The AGs argue that the 2018 federal Farm Bill, which legalized hemp with low levels of tetrahydrocannabinol (THC), unleashed a flood of intoxicating hemp products across state lines. Their proposed solution is for Congress to impose a nationwide prohibition. The irony is that nearly all of these AGs represent states that have already enacted laws governing these products, ranging from outright bans to treating them like alcohol or folding them into their existing frameworks for legal cannabis. Their request for a federal ban is a direct repudiation of the work done by their own democratically elected legislatures.  

This dynamic is perfectly illustrated by Minnesota Attorney General Keith Ellison. His state has regulated intoxicating hemp edibles and beverages since 2022—a year before establishing the state’s adult-use cannabis market—recently imposing new rules on hemp product testing. After facing backlash for signing a letter asking Congress to recriminalize products made legal under Minnesota law, his office clarified that he actually favors a carve-out for those states with “adequate regulatory schemes in place.” That nuance, absent from the AGs’ letter itself, only highlights the contradiction that these chief legal officers, sworn to uphold the laws of their states, are demanding a federal policy that would nullify them.  

Constitutionally, the framework for this issue is clear. Under the long-standing interpretation of the “Commerce Clause,” states retain the authority to regulate or ban any class of product they deem threatening to public health or safety, provided their laws do not discriminate against out-of-state producers. Congress does not interfere with this state-level power by authorizing interstate hemp commerce. However, it is up to states to implement their own rules. If attorneys general are concerned that their state laws are being violated, the responsibility of enforcement rests with them, not Congress.  

It is not surprising that attorneys general are struggling to enforce state-level restrictions on hemp. However, their frustration is the inevitable consequence of adopting overly restrictive and unenforceable regulatory regimes, rather than a loophole in federal law. As governments have learned repeatedly throughout history, prohibition—and even heavy-handed regulation—does not eliminate demand but pushes it toward unregulated alternatives. This is a lesson these officials should understand firsthand from their own states’ experiences regulating cannabis markets.  

It is therefore shocking that some of the signatories represent states like Arizona, California, and Colorado, which regulate hemp cannabinoid products under the same strict rules governing their legal marijuana markets. This raises the question of what these signatories believe a federal ban would accomplish, other than dismantling their own functional regulatory systems and handing the market back to illicit actors. 

Other states are pioneering more innovative models for hemp regulation that could effectively address the AGs’ concerns, if given time. Kentucky, a leading hemp producer, has created a sophisticated dual-track system for regulating hemp-derived products based on their potential to cause intoxication. The Kentucky Department of Public Health maintains an evolving list of cannabinoids categorized as “intoxicating” or “nonintoxicating.” Intoxicating products can be sold outside of the state’s medical marijuana dispensaries but are subject to strict manufacturing and quality controls, with a pathway for out-of-state products to enter Kentucky’s market legally. This approach fosters a compliant market capable of meeting consumer demand, demonstrating that there are many paths to ensuring public safety around adult products.  

The outcome of these state-level approaches is still unfolding. But building an effective regulatory regime that can balance public safety and market realities takes time and experimentation. What is certain is that granting the AGs’ request would bring this regulatory innovation to a screeching halt, preventing state legislatures from developing the very solutions needed to resolve the enforcement problems currently causing frustration.  

A federal hemp ban will prove no more successful than state-level prohibitions because neither eliminates demand. Just as overtaxed and overregulated marijuana markets once drove consumers to hemp, a federal hemp ban will only push them toward more harmful alternatives or back to illicit marijuana.  

The most effective solution to the problem of unregulated hemp products is a workable regulatory framework that businesses can comply with and that consumers will accept. State regimes that give adult consumers access to a variety of legal and reasonably priced state-authorized products would do far more to eliminate unregulated products than any ban. Fortunately, this work is already well underway in many states. Their attorneys general should support that effort rather than asking Congress to interfere.  

The post State attorneys general ask Congress to undermine their state hemp laws  appeared first on Reason Foundation.

But if the Trump administration is serious about reducing the harms of smoking and sticking to its campaign promises, this pilot program should be immediately expanded to include other non-combustible nicotine products, like e-cigarettes.

Currently, the expedited review for premarket tobacco applications (PMTAs) appears open only to nicotine pouches made by four companies, three of which are legacy tobacco firms. This comes as a gut-punch to e-cigarette makers, consumers, and advocates who have pleaded for a similar streamlined process for e-cigarettes since the FDA began regulating them in 2016. The agency’s failure to provide one has been catastrophic.

When Congress granted the FDA authority to regulate tobacco in 2009, the requirement to obtain premarket authorization applied only to new tobacco products. Legacy tobacco products—those marketed in the U.S. prior to 2007—were exempt from premarket authorization. This effectively shielded entrenched cigarette brands from newer, safer competitors, leading some to dub the law the “Marlboro Protection Act.”

This scenario became truly perverse in 2016. When the FDA deemed e-cigarettes subject to its oversight, all vaping products on the market were classified as “new” because there were no e-cigarettes on the U.S. market before 2007. Suddenly, every e-cigarette was forced into a prohibitively expensive and opaque PMTA process, while tobacco companies could continue introducing new cigarettes that were merely “substantially similar” to their legacy products. As many experts and some lawmakers warned, it made no sense to hold safer alternatives to a higher standard than the combustible products they were designed to displace. But the FDA ignored these warnings.

The result was a predictable public health disaster. The FDA’s unworkable approval process eliminated nearly every e-cigarette product available in 2016. Today’s e-cig market is a dystopian mix of the few Big Tobacco brands to receive FDA authorization and a flood of unauthorized e-cigarettes that poured into the U.S. market to fill the vacuum created by the FDA. Few of the independent companies that once existed could afford the $20 to $100 million cost of preparing a PMTA, nor wait the years it might take the FDA to make a decision. Those that tried were squeezed out of the market anyway. They could no longer legally compete with the legacy tobacco brands that received FDA authorization early or the unauthorized products still available in a range of flavors.

The story of Juul, once the dominant e-cigarette brand that was seen as an existential threat to cigarette sales, is just one particularly egregious example of how the FDA’s regulatory failure functionally handed the legal e-cigarette market to Big Tobacco.

In 2018, Juul was the undeniable leader in the e-cig market, representing nearly 70 percent of all e-cigarette sales. Its nearest competitor, British American Tobacco’s Vuse, captured just 13 percent. That year, Juul submitted its PMTA to FDA, reportedly spending over $100 million to prepare the 125,000-page document. But, while the FDA was statutorily required to make a decision within 180 days, it took five years. Juul only received authorization for its tobacco and menthol products this past July.

In the interim, Juul faced massive litigation, nearly went bankrupt, and fell behind its competitors. Vuse, which was authorized by the FDA in 2021, is now the market leader among authorized products, with 35% of sales. Juul is a distant third with 19%, earning fewer sales than even GeekVape—an authorized Chinese import. The technology has also advanced, making the now-approved first-generation Juul outdated before it was authorized. The company’s next generation product, which features built-in age-verification technology, has been available in the U.K. since 2022. But at the FDA’s current glacial approval pace, it will take the agency until 2030 to authorize its sale in the U.S., if it ever does.

The rise of nicotine pouches, arguably accelerated by the FDA’s destruction of the e-cigarette market, is a positive development. Like e-cigarettes, they have no combustion and do not even involve inhalation. As such, nicotine pouches are considered among the least-harmful of the safer smoking alternatives. Speeding up access to these products will undoubtedly benefit public health by giving adult smokers more options to reduce smoking-related risks. But pouches will not work for every smoker, especially those accustomed to the hand-to-mouth ritual of smoking. And it remains unclear if pouches are as effective for smoking cessation as e-cigarettes have proven to be.

The new pilot program is a quiet admission that the PMTA process is broken. It is a small step in the right direction. But, to truly fulfill its public health mission, the FDA must expand this accelerated pathway to include e-cigarettes. Doing so would give adult smokers a full range of life-saving options and allow legal U.S. companies to outcompete the growing illicit market. Streamlining the PMTA process for e-cigarettes is not just sound policy, it is a long overdue correction to a harmful regulatory failure.

The post The FDA’s plan to fast-track nicotine pouches is long overdue. But why aren’t vapes included? appeared first on Reason Foundation.

Until now, the tax system imposed on gambling mostly made sense: If you won money, you paid taxes on your net winnings—the money you made after subtracting the amount spent on losing bets. But, under the new rule, gamblers will no longer be able to deduct the full value of their losses, capping such deductions at 90% of reported winnings. This creates a tax on phantom income—forcing gamblers to pay federal income taxes on up to 10% of their winnings even if they end up losing all of it and more by year’s end.   

The change is projected to raise between $125 million and $165 million in additional tax revenue annually, or around $1.2 billion over the next decade, according to a report by the Joint Committee on Taxation. But this projection ignores gamblers’ long history of sidestepping punitive gambling laws on land, sea, and via the internet. If gamblers were to hide even just 10% more of their winnings—a likely outcome—it would completely negate the additional revenue generated by the new rule. Combined with the adverse effect the new tax would have on corporate and payroll taxes from industry contraction, the cap could result in a net tax revenue loss.  

Underreporting of gambling winnings is already a known and longstanding problem. From 2018 through 2020, just under 150,000 Americans failed to file tax returns on approximately $13.2 billion in gambling winnings, according to a report from the Inspector General for Tax Administration. The new rule will likely only make such underreporting more widespread. 

Some gamblers aware of the change might begin to avoid the types of large-prize games that trigger IRS paperwork, like winning $1,200 or more at a slot machine or $5,000 at a poker tournament. Vacation gamblers may similarly shift from Las Vegas to Macau, or to European and Caribbean casino destinations, where their winnings are not automatically reported to the U.S. government. Many gamblers will also likely turn to offshore gaming websites, which also do not report gambling winnings to the IRS, some of which now accept bets in even harder-to-track cryptocurrencies.   

But the damage extends far beyond an uptick in underreported gambling winnings. Mid- and high-stakes poker tournaments could face collapse as players weigh hefty buy-in fees and other costs against diminished returns. Fewer entrants mean smaller prize pools and likely fewer events for professionals. Poker coach Phil Galfond warned the rule would essentially end professional gambling in the U.S. Alex Cane, CEO of the betting exchange Sporttrade, echoed the sentiment, declaring that no gambler “serious about betting is going to bet anymore, or at least not going to report that they do.” Casino owner Derek Stevens similarly worried about the impact on Vegas casino-resorts, arguing that the new rule would force many bettors to move offshore.  

The stakes are also existential for states invested in the gaming industry, like Nevada, where gambling taxes fund around 35% of the state’s budget and where the industry supports around 27% of the state’s workforce. Nationwide, the $330 billion gaming industry directly employs around 700,000 people and supports a total of 1.8 million jobs, according to industry data. All of that could be threatened as gamblers inevitably seek out alternatives to avoid the new tax.  

These concerns prompted Nevada Rep. Dina Titus (D-Clark County) to introduce the Fair Accounting for Income Realized from Betting Earnings Taxation (FAIR BET) Act days after the passage of the new rule. Her bill would restore the 100% deduction for gambling losses, eliminating the phantom tax. The legislation represents more than fairness for gamblers—it is protection for the nearly 2 million American jobs and state budgets relying on a healthy U.S. gaming industry. 

The phantom tax provision in the new rule appears solely aimed at raising federal revenue from a politically vulnerable group. Though most Americans gamble occasionally, few will defend the activity against tax hikes. But this short-sighted policy risks repeating past mistakes.  

When taxes make legal gambling punitive, players simply move underground. Unregulated bookies thrived when sports betting was banned in the U.S. Offshore websites boomed after the crackdown on online poker. The new rule guarantees that history will repeat itself—shrinking the legal industry, fueling illicit activity, and ultimately costing jobs and revenue.  

