Attorneys General Group Hosts Meeting On State-Level Regulation Of Intoxicating Hemp Products

Current and former state officials, advocates and business representatives
met last week to discuss the legal landscape around hemp-derived
cannabinoid products, including what led to the explosion of intoxicating
products across the country, potential harms posed by the largely
unregulated market and how policymakers are moving forward amid the
uncertainty.

Hosted by the Attorney General Alliance (AGA), a nonprofit that represents
state attorneys general, the June 4 webinar featured current and former
officials from Oregon, Florida, California and Nevada as well as
representatives of business and advocacy groups.

The presentation, “Illicit Hemp-Derived Intoxicants: State Enforcement
Mechanisms and Challenges,” was part of AGA’s Cannabis Project, which the
group says “seeks to provide interested parties an opportunity to dialogue
on how cannabis legalization might preserve public health and safety,
protect consumers and ensure the rule of law, while also respecting the
role of states to innovate and experiment as laboratories of democracy.”

Since Congress passed the 2018 Farm Bill, which legalized hemp nationwide,
largely unregulated products containing not only CBD but also psychoactive
THC—which the Farm Bill sought to limit in hemp products—have proliferated
online and at storefronts across the country.

That, speakers said, has allowed broad access by minors to intoxicating
products, caused confusion among law enforcement—who often struggle to tell
legal hemp products apart from federally illegal marijuana—and undercut
state-regulated medical and adult-use cannabis markets.

At the state level, policymakers are now taking steps of their own to rein
in the products, though often with different approaches.

In 2023, said Chris Lindsey, director of state advocacy and public policy
at the American Trade Association for Cannabis and Hemp (ATACH), only about
eight or nine states had laws on the books around hemp-derived
cannabinoids. Since then, he explained, “we’ve seen states rush in to this
space.”

“Around 41 [states] actually have laws on the books now that try to address
it,” Lindsey noted. “Of course, those laws are inconsistent. They’re all
over the board. They’re taking different approaches. But it speaks to the
fact that lawmakers and regulators are now a much more attenuated to the
challenges, the terminology, the different loopholes that have occurred.”

Multiple states—from California to Florida—have moved to ban intoxicating
cannabinoids in recent months. In Texas, the legislature recently delivered
a bill to the governor that would outlaw all consumable hemp-derived
cannabinoid products containing any detectable THC.

Erin Williams, an assistant attorney general in Oregon’s Department of
Justice who was not speaking on behalf of the agency, said AGs’ offices can
also “rely on their credibility as the top legal agency in their state to
seek federal change,” referencing a 2024 letter sent by 21 state AGs
calling on federal lawmakers to amend the federal definition of hemp.

“As Congress prepares to embark on a new five-year reauthorization of the
Farm Bill,” that letter said, “we strongly urge your committees to address
the glaring vagueness created in the 2018 Farm Bill that has led to the
proliferation of intoxicating hemp products across the nation and
challenges to the ability for states and localities to respond to the
resulting health and safety crisis.”

As federal lawmakers consider changes—a congressional committee earlier
this month approved a bill that would ban all hemp products containing THC—Williams
said attorneys general can also take other steps to limit possible harms,
for example by issuing advisory opinions, offering guidance to lawmakers
and targeting false claims under their consumer protection authority.

One ongoing obstacle, she pointed out, is that it’s typically easier for
state regulators to enforce laws against in-state companies compared to
manufacturers of products sold online.

Other speakers acknowledged that vagueness in the Farm Bill may have
unintentionally created the intoxicating hemp market but said that getting
a handle on the products required more than merely taking enforcement
actions against hemp products, as some jurisdictions have sought to do.

“I see some of the same mistakes being made in the hemp environment across
the states and at the federal level, because we have either either
under-regulated the product or over-regulated hemp products,” said Diane
Goldstein, a retired police lieutenant and chair of the Law Enforcement
Action Partnership (LEAP), likening the approach to the early days of
marijuana in California, which she described as the Wild West.

The hemp market is now similarly in its infancy, Goldstein said, “and law
enforcement is having a really difficult time discerning who’s the good
actor and who’s the bad actor.”

“We need some clear directions so we don’t sweep people up into the
criminal justice system for products that are potentially technically
legal,” she urged, encouraging policymakers to seek out best practices and
craft thoughtful policy.

Michelle Minton, senior policy analyst at libertarian think tank the Reason
Foundation, explained model legislation she’d developed for possible use by
state officials. Much of the current situation around hemp products, she
contended, stems from broader bans on marijuana.

“The root cause, as far as I see it, as we see in my organization, is
actually marijuana prohibition that still exists at the federal level,”
Minton said.

“Most of the consumers who are pursuing these products don’t want a
‘marijuana-like product,'” she said. “They want marijuana, but for whatever
reasons, they don’t have adequate access to those legal marijuana products.”

Among the policy recommendations in the model legislation are to allow most
forms of cannabis products—including flower, vape products and edibles and
beverages, Minton said. Products would be tested, labeled and available
only to consumers 21 and older.

