SB2440 • 2026

Controlled Substances

AN ACT to amend Tennessee Code Annotated, Title 4; Title 5; Title 6; Title 7; Title 29; Title 33; Title 38; Title 39; Title 40; Title 41; Title 43; Title 45; Title 50; Title 53; Title 54; Title 63; Title 67; Title 68 and Title 71, relative to the "Pot for Potholes Act."

Agriculture Children Crime Education Firearms Healthcare Labor Parental Rights Taxes

Did Not Pass

The latest official action shows that this bill did not move forward in that session.

Sponsor: Campbell, Behn
Last action: 2026-03-24
Official status: Failed in Senate Judiciary Committee
Effective date: Not listed

Plain English Breakdown

The bill's exact fiscal impact is uncertain due to multiple unknown variables, including market conditions and public benefit changes.

Pot for Potholes Act

This bill decriminalizes marijuana use and creates a regulatory framework for its cultivation, transport, research, processing, and distribution in Tennessee.

What This Bill Does

Allows people aged 21 or older to possess up to 60 grams of marijuana (with limits on concentrated forms) and cultivate up to 12 plants at home.
Permits parents, guardians, or conservators to give non-smokable medical marijuana products to minors with a doctor's approval.
Protects individuals from certain legal penalties for using marijuana as allowed by the bill.
Does not stop employers from disciplining employees who use marijuana in the workplace.
Requires the Department of Agriculture to create rules for regulating marijuana businesses and research facilities.

Who It Names or Affects

People aged 21 or older who want to use, possess, transport, or cultivate marijuana.
Parents, guardians, or conservators giving medical marijuana products to minors.
Employers with policies regarding workplace drug use.
The Department of Agriculture responsible for regulating the cannabis industry.

Terms To Know

Marijuana: All parts of the plant Cannabis sativa L. with a total THC content greater than one percent, excluding hemp.
Cannabinoid: Active chemical compounds found in cannabis, such as THC and CBD.

Limits and Unknowns

The bill did not pass the Senate Judiciary Committee.
It is unclear how much money will be saved on incarceration or spent on public benefits due to various unknown variables.
Revenue from marijuana sales may vary based on market conditions and other factors.

Bill History

2026-03-25 Tennessee General Assembly
Taken off notice for cal in s/c Criminal Justice Subcommittee of Judiciary Committee
2026-03-24 Tennessee General Assembly
Failed in Senate Judiciary Committee
2026-03-23 Tennessee General Assembly
Placed on Senate Judiciary Committee calendar for 3/24/2026
2026-03-23 Tennessee General Assembly
Action deferred in Senate Judiciary Committee to 3/24/2026
2026-03-18 Tennessee General Assembly
Placed on Senate Judiciary Committee calendar for 3/23/2026
2026-03-18 Tennessee General Assembly
Placed on s/c cal Criminal Justice Subcommittee for 3/25/2026
2026-02-05 Tennessee General Assembly
Passed on Second Consideration, refer to Senate Judiciary Committee
2026-02-05 Tennessee General Assembly
Assigned to s/c Criminal Justice Subcommittee
2026-02-05 Tennessee General Assembly
P2C, ref. to Judiciary Committee - Health Committee - Government Operations for Review
2026-02-04 Tennessee General Assembly
Intro., P1C.
2026-02-03 Tennessee General Assembly
Filed for introduction
2026-02-02 Tennessee General Assembly
Introduced, Passed on First Consideration
2026-02-02 Tennessee General Assembly
Filed for introduction

Official Summary Text

Under present law, it is generally a criminal offense for a person to manufacture, deliver, or sell, or possess
,
with the intent to manufacture, deliver, or sell, marijuana. The classification of the offense and authorized penalties depend on the amount of marijuana involved in the offense. Under present law, certain products that are derived from the cannabis pl
ant (such as hemp, FDA-approved prescription medications, and products with limited amounts of THC that are used for clinical research or treatm
ent of specific medical conditions) are excepted from the definition of marijuana and, therefore, not subject to criminal penalties.

This bill decriminalizes the use of marijuana under certain circumstances and creates a regulatory framework for the cultivation, transport, researching, processing, and distribution of marijuana.

AUTHORIZED USE

This bill generally authorizes a person who is 21 or older to engage in
any of
the following conduct:



Use, possess, and transport up to 60 grams of marijuana, except that no more than 15 grams of that amount may be in the form of marijuana concentrate.


Transfer without remuneration to another person who is 21 or older up to 60 grams of marijuana, except that no more than 15 grams of that amount may be in the form of marijuana concentrate.


Cultivate for personal use up to 12 marijuana plants in a secured, private area on the premises of the person's private residence.


Possess, store, or process on the premises of the adult's private residence no more than the amount of marijuana produced from plants cultivated on the premises.


Use, possess, transport, or transfer to another adult without remuneration marijuana-related drug paraphernalia.

This bill authorizes a parent, legal guardian, or conservator to administer for medical purposes a non-smokable marijuana product to a minor with a medical condition, or symptoms resulting from a medical condition, for which the patient, parent, guardian
, or conservator seeks to use a marijuana product to treat the medical condition, or alleviate the symptoms.

PROTECTION FROM LEGAL ACTION

Generally, this bill specifies that a person is not subject to a civil or criminal penalty for engaging in an authorized use of marijuana, or for acting within the scope of
a
license to grow, process, dispense, transport, test, or conduct research on marijuana.
Further, this
bill specifies that engaging in conduct that is protected under this bill does not, in itself, constitute ground for any of the following:



Denying, limiting, or restricting conservatorship or custody or possession of or access to a child.


Denial of public assistance benefits, unless required by federal law.


Denial of unemployment benefits, unless other cause for termination exists.


Restricting firearms ownership.

PROHIBITION BY EMPLOYERS AND PRIVATE PROPERTY OWNERS

This bill does not prohibit an employer from (i) disciplining an employee for using marijuana or a marijuana product in the workplace or for working while under the influence of marijuana or a marijuana product; or (ii) considering a job applicant's use
of marijuana as a basis for refusing to hire the applicant for a safety-sensitive position.

This bill generally authorizes a person to prohibit or restrict the possession, consumption, cultivation, distribution, manufacture, sale, or display of marijuana or marijuana products on property
that
the person owns, occupies, or manages. However, a person
must not
prohibit a residential tenant under a lease agreement from possessing marijuana, marijuana products, or marijuana-related drug paraphernalia or consuming marijuana by means other than smoking on the premises.

UNAUTHORIZED CONDUCT AND VIOLATIONS

The full text of this bill lists several forms of conduct that this bill does not authorize, which generally involve the consumption or possession of marijuana in vehicles, at public places, on school property, and at correctional facilities.

Under this bill, it is a criminal offense for a person acting pursuant to a license or other authority provided pursuant to this bill to (i) sell, give, or cause to be sold or given, marijuana or a marijuana product to a minor; or (ii) sell, give, or cau
se to be sold or given, marijuana or a marijuana product to another person knowing the other person intends to deliver the marijuana or marijuana product to a minor.

This bill provides that i
t is also an offense for a person to sell marijuana or a marijuana product in or from (i) a marijuana dispensary that is not in compliance with this bill; or (ii) a marijuana establishment other than a dispensary and such sale is not authorized under this
bill.

This bill provides that i
t is a defense to prosecution under the above-described offenses that the person to whom the marijuana or marijuana product was sold or given presented a government-issued photo identification and purports to indicate that the presenter is 21 or older.

This bill provides that a
first, second, or third violation
is
a Class C misdemeanor
, punishable by a term of imprisonment of
no greater than
30
days
,
a fine not to exceed $50, or both,
A fourth or subsequent violation
is
a Class A misdemeanor
, punishable by a term of imprisonment of
no greater than 11 months, 29 days
;
a fine not to exceed $2,500
;
or both,
and result
s
in
the
revocation of any license issued to the violator under this bill
for two years
.

DUTIES OF THE DEPARTMENT OF AGRICULTURE

The full text of this bill specifies various subjects for which the department of agriculture
is
required or authorized to promulgate rules as part of its duty to implement and administer this bill. Generally, the department must promulgate rules for (i) the reasonable regulation of marijuana establishments and marijuana research facilities
,
(ii) the involvement of the state in sanctioning research projects or licensing marijuana research facilities
,
and (iii) establishment of classes of licensure and qua
lifications for licensure.

This bill requires the department to do all of the following:



Establish an image indicating that marijuana or a marijuana product contains THC (a "universal symbol") and publish the symbol on the department's website
.


Submit an annual report concerning the regulation of marijuana to the governor and to the chief clerks of the senate and the house of representatives
.