The post How the One Big Beautiful Bill Act taxes gamblers on money they didn’t keep appeared first on Reason Foundation.

In the shadowy world of illegal gambling, where there is no legal oversight, corruption is harder to detect and easier to profit from. Offshore bookies have no obligation to report suspicious activity and may even benefit from match-fixing if it helps balance their books. By contrast, legal markets create transparency. It was, in fact, regulated sportsbooks that first flagged unusual betting activity around Porter’s games and alerted authorities, triggering investigations by the NBA, the Colorado Division of Gaming, and federal law enforcement.

In an illegal betting market, Porter’s misbehavior might never have been uncovered. This is not an anomaly. From the infamous “Black Sox” scandal—in which several members of Chicago White Sox were allegedly paid by a gambling syndicate to lose the 1919 World Series—to the present day, it is almost always the bookies who catch on to match-fixing earliest. In regulated markets, those bookies have not only the tools to spot corruption, but also the financial and legal impetus to do something about it.

Butler’s nostalgia for a pre-2018 era—when federal law prevented most states from regulating sports betting—is misguided. By 2015 Americans were placing an estimated $150 billion in illegal sports wagers annually—primarily through offshore sportsbooks and with no consumer protections or oversight. Prohibition didn’t stop sports betting, but it did preserve the illusion that it wasn’t happening and that sports were “clean.”

Butler’s essay does raise valid concerns surrounding the implementation of sports betting laws, including potentially predatory behavior by gambling companies, inadequate support for problem gamblers, and lax consumer protections. But, these are arguments for better regulation, not recriminalization. States are refining their rules around betting behavior, advertising, and consumer protections as regulators gain expertise and learn from other state’s experiences. This iterative process is how federalism is supposed to work.

Butler’s discomfort with the “normalization” of sports betting in American culture echoes a broader paternalism that conflates visibility with harm. Legalization didn’t create the demand—Americans have bet on sports for decades—but it did provide safe and regulated environments for that demand to be satisfied legally. He may lament the loss of its “dodgy stigma…suspect bookies” and “dilapidated parlors.” Yet, that stigma and potential danger didn’t deter bettors—it only forced them into unnecessarily risky environments, leaving especially vulnerable gamblers, like women, without the protections offered by legal sportsbooks.

Legalization has increased the visibility of sports betting, including in-game odds analysis and marketing for betting opportunities that clearly rub some sports fans the wrong way. But this criticism confuses cultural discomfort with genuine harm. Analysis of betting odds has been integrated into sports coverage for decades, with a majority of newspapers publishing betting lines since the 1980s. Ad saturation, while perhaps annoying, is neither new nor uniquely dangerous—it’s the inevitable byproduct of moving a once-clandestine activity into the regulated marketplace.

His most alarming criticisms of sports gambling legalization center on the assertion that legal sports betting increases domestic violence and brings financial ruin to families. But these claims immediately collapse under scrutiny. The studies he implicitly relies on, like those critiqued by my colleague Jacob James Rich, suffer from such glaring methodological flaws that their conclusions are unreliable. One frequently cited paper by Kyutaro Matsuzawa and Emily Arnesen tied intimate partner violence in states with legal sports betting to home-team losses but ignored the effect of away games and whether those committing violence actually bet on games, skewing results.

Another study by  Brett Hollenbeck, Poet Larsen, and David Proserpio attributes a trivial 0.3% dip in credit scores post-gambling legalization, then stretches this to blame legalization for bankruptcies. Not only do such studies conflate correlation with causation—a recurring issue in gambling research—they also distract from the real issue of abusive behavior, which studies link to sports losses even in the absence of gambling. Should we ban football games to curb violence? Of course not. The solution is to hold abusers accountable and investigate the actual root causes of violence and financial instability; not to scapegoat a legal industry and responsible gamers for societal ills.

None of this is to say that sports betting is free of risk. There will continue to be bad actors in the worlds of sports and gambling and some portion of the population will likely always struggle with disordered gambling whether the activity is legal or not. But these realities demand clear-eyed policy—not prohibition.

Butler begrudgingly acknowledges a “reversal of legalization does not seem to be in the cards, for now.” Instead, he urges states to regulate the activity “carefully” and learn from the experience of their neighbors. On that, at least, we agree. For more than a quarter century, Congress ignored the growing problem of illicit sports betting, despite its own experts declaring it “the most widespread form of gambling in America” as early as 1999. Yet, in the mere seven years since the Supreme Court overturned the federal ban, 38 states have legalized and regulated the activity, with many repeatedly revisiting those rules and refining them in response to consumer demand, evolving industry practices, and learning lessons.

While not all states got it right from the jump, they have demonstrated a willingness and ability respond, revise, and improve. That is what a healthy regulatory process looks like and supposedly what our federalist system is meant to do: empower states to act as laboratories of democracy, learning from each other and adjusting policies as needed.

That is the path forward—not prohibition, not moral panic, not virtue-policing adults, and certainly not a return to the days when illicit gambling and corruption flourished in the shadows. 

The post Legal gambling enhances sports integrity—despite what critics claim appeared first on Reason Foundation.

It’s an idea that, if implemented carefully, could improve inmate health, reduce contraband tobacco markets in prisons, and lower prisons’ healthcare expenses without increasing risk to the public. For those of us who have spent years advocating for pragmatic, science-based policies to reduce the harms associated with tobacco use, this proposal checks nearly every box. Importantly, it also centers discussion on a population too often ignored by both the tobacco harm reduction and tobacco control movements. For that reason alone, it deserves careful consideration by all experts in the field, regardless of their ideological camp.  

Smoking among incarcerated people is staggeringly high, with estimates ranging from 70 to 80 percent. That’s roughly seven times the national average, even though tobacco has been banned in federal prisons since 2014 and removed from commissaries since 2006. Most state-run prisons prohibit smoking inside prison facilities, many extending that ban to include possession or use of any tobacco product anywhere on prison grounds.  

But like every form of prohibition, these prison tobacco bans haven’t eliminated tobacco use. Instead, illicit tobacco markets thrive in prisons, with inmates obtaining contraband cigarettes through smuggling or bribery. Some turn to improvised tobacco products—made by inmates who collect used tobacco chew spit out by guards—with some reportedly turning to more hazardous alternatives, like “spice” (synthetic cannabinoids), to mimic the experience of smoking.  

The public health rationale underlying “smoke-free prison” policies is the idea that non-smoking prisoners and guards should be protected from second-hand smoke, as well as a belief that forcing smoking inmates to break their nicotine dependence while in prison will improve their health and lead to long-term smoking cessation after release. Even if those goals justified such coercive and cruel tactics—like using solitary confinement to punish inmates caught with contraband cigarettes—the fact is that prison tobacco bans do not work. The vast majority of inmates who quit smoking while incarcerated typically relapse upon release—around 98% by some estimates. Many incarcerated people, in fact, only begin smoking while they are incarcerated.  

In his Filter article, Kirkpatrick—who is currently incarcerated in Washington Corrections Center in Shelton, Washington—argues that allowing the sale of nicotine vapes in prison commissaries could accomplish what tobacco bans have not: reduce smoking among inmates and keep them smoke-free after release. A significant amount of evidence suggests he is right.  

Numerous studies indicate that smokers who switch from cigarettes to vapes see rapid health improvements. For prisoners, that could translate into fewer smoking-related illnesses, doctors’ visits, and health emergencies. Smokers who switch to harm reduction products are also less likely to relapse—with high-quality evidence for e-cigarettes, in particular—indicating that they are even more effective for smoking cessation than traditional nicotine replacement therapies, such as the nicotine patch or gum. This could lower the rate of smoking among inmates after release, reducing healthcare costs both during and after incarceration.  

E-cigarettes, unlike other tobacco harm reduction products, might raise concerns within the context of prisons as they can pose a fire hazard or potentially be used in improvised weapons. However, prisons can opt to purchase specially designed vapes, with soft plastic casings and low-voltage, non-rechargeable batteries—like those already offered in Kentucky and Pennsylvania prison commissaries.   

And, unlike most policy proposals involving e-cigarettes, this one sidesteps the two biggest political landmines: youth use and taxpayer cost. Youth access to e-cigarettes or other tobacco harm reduction products is a non-issue in adult prisons. And there’d be no cost to taxpayers so long as prisons marked up commissary prices just enough to cover costs. But to truly succeed, this policy proposal requires careful implementation.  

Prices that commissaries charge for tobacco harm reduction products are a pivotal factor in whether this policy would succeed or fail. Kirkpatrick, in presenting his idea, reasonably points out that commissary sales of tobacco harm reduction products might generate modest revenue for prisons, which he suggests they direct toward prison maintenance and programming. However, while this potential for cost-offsetting might enhance the policy’s political appeal, any discussion about “revenue generation” from imprisoned people should justifiably raise alarm bells.  

Too many prison systems already engage in financial exploitation of inmates—charging exorbitant fees to make phone calls and send emails, inflating commissary prices, and taking hefty cuts out of low- or non-existent prison wages. Reports suggest that prisons that already sell vapes in commissaries impose markups exceeding 700% over cost. In addition to being exploitative, these sky-high prices undermine the goal of giving inmates safer alternatives to smoking.  If smoking inmates cannot afford commissary prices for tobacco harm reduction products, they will continue to smoke or turn to the contraband market, reinforcing harmful behaviors rather than replacing them. Worse, the policy could become just another revenue stream wrung out of a captive population.  

To work as intended, the safer products at prison commissaries must be attractive, affordable, and accessible, and they must be competitive with combustible cigarettes in both cost and appeal. That means avoiding price gouging, ensuring product quality, and offering inmates real choices. Offering choices to inmates might be among the harder parts of implementing this policy, particularly if prisons are limited to purchasing only those products that have received authorization by the U.S. Food and Drug Administration. Thus far, the FDA has approved only a handful of e-cigarettes, heated tobacco products, nicotine pouches, and smokeless tobacco products. Yet, affordable access to even some of these products would give inmates a chance to switch from smoking to safer alternatives and represent an improvement on the status quo.   

At its core, allowing prison commissaries to sell safer alternatives to smoking isn’t just about reducing tobacco-related disease or helping prisons save money on healthcare. It is about giving incarcerated adults some sliver of control over their own lives and health—it acknowledges their agency in a system built to deny it. That alone is reason to take the proposal seriously.  

For those working in tobacco policy, it is also a chance to put marginalized nicotine users at the center of our advocacy—an imperative too often neglected. Putting safer alternatives to smoking in prison commissaries won’t fix everything, but it is a humane place to begin that might move our criminal justice system ever-so-slightly toward human dignity.  

The post Prisons selling vapes? Smart public health policy and a step toward autonomy behind bars appeared first on Reason Foundation.

Rather than yielding to Lt. Gov. Dan Patrick’s demand for an outright ban, Abbott has called for a special session in July to develop a regulatory framework that protects consumers while preserving the thriving legal industry. This is the right move, and the Texas legislature should seize the opportunity to implement policies that balance public safety, personal choice, and economic freedom.  

SB 3 was a classic example of politics being led by moral panic rhetoric rather than sound policy and public welfare. Proponents, led by Patrick, sold the measure on fears about hemp with tetrahydrocannabinol (THC)–the chemical that gives marijuana its intoxicating effects—and framed prohibition as necessary to protect schoolchildren. In reality, the bill would have not only banned those hemp products with any detectable amount of THC, but also those with any other cannabinoid except cannabidiol (CBD) and cannabigerol (CBG). But, since even non-intoxicating CBD products typically contain trace amounts of THC and other cannabinoids, even these would not have escaped SB 3’s prohibitions.   

