Vermont’s legal cannabis industry went from $0 in recreational sales in 2021 to about $150 million in 2025, and it’s on track to top that in 2026. At its helm is James Pepper, chair of the Vermont Cannabis Control Board.
Since Gov. Phil Scott appointed Pepper to the position in March 2021, the 42-year-old attorney has worked to create — and regulate — the state’s weed market.
In a recent interview, Pepper described the board as “an independent executive branch agency” created by statute. Its mission is “effectively, equitably and safely implementing and overseeing the adult-use and medical-use cannabis programs.” That broad mission can conflict with the desires of cannabis entrepreneurs, who have, at times, directed their ire at the board.
Pepper admits it hasn’t been easy. Answering to the legislature, and ultimately the governor, the board must support, encourage and learn from industry professionals while enforcing the rules. It accomplishes all this with a staff of 25 — plus Pepper and two other board members. The board has asked for a $7.1 million budget for next fiscal year, which begins in July. Pepper’s salary: about $136,000 annually.
The most difficult aspect of the job, according to Pepper, is that the industry is federally illegal. Other state entities that could help regulate the market, such as the Agency of Agriculture, Food and Markets and the Department of Health, “won’t step foot on a cannabis facility,” he said, because they don’t want to risk their federal funding.
“And so we have to be in charge of knowing all those regulations and knowing how to enforce them and implement them safely,” Pepper said.
The board writes regulations and often testifies before legislators at the Statehouse as they consider new laws. Pepper is on the record with his support for some of the proposals in this year’s cannabis bill, S.278, including increasing the quantity of THC allowed in packaged products and the amount of cannabis consumers can buy at retail stores; and offering permits for licensed sales at events, such as weddings and music festivals. The fate of this legislation remains to be decided.
And yes, if you’re wondering, Pepper does use cannabis recreationally — though not often. He’s got 7-year-old twins, and his wife, Aly Richards, just announced she’s running for governor.
“There’s not a lot of time for recreation in my household,” he quipped.
Pepper talked about the challenges of balancing different interests while creating something “brand-new for Vermont.”
Can you explain how the board works and its responsibilities?
The board’s role has evolved dramatically, because you started out with two staff members, an executive director and administrative assistant — and a massive mandate. You needed to develop all these rules that govern this industry in a very compressed timeline — while you’re, by the way, building an agency out of whole cloth. There were no office spaces. There were no computers, laptops. And we’re not stepping into someone else’s shoes. We’re creating something new.
The first phase of the board’s work, when we didn’t really have the staff, was to develop a market structure and report back to the legislature on what that market was going to look like. They said, “There’s going to be six types of licenses; you need to create tiers within those licenses. You need to define what those licenses are going to be able to do and what they’re not going to be able to do. And then we need to set fees for those license types in a way that balances covering your budget while making this an accessible market. And by the way, we don’t want big business in Vermont. We want this to be a small craft market, so make sure you take that into consideration when you’re setting fees.”
The board was heavily involved in the day-to-day operations of every aspect of the agency because we didn’t have any staff to delegate, really, anything. Now that the market is maturing a little bit more, and we have a staff of now 28 people, the board is taking a much more policy-oriented approach, whereas the staff is more operations.
It seems as if you’re supposed to be the cheerleader, supporter and booster of the market but also the regulator and enforcer of laws that you’ve created. Do you feel like that?
We always feel like that, and we feel very accountable for some of the public health outcomes. If we saw a tremendous amount of DUI [with] cannabis or huge increases in accidental exposures, particularly amongst the most vulnerable populations, the board would need to respond to that. We would have to find ways to fix whatever we’re doing that is not working.
So it’s not just us trying to make it a successful and viable marketplace. We also have to balance that against the need to take enforcement actions, make sure that we are creating a culture of compliance, and then be accountable for some of the public health outcomes — or just to be accountable to the legislature, many of whom never supported cannabis to begin with, didn’t want this marketplace in Vermont. And tax revenues are certainly nice, but there’s a lot of questions [from legislators] as to whether [creating a legal cannabis marketplace] was the right policy at all.