Prioritize the issuance of licenses according to a five-tier list that gives first priority to disadvantaged businesses, veteran-owned businesses, and businesses located in tier 4 enhancement counties, which have held a hemp license in the prior year.

LICENSURE

This bill requires a
n applicant for licensure to apply to the department,
to
pay an application fee in an amount set by the department,
to
submit fingerprints for the purpose of obtaining criminal history record checks from the TBI and the FBI,
to
register to conduct business, and
to
comply with local regulations.

Other than a conviction for an offense that involves the delivery, sale, distribution, or casual exchange of a controlled substance to a minor under 18 where the person was an adult who was at least two years older than the minor at the time of the offen
se,
this bill clarifies that
a person's conviction for an offense does not disqualify an applicant for licensure under this bill.

This bill authorizes the department to suspend or revoke a marijuana-related license for good cause. Upon suspending or revoking a license, the department may seize or place under seal all marijuana, marijuana products, and marijuana-related drug paraph
ernalia owned or possessed by the licensee. If a license revocation order becomes final, any property seized from the licensee may be forfeited to the state as contraband.

MICRO-LICENSE CLASS

As part of the classes of licenses established pursuant to this bill, this bill requires the department to create a
micro-license class to be issued for marijuana establishments that are small-scale, locally owned businesses. A micro-license may be issued only to an applicant that (i) is a Tennessee resident, or is a business wholly owned by one or more Tennessee resi
dents; (ii) is a disadvantaged business; or (iii) is a business owned or controlled by an individual who has been convicted of an offense involving marijuana that would not constitute a criminal offense under this bill.

This bill prohibits an applicant for a micro-license or a micro-license holder is prohibited from being owned, affiliated with, or financially controlled by a business entity holding more than one additional marijuana establishment license issued under t
his bill. The department must deny the issuance of, or revoke, a micro-license if the applicant or license holder, as applicable, violates this paragraph.

This bill requires the department to establish reduced capital requirements, simplified reporting, and scaled operational limits for micro-license applicants and holders as long as public health and safety standards are maintained.

DUTIES OF LICENSEES

Before dispensing marijuana to an adult consumer, this bill requires that a marijuana dispensary must make reasonable efforts to verify that (i) the recipient is 21 or older
,
(ii) the marijuana complies with testing and labeling rules promulgated by the department
,
and (iii) the amount of marijuana dispensed is no greater than the amount authorized for personal use.

The full text of this bill specifies security measures that licensees must meet.

This bill prohibits licensees from employing minors.

This bill requires marijuana dispensaries to submit a monthly report to the department specifying the amount of marijuana sold and the
amount of money collected in sales by the establishment during the preceding month.

TAXES

This bill specifies that marijuana is taxable as tangible personal property and subject to sales and use taxes. This bill authorizes local governments to levy a local sales tax of up to 5% on the sale of marijuana within their jurisdictions.

This bill imposes a marijuana tax on sales of marijuana by dispensaries at the rate of 15% of the sales price. The marijuana tax will be allocated as follows:



Seventy-five percent
into the state highway fund
.



Twenty percent
of the funds must be allocated to the various counties to the state as follows (i) 50% of the funds must be distributed among the 95 counties of the state, (ii) 50% of the remaining balance must be distributed among the 95 counties on the basis of area and (iii) the other 50% of the remaining balance must be distributed among the 95 counties on the basis of population, as of the most recent federal census or by special census pursuant to present law
.



Five percent
must be retained by the department of revenue to be used for administrative costs incurred pursuant to this bill.

This bill establishes a tax refund in the amount of 25% of sales and use tax levied on supplies and materials purchased from Tennessee businesses by marijuana growers, processors, and dispensaries for use in their respective businesses.

This bill authorizes marijuana-related business licensees to submit paper tax returns and pay taxes in cash. This bill authorizes the commissioner of revenue to require that paper filings under this bill are accompanied by a manual handling fee, not to
exceed $25.

DISADVANTAGES BUSINESSES

This bill requires the department to discount any application, renewal, or reinstatement fee charged to an applicant that is a disadvantaged business by 50% of the standard fee. Further, the department must prioritize and expedite the processing of an a
pplication submitted for a disadvantaged business. The application must be reviewed and acted upon within 30 days of receipt of a completed application. The department may waive any fees for fingerprinting or criminal history record checks performed as
pa
rt of the application as long as such a fee waiver does not alter other requirements in this bill.

CANNABIS COMMUNITY REINVESTMENT FUND

This bill establishes a fund within the state treasury to be known as the cannabis community reinvestment fund. Five percent of the revenue derived from the marijuana tax must be first allocated and deposited into such fund. Subject to the availability
of funds, the department of economic and community development must use the fund to provide grants to nonprofit organizations and governmental entities for such organizations and entities to provide grants, loans, and technical assistance to and in commu
ni
ties disproportionately impacted by the enforcement of laws relating to marijuana prior to January 1, 2026.

This bill provides that all of the following are eligible uses of grant funds:



Grants and zero-interest loans to disadvantaged businesses.


Workforce development, job training, and apprenticeship programs.


Legal assistance for expungement, record clearance, and reentry services.


Business formation assistance, including licensing, accounting, and compliance services.


Community infrastructure investments in census tracts with historically elevated rates of marijuana-related arrests or convictions.

This bill requires the department of economic and community development to develop and publish an application form for nonprofit organizations and governmental entities to apply for grant funds and promulgate rules governing the administration of the fun
d, including grant eligibility requirements and award procedures and reporting requirements. Grant funds are subject to examination and audit by the comptroller of the treasury.

By February 15, 2028, and each February 15 thereafter, this bill requires the department of economic and community development to submit a report to the governor, the speakers of the house of representatives and the senate, the office of legislative budg
et analysis, and the legislative librarian detailing distributions made from the fund and outcomes observed or achieved.

LOCAL REGULATION

This bill authorizes counties and municipalities to adopt regulations governing the hours of operation, location, manner of conducting business, and number of marijuana dispensaries; provided, that regulations must not be more restrictive than those that
apply to establishments that are licensed as retail package stores.

This bill authorizes a
county or municipality seeking to ban the sale of marijuana to adult consumers or the cultivation or manufacture of marijuana products by marijuana establishments within its jurisdiction
to
do so by a two-thirds vote of the local legislative body; provided, that the initial vote on a local ban occurs no later than September 30, 2022. A local ban established pursuant to this bill generally expires one year from the ban's effective date. Ho
wever, a ban may be renewed for successive o
ne-year periods by two-thirds vote of the local legislative body. A county or municipality that bans the sale, cultivation, or manufacture of marijuana or marijuana products within its jurisdiction is disqualified from receiving any grant funds authorize
d under this bill while the ban is in effect.

Except as specifically authorized, this bill prohibits counties and municipalities from prohibiting or unreasonably restricting the cultivation, production, manufacture, dispensing, transportation, or possession of marijuana or marijuana products or the
operation of a marijuana grower, marijuana processor, marijuana dispensary, marijuana transporter, marijuana research facility, or marijuana testing facility.

USE OF GAS CHROMATOGRAPHY MASS SPECTRUM TESTS

This bill prohibits the following types of government action against a person based solely on a positive confirmatory urine drug test conducted via a gas chromatography mass spectrum test: (i) revocation of bail, parole, probation, or a suspended sentenc
e; (ii) restriction from participation in extracurricular school activities or receiving referral information through a student's school; adverse employment action against a government employee; (iii) referral to a treatment resource; or (iv) prohibiting
re
ceipt of public assistance.

This bill prohibits healthcare licensing boards and employers of licensed health care workers from taking adverse action against a healthcare practitioner based solely on a positive confirmatory urine drug test via gas chromatography mass spectrum.

BANKING

Except where prohibited by federal law, this bill requires the department of financial institutions to promulgate rules authorizing marijuana establishments to conduct cashless transactions and use
banking services, including the depositing of revenue, in Tennessee-chartered banks or other Tennessee-chartered financial institutions.

CONFLICTS OF INTEREST

The full text of this bill specifies requirements to avoid conflicts of interest in marijuana-related businesses.

OTHER PROVISIONS

This bill deletes various provisions of present law concerning (i) offenses involving the cultivation, manufacture, delivery, sale, possession, or transfer of marijuana; (ii) the applicability of the "drug dealer tax" to marijuana; and (iii) the use of p
olice to dogs trained to detect marijuana. This bill does not change present law concerning driving while impaired.

This bill makes a change to present law concerning the definition of "disadvantaged businesses" such that businesses that are majority-owned by a person who was impeded from normal entry into the economic mainstream due to past service in the armed force
s (rather than only those who served in the Vietnam War) may qualify.