History has repeatedly shown that the prohibition of substances doesn’t eliminate demand; it simply drives the market underground, where unregulated producers are not held accountable for safe manufacturing practices, accurate labeling, and ensuring intoxicating products are only sold to adults. Instead, prohibition puts consumers at even greater risk while also increasing the effort and resources needed to enforce the law. Texans already experience this firsthand with cannabis, where prohibition has merely resulted in mass arrests and a thriving illicit market worth an estimated $6 billion.   

A ban on hemp-derived THC would have done the same, forcing consumers toward unregulated products, stimulating illicit and cross-border sales, and actually increasing youth access through these unregulated and age-unrestricted channels. Pediatric patients and veterans who rely on hemp products for therapeutic purposes would have been particularly harmed by the ban, forced to rely on unregulated products or turn to potentially more dangerous substances, like opioids. On top of that, it would have devastated a burgeoning market that supports around 50,000 jobs and generates $8 billion in tax revenue for the state annually, according to industry data.   

In his veto statement, Abbott agreed with SB 3 proponents on the need for immediate and strong regulation of consumer hemp products. However, he also rightly acknowledged that SB 3 would have clashed with federal law—the 2018 Farm Bill, which legalized hemp and its derivatives. If approved, the measure would have faced immediate legal challenge, as it constituted an uncompensated taking of private property and business investments. Abbott warned that it would also inadvertently “make felons of other innocent Texans, like pharmacists stocking health supplements, veterans treating PTSD, and parents caring for epileptic children with FDA-approved medications.”   

Instead of SB 3’s prohibitionist approach, Abbot wants lawmakers to use the July special session to craft sensible regulations. Similar to Reason Foundation’s recommended framework for state regulation of hemp products, he suggests that lawmakers approach regulating these products similarly to alcoholic beverages. He also detailed specific provisions he’d like to see lawmakers adopt, including limiting sales to retailers that restrict access to minors, imposing testing and labeling requirements, outlawing public consumption, restricting permissible THC levels in products, limiting individual purchases, and allowing local governments to ban or limit retail hemp sales.   

To strike the right balance, there are several key issues that the Texas legislature will need to carefully negotiate.   

Issue 1: Potency limits  

The first and perhaps most complex of these issues will be how limits on THC potency are set and determined. Currently, Texas—like many other states—follows federal law, which limits hemp products to no more than 0.3% THC by dry weight. Because THC is measured based only on the dry portion of products, this standard allows companies to produce hemp products—particularly in beverage and edible form, since their weight is primarily comprised of water or gelatin—with as much THC as marijuana products while still adhering to THC thresholds for legal hemp.   

In its final form, SB 3’s prohibition on hemp products with cannabinoids other than CBD or GBG was a draconian standard that would have effectively outlawed most hemp products. The House committee substitute for SB 3 (CSSB 3), on the other hand, abandoned this approach in favor of THC limits based on milligrams per serving and package. This milligram-based limit is far more accurate in terms of gauging products’ potential for intoxication and is an increasingly popular approach among states to close the “dry weight loophole.”    

Under the House substitute version of the bill, hemp products would have been limited to no more than 10 mg of THC per serving and 100 mg per package (with stricter limits for certain products). While this is both more practical and sensible than the original bill, it still fails to distinguish between high-THC and very low-THC hemp products—treating them all the same despite vast differences in psychoactive risk.   

Some states, like Minnesota, have adopted a two-tiered system for hemp products, imposing lighter regulations on products with minimal THC (e.g., less than 5 mg per package) that are extremely unlikely to cause intoxication even if consumed in full. Reason Foundation encourages Texas lawmakers to consider a similar approach in order to ensure that low-THC hemp products—particularly those used for therapeutic purposes—will remain accessible and affordable without unnecessarily burdensome restrictions.   

Issue 2: Purchasing limits and privacy concerns  

Another contentious issue will likely be if—and how—the legislature should impose purchasing limits on individuals. In his veto proclamation, Abbott explicitly endorsed such limiting purchases “in a given period,” though he did not specify exactly what those limits ought to be. While some states, like Washington and Oregon, track cannabis purchases through state-run databases to enforce daily limits, this will likely raise concerns in Texas about government overreach, surveillance, and data security. For example, thousands of cannabis consumers across the U.S. had personal data leaked—including photographs of their government-issued photo IDs—after a point-of-sale system used throughout the cannabis industry was breached. Moreover, a person’s presence on a state purchasing database could endanger their rights to possess a firearm or could be used as evidence against them in a family court proceeding.  

Fears over data privacy and surveillance can deter customers, potentially pushing some to opt for purchasing hemp through unregulated channels. This would not only put those consumers at greater risk from unregulated products but would also thwart the underlying goal of regulatory oversight. If Texas lawmakers opt to impose limits on individual purchases, they should do so in a way that protects the rights and privacy of consumers.   

The easiest way to do this would be to impose such restrictions only on shops, not individuals. This would be similar to Michigan’s rules, which impose limits on how much recreational cannabis can be sold per transaction but do not require tracking of individual consumers. Oregon, which also imposes per-transaction limits on cannabis sales, explicitly bars dispensaries from collecting or retaining this sort of customer data over privacy concerns.   

While these approaches would allow customers to work around purchasing limits by visiting multiple shops, it would still be more effective at deterring large purchases than would be achieved in the illicit market. In their special session, Texas lawmakers will have to decide if strict enforcement of purchasing limits is worth the trade-offs when it comes to protecting consumer privacy and encouraging compliance.   

Issue 3: Local bans and market fragmentation  

Another recommendation Abbott suggested is giving local governments the option to prohibit or limit hemp sales. While this might sound like a reasonable concession, it could lead to access issues that would undermine the regulated market. California cannabis law, for example, includes a similar provision that has led to around half of the counties in the state banning cannabis sales. As a result, nearly half the state’s population lives in “pot deserts” where the closest legal dispensaries might be more than 60 miles away. Unsurprisingly, this has continued to fuel illicit sales with consumers searching for more convenient, if unregulated, options. If Texas enshrines local bans, it may stifle industry growth and undermine enforcement by encouraging similar illicit activity. However, if legislatures deem such provisions as necessary, they should be careful to include safeguards to avoid or address access deserts if they arise, such as by allowing the state to preempt local bans in underserved areas.   

Issue 4: Licensing fees   

While the House committee substitute version of SB 3 established a relatively reasonable fee structure for licensing hemp businesses, such details were conspicuously absent from the bill’s final form. Had it been enacted, this version of the law would have given the regulatory agency the power to dictate licensing fees through rulemaking without additional feedback from the legislature. How much or how little to charge hemp businesses for the privilege of operating within Texas will likely be a major subject of the July special session, and for good reason. Fees that are too high can artificially restrict the market in ways the legislature didn’t anticipate or desire. In particular, exorbitant licensing cost can price out small businesses and consolidate the market in the hands of those companies with deep pockets or political connections.   

In addition to contradicting Texas’s business-friendly stance, market consolidation poses a threat to the state’s ability to enforce its laws, as would-be entrepreneurs and customers opt to stay in the illicit market for the simple fact that they cannot afford licensure. To avoid this outcome, Texas should avoid excessively high licensing fees and create a tiered fee structure with cheaper options for small or micro-businesses. Several states, including California, New York, and Michigan, have adopted this sort of tiered licensing fees based on business scale. This approach not only encourages greater participation in the legal market but also reduces consolidation and increases competition, keeping consumer prices low.   

Issue 5: Interstate commerce and out-of-state products  

Yet another issue legislators ought to weigh carefully during their special session is how Texas should regulate out-of-state hemp products. This is a critical issue both in terms of complying with constitutionally protected interstate commerce—and avoiding legal challenge—as well as establishing a market which encourages compliance and consumer safety. Even if hemp products were not federally legal and states were thereby prevented from entirely blocking interstate commerce, law enforcement simply does not have the ability to stop the flow of products across state borders. Without a viable path for legitimate products to legally enter Texas’ market, consumers would have no way to verify whether those products are sanctioned by the state and meet Texas’ safety standards.      

While all versions of SB 3 made some allowance for out-of-state hemp products, all failed to adequately address the issue. In its original and final form, SB 3 would have allowed the sale of out-of-state hemp products so long as they were produced, processed, and tested in compliance with Texas law. Yet, that would have applied to such a small segment of the hemp market—those products with no detectable THC—that it would have done little to curtail cross-border distribution, leaving consumers of these other hemp products without clarity. The House committee substitute version of SB 3 set out a robust pathway for out-of-state hemp products to become certified for sale in Texas but included a “Texas origin” requirement for hemp flower, essentially limiting legal hemp flower to hemp grown within the state. This would have almost certainly been successfully challenged as a violation of the U.S. Constitution’s dormant commerce clause by creating a bias against out-of-state economic interests.   

A better option for Texas would be to follow Kentucky’s approach, where out-of-state products can be sold in the state so long as they register with regulators and meet baseline testing, labeling, and quality rules. This streamlined path to interstate commerce allows Kentucky consumers to trust that products available to them are free of contaminants, accurately labeled, and regulated by their state, regardless of their origin. Texas should seriously consider doing the same.   

Issue 6: Protecting civil liberties and avoiding overcriminalization  

The last issue likely to generate debate in the legislature’s special session is how violations of the law ought to be treated. Past versions of SB 3 included needlessly punitive enforcement measures—such as criminal penalties and jail time for possession of unsanctioned hemp products—that risked turning minor infractions into criminal offenses and trampling Texans’ civil liberties.   

A glaring omission from all versions of SB 3 was any safeguard against warrantless searches or seizures based solely on the odor of hemp or possession of legal hemp products. This loophole would perpetuate the same types of discriminatory policing practices state-level marijuana legalization hoped to address—where the odor of marijuana served as a pretext for searches and seizures. Even with federal legalization of hemp, law enforcement unable to distinguish hemp from marijuana by sight or smell, continue the same sort of unjustified stops and searches. To protect Texans’ civil rights, legislators should incorporate explicit language into any proposal that protects people from being stopped, searched, detained, or arrested solely on the basis of law enforcement seeing or smelling hemp—or marijuana since their scent is the same—unless they have probable cause to believe a crime has been committed.   

Iterations of SB 3 also treated minor violations—like small-scale possession, minor breaches on THC limits, and open containers in vehicles or minor THC breaches—as criminal misdemeanors rather than civil infractions. This ignores the reality that many violations can stem from unintentional errors (e.g., lab testing variances) and lack of consumer awareness. Lawmakers can address this by reserving harsh criminal penalties for willful violations of the law’s most serious provisions, such as falsifying lab reports or large-scale illegal distribution, while treating minor or accidental violations as civil infractions. Not only would this protect consumers from unnecessary policing, it would also ensure law enforcement resources are being used efficiently and focused on major violations rather than policing people’s hemp use.   

A conservative approach to drug legalization  

In addition to infuriating Patrick, Abbott’s veto of SB 3 has exposed the growing rift between prohibitionist hardliners and those conservatives who acknowledge the failure of the War on Drugs. Even prominent right-wing voices, like former National Rifle Association spokesperson Dana Loesch, criticized SB 3 for “idiotically expanding government” while ignoring parental responsibility.   

The upcoming special session offers Texas lawmakers an opportunity to bridge this divide and gives Texas a chance to demonstrate how conservative states can responsibly regulate adult-use substances without resorting to big-government overreach and freedom-stomping bans. To succeed, legislators must carefully listen to stakeholders, reject fear-driven narratives, and prioritize consumer welfare. Crafting a light-touch regulatory framework—one that fosters compliance, promotes agency coordination, and affords both businesses and regulators sufficient clarity and flexibility—can ensure public safety without sacrificing economic opportunity or personal freedom.   

The governor made the right call. Now it’s time for the legislature to follow through with a regulatory system that keeps Texans safe and free.  

The post Hemp in Texas: Regulation—not THC prohibition—is the sensible path forward    appeared first on Reason Foundation.

