Fiscal Summary

Increase State Revenue - $858,900/FY21-22/General Fund $3,382,400/FY22-23/General Fund $6,756,900/FY23-24 and Subsequent Years/General Fund $900,000/FY21-22/GF - Special Infrastructure $3,600,000/FY22-23/GF - Special Infrastructure $7,200,000/FY23-24 and Subsequent Years/GF - Special Infrastructure $1,500,000/FY21-22/Educational Purposes $6,000,000/FY22-23/Educational Purposes $12,000,000/FY23-24 and Subsequent Years/Educational Purposes $500/FY21-22/Department of State $200/FY22-23/Department of State $100/FY23-24 and Subsequent Years/Department of State Decrease State Expenditures - $893,700 Incarceration* Decrease Local Revenue - $467,300/FY20-21 and Subsequent Years Decrease Local Expenditures - $1,794,200/FY20-21 and Subsequent Years/Incarceration

Bill Summary

This bill authorizes the retail sale of small amounts of marijuana and levies a 12 percent tax on such retail sales.



Generally under present law, it is an offense for a defendant to:



(1) Knowingly manufacture a controlled substance; deliver a controlled substance; sell a controlled substance; or possess a controlled substance with intent to manufacture, deliver or sell the controlled substance (TCA 39-17-417). A violation with respect to marijuana and containing not less than one-half ounce nor more than 10 pounds of marijuana is a Class E felony and, in addition, may be fined not more than $5,000; a violation with respect to marijuana and containing not less than 10 pounds nor more than 70 pounds of marijuana, or consisting of not less than 10 marijuana plants nor more than 19 marijuana plants, regardless of weight, is a Class D felony and, in addition, may be fined not more than $50,000; and a violation with respect to marijuana consisting of not less than 20 marijuana plants nor more than 99 marijuana plants, regardless of weight, is a Class C felony and, in addition, may be fined not more than $100,000;

(2) Knowingly possess or casually exchange a controlled substance. The offense is a Class A misdemeanor;

(3) Distribute a small amount of marijuana not in excess of one-half ounce. An offense is a Class A misdemeanor; and

(4) Violate (2) or (3) above by the casual exchange to a minor from an adult who is at least two years the minor's senior, and who knows that the person is a minor. The offense is punished as a felony.



This bill decriminalizes simple possession and casual exchange of marijuana; specifies that it is an offense to distribute marijuana to a minor; and authorizes a person to grow, process, manufacture, deliver, sell, or possess marijuana with the intent to grow, process, manufacture, deliver, or sell marijuana in this state in accordance with the following:



(A) The growing, processing, manufacture, delivery, or sale of marijuana is only authorized to be conducted by persons or entities who: have registered as a business and acquired a license Under the Business Tax Act and are in compliance with the remaining provisions of that Act; and the growing, processing, manufacture, or sale of marijuana is only authorized to be conducted at locations in compliance with local zoning regulations;

(B) Marijuana may only be sold to consumers: who are 21 years of age or older; from a retail location; and in a quantity not to exceed one-half ounce;

(C) A person who knowingly violates (A) or the quantity limits of (B) commits an offense punishable under (1)-(4) above, as applicable; and

(D) A person who knowingly violates the age or retail location requirements of (B) commits a Class A misdemeanor, unless the sale of marijuana is to a minor in which event the person commits an offense punishable under (1)-(4), as applicable.



This bill levies a 12-percent tax on the sales price of marijuana when sold at retail. The tax will be computed on gross sales and will include each and every retail sale. Revenue from this tax will be earmarked and allocated as follows: 20 percent to the general fund; 50 percent to educational purposes; and 30 percent to the state general fund and credited to a special infrastructure account to be used exclusively to fund projects identified in the annual public infrastructure needs inventory compiled by the Tennessee advisory commission on intergovernmental relations.