Effective upon this bill becoming a law, this bill requires the department of correction to review the records of persons who are incarcerated in this state for the cultivation, manufacture, delivery, sale, possession, or transfer of marijuana. The depa
rtment must identify and list persons incarcerated for such offenses and include information as to whether the person was also convicted of a felony offense involving violence or the use of a firearm or a felony drug offense for a controlled substance oth
er
than marijuana. The department must provide the list to the governor and the speakers of the house of representatives and the senate by December 31, 202
6
. Effective January 1, 2026, under this bill, persons serving a sentence for the cultivation, manufacture, delivery, sale, possession, or transfer of marijuana who are not also serving a sentence for a felony offense involving violence or the use of a fi
rearm or a felony drug offense for a controlled substance other than marijuana are eligible for immedia
te release from incarceration, probation, and parole.

Current Bill Text

Read the full stored bill text

HOUSE BILL 2525
By Behn

SENATE BILL 2440
By Campbell
SB2440
012099
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 4;
Title 5; Title 6; Title 7; Title 29; Title 33; Title 38;
Title 39; Title 40; Title 41; Title 43; Title 45; Title
50; Title 53; Title 54; Title 63; Title 67; Title 68 and
Title 71, relative to the "Pot for Potholes Act."

WHEREAS, Tennessee's motto is "Agriculture and Commerce," and this act supports
these principles; and
WHEREAS, thirty-eight states have a marijuana regulatory structure, and Tennessee
should act forthwith in order to remain competitive nationally and globally in the burgeoning
cannabis industry; and
WHEREAS, Tennessee businesses believe in the promotion of free and fair markets by
providing consumers with the highest quality goods at the lowest possible prices, and this act
does so by protecting Tennessee farmers, processors, and retailers from undue influence on
intrastate cannabis markets by special interests seeking to monopolize trade therein; and
WHEREAS, Tennesseans believe in product safety and the protection of minors, and
this act includes measures to provide funding for both with regard to the cannabis industry; and
WHEREAS, the federal government has not demonstrated a willingness to violate
Tennessee's Tenth Amendment right to promulgate laws regarding agriculture and commerce
within the State; and
WHEREAS, this act honors the United States Constitution by codifying Fourth and Fifth
Amendment protections for Tennesseans with respect to cannabis use and possession; now,
therefore,
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. This act is known and may be cited as the "Pot for Potholes Act."

- 2 - 012099

SECTION 2. Tennessee Code Annotated, Title 43, is amended by adding the following
as a new chapter:
43-23-101. Chapter definitions.
As used in this chapter:
(1) "Adult" means a natural person who is twenty-one (21) years of age or older;
(2) "Advertising":
(A) Means the act of providing consideration for the publication,
dissemination, solicitation, or circulation of visual, oral, or written communication
to induce, directly or indirectly, any person to patronize a particular marijuana
dispensary, or to purchase marijuana or marijuana products;
(B) Includes marketing and marketing materials; and
(C) Does not include product packaging or labeling;
(3) "Batch number" means a unique numeric or alphanumeric identifier assigned
prior to testing to allow for inventory tracking and traceability;
(4) "Cannabinoid":
(A) Means an active chemical compound that is found in cannabis; and
(B) Includes, but is not limited to, delta-9-tetrahydrocannabinol (THC)
and cannabidiol (CBD);
(5) "Cannabis" means the plant species and subspecies of Cannabis sativa L.;
(6) "Child-resistant" means special packaging that is:
(A) Designed or constructed in accordance with 16 CFR Part 1700 to be
significantly difficult to open for children under five (5) years of age and not
difficult for normal adults to use properly;
(B) Opaque so that the outermost packaging does not allow the product
to be seen without opening the packaging material; and

- 3 - 012099

(C) Resealable to maintain its child-resistant effectiveness for multiple
openings for any product intended for more than a single use or containing
multiple servings;
(7) "Clone" means a nonflowering plant cut from a mother plant that is capable
of developing into a new plant and has shown no signs of flowering;
(8) "Community facility" means:
(A) A licensed child care center, as defined in § 71-3-501;
(B) A public park;
(C) A public playground;
(D) A public swimming pool;
(E) A community center, the primary purpose of which is to provide
recreational opportunities or services to children; or
(F) A place of worship;
(9) "Completed application":
(A) Means a document prepared in accordance with the requirements of
this chapter and rules promulgated by the department, and the forms and
instructions provided by the issuing department or agency; and
(B) Includes any required supporting documentation and the applicable
license application fee;
(10) "Cultivate" means to propagate, breed, grow, harvest, dry, cure, or separate
parts of the marijuana plant by manual or mechanical means;
(11) "Department" means the department of agriculture;
(12) "Disadvantaged business" has the same meaning as defined in § 4-26-102;

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(13) "Dispense" means the selling of marijuana or marijuana products to an adult
consumer that is packaged in a suitable container appropriately labeled for subsequent
administration to, or use by, an adult;
(14) "Edible marijuana product":
(A) Means a marijuana product that is intended to be ingested orally; and
(B) Includes, but is not limited to, food-based marijuana concentrate or
marijuana-infused food, drink, or pills;
(15) "Entity" means an individual, general partnership, limited partnership,
limited liability company, trust, estate, association, corporation, cooperative, or any other
legal or commercial organization;
(16) "Flowering" means the reproductive state of a marijuana plant in which
there are physical signs of flower or budding out of the nodes of the stem;
(17) "Food-based marijuana concentrate" means a marijuana concentrate that
was produced by extracting cannabinoids from marijuana through the use of propylene
glycol, glycerin, butter, olive oil, coconut oil, or other typical food-safe cooking fats;
(18) "Good cause" for purposes of an initial, renewal, or reinstatement license
application, or for purposes of discipline of a licensee, means:
(A) The licensee or applicant has violated, does not meet, or has failed to
comply with this chapter or any rules promulgated pursuant to this chapter;
(B) The licensee or applicant has failed to comply with any special terms
or conditions that were placed upon the license pursuant to an order of the
department of agriculture, the department of revenue, or a local governmental
entity with specific governing jurisdiction established by statute or rules
promulgated pursuant to this chapter; or

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(C) The licensed premises of a marijuana establishment or applicant
have been operated in a manner that adversely affects the public health or
welfare or the safety of the immediate vicinity in which the establishment is
located;
(19) "Healthcare practitioner" means a person licensed under title 63, or such
person's counterpart in another state, who has the authority to prescribe or dispense
controlled substances in the course of professional practice;
(20) "Heat- or pressure-derived marijuana concentrate" means a marijuana
concentrate that was produced by extracting cannabinoids from marijuana through the
use of heat or pressure;
(21) "Hemp" has the same meaning as defined in § 43-27-101;
(22) "Immature plant" means a nonflowering marijuana plant that has not
demonstrated signs of flowering;
(23) "Inhalation" means the consumption of marijuana by smoking or
vaporization;
(24) "Licensed premises" means the premises specified in an application for a
marijuana establishment or marijuana research facility that is owned or in possession of
the licensee and within which the licensee is authorized to cultivate, manufacture,
distribute, sell, store, transport, test, or research marijuana or marijuana products
pursuant to this chapter;
(25) "Manufacture" means the production, compounding, or processing of a
marijuana product from marijuana, excluding natural marijuana plants or any part of such
plant;
(26) "Marijuana":

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(A) Means all parts of the plant cannabis with a total THC of greater than
one percent (1%), whether growing or not; the seeds of the plant; the resin
extracted from any part of the plant; and every compound, manufacture, salt,
derivative, mixture, or preparation of the plant, including concentrates and oils, its
seeds, or resin; and
(B) Does not include hemp;
(27) "Marijuana biomass" means the aerial parts of the cannabis plant that are
removed from the roots, stalks, stems, or seeds to the extent possible and primarily used
for extracting marijuana concentrate;
(28) "Marijuana concentrate":
(A) Means the cannabinoid-rich oil or extract from marijuana extracted
from plant material or the resin created from the plant by physical or chemical
means; and
(B) Includes water-based marijuana concentrate, food-based marijuana
concentrate, solvent-based marijuana concentrate, and heat- or pressure-derived
marijuana concentrate;
(29) "Marijuana dispensary" means a marijuana establishment that has been
licensed by the department to purchase marijuana or marijuana products from a
marijuana grower or marijuana processor for the purpose of reselling marijuana or
marijuana products to adult consumers, or selling or transferring such products to
another marijuana dispensary;
(30) "Marijuana establishment":
(A) Means an entity that is licensed by the department under this
chapter;