Many Texans are adamantly opposed to Senate Bill 3 becoming law. The state’s farmers, veterans, small business owners, civil rights advocates, and medical patients are among those who have spoken out against the proposed de facto hemp ban.

While considering Senate Bill 3, both chambers of the Texas legislature heard from thousands of constituents and had a unique opportunity to build consensus with a new regulatory approach to hemp, balancing public health and safety with product accessibility. Instead, unfortunately, the state legislature prioritized the concerns of the alcohol and beverage industries and pursued a prohibition approach to hemp.

The legislature’s analysis of the bill finds significant flaws. The analysis estimates a $27 million revenue loss to the state’s General Fund over the next two years and millions more in losses at the city and county levels. Beyond this financial impact, SB 3 would result in devastating criminal justice consequences by creating nine new criminal offenses for conduct pertaining to consumable hemp products, including two third-degree felony offenses.

The Texas hemp industry is booming, supporting an estimated 50,000 jobs valued at over $8 billion. Senate Bill 3 would effectively dismantle this industry, create widespread confusion amongst consumers and public safety officers, and likely lead to a proliferation of unsafe and unregulated product sales in Texas.

The concerns raised in SB 3 regarding the quality and safety of novel and potentially intoxicating hemp products are warranted. Similarly, the desire to prevent youth access to potentially intoxicating hemp products and to impose reasonable manufacturing and testing standards on consumable hemp products is worthy of consideration.

However, SB 3 adopts an overly blunt approach that risks undermining its goal of consumer health protection by inadvertently driving individuals toward unregulated markets or products and criminalizing patients. 

Senate Bill 3 would effectively outlaw all hemp and CBD products in Texas

A critical point of concern is the bill’s proposed limit on the allowable concentration of THC in hemp products. Generally, a THC concentration of 1% is considered the threshold at which cannabis products begin to exhibit intoxicating or psychotropic effects. Senate Bill 3 proposes to cap the concentration of THC, as well as any cannabinoid other than CBD or CBG, at 0.0001% on a dry weight basis. This standard is 3,000 times lower than the federal government’s 0.3 percent delta-9 THC limit and 10,000 times below the 1% threshold generally recognized as the point at which products begin to exhibit intoxicating effects.  

While the intent to control intoxicating products is understandable, this extreme limit is neither practical nor scientifically justified. Hemp naturally contains trace amounts of THC, and eliminating it entirely is virtually impossible without rendering the product unusable. By setting such a low threshold, SB 3 would effectively outlaw nearly all hemp-derived products, including those that pose no risk of intoxication and those with proven therapeutic benefits on which many Texas patients rely, such as high-dose CBD products that contain THC at non-intoxicating levels.  

A ban on THC and other cannabinoids will harm Texas patients and consumers 

The proposed 0.0001% THC limit would have far-reaching consequences for the hemp industry and consumers. While several states have enacted regulations on hemp-derived cannabinoids, including limits on allowable THC, none have set a threshold as low as that proposed in SB 3. Even states that classify all forms of THC as controlled substances make exceptions for the trace amounts found in hemp.

For example, in states like Kentucky and Tennessee, which have robust hemp regulations, THC limits are aligned with the federal standard of 0.3%. These states have successfully implemented testing and labeling requirements to ensure consumer safety without resorting to outright bans. In contrast, SB 3’s approach would make Texas an outlier, effectively outlawing all hemp products. 

This situation is particularly concerning for patients and families who depend on hemp-derived cannabidiol (CBD) to treat seizure disorders, such as Dravet Syndrome, a rare and severe form of childhood epilepsy. For these patients, high-dose CBD products, which may contain trace levels of THC above 1%, can be a lifeline that offers relief from debilitating symptoms that are often inadequately managed by conventional medications.  

These individuals need assurance that the CBD products they rely on are safe, free from harmful contaminants, and accurately labeled for proper dosing. Rather than providing this necessary reassurance, SB 3 would eliminate their legal access to effective CBD products in the state. Consequently, patients would be forced to forgo essential therapy, travel out of state to purchase it, or turn to unregulated markets, exposing them to potentially greater risks from contamination or improper labeling than the risks posed by intoxicating hemp products. Perhaps even more concerning, rather than protecting these patients and facilitating their access to safe and regulated hemp products, SB 3, as written, would criminalize those patients who seek out such products from states where they are legal and regulated.  

SB 3 would criminalize patients and consumers 

Another critical concern is the criminal penalties established by SB 3 for the possession of hemp products containing trace amounts of cannabinoids other than CBD or CBG. This provision would disproportionately harm patients and consumers who rely on these products for medical or wellness purposes.

For example, a parent legally purchasing a full-spectrum CBD product in a neighboring state to treat their child’s epilepsy could face a Class A misdemeanor simply for bringing the product into Texas. Similarly, a veteran using a hemp-derived product to manage chronic pain or PTSD symptoms could be criminalized for possessing a product that is legal under federal law and in most other states.  

This criminalization is not only unjust and cruel toward patients but also counterproductive. It would not stop the flow of legal hemp products into Texas; it would only drive consumers to unregulated markets, where products are more likely to be untested, unsafe, or mislabeled.

Moreover, the lack of access to effective products regulated by and legal in Texas will stimulate demand for unregulated and out-of-state products, potentially imposing insurmountable challenges for Texas law enforcement in determining the origin and content of products found in people’s possession.  

SB 3 conflicts with federal law and interstate commerce 

The 2018 federal Farm Bill legalized hemp with a THC concentration of no more than 0.3% on a dry weight basis, creating a clear federal standard for hemp production and interstate hemp commerce. By setting a THC limit 3,000 times lower than the federal standard, SB 3 would put Texas at odds with both federal law and the laws of other states. This conflict raises serious legal and practical concerns.  

Hemp is a national industry, with products like CBD oils, edibles, and supplements traded legally across state lines. SB 3 would not only disrupt this market by creating confusion and inconsistency for businesses and consumers but may also violate the Constitution’s Dormant Commerce Clause (DCC).   

The Constitution’s framers were expressly motivated to replace the original form of American government, as articulated under the Articles of Confederation, to prevent the states from erecting trade barriers. Through the years, courts’ interpretations of the dormant commerce clause (DCC) have generally held that states cannot enact policies that impede the free movement of goods, persons, or capital within the union. While SB 3 applies its restrictions uniformly to hemp products produced inside or outside of Texas, its extreme divergence from federal and other state standards could be seen as an undue burden on interstate commerce, potentially making the law vulnerable to legal challenge. 

Economic impact on Texas 

SB 3 would also have devastating economic consequences for Texas businesses, crippling a thriving industry and undermining the livelihoods of thousands of Texans. In 2022, the hemp industry in Texas was valued at $8 billion, supporting roughly 50,000 jobs in the state. This industry has also become a lifeline for farmers, particularly smaller operations that rely on hemp as a profitable and sustainable crop. However, for hemp to remain a viable agricultural commodity, farmers depend on robust end markets for their crop. SB 3’s restrictions would decimate these markets, reducing demand for hemp crops and causing widespread harm to the state’s economy.  

Hemp cultivation for cannabinoid extraction, particularly CBD and other beneficial compounds, has become a critical revenue stream for Texas farmers. In 2023, hemp flower and cannabinoid extraction accounted for over 30% of the total harvested hemp acreage nationwide, generating $241 million in income for farmers.

In Texas, where hemp fiber and grain markets are still underdeveloped, cannabinoid production is one of the few economically viable uses for the crop. Without a market for cannabinoids, many farmers would lose a significant source of income, forcing them to abandon hemp cultivation altogether or relocate to states with more reasonable regulations.  

Senate Bill 3’s consequences may be particularly harmful for farmers operating on smaller acreage. Unlike traditional crops, hemp offers higher profit margins and the flexibility to adapt to market demands. For many of these farmers, hemp represents a rare opportunity to compete in an increasingly consolidated agricultural sector. SB 3’s restrictions would disproportionately harm these smaller operations, which lack the resources to pivot to other crops or absorb the financial losses caused by a collapsing hemp market. 

The economic impact of SB 3 would extend beyond the hemp industry. Nationally, the market for hemp-derived cannabinoids is booming, with industry experts estimating its value at between $28 billion and $36 billion in annual sales. Texas, with its favorable climate and agricultural expertise, is well-positioned to capitalize on this growth. However, SB 3 would stifle innovation and investment in the state, pushing businesses, entrepreneurs, and investors to more hemp-friendly states like Tennessee and Kentucky. These states have embraced the economic potential of hemp, creating thousands of jobs and generating millions in tax revenue. By contrast, Texas risks losing its competitive edge and becoming a cautionary tale of missed opportunities. 

Reasonable hemp regulations  

If the aim is to protect consumers from unregulated products while keeping potentially intoxicating hemp products away from minors, we encourage Texas lawmakers to develop a sensible regulatory framework governing hemp products. Reason Foundation’s recently published study, A Framework for Federal and State Hemp-Derived Cannabinoid Regulation, offers detailed recommendations for state regulation of the production, testing, labeling, and sale of both intoxicating and non-intoxicating hemp products without imposing arbitrary or prohibitive THC limits that could hinder consumer access and expand illicit markets.

A sensible regulatory framework would include:  

• Safe manufacturing standards for hemp-derived goods; 
• Final product testing requirements to ensure products are free of harmful contaminants; 
• Packaging standards for clear and accurate labeling; 
• Age restrictions on the purchase of intoxicating hemp products; and 
• Restricted sales of intoxicating hemp products to outlets with established age-gating practices.  

By implementing a framework that prioritizes transparency, product quality, and compliance, Texas could more effectively ensure consumer safety than through blanket prohibitions. This approach would protect consumers, support public health, and promote a regulated, orderly market without creating the undesirable consequences associated with prohibition.   

Conclusion 

In conclusion, Reason Foundation urges Governor Abbott to veto Senate Bill 3 in its current form. While the intent of protecting consumers is commendable, the bill’s provisions would inadvertently harm those who rely on hemp products for therapeutic benefits and other hemp consumers in the state.

A previous version of this commentary was first published on March 5, 2025.

The post Why Gov. Greg Abbott should veto Texas Senate Bill 3 appeared first on Reason Foundation.

A new report published in April by the American Consumer Institute (ACI), “Betting on the Future: Crafting Smart Policies for a Thriving Online Sports Betting Market,” finds that widespread legalization did not lead to significantly more spending on gambling in states where sports betting was legalized compared to states that maintained a prohibition. Using 2015 and 2023 data from the Bureau of Labor Statistics’ Consumer Expenditure Survey, the study compared per capita gambling spending in states before and after those states legalized sports betting, as well as those that did not. The results were striking:

• $60: Average annual gambling spending in states with no legal sports betting.
• $65: Average in states with only in-person sports betting.
• $28.50: Average in states with both online and retail sports betting.

Contrary to popular belief and media portrayals, easier access to legal sports betting has not fueled reckless spending. In fact, states with the most accessible markets, including online betting, saw the lowest per capita expenditures. 

This snapshot of overall household expenditures on gambling pre- and post-legalization does not offer a complete picture of how sports betting legalization might affect problem gambling rates. However, it does indicate that broad legalization has not driven significant increases in spending on the activity compared to states that did not legalize. This aligns with decades of research on gambling disorders, which have remained remarkably steady around the world over the decades. 

Globally, around one percent of world’s adult population meets the clinical definition of disordered gambling—also known as pathological gambling or gambling addiction, which is defined by the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition as persistent and harmful gambling patterns, including increased spending of time or money on the activity, an inability to control spending, harm to one’s professional or personal life due to gambling, and concealment of gambling activities. Another 2-3% of adults are considered at risk for disordered gambling. These rates have remained remarkably consistent for decades, even as legal gambling opportunities have expanded dramatically since researchers began tracking the behavior in the 1970s. 

