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Bill filed in Tennessee to regulate and tax CBD and Delta 8 THC

by The Real Dirt | Jan 14, 2022 | Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Culture, Hemp, Hemp Law, Industry News

Tennessee might regulate and tax CBD and Delta 8 THC products

A Republican lawmaker is seeking to tax and regulate the existing cannabis industry in the state.

Rep. Chris Hurt (R-Halls) filed House Bill 1690 this week. The bill seeks to regulate psychotropic hemp-derived cannabinoids, which include products that have more than 0.1 percent THC. (Current federal regulations limit THC to 0.3 percent.) That includes products containing the newly popular Delta-8 THC but not pure CBD products, which do not contain THC.

As a member of the Agriculture and Natural Resources Committee, a former hemp farmer and current co-owner of CBD ProCare — a CBD company in Dyersburg — Hurt says he filed the bill in an effort to “legitimize the industry.”

According to Hurt and Joe Kirkpatrick of the Tennessee Growers Coalition, who collaborated with Hurt on the writing of the bill, no other state has legislation that specifically taxes and limits the sale of hemp-derived cannabidiol products.

“People think that Tennessee is the last to do anything when it comes to the hemp industry,” Kirkpatrick says, “but they are forgetting that Tennessee was the first state to allow and define smokable hemp and the first state to allow the feeding of hemp to livestock.”

HB1690 would do three things: create a licensing requirement for retailers and wholesalers, establish a 6.6-percent excise tax on the wholesale of hemp-derived cannabinoids and limit sale of psychotropic hemp-derived products like Delta-8 to those 21 and older.

The bill would require retailers and wholesalers to apply for an annual $200 license through the Tennessee Department of Agriculture. Based on the licensing structure outlined, Kirkpatrick says he would expect the state to collect $160,000 annually in fees. (The legislative Fiscal Review Committee has not yet analyzed the potential economic impact of the legislation.) Licenses could be revoked or suspended at the discretion of the Department of Agriculture.

Kirkpatrick estimates that the proposed 6.6 percent tax, modeled after the tax on tobacco, could generate as much as $4-5 million in annual revenue for the state. Hurt and Kirkpatrick would like to see the money collected from licensing and the wholesale tax used to increase the resources at the Department of Agriculture to ensure product safety.

Read Full Story on Nashville Scene

Delta 8 THC Banned in New York

by The Real Dirt | Nov 5, 2021 | Blog, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Culture, Hemp, Hemp Law, Industry News, Legalization

Rules to allow for delta-8 THC could come in the “future,” but in the meantime, those for CBD in food and beverages have been finalized.

Delta-8 THC was front and center during the latest meeting of New York’s cannabis regulators, as officials work to stand up what will be one of the world’s biggest cannabis markets.

The state’s Cannabis Control Board (CCB) met on Wednesday, for the third time, to approve Cannabinoid Hemp regulations presented by the Office of Cannabis Management. The package of rules will now regulate hemp products, including CBD products, by creating “clear” guidelines for what kinds of products and activities are allowed, and which ones aren’t, “to help foster the development of a robust cannabinoid hemp industry.”

The rules also seek to enhance consumer protection and quality control through testing and labeling, and to “enforce against” products that don’t meet the bar and those that are explicitly banned.

“Delta-8, similar to delta-9 THC, is psychoactive, has psychoactive properties, particularly when synthesized through the processing process. Because of that, we’ve decided to hold off on including the regulations for those products in this package and that will be addressed in the future adult use packages,” Chris Alexander, executive director of the Office of Cannabis Management (OCM), within which the Board sits, said during a question and answer portion of the meeting, when asked specifically where delta-8 rules stood.

The regulations do, however, allow for cannabinoids, like CBD, to be added to foods and beverages, if they meet the state’s standards, which will require that each product be made using Good Manufacturing Practices. Last month, California Gov. Gavin Newsom signed AB 45, which will now allow hemp-derived CBD (or other cannabinoids) in supplements, foods, drinks, cosmetics, and pet food.

“I’m pleased that we will be advancing the cannabinoid hemp program today, just as we have done with the expansion of the medical marijuana program at prior meetings,” Tremaine Wright, chair of the Board, said at the start of the meeting. (As Cannabis Wire recently reported, the Board has already moved to allow for medical cannabis shops to sell flower products, which several have started to do, and released rules for patients to home grow.)