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(B) Includes, but is not limited to, marijuana dispensaries, marijuana
processors, marijuana growers, marijuana testing facilities, and marijuana
transporters; and
(C) Does not include a marijuana research facility;
(31) "Marijuana flower" means the reproductive organs of the marijuana plant
referred to as the bud and are parts of the plant, whether trimmed or not, that are
harvested and consumed orally or via inhalation in the plant's natural form;
(32) "Marijuana grower" means an individual or entity that is licensed pursuant to
this chapter to cultivate, prepare, and package marijuana for sale or transfer, or contract
for transfer, to a marijuana establishment or marijuana research facility;
(33) "Marijuana plant" means a rooted cannabis plant, of a variety not intended
to be cultivated as hemp as defined in § 43-27-101, that has a minimum of three (3) leaf
sets;
(34) "Marijuana processor" means an individual or entity that is licensed
pursuant to this chapter to operate a marijuana establishment that is responsible for the
production, manufacture, extraction, processing, packaging, or creation of marijuana
concentrate or marijuana products, including edible marijuana products, marijuana-
infused products, and other marijuana products;
(35) "Marijuana product" means a product that contains cannabinoids extracted
from marijuana by physical or chemical means and is intended for sale to and use by
adult consumers and takes the form of oils, tinctures, flower, edibles, pills, topical forms,
gels, creams, vapors, patches, suppositories, liquids, and forms administered by a
nebulizer;

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(36) "Marijuana research facility" means a private postsecondary educational
institution located in this state with a postgraduate program in agriculture or medicine
conducting marijuana research or a public institution;
(37) "Marijuana testing facility" means an entity licensed by the department
under this chapter to analyze the safety and potency of marijuana and marijuana
products;
(38) "Marijuana transporter" means an individual or entity that is licensed by the
department under this chapter to transport marijuana or marijuana products;
(39) "Marijuana trim" means the byproduct of trimming marijuana flower that may
be used as marijuana biomass or as an ingredient in smokable or edible marijuana
products;
(40) "Marijuana waste" means unused, surplus, returned, or out-of-date
marijuana or marijuana products to be remediated or destroyed;
(41) "Material change" means a change that would require a substantive revision
to the standard operating procedures of a licensee;
(42) "Mature plant" means a harvestable female marijuana plant that is
flowering;
(43) "Minor" means a person who has not attained twenty-one (21) years of age;
(44) "Mother plant" means a marijuana plant that is grown or maintained for the
purpose of generating clones;
(45) "Natural person" means an individual, living human being;
(46) "Owner" means a direct beneficial owner and is limited to the following:
(A) A shareholder owning at least a five percent (5%) interest of a
corporate entity;
(B) An officer of a corporate entity;

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(C) A partner in a general partnership;
(D) A general or limited partner who owns an interest in a limited
partnership;
(E) A member who owns an interest in a limited liability company;
(F) A beneficiary who holds a beneficial interest in a trust;
(G) A trustee of a trust;
(H) A person who owns an interest in a joint venture;
(I) A person who owns an interest in an association;
(J) An owner of any other type of legal entity; and
(K) Any other person holding an interest or convertible note in any entity
that owns, operates, or manages a licensed facility;
(47) "Package" or "packaging" means a container or wrapper that may be used
by a marijuana establishment to enclose or contain marijuana or marijuana products;
(48) "Person":
(A) Means a natural person, partnership, association, business trust,
company, corporation, estate, limited liability company, trust, or any other legal
entity or organization, or a manager, agent, owner, director, servant, officer, or
employee thereof; and
(B) Does not include a governmental entity;
(49) "Process" means to separate or otherwise prepare parts of the marijuana
plant and to compound, blend, extract, infuse, or otherwise make or prepare marijuana
concentrate or marijuana products;
(50) "Production batch":
(A) Means:

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(i) An amount of marijuana concentrate of the same category that
is produced using the same extraction methods, standard operating
procedures, and harvest batch of marijuana; or
(ii) An amount of marijuana product of the same exact type that is
produced using the same ingredients, standard operating procedures,
and production batch of medical marijuana concentrate; and
(B) Does not include marijuana flower;
(51) "Public institution" means an entity established or controlled by the federal
government, state government, or a local government, including, but not limited to,
institutions of higher education and related research institutions;
(52) "Public money" means funds or money obtained from a governmental entity
by a licensee, including, but not limited to, research grants;
(53) "Registered to conduct business" means an eligible applicant who has
provided proof that the applicant's business is in good standing with the secretary of
state and department of revenue;
(54) "Remediation" means:
(A) The process by which marijuana flower or marijuana trim that has
failed required testing is processed into marijuana concentrate and retested for
compliance; or
(B) The process by which marijuana waste is recycled into usable
product, where possible;
(55) "Research project" means a discrete scientific endeavor to answer a
research question or a set of research questions related to hemp or marijuana as
required by a marijuana research license;

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(56) "Revocation" means the final decision by the department to rescind a
license issued pursuant to this chapter because the licensee did not comply with the
applicable requirements set forth in this chapter or rules promulgated pursuant to this
chapter;
(57) "Solvent-based marijuana concentrate" means marijuana concentrate
produced by extracting cannabinoids from marijuana through the use of a safe solvent
medium, resulting in a finished product that meets state and federal guidelines for food
safety;
(58) "Strain" means the classification of cannabis or marijuana plants based on
the individual genetics of the plant that can be used to track genetic traits through the
cultivation and processing of marijuana products and to help licensees and consumers
predict the contents and effects of a marijuana product;
(59) "Suitable container" means a child-resistant package that complies with
state law;
(60) "Test batch":
(A) With regard to usable marijuana, means a homogenous, identified
quantity of usable marijuana by strain that is harvested during a seven-day
period from a specified cultivation area; and
(B) With regard to oils, vapors, and waxes derived from usable
marijuana, means an identified quantity that is uniform, intended to meet
specifications for identity, strength, and composition, and manufactured,
packaged, and labeled during a specified time period according to a single
manufacturing, packaging, and labeling protocol;

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(61) "THC" means delta-9 tetrahydrocannabinol, which is a cannabinoid in
cannabis formed by decarboxylation of natural tetrahydrocannabinolic acid, which
generally occurs by exposure to heat;
(62) "THCA" means delta-9 tetrahydrocannabinolic acid, the precursor to the
primary psychotropic cannabinoid contained in cannabis;
(63) "Total THC" means the sum of the amount of THC and the result of eight
hundred seventy-seven one-thousandths (0.877) multiplied by the amount of THCA;
(64) "Transporter agent" means a person who transports marijuana or marijuana
products for a licensed marijuana transporter and holds a transporter agent license;
(65) "Universal symbol" means an image indicating that marijuana or a
marijuana product contains THC;
(66) "Veteran" means a person who has been honorably discharged from the
army, navy, air force, marine corps, coast guard, or space force or any person who has
been honorably discharged from a reserve component, as defined in 10 U.S.C. § 10101,
having performed active federal service in the armed forces of the United States; and
(67) "Veteran-owned business" means a business that is a continuing,
independent, for-profit business located in this state that performs a commercially useful
function, and is at least fifty-one percent (51%) owned and controlled by one (1) or more
veterans; or, in the case of any publicly owned business, at least fifty-one percent (51%)
of the stock of which is owned and controlled by one (1) or more veterans and whose
management and daily business operations are under the control of one (1) or more
veterans.
43-23-102. Authorized conduct – Personal use of marijuana.
(a) An adult is authorized under this chapter to:

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(1) Except as provided in subdivision (a)(4), use, possess, and transport
not more than sixty (60) grams of marijuana, except that not more than fifteen
(15) grams of that amount may be in the form of marijuana concentrate;
provided, that the restrictions regarding the amount of marijuana or marijuana
concentrate that may be possessed or transported do not apply to a marijuana
transporter or a transportation agent acting within the course and scope of the
transporter's or agent's license;
(2) Transfer without remuneration to another adult not more than sixty
(60) grams of marijuana, except that not more than fifteen (15) grams of that
amount may be in the form of marijuana concentrate; provided, that the transfer
is not advertised or promoted to the public;
(3) Cultivate for personal use not more than twelve (12) marijuana plants
in an area on the premises of the adult's private residence; provided, that the
cultivation occurs in a private area that is:
(A) Equipped with locks or other security devices that restrict
access to the area; and
(B) Not visible from a public place without the use of aircraft or
optical aids;
(4) Possess, store, or process on the premises of the adult's private
residence not more than the amount of marijuana produced from plants
cultivated on the premises; provided, that:
(A) Not more than the twelve (12) marijuana plants are
possessed, cultivated, or processed on the premises at one (1) time; and