The United States is no exception despite its massive shift toward legalized gambling in recent decades. States that legalize gambling activities may see short-term spikes in spending (driven primarily by novelty and tourism), but problem gambling rates, if they rise, typically stabilize within a few years, aligning with global averages. 

Maryland’s experience with legalized casino gambling is one telling example. In 2010, when the state had no legal casinos, surveys estimated that 3.4% of adults met the criteria for disordered gambling. Yet, by 2017—after the introduction of six casinos—the problem gambling rate had fallen to 1.9% according to a Maryland Department of Health study. That report concluded that Marylanders’ gambling habits had not significantly changed; they were spending roughly the same amount of time and money on the same types of games, but they were now doing it at legal Maryland venues. 

The evidence that gambling legalization has little effect on pathological gambling has not quelled calls for more restrictive regulations or outright bans on certain types of gambling, particularly online betting. For example, both state and federal lawmakers have introduced bills seeking to impose new and often intrusive rules aimed at controlling how Americans gamble with their money, including mandatory spending limits, invasive financial disclosures, or “affordability checks” (limiting bets based on player income or finances), and bans on advertising. But, as ACI’s study contends, greater restrictions on legal gambling opportunities would not only fail to reduce gambling harm, but likely push consumers toward more convenient illicit gambling platforms where fraud can thrive and problem gambling tools don’t exist.

If lawmakers wish to address problem gambling without pushing players toward illicit markets or losing out on potential tax revenue, a smarter approach would be to focus on sensible rules that keep gambling safe, legal, and competitive, encouraging compliance from operators and incentivizing players to migrate from the illicit to the regulated market:

• Keep taxes low: High tax rates make legal operators uncompetitive. Rates under 15% discourage black-market activity.
• Encourage competition: States with many operators, both in the online and retail space, see faster player migration from the illegal to the legal market. Monopolies and state-run operations do the opposite. 
• Fund voluntary safeguards: Redirecting a small portion of tax revenue to problem gambling treatment, education, and self-exclusion programs—which allow players to voluntarily ban themselves from gambling venues—is more effective than blanket restrictions. 

The ACI report’s findings should reassure policymakers that legalized sports betting has not significantly increased problem gambling. Rather than resorting to heavy-handed rules, states should embrace light-touch regulation that ensures legal markets are so convenient and secure that illicit markets can’t compete. 

The data is clear. Overregulation helps no one except criminals. A free, competitive, and well-monitored market is the best way to keep betting fair, safe, and aboveboard.

The post New data shows no surge in problem gambling following sports betting expansion appeared first on Reason Foundation.

The concerns raised by Senate Bill 86 regarding the quality and safety of novel and potentially intoxicating hemp products are warranted. However, we believe that SB 86 adopts an overly restrictive approach that risks undermining its goal of consumer health protection by inadvertently driving individuals toward unregulated markets and products. 

The proposed THC limit is excessively low 

A critical point of concern is the bill’s proposed definition of “intoxicating hemp products” as those with greater than 0.5 milligrams of delta-9 THC per serving, greater than 2 milligrams of delta-9 THC per package, or greater than 0.5 milligrams of THC other than delta-9 THC.  

Generally, a THC concentration of 1% is considered the threshold at which cannabis products begin to exhibit intoxicating or psychotropic effects. In terms of edible products, a concentration of 1% THC in a 10-gram package would amount to 100 milligrams of THC per package. The limit proposed by SB 86, capping total non-delta-9 THC to 0.5 milligrams per package, would be 200 times below the generally accepted threshold for intoxication.  

SB 86 would classify most natural hemp products as “intoxicating”  

Because it is virtually impossible to eliminate trace levels of THC from hemp extract, SB 86’s excessively low THC threshold would effectively define all naturally-derived hemp products as “intoxicating hemp,” requiring consumers to purchase these products through Ohio’s marijuana dispensary system. This mandate includes products that pose no risk of intoxication and those clinically demonstrated to provide therapeutic benefits. 

Restricting sales of hemp products, including those with therapeutic uses, would greatly increase burdens for both businesses and consumers in the state. As of March 2025, 312 local governments have imposed moratoriums that prohibit adult-use cannabis businesses, limiting access for around 15% of the state’s population. Even where consumers have access, products available at dispensaries may be significantly more expensive due to regulatory costs compared to products sold outside of the dispensary system.  

This situation is particularly concerning for patients and families who depend on hemp-derived cannabidiol (CBD) to treat seizure disorders, such as Dravet Syndrome, a rare and severe form of childhood epilepsy. For these patients, CBD can be a lifeline, offering relief from debilitating symptoms that are often inadequately managed by conventional medications. These individuals need assurance that the CBD products they rely on are safe, free from harmful contaminants, and accurately labeled for proper dosing.  

Rather than providing this necessary reassurance, SB 86 would greatly reduce their legal access to regulated CBD products. As a result, patients may be forced to forgo essential therapy, travel out of state to purchase it, or turn to unregulated markets, exposing them to potentially greater risks than those posed by intoxicating hemp products. 

Reasonable hemp regulations  

If the aim is to protect consumers and keep potentially intoxicating hemp away from minors, we encourage Ohio lawmakers to develop a sensible regulatory framework governing hemp products. Reason Foundation’s recently published study, A Framework for Federal and State Hemp-Derived Cannabinoid Regulation, offers detailed recommendations for state regulation of the production, testing, labeling, and sale of both intoxicating and non-intoxicating hemp products without imposing arbitrary or prohibitive THC limits that could hinder consumer access and expand illicit markets.

A sensible regulatory framework would include:  

• Safe manufacturing standards for hemp-derived goods; 

• Final product testing requirements to ensure products are free of harmful contaminants; 

• Packaging standards for clear and accurate labeling; 

• Age restrictions on the purchase of intoxicating hemp products; and 

• Restricted sales of intoxicating hemp products to outlets with established age-gating practices.  

By implementing a framework that prioritizes transparency, product quality, and compliance, Ohio could more effectively ensure consumer safety than through excessive restrictions or prohibitions. This approach would protect consumers, support public health, and promote a regulated, orderly market without creating unintended harm.    

Conclusion 

Reason Foundation urges the committee to exercise caution with SB 86. While the intent to protect consumers is commendable, the bill’s provisions would inadvertently harm those who rely on hemp products for therapeutic benefits, as well as other hemp consumers in the state. Instead of pushing hemp products into the overly restrictive marijuana dispensary system, we urge members to develop a more balanced regulatory framework for hemp products.  

Such an approach would allow Ohio to maintain oversight of the hemp market, enforce standards that safeguard consumer welfare, promote responsible access to products, and prevent the proliferation of unregulated and potentially harmful markets or products.  

The post Ohio Senate Bill 86 would needlessly restrict the hemp industry appeared first on Reason Foundation.

• Since the 2018 Farm Bill federally legalized hemp and its derivatives, the hemp cannabinoid market has grown into a $3 billion interstate industry, including both non-intoxicating therapeutic products like cannabidiol (CBD) and intoxicating hemp products that mimic the psychoactive effects of marijuana. Courts have interpreted federal statute to mean that even chemically modified and intoxicating hemp extracts are federally legal hemp products. 
• Consumer demand for these products has surged, in part due to federal marijuana prohibition and restrictive state cannabis laws that limit consumer access. While less than 30% of legal cannabis businesses were profitable in 2024, hemp cannabinoids have proved a lifeline for farmers and other businesses, generating $241 million in farm income in 2023 alone.  

The risk of overregulation or prohibition 

• Despite its economic and consumer benefits, the hemp market faces growing threats from heavy-handed state regulation and outright bans. In the absence of federal product standards, many states have adopted reactionary policies that mimic the burdensome rules stifling the cannabis industry or outlaw intoxicating hemp cannabinoids. 
• Prohibition and excessive restrictions on products consumers want have well-documented consequences, including fueling illicit markets that operate without oversight, compromising public health with unregulated and mislabeled products, increasing youth access due to lax age-verification, burdening law enforcement with low-priority enforcement efforts, undermining legitimate businesses, and depriving states of tax revenue. 

A smarter approach to regulation  

• Intoxicating hemp products pose no greater risk to society than other intoxicating goods, like alcohol or marijuana. With thoughtful regulation, they can be produced safely and sold responsibly, ensuring consumer protection while fostering economic growth. To achieve this, Reason Foundation’s Model Legislation for Optimal State Regulation of Hemp Cannabinoids recommends that states adopt hemp cannabinoid regulations that:  
  • Establish clear, science-based product safety and manufacturing standards; 
  • Regulate, don’t ban, naturally occurring and synthesized hemp cannabinoids; 
  • Ensure age restrictions and responsible retailing;  
  • Mandate reasonable testing and labeling requirements; and 
  • Avoid excessive fees and taxes that undermine legal market viability. 

Full Backgrounder: Optimal framework for the state regulation of hemp cannabinoids

The post Optimal framework for the state regulation of hemp cannabinoids  appeared first on Reason Foundation.

The intent behind Georgia State Senate Bill 33, which seeks to regulate the manufacture, testing, and labeling of hemp products in Georgia, is commendable. We appreciate and support the bill’s goal of establishing clear regulatory standards for hemp-derived consumable products. Thoughtful regulations help ensure consumer safety, provide clarity for businesses, and prevent illicit activity. However, we have concerns regarding the bill’s approach to defining and regulating intoxicating hemp cannabinoids.  

Concerns with the 0.3% THC threshold 

SB 33 sets a total THC threshold of 0.3% for intoxicating cannabinoids, encompassing all forms of THC and related compounds. While we do not oppose the establishment of a THC threshold to distinguish intoxicating from non-intoxicating hemp products, the bill, as written, would effectively ban – rather than regulate – products exceeding this limit. This could have unintended consequences for consumers, agricultural stakeholders, and law enforcement.  

One of our primary concerns is the impact this restriction would have on patients and consumers who rely on high-dose CBD products for therapeutic purposes. Many individuals using CBD and other hemp-derived cannabinoids for medical or wellness reasons require high doses, particularly those treating seizure disorders. For some adult patients, therapeutic dosing can require up to 1,600 milligrams (mg) of CBD per day. Because CBD products naturally contain trace levels of THC, high-dose users ingest significant levels of THC. Importantly, these products can remain non-intoxicating due to two key factors. First, patients typically increase their CBD intake over time, building a tolerance to the accompanying levels of THC. As a result, even if trace THC is present at higher absolute levels, it does not induce intoxication. Second, scientific research indicates that CBD may mitigate the psychoactive effects of THC. Therefore, a patient consuming 1,600 mg of CBD per day – and ingesting 50 mg or more of THC in the process – may still experience no intoxication due to the modulating effects of the higher CBD content.  

By restricting total THC concentration to 0.3% without considering a product’s full cannabinoid profile, SB 33 may inadvertently force patients to purchase significantly larger quantities of hemp products to maintain their therapy. This would impose unnecessary financial burdens that may drive consumers to either forgo a vital therapy, purchase products from out-of-state or push them toward unregulated products and illicit suppliers.  

A more nuanced approach  

We support the state’s goal of distinguishing between intoxicating and non-intoxicating hemp products. However, a more effective, science-based regulatory approach would consider the ratio of non-intoxicating to intoxicating cannabinoids rather than relying solely on THC concentration. 

For example, Kentucky has adopted a regulatory framework that classifies hemp products based not only on total THC but also on cannabinoid ratios. Under Kentucky’s system, products are deemed non-intoxicating if they contain at least 15 parts of non-intoxicating cannabinoids for every one part of the intoxicating cannabinoid. Perhaps more importantly, Kentucky does not simply ban products that meet the definition of intoxicating hemp, instead subjecting them to a stricter regulatory regime – requiring special retailer permits and other restrictions aimed at protecting consumers and preventing sales to minors.  