What’s your day-to-day job like?
A lot of my time is consumed by dealing with legislative requests, and they are always punting controversial issues to report writing. So in the summers, we are continuously doing stakeholder engagement around certain policy initiatives. And stakeholder engagement isn’t just industry; it is also a lot of the public health folks who get involved in policy development and report writing.
During the summers, I try to spend a lot of my days out in the field, visiting cannabis establishments, really being visible. Trying to understand where the struggles are, where the friction points are, where our regulations are redundant or just not adding value. A lot of our regulations were put into place based on theoretical fears about diversion, inversion, cartels getting involved, bad actors getting involved, and a lot of them aren’t necessary.
We’re trying to learn from the industry about the things that aren’t necessary, and try and normalize the business practices a little bit through regulation reform.
What’s your favorite part of the job?
My favorite part is just the fact that everything we do is brand-new for Vermont. Every aspect of the job is breaking new ground in some way or the other. And there are these intractable problems that need solutions. It’s just really exciting to be at the forefront of figuring things out. I really don’t like to re-create the wheel. I try to always look at problems in the context of how other states have dealt with them, how other agencies within our state have dealt with them, and try and take lessons learned and work with industry and interested stakeholders.
Thinking about the bill that’s moving through the Senate right now, they want us to do event licensing with cannabis, and they want to authorize us to do both public and private events. People have been consuming cannabis at festivals and weddings for as long as I can remember, but to do it in a way that is regulated and safe and hits the desires of the legislature … is a fun aspect. It’s not easy to make sure that these things don’t go sideways.
It’s always fun to try and figure this out. There’s a lot of ingenuity and creativity within this industry that I love just being a part of. One of the best parts is when you see these cannabis entrepreneurs who have been persecuted, in some instances prosecuted or stigmatized, at the very least, for their cannabis use, and now they’re doing it in the open, and they’re making money, and they’re paying their bills with it. They’re excited, and that excitement is infectious.
What’s your overall assessment of the market?
We are in a spot we were warned about when we started this operation — that the first couple years, things are going to look like they’re doing just fine. People will be making money for a large portion of our cultivators; demand is going to exceed supply. So it’s going to look like everyone’s doing well, and certainly the tax revenue, if you’re using that as measuring stake, is coming in much higher than was expected. And we have a huge number of small cultivators. They’re driving innovation, and there’s a huge number of registered products.
There’s a lot of ingenuity and creativity in this industry that I love just being a part of.
James pepper
But once people are getting more efficient at growing, and once supply starts really exceeding demand, you’re going to start to see business failures. And it’s just exacerbated by this disparate tax treatment at the federal level, the lack of banking, the exorbitant prices people pay for banking and insurance, and the evolution of this … intoxicating hemp product market. So, all those factors combined, I think our market is always in somewhat of a precarious position.
That being said, I think some of these new evolutions, the innovation in the market — the event license pilot, the [adult-use, direct-to-consumer] delivery pilot — they’re going to help us capture more consumers.
I think it’ll unlock a little bit more creativity and innovation if we can do it safely and do it well, because we are starting to lag behind some of our neighbors. For New York, they’ve got a very liberal open-consumption policy, which just means that they can do things like events. They’ve had permitted farmers markets for two years now.
We were on the vanguard of a number of issues that made our market exciting, but we’re now starting to see that, without innovation at the statutory level, we’re starting to fall behind a little bit. ➆
This interview was edited for clarity and length.
Learn more at ccb.vermont.gov.
The original print version of this article was headlined “Heady Honcho | James Pepper, chair of Vermont’s powerful Cannabis Control Board, discusses the growing industry”
This article appears in Vermont Cannabiz Guide • 2026.
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