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(B) Any other amount of marijuana in excess of sixty (60) grams
is stored in a locked container or secure area equipped with security
devices that restrict access; and
(5) Use, possess, transport, or transfer to another adult without
remuneration marijuana-related drug paraphernalia.
(b)
(1) A parent, legal guardian, or conservator may administer for medical
purposes a marijuana product, excluding a smokeable product, to a minor with a
medical condition, or symptoms resulting from a medical condition, for whom the
parent, guardian, or conservator has legal authority to provide for the care,
supervision, and control.
(2) The department of health shall provide on the department's website a
form that, if executed by the parent, guardian, or conservator after consultation
with a healthcare practitioner, creates a rebuttable presumption:
(A) That the practitioner's patient, as a minor for whom the parent,
guardian, or conservator has legal authority to provide for the care,
supervision, and control, has a medical condition, or symptoms resulting
from a medical condition, for which the patient, parent, guardian, or
conservator seeks to use a marijuana product to treat the medical
condition, or alleviate the symptoms thereof; and
(B) Of legal conduct under subdivision (b)(1).
43-23-103. Authorized conduct – Retail marijuana operations.
This chapter authorizes:
(1) A marijuana grower director, manager, or employee acting within the
scope of the grower's license to:

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(A) Cultivate marijuana for sale or transfer to a marijuana
establishment, including the sale or transfer of seeds, flower, mother
plants, mature plants, immature plants, or clones; and
(B) Possess marijuana and marijuana-related drug paraphernalia;
(2) A marijuana processor director, manager, or employee acting within
the scope of the processor's license to:
(A) Produce marijuana products for sale or transfer to a marijuana
establishment; and
(B) Possess marijuana and marijuana-related drug paraphernalia;
(3) A marijuana dispensary director, manager, or employee acting within
the scope of the dispensary's license to:
(A) Possess marijuana and marijuana products; and
(B) Transfer and sell marijuana, marijuana products, and
marijuana-related drug paraphernalia to an adult;
(4) A marijuana transporter director, manager, employee, or agent acting
within the scope of the transporter's license to transport and transfer marijuana or
marijuana products between marijuana establishments; and
(5) A marijuana testing or research facility director, manager, or
employee acting within the scope of the facility's license to possess, test, and
transport marijuana, marijuana products, and marijuana-related drug
paraphernalia.
43-23-104. Protection from legal action for authorized conduct.
(a) A person is not subject to the denial of any right or privilege or to arrest,
prosecution, forfeiture of property, or penalty, including any civil penalty or disciplinary

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action by a court or occupational or professional licensing board or other like
instrumentality solely due to conduct authorized under §§ 43-23-102 and 43-23-103.
(b) The fact that a person engages in conduct authorized by § 43-23-102 or §
43-23-103 does not in itself constitute grounds for denying, limiting, or restricting
conservatorship or custody or possession of or access to a child.
(c) Unless expressly required by federal law, a person in compliance with this
chapter shall not be denied eligibility, based on acts authorized under this chapter, for a
public assistance program, including, but not limited to, the special supplemental food
program for women, infants, and children; temporary assistance for needy families
(TANF); TennCare; the supplemental nutrition assistance program (SNAP); or other
such public assistance programs.
(d)
(1) An employer is authorized to establish policies permitting, restricting,
or prohibiting the use of marijuana or marijuana products in the workplace.
(2) This chapter does not prohibit an employer from:
(A) Disciplining an employee for using marijuana or a marijuana
product in the workplace or for working while under the influence of
marijuana or a marijuana product; or
(B) Considering a job applicant's use of marijuana as a basis for
refusing to hire the applicant for employment responsibilities described in
§ 50-9-106(a)(3)(A) as long as that consideration, including testing of the
applicant, is consistent with and appropriate in its application to the
employer's hiring policy with regard to other adulterants that cause a
refusal of hiring for an applicant, including the time segment under review,
so as to not disproportionately restrict the legal rights of the applicant.

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(3) Notwithstanding title 50, chapters 7 and 9, and for purposes of
eligibility for benefits under Tennessee Employment Security Law, compiled in
title 50, chapter 7, the use of marijuana or a marijuana product, when there is no
other action or cause by the employee or reason for the termination, shall not be
deemed a discharge for misconduct under § 50-7-303 or otherwise a termination
for cause.
(e) Notwithstanding title 39, chapter 17, part 13, the use of marijuana or
marijuana products, personal cultivation of marijuana, or status as a licensee under this
chapter or under title 43, chapter 27, shall not be grounds for the denial or infringement
of the right to own, purchase, or possess a firearm, ammunition, or firearm accessory
under state law.
43-23-105. Prohibition of marijuana on private property – Exception.
(a) Except as otherwise provided by subsection (b), a person may prohibit or
restrict the possession, consumption, cultivation, distribution, manufacture, sale, or
display of marijuana or marijuana products on property the person owns, occupies, or
manages.
(b) A person shall not prohibit a residential tenant under a lease agreement from
possessing marijuana, marijuana products, or marijuana-related drug paraphernalia or
consuming marijuana by means other than smoking on the premises.
43-23-106. Conduct not authorized – Violations.
(a) This chapter does not authorize the following conduct:
(1) Smoking or otherwise consuming marijuana in:
(A) A motor vehicle;
(B) An aircraft;
(C) A watercraft on the public waters of this state; or

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(D) A public place, unless:
(i) The public place is an area designated by a political
subdivision as an area where using marijuana or a marijuana
product is permissible; and
(ii) The area described by subdivision (a)(1)(D)(i) is not
accessible to minors;
(2) Possessing or consuming marijuana or marijuana products or
possessing marijuana-related drug paraphernalia:
(A) On the premises of a public or private child care facility, pre-
kindergarten, or primary or secondary school;
(B) On a school bus that serves a facility or school described by
subdivision (a)(2)(A); or
(C) On the premises of a correctional facility; or
(3) The separation of resin from the marijuana plant by butane extraction
or another method that uses a substance with a flashpoint below one hundred
degrees Fahrenheit (100° F) in a public place or motor vehicle or within the
curtilage of a residential structure.
(b) A person commits an offense if the person:
(1) Under the authority of this chapter:
(A) Sells, gives, or causes to be sold or given, marijuana or a
marijuana product to a minor; or
(B) Sells, gives, or causes to be sold or given, marijuana or a
marijuana product to another person knowing the other person intends to
deliver the marijuana or marijuana product to a minor, except as
authorized under § 43-23-102(b); or

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(2) Sells marijuana or a marijuana product in or from:
(A) A marijuana dispensary that is not in compliance with this
chapter; or
(B) A marijuana establishment other than a dispensary and such
sale is not authorized under this chapter.
(c) It is a defense to prosecution under subsection (b) that the person to whom
the marijuana or marijuana product was sold or given presented apparently valid proof of
identification. For purposes of this subsection (c), "apparently valid proof of
identification" means a government-issued photo identification that contains a physical
description and photograph consistent with the person's appearance and purports to
establish that the person is twenty-one (21) years of age or older. Such government-
issued photo identification may include a driver license issued by this state or another
state, a passport, or other identification card issued by a state, territory, tribe, or the
federal government.
(d) A violation of this section is punishable as follows:
(1) A first, second, or third offense is a Class C misdemeanor; and
(2) A fourth or subsequent offense is a Class A misdemeanor, and if the
violator is a licensee, the revocation of the violator's license for a period of two (2)
years.
43-23-107. Duties of the department – Rules.
(a) The department shall implement and administer this chapter.
(b) The department shall promulgate all necessary rules for the administration
and enforcement of this chapter. All rules must be promulgated in accordance with the
Uniform Administrative Procedures Act, compiled in title 4, chapter 5.

