New regulations for the consumable hemp industry were approved by the Texas Alcoholic Beverage Commission on Tuesday, concluding the agency’s involvement in a yearlong effort to more tightly regulate the products in the state.
The rules change little for the $5 billion industry, replacing the temporary emergency rules in place since September. The rules prohibit the sale of consumable help products by TABC license holders to people under 21 and require ID checks on all sales.
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The rules apply to 60,000 TABC license holders, including convenience stores, restaurants and liquor stores, many of which sell consumable hemp products.
“It’s much like alcohol, the same reasons we regulate alcohol to those aged 21 and older,” said Robert Eckels, chair of the TABC board. “You see not only developmental problems, and you need a level of maturity to use these products or it can be very harmful to the kids and the community.”
The permanent rules also pull back on some of the stricter measures in the emergency rules. The new proposal removes a “one strike” provision that allows TABC to cancel the license of any business found to have sold the products to a minor or that failed to check a customer’s ID. The permanent rules allow for the agency to temporarily suspend licenses for less egregious violations.
During the monthlong public comment period, industry representatives for convenience stores and restaurants told the industry that the “one strike” provision risked putting stores out of business over a simple mistake.
TABC General Counsel James Person said the agency had entered into a memorandum of understanding with the Department of State Health Services to be the primary agency in charge of enforcement of consumable hemp product regulations. The agencies are currently negotiating an inter-agency contract to finalize the terms of that agreement, Person said.
Opponents of the industry were the most outspoken during the public comment period of the meeting, arguing that consumable hemp products should be banned altogether, or the minimum purchase age should be raised to somewhere between 25 or 30 to prevent young adults from accessing the products while their brains are still developing.
Aubree Adams, director of Citizens for a Safe and Healthy Texas, said hemp products are addictive and harmful at any age.
“These are, quite frankly, some very heartbreaking conversations that the state of Texas needs to pay attention to as we go through trying to do what’s best for all of Texas,” TABC Commissioner Deborah Gray Marino said following the vote.
Eckels acknowledged the advocates’ concerns and said Tuesday’s vote would not be the final word on regulating the industry. Eckels, a former member of the state House of Representatives and former Harris County Judge, said he expects the Legislature to again try its hand at passing laws that apply to the industry during the 2027 session.
DSHS is currently working to finalize its own regulations for smoke shops and other retailers not covered by TABC, including its own ban on sales to those under the age of 21. Those proposed rules increase DSHS licensing fees by 13,000% to sell the products, something DSHS said is necessary to fund the new oversight. The licensing cost hike does not apply to TABC license holders.
DSHS is accepting public comment on its proposed rules until Jan. 26.
TABC and DSHS both proposed new rules in the fall aimed at regulating the consumable hemp market to fulfill an executive order by Gov. Greg Abbott.
The two agencies are working together because neither has jurisdiction over the entire landscape of retailers that sell consumable hemp products. For example, TABC rules wouldn’t apply to 8,000 licensed hemp retailers who fall under DSHS, including smoke shops and online retailers that do not sell liquor and presumably do not hold a liquor license.
The executive order came after the Texas Legislature spent the better part of last year debating whether to ban consumable hemp products all together or just impose stricter regulations on the industry. The House of Representatives and the Senate both voted to ban the products, but that measure was vetoed by Abbott last summer.
The governor then put THC regulation on the agenda for two consecutive special sessions, but lawmakers were unable to find a compromise before the end of the second session.
Rather than call a third special session, Abbott issued his executive order, bypassing the Legislature. The decision has put Abbott at odds with Lt. Gov. Dan Patrick, who has been an ardent supporter of a ban on consumable hemp products.
The state agencies’ work may end up being moot because of a congressional ban of nearly all consumable hemp products approved last year that takes effect in November. Industry representatives say they intend to lobby for the provision’s repeal.