We urge Georgia lawmakers to consider a similar approach—one that considers both THC concentration and the ratio of intoxicating to non-intoxicating cannabinoids. Additionally, rather than banning intoxicating hemp products, the state should regulate them in a manner that ensures they remain accessible to adults while preventing misuse. 

By following Kentucky’s model—or a similar evidence-based framework—Georgia can protect public health, support the responsible hemp industry, and prevent the unintended consequences of driving consumers toward unregulated markets. 

The post Georgia Senate Bill 33 would implement restrictive THC thresholds appeared first on Reason Foundation.

The concerns raised in Senate Bill 3 regarding the quality and safety of novel and potentially intoxicating hemp products are warranted. Similarly, the desire to prevent youth access to potentially intoxicating hemp products and to impose reasonable manufacturing and testing standards on consumable hemp products is worthy of consideration. However, we believe that SB 3 adopts an overly blunt approach that risks undermining its goal of consumer health protection by inadvertently driving individuals toward unregulated markets or products and criminalizing patients. 

SB 3 would effectively outlaw all hemp and CBD products 

A critical point of concern is the bill’s proposed limit on the allowable concentration of THC in hemp products. Generally, a THC concentration of 1% is considered the threshold at which cannabis products begin to exhibit intoxicating or psychotropic effects. SB 3 proposes to cap the concentration of THC, as well as any cannabinoid other than CBD or CBG, at 0.0001% on a dry weight basis. This standard is 3,000 times lower than the federal government’s 0.3 percent delta-9 THC limit and 10,000 times below the 1% threshold generally recognized as the point at which products begin to exhibit intoxicating effects.  

While the intent to control intoxicating products is understandable, this extreme limit is neither practical nor scientifically justified. Hemp naturally contains trace amounts of THC and eliminating it entirely is virtually impossible without rendering the product unusable. By setting such a low threshold, SB 3 would effectively outlaw nearly all hemp-derived products, including those that pose no risk of intoxication and those with proven therapeutic benefits on which many Texas patients rely, such as high-dose CBD products that contain THC at non-intoxicating levels.  

A ban on THC and other cannabinoids will harm Texas patients and consumers 

The proposed 0.0001% THC limit would have far-reaching consequences for the hemp industry and consumers. While several states have enacted regulations on hemp-derived cannabinoids, including limits on allowable THC, none have set a threshold as low as that proposed in SB 3. Even states that classify all forms of THC as controlled substances make exceptions for the trace amounts found in hemp.

For example, in states like Kentucky and Tennessee, which have robust hemp regulations, THC limits are aligned with the federal standard of 0.3%. These states have successfully implemented testing and labeling requirements to ensure consumer safety without resorting to outright bans. In contrast, SB 3’s approach would make Texas an outlier, effectively outlawing all hemp products. 

This situation is particularly concerning for patients and families who depend on hemp-derived cannabidiol (CBD) to treat seizure disorders, such as Dravet Syndrome, a rare and severe form of childhood epilepsy. For these patients, high-dose CBD products, which may contain trace levels of THC above 1%, can be a lifeline that offers relief from debilitating symptoms that are often inadequately managed by conventional medications.  

These individuals need assurance that the CBD products they rely on are safe, free from harmful contaminants, and accurately labeled for proper dosing. Rather than providing this necessary reassurance, SB 3 would eliminate their legal access to effective CBD products in the state. Consequently, patients would be forced to forgo essential therapy, travel out of state to purchase it, or turn to unregulated markets, exposing them to potentially greater risks from contamination or improper labeling than the risks posed by intoxicating hemp products. Perhaps even more concerning, rather than protecting these patients and facilitating their access to safe and regulated hemp products, SB 3, as written, would criminalize those patients who seek out such products from states where they are legal and regulated.  

SB 3 would criminalize patients and consumers 

Another critical concern is the criminal penalties established by SB 3 for the possession of hemp products containing trace amounts of cannabinoids other than CBD or CBG. This provision would disproportionately harm patients and consumers who rely on these products for medical or wellness purposes. For example, a parent legally purchasing a full-spectrum CBD product in a neighboring state to treat their child’s epilepsy could face a Class A misdemeanor simply for bringing the product into Texas. Similarly, a veteran using a hemp-derived product to manage chronic pain or PTSD symptoms could be criminalized for possessing a product that is legal under federal law and in most other states.  

This criminalization is not only unjust and cruel toward patients but also counterproductive. It will not stop the flow of legal hemp products into Texas; it will only drive consumers to unregulated markets, where products are more likely to be untested, unsafe, or mislabeled. Moreover, the lack of access to effective products regulated by and legal in Texas will stimulate demand for unregulated and out-of-state products, potentially imposing insurmountable challenges for Texas law enforcement in determining the origin and content of products found in peoples’ possession.  

SB 3 conflicts with federal law and interstate commerce 

The 2018 Farm Bill legalized hemp with a THC concentration of no more than 0.3% on a dry weight basis, creating a clear federal standard for hemp production and interstate hemp commerce. By setting a THC limit 3,000 times lower than the federal standard, SB 3 would put Texas at odds with both federal law and the laws of other states. This conflict raises serious legal and practical concerns.  

Hemp is a national industry, with products like CBD oils, edibles, and supplements traded legally across state lines. SB 3 would not only disrupt this market by creating confusion and inconsistency for businesses and consumers but may also violate the Constitution’s Dormant Commerce Clause (DCC).   

The Constitution’s framers were expressly motivated to replace the original form of American government, as articulated under the Articles of Confederation, to prevent the states from erecting trade barriers. Through the years, courts’ interpretations of the dormant commerce clause (DCC) have generally held that states cannot enact policies that impede the free movement of goods, persons, or capital within the union. While SB 3 applies its restrictions uniformly to hemp products produced inside or outside of Texas, its extreme divergence from federal and other state standards could be seen as an undue burden on interstate commerce, potentially making the law vulnerable to legal challenge. 

Economic impact on Texas 

SB 3 would also have devastating economic consequences for Texas businesses, crippling a thriving industry and undermining the livelihoods of thousands of Texans. In 2022, the hemp industry in Texas was valued at $8 billion, supporting roughly 50,000 jobs in the state. This industry has also become a lifeline for farmers, particularly smaller operations that rely on hemp as a profitable and sustainable crop. However, for hemp to remain a viable agricultural commodity, farmers depend on robust end markets for their crop. SB 3’s restrictions would decimate these markets, reducing demand for hemp crops and causing widespread harm to the state’s economy.  

Hemp cultivation for cannabinoid extraction, particularly CBD and other beneficial compounds, has become a critical revenue stream for Texas farmers. In 2023, hemp flower and cannabinoid extraction accounted for over 30% of the total harvested hemp acreage nationwide, generating $241 million in income for farmers. In Texas, where hemp fiber and grain markets are still underdeveloped, cannabinoid production is one of the few economically viable uses for the crop. Without a market for cannabinoids, many farmers would lose a significant source of income, forcing them to abandon hemp cultivation altogether or relocate to states with more reasonable regulations.  

The consequences may be particularly harmful for farmers operating on smaller acreage. Unlike traditional crops, hemp offers higher profit margins and the flexibility to adapt to market demands. For many of these farmers, hemp represents a rare opportunity to compete in an increasingly consolidated agricultural sector. SB 3’s restrictions would disproportionately harm these smaller operations, which lack the resources to pivot to other crops or absorb the financial losses caused by a collapsing hemp market. 

The economic impact of SB 3 would extend beyond the hemp industry. Nationally, the market for hemp-derived cannabinoids is booming, with industry experts estimating its value at between $28 billion and $36 billion in annual sales. Texas, with its favorable climate and agricultural expertise, is well-positioned to capitalize on this growth. However, SB 3 would stifle innovation and investment in the state, pushing businesses, entrepreneurs, and investors to more hemp-friendly states like Tennessee and Kentucky. These states have embraced the economic potential of hemp, creating thousands of jobs and generating millions in tax revenue. By contrast, Texas risks losing its competitive edge and becoming a cautionary tale of missed opportunities. 

Reasonable hemp regulations  

If the aim is to protect consumers from unregulated products while keeping potentially intoxicating hemp products away from minors, we encourage Texas lawmakers to develop a sensible regulatory framework governing hemp products. Reason Foundation’s recently published study, A Framework for Federal and State Hemp-Derived Cannabinoid Regulation, offers detailed recommendations for state regulation of the production, testing, labeling, and sale of both intoxicating and non-intoxicating hemp products without imposing arbitrary or prohibitive THC limits that could hinder consumer access and expand illicit markets.

A sensible regulatory framework would include:  

• Safe manufacturing standards for hemp-derived goods; 

• Final product testing requirements to ensure products are free of harmful contaminants; 

• Packaging standards for clear and accurate labeling; 

• Age restrictions on the purchase of intoxicating hemp products; and 

• Restricted sales of intoxicating hemp products to outlets with established age-gating practices.  

By implementing a framework that prioritizes transparency, product quality, and compliance, Texas could more effectively ensure consumer safety than through blanket prohibitions. This approach would protect consumers, support public health, and promote a regulated, orderly market without creating the undesirable consequences associated with prohibition.   

Conclusion 

In conclusion, Reason Foundation urges the committee to reject SB 3 in its current form. While the intent of protecting consumers is commendable, the bill’s provisions would inadvertently harm those who rely on hemp products for therapeutic benefits and other hemp consumers in the state. Instead of outright prohibition, we urge members to develop a more balanced regulatory framework for hemp products.  

Such an approach would allow Texas to maintain oversight of the hemp market, enforce standards that safeguard consumer welfare, promote responsible access to products, and prevent the proliferation of unregulated and potentially harmful markets or products.  

The post Texas Senate Bill 3 would harm the state’s hemp industry appeared first on Reason Foundation.

Many of these extracts and cannabinoids are non-intoxicating, but some are THC variants that have an intoxicating effect similar to delta-9 THC or can be chemically modified into an intoxicating THC variant. Courts have interpreted the federal statute to mean that even chemically modified hemp extracts are federally legal hemp products because the dispositive factor for this determination is the provenance of the material and not the method of manufacture. 

The rapid growth of hemp-derived cannabinoids, such as delta-8 THC, coupled with federal inaction for regulatory clarity, presents both challenges and opportunities for state governments. Emerging inconsistencies in state approaches to cannabis regulation, product safety concerns, potential access to intoxicating substances by minors, and an uneven playing field for businesses highlight the urgent need for thoughtful, evidence-based policy solutions at the state level. 

Reason Foundation’s model legislation offers a clear and practical framework for states seeking to regulate adult-use hemp cannabinoids effectively. This model balances consumer protection, public safety, and transparency while promoting compliance and fair competition within the industry. By setting forth homogenized standards for products containing intoxicating cannabinoids, it also lays the groundwork for future interstate commerce in other legal cannabis products, including those originating from state-regulated marijuana.   

This model legislation would implement the recommendations that Reason Foundation senior policy analyst Michelle Minton and research director Geoffrey Lawrence developed in their joint paper, “A Framework for Federal and State Hemp-Derived Cannabinoid Regulation.” It is designed to foster safety, transparency, and fair competition within the marketplace for cannabis products. It draws from best practices in states with successful programs and incorporates lessons from those facing regulatory pitfalls.  

Key Features

• Establishes a streamlined permitting and registration regime for manufacturers and sellers of hemp cannabinoid products

• Simplifies licensing categories to reduce barriers for small businesses and promote equitable opportunities

• Implements robust product testing and labeling standards

• Restricts sales of hemp cannabinoid products to individuals under the age of 21

• Reduces unnecessary taxation to curb illicit-market competition and level the playing field between “hemp” and “marijuana” businesses

Learn More

To download the full text of the Cannabis Regulatory Reform Act and explore how it can be tailored to your state’s needs, see below: 

Model Legislation: Optimal State Regulation of Hemp Cannabinoids 

The post Model legislation for optimal state regulation of hemp cannabinoids  appeared first on Reason Foundation.

