Texas Governor Vetoes Hemp Ban Bill

Texas' multibillion-dollar hemp market has escaped a death sentence.

Republican Gov. Greg Abbott vetoed a bill that would have banned intoxicating hemp products.

The ban would have impacted the vast majority of hemp products in Texas’ booming industry, with at least $4 billion in annual sales and more than 8,000 licensed retailers. Abbott is instead calling lawmakers back to Austin for a special session next month to pass a hemp regulatory bill.

“Texas must enact a regulatory framework that protects public safety, aligns with federal law, has a fully funded enforcement structure, and can take effect without delay,” Abbott’s veto message read. “Legislators could consider a structure similar to the way alcohol is regulated, with strict enforcement by an agency like the Texas Alcoholic Beverage Commission.”

The veto marks a major lobbying victory for the fledgling industry, which had pushed Abbot for weeks to kill the bill, arguing that the financial impact would be devastating to the state.

The Texas Hemp Business Council, which collected about 150,000 signatures on a petition asking the governor to veto the bill, said in a statement that the governor’s veto “reinforces Texas’ reputation as a leader in business innovation,” and chooses “balance over overreach.”

Banning intoxicating hemp products was a top priority for Republican Lt. Gov. Dan Patrick this session, who argued that they presented a major public health threat.

"The 8,000 shops have been put in Texas in the last three years, many of them without permits [are] selling this to their kids, to destroy their kids," Patrick said at a press conference last month.

A bill, sponsored by Republican state Sen. Charles Perry, would have banned most hemp-derived products.

While that bill sailed through the Senate, the House overhauled the language, advancing a proposal out of committee that would regulate rather than prohibit the products.

But in a stunning reversal, the House reverted back to the Senate’s version of the bill in May, passing the legislation to ban most hemp products in a largely party-line vote.

Abbott called on lawmakers to send him a hemp regulatory bill that includes many provisions of the House’s substitute that passed out of committee: prohibiting sales near schools, requiring child-proof packaging, requiring customers to be 21 and over, capping the amount of THC and more.

National fight

States across the country have been trying to put guardrails around the loosely regulated markets for hemp products — many of which are highly intoxicating — that have proliferated across the country since Congress legalized hemp though the 2018 farm bill.

A hemp regulatory bill in Alabama will take effect next month, banning the sale of smokable hemp products. A new law in Tennessee will ban the sale of THCA and other synthesized cannabinoid products starting next year. Public health officials in California are moving to make emergency rules banning intoxicating hemp products permanent.

At the same time, legislative efforts to clamp down on the intoxicating hemp market in several states, including Missouri and Florida, did not make it across the finish line this year.

Abbott expressed concerns about litigation — one lawsuit was already preemptively filed to challenge the bill before it was even signed.

“The legal defects in the bill are undeniable,” the governor’s veto message said. “Its enforcement would be enjoined for years, leaving existing abuses unaddressed. Texas cannot afford to wait.”

Abbott also pointed to a lawsuit that sought to challenge similar legislation passed in Arkansas.

“Their law has sat dormant, meaningless, having no effect for nearly two years while further legal proceedings play out,” Abbott’s veto message said. “That result must be avoided in Texas.”

Hemp industry officials praised the governor’s decision to veto the bill.

“Gov. Abbott did the right thing,” said cannabis attorney Susan Hays. “Cannabis is a complicated plant. Simplistic, politically driven bills attacking cannabis products will fail in practice every time.”

Smart Approaches to Marijuana, an anti-legalization advocacy group, criticized the decision as a “profound disappointment.”

“The governor's apparent reasoning, that his state could not [enact] this ban because it might face industry lawsuits, is ludicrous,” SAM President Kevin Sabet said in a statement. “Worse, it creates a clear precedent for the wider marijuana industry to exploit.”