Board member Jen Metzger gave an overview of the hemp program in New York. In 2015, the Department of Agriculture and Markets launched the state’s Industrial Hemp Agricultural Research Pilot Program. Metzger said this program “exploded” after it launched, with 800 farmers registered to grow, most for cannabidiol (CBD).

When the Marijuana Regulation and Taxation Act passed in March, legalizing cannabis for adult use, the Cannabinoid Hemp Program was transitioned under the umbrella of the new Office of Cannabis Management.

Read Full Story on Cannabis Wire

USPS Bans Mailing Hemp, CBD and Vape Cartridges

by The Real Dirt | Oct 27, 2021 | 420 News, Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Hemp, Hemp Law, Industry News, Legalization

The U.S. Postal Service (USPS) on Wednesday released its final rule on the mailability of vapes, asserting that even devices designed for federally legal hemp derivatives like CBD generally cannot be shipped through the U.S. mail.

The agency has been developing the regulations to comply with a bill passed by Congress last year that is mostly aimed at stopping nicotine vaping devices from being mailed—though it has broader implications. Despite significant public comment on an earlier proposed version of the rules that urged USPS not to interpret the law in a way that restricts hemp businesses, the agency ultimately said that cannabis vapes fit the definition of what lawmakers moved to ban.

There are some exceptions, but stakeholders are disappointed by the final rule.

During public comment, some argued that the bill was specifically meant to restrict mailing of nicotine-based vapes. But while the legislation refers to limitations on “electronic nicotine delivery systems,” or ENDS, it defines that term as “any electronic device that, through an aerosolized solution, delivers nicotine, flavor, or any other substance to the user inhaling from the device.”

USPS explained in the rule, which is set to be published in the Federal Register on Thursday, that by the letter of the law, that includes hemp and marijuana vapes.

“It goes without saying that marijuana, hemp, and their derivatives are substances,” the agency said. “Hence, to the extent that they may be delivered to an inhaling user through an aerosolized solution, they and the related delivery systems, parts, components, liquids, and accessories clearly fall within the [Preventing Online Sales of E-Cigarettes to Children Act’s] scope.”

Other commenters argued that USPS shouldn’t impose the restriction on cannabis products because the ban could conflict with state or local marijuana laws—or because Congress has approved spending legislation that prohibits the use of Justice Department funds for interfering in state-legal medical cannabis programs.

USPS said those arguments are not valid because, 1) it’s part of the federal government and is, therefore, unaffected by state or local marijuana policies and 2) it’s not part of the Justice Department, which is the only branch of the government restricted by the state protection rider in appropriations legislation.

The agency further clarified that hemp containing up to 0.3 percent THC is federally legal and is generally mailable, but only “to the extent that they are not incorporated into an ENDS product or function as a component of one.” As such, while business can generally mail out legal hemp-derived products, that’s only the case if they are not vaping products covered under the new law.

“The POSECCA and the Agriculture Improvement Act overlap, but they do not conflict. The Agriculture Improvement Act merely excludes certain products from the CSA. It does not affirmatively declare hemp and hemp derivatives to be mailable in any and all circumstances, superseding all other relevant laws (such as the POSECCA). For its part, the POSECCA restricts the mailability of only certain hemp-based and related products; hemp-based non-ENDS products are unaffected, as are ENDS products falling within one of the PACT Act’s exceptions. That Congress has rendered some subset of a class of goods to be nonmailable while leaving the remainder mailable is not some sort of legal conflict, but, rather, how mailability regulation typically works.”

Read Full Story on Marijuana Moment

Texas lifts ban on smokable hemp, with caveats

by The Real Dirt | Aug 6, 2021 | Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Hemp, Hemp Law

Texas lifts smokable hemp ban but it can't be grown in state

An appeals panel in Texas issued a mixed judgment Thursday in a lawsuit challenging the state’s ban on smokable hemp. Regulators may enforce a ban on the processing and manufacture of products intended for smoking or vaping, the court ruled, but it cannot prevent such products made elsewhere from being sold in the state.

The decision creates a situation in which consumers may be able to freely purchase smokable hemp flower and hemp-derived CBD oils for vaping, but only if the products are produced outside Texas.

