A version of this public comment was submitted to the Texas Senate State Affairs Committee on March 3, 2025.
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.