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(c) The department shall promulgate rules for the reasonable regulation of
marijuana establishments and marijuana research facilities, including rules that:
(1) Set application and license fees under this chapter in amounts
sufficient to administer this chapter and such fees may be adjusted annually for
inflation;
(2) Establish standards for:
(A) The operation of marijuana testing facilities;
(B) The testing of cultivated marijuana flower and marijuana
products; and
(C) The secure transportation of marijuana by marijuana
transporters, including standards to ensure all marijuana establishments
and marijuana research facilities are properly served;
(3) Restrict the use of dangerous pesticides;
(4) Regulate the packaging and labeling of marijuana products available
at marijuana dispensaries, including requirements regarding:
(A) Child-resistant packaging;
(B) The use of a universal symbol; and
(C) The amount of THC or total THC present;
(5) Restrict advertising and display of marijuana and marijuana products;
(6) Restrict the maximum amount of THC or total THC, or regulate the
serving size, that may be contained in a marijuana product sold to an adult
consumer;
(7) Require recordkeeping and monitoring for identification of a
production batch or test batch through the use of a batch number;

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(8) Require recordkeeping for any remediation conducted by a marijuana
establishment;
(9) Require recordkeeping and monitoring to track the transfer of
marijuana and marijuana products between marijuana establishments or
licensees;
(10) Require security measures; provided, that the security measures do
not restrict the cultivation of marijuana outdoors or in greenhouses; and
(11) Establish protocols or restrictions with regard to the proximity of
marijuana establishments to community facilities and elementary and secondary
schools.
(d) The department, in consultation with the department of health, shall
promulgate rules regarding the involvement of the state in sanctioning research projects
or licensing marijuana research facilities, including a process by which marijuana
research facilities may request and receive public money for research projects; provided,
that a research project must include a description of a defined protocol, clearly
articulated goals, defined methods and outputs, and a defined start and end date in
order for the project to be sanctioned by the department.
(e) The department of health may promulgate rules and forms necessary to
facilitate a medical use component of this chapter. In promulgating rules and forms, the
department shall consider and prioritize the process by which patients, practitioners, and
caregivers are able to document recommendations for the medical use of marijuana or
marijuana products and by which patients and caregivers are able to establish that
marijuana and marijuana products are being obtained for medical use when marijuana
and marijuana products are purchased from a marijuana dispensary. The department of
health shall publish such forms on the department's website.

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(f) Except where prohibited by federal law and notwithstanding any other law to
the contrary, in accordance with the Uniform Administrative Procedures Act, compiled in
title 4, chapter 5, the department of financial institutions shall promulgate rules
authorizing marijuana establishments to conduct cashless transactions and use banking
services, including the depositing of revenue, in Tennessee-chartered banks or other
Tennessee-chartered financial institutions.
(g) The department shall establish a universal symbol and publish the symbol on
the department's website.
43-23-108. Conflicts of interest.
(a) A person who is involved in the implementation, administration, or
enforcement of this chapter as a member or employee of the department, or a consultant
to the department, shall not also hold a pecuniary interest in any entity licensed by the
department under this chapter.
(b) A person who holds a pecuniary interest in a marijuana testing facility or a
marijuana transporter that holds a license issued under this chapter shall not hold a
pecuniary interest in any entity that holds a marijuana dispensary, marijuana processor,
or marijuana grower license issued under this chapter.
(c) A person may not hold a pecuniary interest in more than five (5) entities that
are licensed under this chapter as a marijuana grower, unless otherwise authorized by
the department.
43-23-109. Annual report.
The department shall annually submit to the governor and to the chief clerks of
the senate and the house of representatives a report providing the following information
regarding licensing and regulation under this chapter:

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(1) The number of licenses issued for each class of license under this
chapter;
(2) Demographic information pertaining to licensees;
(3) A description of any fines imposed on a licensee or disciplinary
actions taken against a licensee by the department; and
(4) A statement of revenues and expenses of the department related to
the implementation, administration, and enforcement of this chapter.
43-23-110. Licensing.
(a) A license issued by the department under this chapter is required to operate
as a marijuana establishment.
(b) The department by rule shall provide classes of licensure to be issued under
this chapter and, for each class of license issued under this chapter, qualifications for
licensure that are demonstrably related to the operations authorized and duties imposed
under that class of license.
(c) The department shall prioritize the issuance of licenses in the following order:
(1) First priority to:
(A) Disadvantaged businesses and veteran-owned businesses
that have held a hemp license, issued under § 43-27-102, in the prior
year; and
(B) Business entities located in a tier 4 enhancement county, as
described in § 67-4-2109, that have held a hemp license, issued under §
43-27-102, in the prior year;
(2) Second priority to business entities that have held a hemp license,
issued under § 43-27-102, in the prior year;
(3) Third priority to entities that are:

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(A) Owned solely by an individual who is a resident of this state;
or
(B) At least fifty-one percent (51%) owned and controlled by one
(1) or more residents of this state; or, in the case of any publicly owned
business, have at least fifty-one percent (51%) of the stock owned and
controlled by one (1) or more residents of this state and management and
daily business operations under the control of one (1) or more residents
of this state;
(4) Fourth priority to disadvantaged businesses and veteran-owned
businesses located in a tier 3 or tier 4 enhancement county as described in § 67-
4-2109; and
(5) Fifth priority to all other qualified persons.
(d)
(1) As part of the classes of licenses established pursuant to subsection
(b), the department shall create a micro-license class to be issued for marijuana
establishments that are small-scale, locally owned businesses.
(2) A micro-license may be issued only to an applicant that:
(A) Is a Tennessee resident, or is a business wholly owned by
one (1) or more Tennessee residents;
(B) Is a disadvantaged business; or
(C) Is a business owned or controlled by an individual who has
been convicted of an offense involving marijuana that would not constitute
a criminal offense under this chapter.
(3) An applicant for a micro-license or a micro-license holder is prohibited
from being owned, affiliated with, or financially controlled by a business entity

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holding more than one (1) additional marijuana establishment license issued
under this chapter. The department shall deny the issuance of, or revoke, a
micro-license if the applicant or license holder, as applicable, violates this
subdivision (b)(3).
(4) The department shall establish reduced capital requirements,
simplified reporting, and scaled operational limits for micro-license applicants and
holders; provided, that public health and safety standards are maintained.
43-23-111. Licensure application.
(a) A person eligible for licensure may apply for an initial or renewal license
under this chapter by submitting a form prescribed by the department along with the
application fee in an amount set by the department.
(b) The completed application must indicate the class of license sought and
include:
(1) The name and address of the applicant;
(2) The name of each owner, which the department shall make available
as a matter of public record;
(3) The name and address of each of the applicant's directors,
managers, and employees; and
(4) Any other information considered necessary by the department to
determine the applicant's eligibility for the license.
(c) In addition to satisfying the other requirements provided by department rule
under this chapter:
(1) An applicant for a license must submit to the department a complete
and legible set of fingerprints, on a form prescribed by the department, for the

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purpose of obtaining criminal history record checks from the Tennessee bureau
of investigation and the federal bureau of investigation;
(2) The department may deny a license to an applicant who does not
comply with the requirement of subdivision (c)(1). Issuance of a license by the
department is conditioned on the department obtaining the applicant's criminal
history record check under this subsection (c); and
(3) Other than a conviction for an offense that involves the delivery, sale,
distribution, or casual exchange of a controlled substance to a minor under
eighteen (18) years of age where the person was an adult who was at least two
(2) years older than the minor at the time of the offense, a person's conviction for
an offense does not disqualify an applicant for licensure under this chapter.
(d) Notwithstanding this chapter to the contrary, the department shall discount
any application, renewal, or reinstatement fee charged to an applicant that is a
disadvantaged business by fifty percent (50%) of the standard fee.
(e) The department shall prioritize and expedite the processing of an application
submitted for a disadvantaged business. The application must be reviewed and acted
upon in accordance with § 43-23-112 within thirty (30) days of receipt of a completed
application. The department may waive any fees for fingerprinting or criminal history
record checks performed as part of the application; provided, that such a fee waiver
does not alter the requirements of subsection (c).
43-23-112. Issuance, renewal, or denial of license.
(a) The department shall issue or renew a license under this chapter only if:
(1) The department determines the applicant meets the qualifications for
the class of license sought, under §§ 43-23-110 and 43-23-111;
(2) The applicant is registered to conduct business; and

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(3) The applicant is in compliance with any applicable local regulations.
(b) If the department denies the issuance or renewal of a license under
subsection (a), then the department shall give written notice of the grounds for denial to
the applicant.
(c) A license issued or renewed under this section expires on the second
anniversary of the date of issuance or renewal, as applicable.
43-23-113. Duty to maintain qualifications.
(a) A licensee shall maintain compliance at all times with the qualifications for
the applicable class of license established under § 43-23-110.
(b) A licensee shall notify the department in writing whenever there is a material
change in the operations of a licensee.
43-23-114. License suspension or revocation.
(a) The department may at any time suspend or revoke a license issued under
this chapter for good cause, including if the department determines that the licensee has
not maintained the qualifications established under § 43-23-110 or has failed to comply
with a duty imposed under this chapter.
(b) The department shall give written notice to a licensee of a license
suspension or revocation under this section and the grounds for the suspension or
revocation. The notice must be sent by certified mail, return receipt requested.
(c) After suspending or revoking a license issued under this chapter, the
department may seize or place under seal all marijuana, marijuana products, and
marijuana-related drug paraphernalia owned or possessed by the licensee. If the
license is revoked, a disposition shall not be made of the seized or sealed marijuana,
marijuana products, or drug paraphernalia until the time for administrative appeal of the
order has elapsed or until all appeals have been concluded. When a revocation order

