical marijuana program. Partisan control of Virginia government flipped in November 2021, and the issue stalled out for years. In 2024, Republican Gov. Glenn Youngkin vetoed a bill that would have established recreational retail sales.

Spanberger, who assumed office in January 2026, pledged support during her winning campaign for legislation setting up a retail market. While the governor did veto Democratic legislation that emerged from this year’s legislative session, she eventually worked out a compromise with lawmakers. Those provisions were rolled into a state budget bill that reached final passage Monday and now becomes law, according to the governor’s office, after lawmakers accepted all of Spanberger’s amendments.