Thousands up in smoke: San Antonio hemp product businesses take hit

A new clarification from a Texas agency that makes Delta 8 illegal concerns local business owners

Products containing Delta 8 THC on the counter at GR8 Vapes in San Marcos on Oct. 20, 2021.

Editor’s note: This story was published through a partnership between KSAT and the San Antonio Business Journal.

As a combat veteran, Asad Shalami, owner of CBD Zar on the North Side of San Antonio, gets why Delta-8 is so popular.

He’s used products that contain the derivative of cannabis, Delta-8-tetrahydrocannabinol, to combat insomnia and PTSD he experienced after leaving the Army.

A recent clarification on the legality of Delta-8 by the Texas Department of State Health Services has Shalami concerned about the business he’s so passionate about.

Under new clarification by the Texas Department of State Health Services published on its website on October 15, products containing Delta-8 THC in any concentration are classified as Schedule 1 controlled substances in the state.

“We stopped selling it for about a day and a half before we put it back on shelves,” Shalami said. “It’s 60% of our business. I’m sure that same ratio applies to hundreds of businesses out there.”

Although Shalami said the clarification will scare some customers from continuing to buy it, he’s refusing to take it off his store shelves after spending hours making phone calls to district attorneys offices and police departments near his six area locations.

Those local authorities would have to be the ones to enforce the rule, as DSHS itself does not carry out enforcement.

“Every single one of them said ‘we have better things to do than prosecute businesses and their customers.’”

Ruben Mendoza, owner of Stash CBD, is taking the opposite route. He’s already thrown away his Delta-8 products at his family-owned store, Stash CBD.

“We’ve already gotten rid of close to $10,000 worth of product. It’s probably a 30 to 40% revenue loss. It is going to affect our overhead.”

For small business owners with one location, like Mendoza, it’s a huge hit. Still, he said he’s willing to take to avoid possible fines and felony charges for possession of a controlled substance.

Mendoza and Shalami said they’re keeping an eye on the legal battle that’s unfolded between Delta-8 sellers and the state.

November 5 will mark a major moment in response to DSHS, when a Travis County CBD store argues for a temporary injunction against Texas, arguing that DSHS improperly revised its policy.

Although anxious to get Delta-8 back on shelves, Mendoza still insists his profit loss isn’t worth potential legal consequences.

“I’ll let that fight happen in court,” he said.

Click here to read the full story in the San Antonio Business Journal.

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