Four Texas companies challenged the ban in a lawsuit last year, asking the court to declare the restrictions unconstitutional and allow hemp products intended for smoking or vaping to be produced and sold legally. In response, a state judge eventually put the entire ban on hold, preventing the government from enforcing it until the matter could be resolved in court.

In Thursday’s ruling, a three-justice panel of the Third District Court of Appeals drew a distinction between the processing and manufacturing of smokable hemp—which lawmakers strictly prohibited its production when they legalized hemp in 2019—and distribution and sales, which regulators at the Texas Department of State Health Services (DSHS) forbade under a rule adopted a year later.

Writing for the panel, Justice Melissa Goodwin reasoned that lifting the ban on product sales was justified because the DSHS restriction went beyond the scope of lawmakers’ manufacturing ban.

“The Legislature required that the Department’s rules must reflect the principle that ‘the processing or manufacturing of a consumable hemp product for smoking is prohibited,’ but did not mention retail sale,” the judgment says. “Nevertheless, the Department adopted a rule that banned not only the processing and manufacturing of consumable hemp products for smoking, but also the distributing and retail sale of such products.”

On the other hand, the panel’s ruling will allow lawmakers’ ban on production and manufacturing of smokable hemp products to take effect. Thursday’s ruling reversed a lower court’s decision to prevent the state from enforcing that part of the ban.

“Because the Hemp Companies never provided ‘a plain and intelligible statement of the grounds’ to enjoin the enforcement of rule 300.104’s bans on manufacturing and processing consumable hemp products for smoking, we conclude that the trial court abused its discretion in granting the temporary injunction and enjoining the enforcement of that portion of the rule,” Goodwin wrote.

Advocates in favor of broader legal access to cannabis products emphasized the significance of the court’s decision to allow smokable hemp to be sold in the state. But they lamented the fact that in-state manufacturing of the products will remain illegal.

“The reversal of the ban on distributing and selling smokable hemp products is a big win for Texas farmers and hemp businesses. It is extremely important that regulatory overreach is kept in check so that Texas companies are not prevented from excelling in this market,” Jax Finkel, executive director of Foundation for an Informed Texas, told Marijuana Moment on Thursday. “I am hopeful that manufacture portion of the suit will end in a similar opinion.”

Read Full Story on Marijuana Moment

THC-O Acetate: Will it replace Delta 8 THC?

by Travis C | Jul 22, 2021 | Blog, Broscience Mythbusters, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Culture, Hemp, Hemp Law

What is THC-O Acetate and is it like Delta 8 THC?

As more states begin banning and regulating Delta 8 THC, manufacturers are looking for alternatives to skirt the rules. Bring in THC-O Acetate.

Before we dive into the latest designer cannabinoid that aims to replace Delta 8 THC as it becomes banned in several states and regulated in some others, let’s briefly run through what Delta 8 THC is itself.

All cannabinoids, from CBD to THC and beyond begin as CBGA. Because of the shared molecular structure of cannabinoids, manipulating them is simpler than it may seem. While Delta-8 is relatively new, producers have been using these methods to manipulate cannabinoids for a long time to find exotic new cannabinoids.

While Delta-8 THC exists in a wide range of cannabis strains, it is in minuscule, trace amounts. To extract and purify Delta-8 from raw plant material with less than one percent of the targeted cannabinoid is unprofitable. This is why producers have begun converting other, more prevalent cannabinoids like CBD and Delta-9 THC into Delta-8.

Through a synthetic isomerization process, CBD is combined with a solvent to create Delta-8 THC. This is why the most popular products are vape cartridges and gummies. Cannabis cannot produce enough Delta-8 on its own.

Why Delta 8 THC is being banned

If you read the above section and started thinking, “That sounds pretty similar to those designer cannabinoids like spice that hurt a lot of people”, you would be on the right track. That is why over a dozen states have already banned Delta 8 THC.

Due to grey areas in the 2018 Farm Bill which legalized hemp and all of its derivatives (besides Delta 9 THC), producers of Delta 8 believe they technically aren’t breaking any laws. However unlike CBD which was immediately popular and thus regulated by the FDA for safety, Delta 8 has had no such treatment.