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becomes final, all marijuana, marijuana products, and drug paraphernalia may be
forfeited to the state as contraband.
(d) Proceedings under this section must be conducted pursuant to title 4,
chapter 5, part 3 of the Uniform Administrative Procedures Act.
43-23-115. Duties of licensees relating to dispensing marijuana or marijuana
products.
Before dispensing marijuana or marijuana products to an adult consumer, a
marijuana dispensary must make reasonable efforts to verify that:
(1) The person receiving the marijuana or marijuana product is an adult;
(2) The marijuana or marijuana product complies with testing and
labeling rules promulgated by the department; and
(3) The amount of marijuana or marijuana products dispensed is not
greater than the amount authorized for personal use under § 43-23-102(a).
43-23-116. Duties of licensees relating to security.
(a) A licensee shall ensure that the cultivation, manufacture, sale, or display of
marijuana, marijuana products, and marijuana-related drug paraphernalia is not visible
from a public place without the use of optical aids or aircraft.
(b) A licensee shall not cultivate, manufacture, store, or sell marijuana,
marijuana products, or marijuana-related drug paraphernalia at a location other than the
physical address approved by the department for the establishment under the license
issued to the establishment under this chapter.
(c) A licensee shall adopt reasonable security measures necessary to restrict
access to areas where marijuana or marijuana products are stored and to prevent theft
of marijuana and marijuana products.
43-23-117. Licensee employees.

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A licensee shall not employ or otherwise accept the services of a person younger
than eighteen (18) years of age.
43-23-118. Monthly sales report.
A marijuana dispensary shall submit a report to the department monthly
specifying the amount of marijuana sold, the number of marijuana products sold, and the
amount of money collected in sales by the establishment during the preceding month.
43-23-119. Taxes.
(a) Marijuana and marijuana products are taxable as tangible personal property
and subject to sales and use taxes imposed by title 67, chapter 6. Notwithstanding § 67-
6-702, a county, by resolution of the county legislative body, or an incorporated
municipality, by ordinance of its governing body, is authorized to levy a local sales tax in
a rate not to exceed five percent (5%) on the sale of marijuana and marijuana products
within such county or municipality. Such local sales tax is to be levied, collected, and
distributed in the same manner as local sales and use taxes under title 67, chapter 6,
part 7.
(b)
(1) A marijuana tax is imposed on each sale of marijuana or a marijuana
product by a marijuana dispensary.
(2) The rate of the tax is fifteen percent (15%) of the sales price of the
marijuana or marijuana product.
(3) The tax imposed by this subsection (b) is administered, collected, and
enforced in the same manner as the sales and use tax under title 67, chapter 6 is
administered, collected, and enforced.
(4) The tax imposed by this subsection (b) is in addition to any other tax
imposed by law.

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(c)
(1) Notwithstanding any law to the contrary:
(A) A marijuana grower is entitled to a refund of twenty-five
percent (25%) of the sales and use tax levied on supplies and materials
purchased from a business located in this state and used for the
cultivation of marijuana;
(B) A marijuana processor is entitled to a refund of twenty-five
percent (25%) of the sales and use tax levied on supplies and materials
purchased from a business located in this state and used for the
manufacture or processing of marijuana and production of marijuana
products; and
(C) A marijuana dispensary is entitled to a refund of twenty-five
percent (25%) of the sales and use tax levied on supplies and materials
purchased from a business located in this state and used for the
dispensing and retail sale of marijuana and marijuana products.
(2) To receive a refund authorized under this subsection (c), a marijuana
establishment must submit the form prescribed by the department of revenue, in
addition to any documentation the department may require.
(d) Notwithstanding any law to the contrary, electronic payment and filing
requirements for taxes levied under title 67 are waived and a marijuana establishment
may file a return in paper form and remit payments in cash or other form approved by
the department of revenue. The commissioner of revenue is authorized to require that
any such paper filing be accompanied by a manual handling fee, not to exceed twenty-
five dollars ($25.00), that is reasonably calculated by the department to account for the

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additional cost of preparing, printing, receiving, reviewing, and processing any paper
filing.
43-23-120. Allocation of marijuana tax.
The department of revenue shall allocate the revenue derived from the marijuana
tax imposed by § 43-23-119(b) in the following manner:
(1) Seventy-five percent (75%) of the funds must be deposited into the
state highway fund;
(2) Twenty percent (20%) of the funds must be allocated to the various
counties of the state as follows:
(A) Fifty percent (50%) of the funds must be distributed equally
among the ninety-five (95) counties of the state;
(B) Fifty percent (50%) of the remaining balance must be
distributed among the ninety-five (95) counties on the basis of area; and
(C) The other fifty percent (50%) of the remaining balance must
be distributed among the ninety-five (95) counties on the basis of
population, as of the most recent federal census or by special census
pursuant to § 9-16-101; and
(3) Five percent (5%) of the funds must be retained by the department of
revenue to be used for administrative costs incurred pursuant to this chapter,
including collection and enforcement costs.
43-23-121. Cannabis community reinvestment fund.
(a) There is hereby created a fund within the state treasury to be known as the
cannabis community reinvestment fund.

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(b) Notwithstanding § 43-23-120, five percent (5%) of the revenue derived from
the marijuana tax imposed pursuant to § 43-23-119(b) must be first allocated and
deposited into the cannabis community reinvestment fund.
(c) Moneys deposited in the fund must be invested for the benefit of the fund
pursuant to § 9-4-603. The fund shall be administered by the department of economic
and community development. Interest accruing on investments and deposits of the fund
must be carried forward into the subsequent fiscal year. Moneys in the fund must not
revert to the general fund, but must remain available to be used by the department of
economic and community development exclusively for the purposes specified in this
section.
(d) Subject to the availability of funds, the department of economic and
community development shall use the cannabis community reinvestment fund to provide
grants to nonprofit organizations and governmental entities for such organizations and
entities to provide grants, loans, and technical assistance to and in communities
disproportionately impacted by the enforcement of laws relating to marijuana prior to
January 1, 2026.
(e) Eligible uses of grant funds include, but are not limited to:
(1) Grants and zero-interest loans to disadvantaged businesses;
(2) Workforce development, job training, and apprenticeship programs;
(3) Legal assistance for expungement, record clearance, and reentry
services;
(4) Business formation assistance, including licensing, accounting, and
compliance services; and
(5) Community infrastructure investments in census tracts with
historically elevated rates of marijuana-related arrests or convictions.

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(f) The department of economic and community development shall develop and
publish an application form for nonprofit organizations and governmental entities to apply
for grant funds and promulgate rules governing the administration of the fund, including
grant eligibility requirements and award procedures and reporting requirements. Rules
must be promulgated in accordance with the Uniform Administrative Procedures Act,
compiled in title 4, chapter 5.
(g) Grant funds are subject to examination and audit by the comptroller of the
treasury.
(h) By February 15, 2028, and each February 15 thereafter, the department of
economic and community development shall submit a report to the governor, the
speakers of the house of representatives and the senate, the office of legislative budget
analysis, and the legislative librarian detailing distributions made from the fund and
outcomes observed or achieved.
43-23-122. Prohibited local regulation.
Except as provided in § 43-23-123(b), a political subdivision of this state shall not
enact, adopt, or enforce a rule, ordinance, order, resolution, or other regulation that
prohibits or unreasonably restricts the cultivation, production, manufacture, dispensing,
transportation, or possession of marijuana or marijuana products or the operation of a
marijuana grower, marijuana processor, marijuana dispensary, marijuana transporter,
marijuana research facility, or marijuana testing facility as authorized by this chapter.
43-23-123. Permissible local regulation.
(a) A political subdivision may adopt regulations consistent with this chapter
governing the hours of operation, location, manner of conducting business, and number
of marijuana dispensaries; provided, that regulations must not be more restrictive than

