Will hemp-derived THC issue make Congress act – unlike marijuana?

This post was originally published on this site

Sponsored cannabis industry news from MJbizdaily.com

Congress at long last seems set to take decisive action on legislation affecting the U.S. cannabis industry.

But instead of legalizing interstate commerce, offering banking protections or 280E tax relief, federal lawmakers on both sides of the partisan divide want to eliminate the protections for hemp-derived THC that were accidentally created by the 2018 Farm Bill.

That’s the conclusion hemp lobbyists and industry observers are drawing from the Republican budget proposal – introduced in the House last week and quickly passed by an initial subcommittee – that would ban hemp-derived THC products under federal law.

Whether or not that draconian ban passes, the proposal alone is the latest confirmation that there’s a growing sense among operators in the space that the “good old days” of freewheeling online transactions and sales at loosely regulated stores could be ending – eventually, if not soon.

“The question is not if Congress will act, but more a matter of when and to what extent,” Michael Bronstein, the president of the American Trade Association for Cannabis & Hemp (ATACH), which lobbies Congress and state lawmakers, told MJBizDaily via email.

How far can bill go without Democrats’ support?

Hackles were raised when U.S. Rep. Andy Harris, a Maryland Republican, introduced in his budget proposal a redefinition of “hemp” under federal law that would close what he and many others described as a “loophole” in the Farm Bill.

Harris echoed many critics, including some state-regulated marijuana operators, when he said that bill’s unintended consequence is the “proliferation of unregulated intoxicating hemp products, including (d)elta-8 and hemp flower, being sold online and in gas stations across the country.”

His proposal, which passed a House Appropriations subcommittee by a 9-7 partisan vote, would:

• Account for tetrahydrocannabinolic acid, or THCA, to ban so-called THCA flower.
• Remove novel cannabinoids “synthesized or manufactured outside the plant” such as THCP and delta-10 THC from the definition of hemp.

That would mean a major reckoning for many hemp manufacturers and retailers around the country, though the question of who would enforce such a ban – and whether such action would be effective – is an open one.

There also are serious doubts about the long-term viability of Harris’ budget proposal.

Democrats, for example, are staunchly opposed to serious cuts to food assistance and other programs that also are included in the bill.

And the Republicans’ tiny majority in the House – set to shrink further after Tennessee Rep. Mark Green announced his retirement on Monday – means any bill will fail if three or more GOP lawmakers withdraw support.

With hemp farming popular in red states such as Kentucky and North Carolina and congressional lawmakers reluctant to aggravate powerful agricultural interests, there’s a feeling that Harris’ proposal will be significantly watered down before it could become law.

There’s also a feeling of trust in President Donald Trump, who signed the initial Farm Bill into law.

“There is always concern when a bill gets introduced, but we remain confident that Congress won’t turn its back on the farmers and small businesses that have invested significant time and money in developing this industry in a safe, responsible manner,” said Christopher Lackner, the president of the Chicago-headquartered Hemp Beverage Alliance.

“The president who passed the 2018 Farm Bill is the same president in the White House today, which is why we remain confident that Congress will continue to support the hemp industry.”

Often divided, marijuana and hemp united against ban

Harris’ proposal created an unintended consequence of its own.

Instead of exacerbating the squabbling between marijuana and hemp interests that state-level bans such as California’s revealed, Harris’ bill triggered a united front in opposition.

“The value of us taking this punch from Andy Harris is it helps further unite greater cannabis industries,” said Jim Higdon, a co-founder and chief communications officer for Kentucky-based Cornbread Hemp, which markets hemp-derived CBD and THC gummies and drinks.

Indeed, advocates for state-regulated marijuana companies are opposing the ban, as are liquor wholesalers keen to replace lost revenue from dwindling alcohol sales with increasingly popular hemp-derived beverages.

While there is a feeling of inevitability that the status quo is ending, there’s also a sense on Capitol Hill that Harris’ proposal goes too far, said Diana Eberlein, the acting chair of the Coalition for Adult Beverage Alternatives (CABA), which advocates for hemp beverages in Washington, D.C.

CABA and other lobbying group, including the U.S. Hemp Roundtable, are using the Harris amendment as an opportunity to renew efforts to “educate” lawmakers on the popularity of regulated hemp products.

They’re also pointing to successful state-level regulations that, while outlawing so-called “hemp dispensaries” that have sprung up in markets without medical or adult-use marijuana laws, still allow for low-dose THC beverages.

“I think there’s a lot of understanding among legislators that prohibition doesn’t work,” Eberlein added.

However, she cautioned, “We are still dealing with residual frustration from some lawmakers who feel duped by the Farm Bill.”

Congress sends clear signal about Farm Bill ‘loophole’

For its part, Congress has made clear its feelings about hemp-derived THC for more than a year.

Alarm bells rang in May 2024 when Indiana Republican Rep. Mary Miller introduced a Farm Bill amendment, co-sponsored by California Republican Rep. Doug LaMalfa, that excluded ingestible hemp products with any detectable level of THC from federal hemp protections.

The Miller Amendment ultimately went nowhere as the House version of the Farm Bill did not advance to the full floor for a vote.

And in the then-Democratic-controlled Senate, that measure wasn’t even heard in committee.

However, a Senate draft released during the lame-duck session did include language that redefined hemp to address cannabinoids such as delta-8 THC while also closing the so-called “THCA loophole.”

That was considered an agenda-setting signal that sent a clear message: Congress finally realized what it did with the 2018 Farm Bill.

And on Capitol Hill, it’s considered a problem in need of correction.

“The difference on this issue versus other cannabis-adjacent issues is that there is bicameral and bipartisan support to address the problem,” ATACH’s Bronstein said, as well as “a Congress saying that the intent of the Farm Bill was to create a vibrant industrial hemp market, and not just an opportunity for chemists to create a synthetic THC derivative market.”

Chris Roberts can be reached at chris.roberts@mjbizdaily.com.

Sponsored cannabis industry news from MJbizdaily.com

Will hemp-derived THC issue make Congress act – unlike marijuana?