“Most hemp cannabinoids should remain legal as well, including the ones
that are sometimes called synthetic or synthesized,” she continued. “But
then we kind of left leeway for the states to prohibit truly artificial
cannabinoids, the ones that do not naturally occur in in cannabis plants.”

The goal, she said, was to close loopholes that allow a lot of unregulated
products to be flowing through the market.”

“If a model like this were implemented,” Minton concluded, “this should
come with similar reforms on the marijuana industry, so that they can feel
slightly more lightly regulated [and] have fewer costs.”

Many state-licensed cannabis companies have complained that intoxicating
hemp products unfairly compete with marijuana because they aren’t subject
to the same degree of regulation and typically are taxed at lower rates.

Another speaker, Kelly Vance, assistant director of the Division of Food
Safety at the Florida Department of Agriculture and Consumer Services,
noted the difficulty of drawing a hard line between naturally occurring and
synthesized cannabinoid products.

“You can look at the molecular structure of delta 8 [THC] and heroin,
they’re not terribly different,” he said. “So if you make the argument—and
successfully—so that you can take CBD, convert it to delta 8, and it’s
legal under the Farm Bill. You take it three, four, five, 10 more steps in
a laboratory and create heroin. Did you just legalize heroin under the same
argument?”

During a short Q&A portion of the webinar, an audience member asked whether
only retailers with liquor licenses should be able to sell intoxicating
hemp products—a position some alcohol trade groups have endorsed.

“I would say that any retailer that is permitted or licensed to sell age
gated adult products, and is that has shown to do that effectively, should
be able to sell a another type of adult intoxicating product,” Minton at
the Reason Foundation replied, “and then you still have the control of, if
they’re failing to appropriately age gate, you can strip them of their
permit or license.”

Asked to look into the future, speakers said they expected Congress to
attempt to close the hemp loophole.

“I’m lobbying Congress on that issue, so I am confident that Congress will
close the loophole,” said Lindsey at ATACH, “if for no other reason [than]
that there are no other products in the United States that run free.”

Even water is regulated once it falls from the sky, Lindsey added. “They
are going to regulate intoxicants from hemp. It’s a matter of when.”

With recent sign-off from a congressional subcommittee, the latest
legislation that would ban intoxicating cannabinoids now proceeds to a full
House committee for consideration.

The 138-page bill covers a wide range of issues, but for the hemp industry,
there’s a section of particular concern that would redefine hemp under
federal statute in a way that would prohibit cannabis products containing
any “quantifiable” amount of THC or “any other cannabinoids that have
similar effects (or are marketed to have similar effects) on humans or
animals” as THC.

Rep. Andy Harris (R-MD), chair of the subcommittee, said in opening remarks
that the legislation “closes the hemp loophole from the 2018 Farm Bill that
has resulted in the proliferation of intoxicating cannabinoid products,
including delta-8 and hemp flower being sold online and in gas stations
nationwide under the false guise of being ‘USDA approved.’”

“As many states have stepped in to curb these dangerous products from
reaching consumers, particularly children, it’s time for Congress to act to
close this loophole, while protecting the legitimate industrial hemp
industry,” he said.

That would effectively eliminate the most commonly marketed hemp products
within the industry, as even non-intoxicating CBD items that are sold
across the country typically contain trace amounts of THC. Under current
law, those products are allowed if they contain no more than 0.3 percent
THC by dry weight.

The hemp language is largely consistent with appropriations and agriculture
legislation that was introduced, but not ultimately enacted, under the last
Congress.

Hemp industry stakeholders rallied against that proposal, an earlier
version of which was also included in the base bill from the subcommittee
last year. It’s virtually identical to a provision of the 2024 Farm Bill
that was attached by a separate committee last May via an amendment from
Rep. Mary Miller (R-IL), which was also not enacted into law.

“If this amendment becomes law, it will destroy the entire American hemp
industry and set back a decade’s worth of progress to fully legalize
cannabis,” Jim Higdon, co-founder of the Kentucky-based company Cornbread
Hemp, told Marijuana Moment. “Democrats and Republicans who believe in
freedom should oppose Rep. Harris’s attack on American hemp farmers.”

Meanwhile, alcohol industry representatives descended on Washington, D.C.
in April to urge members of Congress to create a federal regulatory
framework for intoxicating hemp-derived products such as
cannabinoid-infused beverages—a market segment that’s ballooned since the
legalization of hemp through the 2018 Farm Bill.

A report from Bloomberg Intelligence (BI) last year called cannabis a
“significant threat” to the alcohol industry, citing survey data that
suggests more people are using cannabis as a substitute for alcoholic
beverages such a beer and wine.

Last November, meanwhile, a beer industry trade group put out a statement
of guiding principles to address what it called “the proliferation of
largely unregulated intoxicating hemp and cannabis products,” warning of
risks to consumers and communities resulting from THC consumption.

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*Photo courtesy of Pixabay.*

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Intoxicating Hemp Products appeared first on Marijuana Moment.