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those that apply to establishments that are licensed as retail package stores pursuant to
§ 57-3-204.
(b)
(1) A county or municipality seeking to ban the sale of marijuana or
marijuana products to adult consumers or the cultivation or manufacture of
marijuana or marijuana products by marijuana establishments within its
jurisdiction is authorized to do so by a two-thirds (2/3) vote of the local legislative
body; provided, that the initial vote on a local ban occurs no later than September
30, 2026.
(2) Notwithstanding any law to the contrary, a ban established pursuant
to this subsection (b) expires one (1) year from the ban's effective date; provided,
that a ban may be renewed under the same procedure established in subdivision
(b)(1).
(3) A county or municipality that bans the sale, cultivation, or
manufacture of marijuana or marijuana products within its jurisdiction is
disqualified from receiving any grant funds authorized under this chapter while
the ban is in effect.
43-23-124. Use of gas chromatography mass spectrum tests.
Notwithstanding any law to the contrary:
(1) A person's bail, parole, probation, or suspended sentence shall not be
revoked based solely on a positive confirmatory urine drug test conducted via a
gas chromatography mass spectrum test (GC-MS) for THC-COOH (11-nor-9-
carboxy-delta 9 tetrahydrocannabinol);
(2) A student shall not be prohibited or otherwise restricted from
participation in voluntary extracurricular activities, or be required to receive

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referral information under § 49-6-4213(k)(3), based solely on a positive
confirmatory urine drug test conducted via a gas chromatography mass spectrum
test (GC-MS) for THC-COOH (11-nor-9-carboxy-delta 9 tetrahydrocannabinol)
when the minor is administered a marijuana product in accordance with § 43-21-
102(b);
(3) A governmental entity acting in its capacity as a public employer shall
not take adverse action against an employee based solely on a positive
confirmatory urine drug test conducted via a gas chromatography mass spectrum
test (GC-MS) for THC-COOH (11-nor-9-carboxy-delta 9 tetrahydrocannabinol);
and
(4) A person shall not be required to receive a referral to a treatment
resource or be prohibited from receiving public assistance based solely on a
positive confirmatory urine drug test conducted via a gas chromatography mass
spectrum test (GC-MS) for THC-COOH (11-nor-9-carboxy-delta 9
tetrahydrocannabinol). For purposes of this subdivision (4), "public assistance"
includes, but is not limited to, assistance from the special supplemental food
program for women, infants, and children; temporary assistance for needy
families (TANF); TennCare; the supplemental nutrition assistance program
(SNAP); and other public assistance or welfare programs under title 71.
SECTION 3. Tennessee Code Annotated, Section 4-3-610(a), is amended by deleting
the language "dogs trained to detect marijuana and other illicit substances" and substituting
instead the language "dogs trained to detect illicit substances".
SECTION 4. Tennessee Code Annotated, Section 4-7-115, is amended by deleting the
language "dogs trained to detect marijuana and other illicit substances" and substituting instead
the language "dogs trained to detect illicit substances".

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SECTION 5. Tennessee Code Annotated, Section 4-26-102, is amended by deleting
subdivision (6)(B) and substituting instead the following:
(B) Impeded from normal entry into the economic mainstream because of past
practices of discrimination based on race, religion, ethnic background, sex, or service in
the armed forces;
SECTION 6. Tennessee Code Annotated, Section 29-38-104, is amended by deleting
the following:
(1) From subdivision (5), the language "; or possession of one pound (1 lb.) or
twenty-five (25) plants or more, but less than four pounds (4 lbs.) or fifty (50) plants, or
distribution of less than one pound (1 lb.), of marijuana";
(2) From subdivision (6), the language "; or possession of four pounds (4 lbs.) or
more or fifty (50) plants or more, but less than eight pounds (8 lbs.) or seventy-five (75)
plants, or distribution of more than one pound (1 lb.), but less than five pounds (5 lbs.),
of marijuana";
(3) From subdivision (7), the language "; or possession of eight pounds (8 lbs.)
or more or seventy-five (75) plants or more, but less than sixteen pounds (16 lbs.) or one
hundred (100) plants or more, or distribution of more than five pounds (5 lbs.), but less
than ten pounds (10 lbs.), of marijuana"; and
(4) From subdivision (8), the language "; or possession of sixteen pounds (16
lbs.) or more or one hundred (100) plants or more, or distribution of ten pounds (10 lbs.)
or more, of marijuana".
SECTION 7. Tennessee Code Annotated, Section 38-6-108, is amended by deleting the
language "dogs trained to detect marijuana and other illicit substances" and substituting instead
the language "dogs trained to detect illicit substances".

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SECTION 8. Tennessee Code Annotated, Section 39-17-402, is amended by deleting
subdivision (C) from the definition of "drug paraphernalia" and substituting instead the following:
(C) Objects used, intended for use, or designed for use in ingesting, inhaling, or
otherwise introducing cocaine into the human body;
SECTION 9. Tennessee Code Annotated, Section 39-17-402, is amended by deleting
subdivision (16) in its entirety.
SECTION 10. Tennessee Code Annotated, Section 39-17-415(a), is amended by
deleting subdivisions (1) and (2) in their entireties.
SECTION 11. Tennessee Code Annotated, Section 39-17-417, is amended by deleting
subsection (g), subdivision (i)(14), and subdivision (j)(14) in their entireties.
SECTION 12. Tennessee Code Annotated, Section 39-17-418, is amended by deleting
subsection (b); and deleting the language "subsections (a) or (b)" in subsection (d) and
substituting instead the language "subsection (a)".
SECTION 13. Tennessee Code Annotated, Section 39-17-428(b), is amended by
deleting the language "classified as marijuana or hashish" wherever it appears.
SECTION 14. Tennessee Code Annotated, Section 40-32-101(g)(1), is amended by:
(1) Deleting subdivision (A)(xxxiii) and substituting instead the following:
(xxxiii) Section 39-17-417(g)(1) — Manufacture, delivery, sale, or
possession of Schedule VI controlled substance;
(2) Deleting subdivision (D)(xxv) and substituting instead the following:
(xxv) Section 39-17-417(g)(2) — Manufacture, delivery, sale, or
possession of Schedule VI controlled substance; and
(3) Deleting subdivision (E)(xxii) and substituting instead the following:
(xxii) Section 39-17-417(g)(3) — Manufacture, delivery, sale, or
possession of Schedule VI controlled substance;

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SECTION 15. Tennessee Code Annotated, Section 41-1-118, is amended by deleting
the language "marijuana and other illicit substances" wherever it appears and substituting
instead the language "illicit substances".
SECTION 16. Tennessee Code Annotated, Section 67-4-2802, is amended by deleting
subdivision (7) in its entirety.
SECTION 17. Tennessee Code Annotated, Section 67-4-2803, is amended by deleting
subdivisions (a)(1), (2), and (3) in their entireties; and deleting the language "of marijuana or
other" in subsection (b) and substituting instead the language "an".
SECTION 18. Tennessee Code Annotated, Section 67-4-2804, is amended by deleting
subsection (b) in its entirety.
SECTION 19. Tennessee Code Annotated, Section 71-3-1201(4), is amended by
deleting the language "marijuana,".
SECTION 20. Tennessee Code Annotated, Section 63-1-126, is amended by adding
the following as a new subsection:
Notwithstanding this section to the contrary, neither the board nor the employer
of the healthcare practitioner shall take adverse action against a healthcare practitioner
based solely on a positive confirmatory urine drug test via GC-MS (gas chromatography
mass spectrum) THC-COOH (11-nor-9-carboxy-delta 9 tetrahydrocannabinol).
SECTION 21. The Department of Correction shall review the records of persons who
are incarcerated in this state for the cultivation, manufacture, delivery, sale, possession, or
transfer of marijuana under Tennessee Code Annotated, § 39-17-417 or § 39-17-418. The
department shall identify and list persons incarcerated for such offenses and include information
as to whether the person was also convicted of a felony offense involving violence or the use of
a firearm or a felony drug offense for a controlled substance other than marijuana. The

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department shall provide the list to the Governor and the Speakers of the House of
Representatives and the Senate by December 31, 2026.
SECTION 22. Persons serving a sentence for the cultivation, manufacture, delivery,
sale, possession, or transfer of marijuana under Tennessee Code Annotated § 39-17-417 or §
39-17-418, who are not also serving a sentence for a felony offense involving violence or the
use of a firearm or a felony drug offense for a controlled substance other than marijuana are
eligible for immediate release from incarceration, probation, and parole, and the Department of
Correction shall take action to secure such release.
SECTION 23. The headings to sections in this act are for reference purposes only and
do not constitute a part of the law enacted by this act. However, the Tennessee Code
Commission is requested to include the headings in any compilation or publication containing
this act.
SECTION 24. If any provision of this act or its application to any person or circumstance
is held invalid, then the invalidity does not affect other provisions or applications of the act that
can be given effect without the invalid provision or application, and to that end, the provisions of
this act are severable.
SECTION 25. For the purposes of promulgating rules and forms, this act takes effect
upon becoming a law, the public welfare requiring it. Section 21 of this act takes effect upon
becoming a law, the public welfare requiring it. For all other purposes, this act takes effect
January 1, 2027, the public welfare requiring it.