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The Texas Alcoholic Beverage Commission is moving forward with permanent regulations for consumable hemp products despite federal restrictions approved by Congress last week that threaten to effectively ban the state's $8 billion hemp industry.
TABC commissioners voted Tuesday to begin a public input period on permanent regulations that will replace emergency rules adopted in September barring THC product sales to anyone under 21. The public comment period concludes January 4, with formal adoption expected in January—just months before new federal restrictions take effect next November.
A provision in the U.S. Department of Agriculture funding bill that ended the recent government shutdown reverses key elements of the 2018 Farm Bill that enabled Texas's hemp industry to flourish. The new federal law bans the sale of hemp-derived products containing more than 0.4 milligrams of THC, the psychoactive compound also found in marijuana. This restriction effectively criminalizes nearly all consumable hemp products currently sold nationwide, putting Texas law in direct conflict with federal statute.
Despite this looming contradiction, TABC Commissioner Hasan K. Mack stated the agency intends to act "regardless of the actions at the federal level," following Governor Greg Abbott's September executive order directing stricter hemp industry regulations.
TABC's proposed permanent rules largely align with September's emergency regulations but soften some stricter measures. The new proposal removes a "one strike" provision that allowed automatic license revocation for businesses selling to minors or failing to check identification. Permanent rules instead permit temporary license suspensions for less serious violations.
Trade group representatives testified in support of the less punitive approach, arguing that automatic cancellation risked putting stores out of business over simple mistakes. The regulations will apply to businesses with liquor licenses that also sell hemp products, including restaurants, bars, and convenience stores.
The hemp industry is mobilizing for a lobbying battle similar to its successful spring campaign that convinced Abbott to veto a state-level ban. "Hemp is too vital to the American economy and to the livelihoods of millions to be dismantled by rushed, politically driven legislation," the Texas Hemp Business Council stated, vowing to pursue "every legal and legislative option" to overturn the federal restrictions.
Questions remain about how aggressively federal restrictions will be enforced. Marijuana remains federally illegal as a Schedule I drug but prohibition generally isn't enforced in states where it's legal—40 states including Texas have medical marijuana programs, and 24 permit recreational use.
Texas Senator Ted Cruz voted for a failed amendment to remove hemp restrictions from the funding bill, while Representatives Dan Crenshaw and Troy Nehls both opposed the restrictions despite voting for the overall funding package to end the government shutdown.
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