House committee advances bill that would close the hemp ‘loophole’ 👀

HEMP
A key House committee advanced a  bill that would close the hemp ‘loophole’ 👀

Driving the news: Intoxicating hemp products have suffered severe policy setbacks in recent weeks. 

Last September, California Gov. Gavin Newsom instituted an emergency ban on intoxicating THC products derived from hemp. Texas Lieutenant Gov. Dan Patrick fought tooth-and-nail to pass SB3, a bill that would ban all consumable THC products in the state.

And now, a key House committee wants to close the original ‘loophole’ in the 2018 Farm Bill that allowed these products to flourish in the first place. 

What happened: On Thursday, a key Congressional committee advanced a bill that would effectively close the loophole and federally prohibit all consumable intoxicating cannabis products derived from hemp. 

The House Appropriations Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies, is chaired by Republican Maryland Rep. Andy Harris, a longtime opponent of federal cannabis reform. 

In a press release, Harris said closing the loophole would support President Donald Trump’s agenda by halting the “proliferation of unregulated intoxicating hemp products, including Delta-8 and hemp flower, being sold online and in gas stations across the country.”

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

On the other side: “We are disappointed that Chairman Harris is yet again trying to inappropriately shoehorn a farmer-crushing, job-killing hemp ban into a spending bill,” Jonathan Miller, the general counsel of the US Hemp Roundtable, an industry trade group, said. 

“We are hopeful that this effort fails as it has in the past, but the US hemp industry will be united in working together to defeat this misguided attempt to destroy a market.” 

Go deeper: Hemp is defined by the federal government as cannabis that contains less than 0.3% THC by dry weight, per the 2018 Farm Bill. But that’s a legal definition. Biologically, hemp and cannabis are the same plant.

Companies have developed novel ways to exploit this, both by synthesizing other forms of THC like Delta-8 from hemp to put into edibles and drinks, and by putting regular Delta-9 THC derived from hemp into consumer products. The effect for the consumer is largely the same as cannabis products procured from a state-legal dispensary (at least in the case of Delta-9 or THCa products), but in the federal government’s eyes, the legality is totally different.

While Harris’ push to close the loophole is ostensibly directed at those who sell untested, synthesized THC, sometimes to minors — “gas station weed” in colloquial terms — it will also effectively kill the companies that are going about this in the right way. 

Our take: Those companies include Cann, CanTrip, and Rebel Rabbit, all of which have found product-market fit and are creating jobs across the country, as we’ve shared on Cultivated.

Closing the loophole without a carveout for the good actors would destroy people’s livelihoods and force many out of work. There are also millions of investment dollars chasing the emerging market for hemp-derived THC drinks, as Chris Casacchia reported for Cultivated. 

At the same time, there is a consumer safety benefit to getting unregulated, untested, synthesized cannabis off of store shelves, where it is frequently sold to minors. 

Sensible legislation would provide clear regulations for companies to continue building their businesses, while rooting out the bad actors who are a threat to public safety. But the language of this bill seems to do away with the industry entirely, without separating the good from the bad.

This bill paints too broad of a brush. We’d call for much more industry engagement before this is passed, though with Harris at the helm, that might be too big of an ask. 

What’s next: The bill will go to a full House Appropriations Committee review next, on its way to a full floor vote. Expect there to be some back-and-forth over changes, though we’ll keep you updated. 

-JB

Editor’s note: This has been updated to reflect that the bill will go to an Appropriations Committee review next.

“Adults should be able to use cannabis with intoxicating THC if they want,” North Carolina Gov. Josh Stein said. “I do support that. But what I really support is making sure that kids cannot buy it, and by law today in North Carolina, they can. That is absolutely unacceptable to me.”

Minnesota holds first license lottery 💻

The Office of Cannabis Management held lotteries on Thursday to select 249 license winners for cultivation (50), manufacturing (24) and mezzobusinesses (100) — which are allowed to cultivate and sell through up to five retail stores. A fourth lottery was held for social equity candidates seeking one of 75 retail licenses. A general applicant retail lottery for an additional 75 licenses will be held on July 22. 

North Carolina Governor pushes legalization 🚀

North Carolina’s new Democratic Gov. Josh Stein is seeking to legalize cannabis in the state, he told WRAL. He’s forming a bipartisan commission to develop policy recommendations around erasing criminal records and regulating sales. The commission includes Pat Oglesby, a tax and drug policy expert. 

Medical sales are on the rise in Arkansas 📈

Sales in the first five months of 2025 shot up 6% compared to the same time in 2024. The increase indicates that 2025 could see a rebound after 2024 was the first year to not top its predecessor in total sales. Governor Sarah Huckabee Sanders signed HB 533 into law back in April, which set a 1mg per container limit on hemp-derived intoxicants, effectively knee-capping the state's hemp industry. 

Czechia will allow people to grow cannabis at home next year 🌿

Czechia will become the third European country to allow adults to grow cannabis at home, after the country’s Chamber of Deputies passed a bill on May 30. Under the new rules, adults over the age of 21 will be able to cultivate up to 3 cannabis plants at home, store 100 grams of dried cannabis, and carry up to 25 grams in public. The new rules go into effect in January, and also include legalizing the therapeutic use of psilocybin, the key ingredient in magic mushrooms. Read more.

Vireo Growth buys into Missouri 💰

Vireo Growth completed its $102 million purchase of 11 dispensaries in Missouri. This marks the fourth state the company will operate in, following New York, Maryland, and Minnesota. Ten of the new dispensaries are located in the St. Louis area, with the 11th located in Kansas City. 

Canadian producer launches cannabis coverage for union members 🩺

Entourage Health Corp., a Canadian cannabis producer and distributor, announced a partnership with the International Brotherhood of Electrical Workers Local 353 to offer medical cannabis care to its union members through Entourage's subsidiary, Starseed Medicinal.

And more:

• Theory Wellness is opening its second Ohio dispensary in Columbus. 

• Rubicon Organics announced the closing of its 47,500 square foot Hope, British Columbia facility. 

• Colorado cannabis company Green Dot Labs announced a “refreshed brand identity.”

New York’s Cannabis Control Board gets a new chair 🪑

New York Gov. Kathy Hochul has nominated Cannabis Control Board member Jessica Garcia to replace current chair Tremaine Wright. Earlier this year, the governor's budget proposal included replacing the chair's salary with a much smaller stipend, similar to what other state board members receive. The Senate is expected to vote on Garcia's nomination on Friday. 

And more:

• The FDA lawyer who sent the letter to Dozo that we covered yesterday, Laura Akowuah, has joined the law firm Cooley after a decade at the federal agency.

Colorado indicates legal weed is good for hotels 🛌

A study published in the journal Production and Operations Management Society found that hotel revenue in Colorado increased about 25% following the legalization of cannabis. The increase comes from both a jump in bookings and room rates. The increases were still being felt six years after legalization started in Colorado, which was still a time when fewer states had legalized and Colorado was a stronger draw for 420-friendly tourists.

Jay & Silent Bob x Jeeter Celebrate National Donut Day with Bluntman’s Chronic

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Sadiq Khan is right: Britain must decriminalise cannabis – or remain in the dark ages | The Guardian

Proposed federal ban on intoxicating hemp could rock New York's cannabis industry | Crain’s