In 2020, the DEA released a set of rules for hemp production in the country. This ruling states that any naturally occurring tetrahydrocannabinols in the hemp plant that has a Delta 9 THC percentage below .3% is not a controlled substance under the Controlled Substance Act. In other words, it would seem like Delta 8 in the clear.

However the DEA also includes that for synthetically derived tetrahydrocannabinols (like Delta 8 which is created synthetically), the concentration of D9 -THC is not a determining factor in whether the material is a controlled substance. All synthetically derived tetrahydrocannabinols remain schedule I controlled substances. In other words, maybe Delta 8 is not so in the clear.

For the states that have already banned Delta 8 THC, it seems the easiest solution to a product that the FDA and DEA have made no mention of regulating. For producers however, THC-O Acetate is the solution.

What is THC-O Acetate?

While Delta 8 THC occurs in low concentrations in cannabis that must be extracted and isolated, THC-O Acetate — commonly called ATHC or THC-O — is not naturally occurring in the cannabis plant and can only be made synthetically.

THC-O is a man-made cannabinoid produced by using specific chemicals to acetylate THC. Acting as a metabolic prodrug for THC itself, THC-O works in the same manner as heroin does as a metabolic prodrug for morphine. That alone is enough to rub many cannabis users the wrong way, especially whole plant advocates.

THC-O Acetate can also be made from Delta 8 THC, so in states where it has been banned and producers may have a bulk supply of Delta 8, it can be converted relatively easily. And what truly makes THC-O so popular is the effects users feel.

Traditional THC Molecule:

Delta 9 THC vs THC-O Acetate THC-O Acetate Molecule:

What is THC-O Acetate and is it safe?

A better high than Delta 9?

According to user reports and the little science behind it, THC-O Acetate has been shown to be two to three times stronger than Delta 9 THC. You read that right. THC-O can be 300% more potent than traditional Delta 9 THC.

Users have claimed that THC-O Acetate is a much more introspective and psychedelic experience compared to Delta 9 or Delta 8 THC, which is likely due to the extreme potency. Similarly to Delta 8 THC, THC-O can only be made through isolation, which means most products will be either a vape cartridge or edibles.

While for most, normal Delta 8 or Delta 9 THC does the trick just fine and taking such a concentrated product would be excessive, there is a real appeal for medical applications of THC-O Acetate. For some, traditional Delta 9 doesn’t provide enough relief from pain, anxiety or other issues.

Due to its potency, many believe that THC-O could be a great beneficial medicine for those who want to use cannabis but need a more concentrated dose that isn’t easily attainable through traditional consumption. With that said, THC-O Acetate is treated similarly to Delta 8 currently.

That means in states where Delta 8 has already been banned, you may be unable to have THC-O products delivered, or find them at smoke shops. However since there is so little information on THC-O, few states actually know about it, which means distributors may be able to get away with it for a while.

Is THC-O Acetate the new designer drug?

Of course for now it is too soon to say if THC-O is likely to end up in a similar grave to Spice or K2. These were synthetically created cannabinoid products that ended up hurting a lot of people, leading them to be banned across the country. However the way these products skirted the law was by minutely adjusting their chemical makeups every time one was banned.

Because the government would ban specific makeups of these products, small adjustments made them different products technically. It is always possible, being a fully synthetic creation, that THC-O befalls a similar fate. In grey markets, profits typically rise above safety. As competition grows, just like Delta 8 became more widespread, the same will likely happen to THC-O Acetate.

Producers will try to create stronger and cheaper versions of the drug, the latter effort being that which leads to danger. We all saw what happened when illicit market vape cartridge producers tried to cut costs by including Propylene Glycol and Vitamin E Acetate in their products. This resulted in hundreds of hospitalizations and even deaths.

With any grey or black market cannabis products, it is always on the user to ensure they are getting a safe and reliable product. If demand for THC-O Acetate grows enough, you can bet there will be a market for it.

However as a non-natural cannabinoid, THC-O isn’t measured with most testing methods used for cannabis currently. While some have claimed to created a reliable process for measuring THC-O, nothing has become the standard. Due to this it might be a while before there are truly reliable providers of THC-O products, but that hasn’t stopped consumers before, and likely won’t this time around either.