Yet, only a year after this progress, State Sen. Steve Huffman (R-Tipp City) has proposed a bill that would outlaw “intoxicating hemp” products in Ohio that, if enacted, would prohibit most hemp products in the state. Relying on prohibition to address issues surrounding hemp, rather than sensible regulation, risks undermining the goals underlying Ohio’s legalization of recreational cannabis, likely creating similar problems that led voters to end marijuana prohibition in the first place. As with marijuana, there are far better solutions to intoxicating hemp products than prohibition.  

Both hemp and marijuana are derived from cannabis plants. They contain many of the same compounds, including various forms of tetrahydrocannabinol (THC). THC is the class of chemicals, like delta-9 THC, responsible for the intoxicating and psychoactive effects of marijuana. While hemp typically has a low THC content that is non-intoxicating, hemp plant material can be processed to extract and concentrate other forms of THC, like delta-8 THC, to create intoxicating hemp edibles and beverages, smokable hemp flower, and vape cartridges. How much THC a hemp product must contain in order to be considered “intoxicating hemp” is a subject of current debate, but experts generally believe that the risk of intoxication begins when THC concentration is above 1%.     

However, unlike marijuana, hemp and its derivatives were federally legalized in 2018. Freed from both federal prohibition and onerous state laws governing marijuana, hemp products could be sold at a wider variety of outlets, often at lower prices than marijuana. Consequently, the market for hemp products and those derived from hemp, including both non-intoxicating cannabidiol (CBD) and intoxicating delta-8 THC, has boomed. This rise in popularity has provoked concern among lawmakers worried about the safety and youth access to these products.  

Huffman’s legislation (Senate Bill 326) would outlaw sales of intoxicating hemp products throughout the state, which the bill defines as those with more than 0.5 milligrams of THC per package. Supporters of the approach argue that a ban is necessary to protect the public, especially youth. But, a blanket prohibition will more likely backfire, increasing illicit activity and undermining public safety as consumers seek alternative sources for the products they want.    

Arguably, the popularity of hemp-based products is a direct result of overly stringent marijuana regulations. High excise taxes, regulatory costs, and a dearth of legal retailers make marijuana hard to access at reasonable prices for many consumers. For example, 55 local governments in Ohio have enacted local moratoriums on legal marijuana sales, leaving at least 10 percent of the state’s population without legal dispensaries nearby. This lack of access most likely fuels the demand for intoxicating hemp products. A ban will only push consumers further toward unregulated products and illicit markets, where regulators have no oversight and little control over product safety.    

Huffman’s bill has received four hearings in the Senate General Government Committee so far, with the majority of those testifying in opposition to the measure. Hemp producers and retailers expressed concerns that the bill would devastate their businesses and cost thousands of jobs for the state. Many non-industry members also testified against the measure, with both consumers and health providers arguing the bill would unnecessarily strip their access to therapeutic hemp products.  

Jasmine Trowbridge, a licensed nurse in Cleveland, told the committee that the federal legalization of hemp had “opened up a world of possibilities for those struggling with chronic conditions” and argued outlawing these products or limiting their sales to dispensaries would be especially harmful to elderly patients uncomfortable or unable to shop at marijuana dispensaries. Trowbridge argued that older patients, in particular, benefit from hemp products being available at a broad range of traditional retail outlets due to closer proximity to where patients live and more accessible hours of operation.  

As it stands, the measure is unlikely to pass before the current session ends at the end of December and would need to be re-introduced when the next session begins in January. Despite an effort to amend the bill to limit hemp sales to marijuana dispensaries rather than outlawing them entirely, House members rejected the dispensary-only idea.  

However, Huffman’s bill is not the only measure seeking to regulate hemp products in Ohio. The legislature is considering three additional bills related to intoxicating hemp. House Bill 86, which began as a proposal to update state liquor laws, was heavily revised by the Senate and now includes significant changes to voter-approved recreational marijuana rules, including a ban on hemp products with any amount of non-delta-9 THC. Such strict limits would effectively outlaw all intoxicating hemp products, as well as many non-intoxicating ones. The House is unlikely to pass this version due to its extensive alteration of the state’s marijuana laws, which the bill’s original sponsor, State Rep. Jeff LaRe (R-Violet Township), criticized as a “slap in the face to Ohio voters.”  

Senate Bill 278, introduced by state Sens. Huffman and Kirk Schuring (R-Canton), would similarly alter voter-approved recreational marijuana rules, as well as regulate intoxicating hemp. The bill would define “adult-use hemp products” as those with 2.5 milligrams or more of THC per serving, more than four servings per package, and a ratio of CBD-to-THC that is not more than 15-to-1. The measure would prohibit sales of adult-use hemp products to minors, require retailers to keep them behind counters, and outlaw internet sales.    

Finally, House Bill 642 (HB 642), introduced by State Rep. Sara Carruthers (R-Hamilton) in July 2024, would require the director of agriculture to study the issue of intoxicating hemp and provide recommendations for how such products should be regulated, delaying any immediate action.   

Though each of these measures addresses certain concerns surrounding intoxicating hemp products, all fall short of creating the comprehensive regulatory framework necessary to ensure consumers have access to hemp products that are safe, accurately labeled, and responsibly marketed. Aside from barring sales to minors, none of the bills sufficiently address issues like product contamination, unsafe manufacturing practices, or misleading labeling. These issues are essential to address if Ohio hopes to create a thriving hemp market with compliant businesses rather than one driven by illicit, unregulated activity.  

Reason Foundation’s recently published recommendations for state regulation of hemp cannabinoids offers suggestions for how states could create a balanced and comprehensive framework for regulating hemp products, including minimum requirements for safe manufacturing practices, product testing, and clear labeling rules to ensure consumer safety and inform choices. It also recommends distinguishing intoxicating from non-intoxicating hemp products based not only on total THC concentration but also the ratio of CBD to THC.  

This approach, echoed in SB 278, would ensure continued access to high-CBD therapeutic products for patients with conditions like seizure disorders because higher CBD content mitigates THC’s psychoactive effects, keeping these products non-intoxicating. However, we do not recommend that this threshold be used to determine the legality of products; instead, we suggest that products defined as adult-use or intoxicating merely be subject to additional rules and controls, such as a minimum purchasing age.  

A blanket prohibition on intoxicating hemp would be a step backward for Ohio, pushing demand underground and exposing consumers, young and old, to unnecessary risk and uncertainty.  Instead, a framework like that proposed by Reason would align Ohio’s hemp policy with the goals of its recent cannabis legalization, ensuring consumers have access to safe products made by accountable producers and keeping intoxicating products away from youth.  

The post Intoxicating hemp products in Ohio need regulation, not prohibition   appeared first on Reason Foundation.

Signed by New Jersey Gov. Phil Murphy in September, the law, passed as Senate Bill No. 3235, granted the Cannabis Regulatory Commission (CRC), which currently regulates the state’s legal medical and adult-use marijuana markets, oversight over hemp products with THC. The Cannabis Regulatory Commission was given six months to construct a new regulatory regime governing intoxicating hemp products.

Since hemp was federally legalized in 2018, the market for hemp cannabinoids, like cannabidiol (CBD), delta-8 THC, and hemp-infused drinks, has boomed. However, that growth has led to anxiety among state lawmakers about the quality and safety of products, as well as youth access. While many states responded with prohibitionist policies, outlawing hemp with any amount of THC, New Jersey’s law took a more balanced approach.

Rather than prohibiting THC hemp products or restricting sales to cannabis dispensaries—a limitation that could harm CBD patients—New Jersey’s law offered the possibility of a more open market. Though dependent on the rules CRC adopts, the law at least maintained the possibility of a framework allowing qualified manufacturers or retailers, including liquor stores, to participate in the legal market.

The law, which took effect on Oct. 12, mandated the removal of all THC-containing hemp products, including CBD, from retail stores unless sold through licensed cannabis dispensaries. Manufacturers and retailers could only resume production and sales after obtaining a license from CRC.

However, two weeks after Gov. Murphy signed the law, producers of hemp-based drinks filed for a preliminary injunction, arguing the law violated interstate commerce federal rules by expressly limiting legal products to those made in New Jersey. U.S. District Court Judge Zahid N. Quraishi agreed, writing in his opinion that the state cannot enforce the provisions of the law that excluded otherwise compliant out-of-state intoxicating hemp and hemp products from New Jersey’s market. 

As a result, the Cannabis Regulatory Commission delayed enforcement of the law, except for its ban on selling intoxicating hemp to minors. This gives lawmakers time to amend the law to comply with federal rules and offers an opportunity to make improvements supporting a genuinely competitive hemp market.

A crucial step the legislature should take is to ensure that Cannabis Regulatory Commission rules do not impose overly restrictive barriers to entering the legal hemp market. As a recent Reason Foundation study suggests, a streamlined licensing process open to all qualified businesses would discourage market concentration, help smaller businesses thrive, and lower prices for consumers. Lawmakers should ensure that a fast, simple application process is available.

Additionally, New Jersey should adopt measures allowing out-of-state hemp producers to comply with state rules to avoid future lawsuits and ensure consumer access to safe, regulated products. Kentucky’s approach, which requires out-of-state producers to register with the state and meet equivalent processing, testing, and labeling standards, could provide a model for how New Jersey could maintain oversight while fostering a robust interstate market.

Finally, New Jersey lawmakers could use this moment to consider broader marijuana regulatory reforms. Due to federal prohibition, marijuana businesses face higher costs and regulatory burdens than hemp producers, giving hemp products an artificial competitive advantage. Lawmakers could level the playing field by seeking ways to reduce burdens on marijuana businesses, for example, by making the licensing process more accessible and affordable. 

If lawmakers seize this opportunity to impose a balanced cannabis regulatory regime, New Jersey could become a national leader in the cannabis space, one that promotes fair and vibrant competition in both the hemp and marijuana industries, keeps prices low, and ensures consumer access to safe products. 

The post Court ruling underscores the need for sensible hemp rules in New Jersey appeared first on Reason Foundation.

According to Gallup, marijuana consumption has more than doubled since 2013. Recreational marijuana is now legal in 24 states, medical marijuana is legal in 40 states, legalization is on four state ballots this November, the Biden administration has taken the long overdue step of rescheduling cannabis, and both major party presidential candidates, Vice President Kamala Harris and former President Donald Trump, have signaled at least acceptance that legal marijuana is the future.

Yet, legal marijuana markets are faltering across the country, and there are numerous state-level efforts to ban hemp and CBD products.

Colorado and Massachusetts are seeing their legal marijuana dispensaries shutter, California’s cannabis industry seems on the verge of collapse, and in 2024, only about a quarter of U.S. marijuana businesses have reported turning a profit. The underlying problem is federal law and the complex web of state regulations that suffocate legal companies with high costs and inefficiencies. Sadly, many states appear poised to make the same regulatory mistakes with legalized hemp.

Marijuana and hemp, both derived from Cannabis sativa L., are chemically similar, but their regulatory paths couldn’t be more different. Marijuana has been federally prohibited since 1970. Hemp, on the other hand, was federally legalized in the 2018 Farm Bill, triggering an interstate market boom that states are now trying to stop or regulate.

Freed from federal prohibition, hemp has rapidly outpaced legal marijuana sales, rivaling even the craft beer industry in size. Hemp’s industrial uses—like textiles and building materials—are important, but it’s the cannabinoid-rich products created from hemp extract that are driving its market growth. As a result, concerned lawmakers across the country are imposing reactionary restrictions and outright bans because some of these hemp products have intoxicating effects similar to marijuana.

Cannabidiol (CBD), a non-psychoactive hemp derivative, is perhaps the most well-known hemp extract product. Widely recognized for its therapeutic benefits, CBD has become popular as a health product and an effective treatment for childhood seizure disorders. But the rise of intoxicating cannabinoids, like delta-8 THC, has triggered alarm among state lawmakers and legal marijuana businesses alike.

Delta-8 THC offers similar psychoactive effects to marijuana but, unlike marijuana, is not prohibited or controlled at the federal level. As a result, delta-8 products have flooded states, even those like Texas that have not legalized marijuana sales.

Consumers have far greater and easier access to hemp products, with products crossing state lines, available through online vendors and places like gas stations and convenience stores and sometimes even available for legal purchase by minors.

In contrast, legal marijuana sales remain tightly restricted to licensed dispensaries only in states where it is legal. Licensed marijuana businesses, overburdened by heavy regulation, are understandably frustrated by new competition from lightly regulated hemp products. Moreover, some concerns about youth access and the safety of novel hemp products are warranted. But the answer isn’t to burden hemp with equally stringent rules or outright prohibition.

Unfortunately, we’ve seen a wave of drastic measures proposed or adopted by states. Over 90 state bills were introduced to regulate hemp products this year. More recently, Missouri Gov. Mike Parson (R) ordered a state-wide ban on intoxicating hemp products. California Gov. Gavin Newsom (D) introduced emergency regulations prohibiting hemp products with detectable levels of THC. New Jersey followed suit, and Texas Lt. Gov. Dan Patrick (R) has urged the state’s legislature to prioritize banning delta-8 products next year.

While these policies are framed as consumer protection, they risk causing more harm than good, driving consumers toward illicit and truly unregulated products and cutting off access to therapeutic products because it is nearly impossible to extract non-intoxicating cannabinoids, like CBD, from hemp without trace levels of THC.

Instead, state lawmakers should aim for sensible regulations focused on consumer protection and transparency in both industries. Hemp cannabinoids and the products created with them are no more inherently dangerous than marijuana or marijuana products. The only difference is that while the manufacture and sales of marijuana products are held to overly stringent standards, hemp is often held to few, if any.

Rather than rushing to impose bans and restrictions on hemp that won’t help people or the economy, states should instead impose reasonable regulations on both hemp and marijuana to ensure the quality, safety, and viability of both industries. As a recent Reason Foundation study detailed, states can do this by implementing manufacturing, testing, labeling standards, and age restrictions for hemp while reducing unnecessarily restrictive and overly burdensome rules that stymie legal marijuana businesses.

The current piecemeal approach to regulation puts consumers at risk and hampers the ability of even willing actors to comply with a maze of state rules. Unlike legal marijuana’s unspooling mess, it’s far easier for lawmakers to get it right on hemp today. Unencumbered by federal prohibition of hemp, states can craft policies that balance consumer protection with market flexibility, coordinate with other states to standardize rules for a more coherent interstate market, and foster fair and healthy competition between legal hemp and marijuana products.

The cannabis and hemp industries should be working with states to seize this chance to build a thriving, sensibly regulated hemp industry that works for consumers, businesses, and regulators alike.

A version of this commentary first appeared in Marijuana Moment.

The post Banning hemp products won’t protect public health or foster fairness for marijuana businesses appeared first on Reason Foundation.

Hemp, a variant of the cannabis plant, was legalized at the federal level in 2018. Though hemp and marijuana both come from the same plant, the critical difference is that hemp must contain less than 0.3% tetrahydrocannabinol (THC). Anything higher is classified as marijuana.

Hemp has many commercial uses, from textiles to building materials, but one of its most significant applications is the extraction of cannabinoids. Cannabidiol (CBD) is a non-intoxicating cannabinoid, and clinical trials have proven it reduces seizures in epileptic children. However, extracting cannabinoids like CBD from hemp without trace levels of THC is nearly impossible.

Gov. Newsom is targeting intoxicating hemp products, including those made by chemically converting CBD into forms of THC. However, Newsom does not distinguish between intoxicating products and those with proven therapeutic value. As a result, the standard of “any detectable quantity” would remove CBD therapies from the market even though they pose no threat of intoxication.

The proposal would harm families like Paige and Matt Figi’s, who turned to CBD to treat their daughter, Charlotte, whose severe epilepsy resisted conventional therapies. By age 5, Charlotte was suffering 300 seizures a week and lost the ability to walk, talk, and eat on her own. Hospitals told Charlotte’s parents there was nothing more they could do. The Figis tried CBD, and from that first treatment until her death at age 13 due to suspected COVID-19, the Figis say Charlotte was virtually seizure-free.

Charlotte’s story helped spur medical cannabis legalization across the country. Today, 38 states have legalized some form of medical use, and nine have specifically legalized CBD. Yet, Newsom’s plan would block families like the Figis from accessing this life-changing therapy.

States that have legalized marijuana often impose onerous and costly restrictions due to ongoing federal marijuana prohibition. With federal hemp legalization, however, hemp manufacturers can operate free of both federal rules and state marijuana regulations. Ironically, restrictions on marijuana sales allow hemp manufacturers to offer intoxicating products that compete with marijuana at more outlets and lower costs.

In 2024, over 10 states enacted legislation regulating hemp-derived cannabinoids, and many states are considering similar proposals. Most of these bills have focused on barring sales to minors, ensuring product safety, limiting THC content, and restricting sales of intoxicating hemp to licensed dispensaries. But no state has gone as far as banning hemp products with any detectable THC, as Gov. Newsom proposes.

Newsom previously backed legislation that would have regulated hemp products, imposing rules on hemp similar to those governing marijuana, including manufacturing and labeling standards, limiting sales to dispensaries, and capping THC at 0.3% total or no more than 1 milligram per container. But that measure failed, in part due to concerns raised by patients and parents like the Figis, who feared that forcing all CBD sales into the dispensary system would lead to prohibitively high prices and strip access entirely for many patients since many Californians live more than 100 from the nearest dispensary.

Newsom’s concerns about consumer safety and youth access to intoxicating hemp products are valid. But a ban goes unnecessarily far and will undermine his goals. It would strip patients of access to vital therapies and push consumers toward illicit products without oversight.

If protecting consumers is the goal, California should heed the lessons it learned from legalizing marijuana. Rather than a ban, California should require hemp producers to adhere to the same testing and labeling standards as marijuana and limit sales of intoxicating products to retailers with track records of age-gating adult products.

At the same time, the state should reduce burdensome regulations on marijuana businesses, enabling them to compete in an evolving cannabinoid landscape. By striking this balance between safety, access, and fairness, California can protect patients, consumers and marijuana businesses without restricting access to life-changing cannabis therapies.

A version of this column first appeared in the Orange County Register.

The post California’s emergency hemp rules could block access to life-saving therapies appeared first on Reason Foundation.

The last U.S. surgeon general’s report on nicotine was issued in 1988 when cigarettes were one of the only options for nicotine consumers, and around 32% of adults smoked.

Today, consumers have access to a broader range of products, including many that the scientific evidence indicates pose significantly lower risks compared to smoking, such as e-cigarettes, snus, heated tobacco, and modern oral tobacco. A fresh review from the surgeon general could cut through growing public confusion surrounding these products, ensuring that public health messaging keeps pace with scientific advancements. 

E-cigarettes, in particular, have risen in popularity, and nearly two decades of evidence shows that smokers who switch to vaping drastically reduce their health risks. Despite these advancements in science and technology, public misperceptions about nicotine and confusion over e-cigarettes have only grown.  

Nicotine has been vilified due to its association with combustible tobacco products. Cigarettes are undeniably harmful and are a leading cause of lung cancer, heart disease, and other serious conditions. However, while nicotine plays a role in smoking’s habit-forming nature, researchers have long been aware that the health risks associated with smoking are due not to nicotine but rather the nicotine delivery method cigarettes employ: combustion. Without the smoke and tar created by lighting tobacco and paper on fire, nicotine use is not linked to the diseases associated with smoking. For example, nicotine replacement therapies, like the nicotine patch or gums, are generally regarded as safe for most users, for long-term use, and even for pregnant smokers who cannot otherwise quit.  

Nearly two decades of research on e-cigarettes has repeatedly vindicated e-cigarettes as a lower-risk alternative to combustible smoking. E-cigarettes have also been tacitly endorsed as a method of tobacco harm reduction by various representatives of the Food and Drug Administration (FDA)—the agency responsible for regulating tobacco products and communicating the relevant health information about such products to the public. Brian King, the current director of the FDA’s Center for Tobacco Products (CTP), has noted that adults who switch completely from smoking to vaping can improve their health, a view echoed by other FDA representatives, including former FDA Commissioner Scott Gottlieb and former CTP Director Mitch Zeller. King, however, cautions that while vaping is generally safer than smoking, some vaping products are “more risky” than others.  

Despite the acknowledgment that there is a spectrum of risk when it comes to tobacco products and e-cigarettes, neither King nor anyone else at the FDA has clearly specified which products or types of e-cigarettes might be on the safer or riskier side of that spectrum. Nor has the FDA meaningfully updated its public messaging strategies to reflect this shift in understanding. As a result of the FDA’s failure, public knowledge about nicotine and the lower risks associated with e-cigarettes has only grown more muddled, even as the science on these issues has become clearer.  

In 2012, when the science of e-cigarettes was still developing, only about 13% of adults incorrectly believed that e-cigarettes were as harmful as or more harmful than smoking. Yet, as research increasingly demonstrated that e-cigarettes are a lower-risk alternative, this public misperception grew. By 2020, nearly 65% of adults held this mistaken belief.  

Alarmingly, the falsehood is even more prevalent among smokers—the very people who could benefit most from accurate information about nicotine products—with 88% of adult smokers believing as of 2023 that e-cigarettes are no safer than smoking. Physicians might be able to correct these myths, but even they are confused about nicotine. A 2021 study revealed that a shocking 80% of U.S. physicians mistakenly believe that nicotine is the cause of tobacco-related cancers. On the contrary, there is a broad scientific consensus that while smoking exposes smokers to numerous carcinogens, nicotine is not one of them. Without the knowledge that e-cigarettes offer a safer alternative to smoking, fewer smokers will switch, more will continue to smoke, and more will die as a result.  

The FDA has been aware of the growing public misinformation since at least 2017, when then-Commissioner Scott Gottlieb unveiled the agency’s new approach to tackling tobacco-related harm. The ambitious plan centered on taking a more sober and scientific perspective on the role nicotine plays in addiction and disease, with a key component aimed at educating the public about the relative risks of different nicotine-consumption methods. However, apart from informal acknowledgments from staff and a single page on its website, the FDA has done little to correct public confusion. The FDA’s failure to address a problem it has acknowledged—and, in some ways, contributed to—underscores the need for other health authorities to intervene. 

The surgeon general should initiate a comprehensive review of the evidence on nicotine e-cigarettes, summarizing what the evidence says about their risks and benefits and comparing those risks to other forms of nicotine use. Such a report could provide much-needed clarity on e-cigarettes, cutting through sensationalistic news reporting and FDA rigidity to provide the public, providers, and policymakers with the clear and actionable information they need to make science-based health decisions.  

Recent statements from the FDA suggest a willingness to embrace harm reduction more fully. However, this shift must be accompanied by robust public education efforts, which must be grounded in evidence. An updated surgeon general’s report could serve as a cornerstone of those efforts, helping to reshape public understanding and policy in a way that truly promotes health. Such a report could correct longstanding myths, correct misperceptions, and support regulatory strategies that differentiate between the harms of smoking and the far lesser risks associated with noncombustible nicotine products like e-cigarettes.  

With an updated report from the surgeon general, we can better align public health policy with scientific evidence about e-cigarettes and provide individuals with the information they need to make better health choices. 

The post The case for a surgeon general’s report on e-cigarettes  appeared first on Reason Foundation.