HOUSTON, Texas – A bill that would ban all forms of consumable tetrahydrocannabinol (THC) in Texas could have a significant impact on the state’s cannabis dispensaries and related businesses.
Since consumable cannabis was legalized in 2019, the industry has grown rapidly, with thousands of stores opening across Texas.
These establishments sell a variety of THC-infused products, including gummies, beverages, and e-cigarettes, taking advantage of a loophole in the law that allows cannabis products to contain trace amounts of THC.
What will happen if this ban is passed?
If Senate Bill 3 passes, it will likely lead to the closure of many THC-focused businesses.
Business owners may face financial losses due to unsellable inventory or the potential need to pivot their business models to products other than THC-related products.
This ban could impact employment within the industry, as store closures and reduced demand for THC products are likely to result in job losses.
This ban could disrupt supply chains and negatively impact ancillary businesses, such as those involved in the production, distribution, and marketing of THC products. The ripple effects could extend to local economies that have benefited from the hemp market’s growth.
For consumers, especially those who rely on THC products for medical purposes, this ban could limit their access to these products and, in some cases, force them to seek alternatives outside the state. . This could also lead to an increase in the illicit market as consumers look for ways to obtain THC products.
Why would the Texas Senate want to ban THC products?
Lt. Gov. Dan Patrick said in an announcement earlier this week that state senators are moving forward with a plan to ban all forms of consumable THC. but why?
Patrick said the law was intended to boost Texas agriculture by allowing the commercialization of hemp that contains trace amounts of delta-9 THC, which is not intoxicating, but has since become unsafe. They say it is being abused by retailers who are exploiting loopholes to sell products that contain low levels of THC.
“Dangerously, retailers have exploited the Farm Bill to sell life-threatening, unregulated forms of THC to the public and make them readily available,” Patrick said in a statement late Wednesday announcing the move. said in a statement released. “Since 2023, thousands of stores have sprung up selling harmful THC products to communities across the state, many with 3-4% THC content that can be found in marijuana purchased from drug dealers. We sell products containing beverages with double the THC content.”
In October, KPRC 2 reported that eight people were arrested in connection with criminal activity that allegedly laundered more than $4 million through a network of 18 cannabis dispensaries in Houston.
Those arrested were owners, investors and managers of a chain known as “THC Club”.
The alleged scheme lasted from June 2020 to September 2024 and raised funds through at least 57 bank accounts, according to court documents. THC Club locations, each operating under a different business name, are strategically located throughout Houston, including prominent spots such as the Galleria, the Heights, Westchase, and the Energy Corridor.
During the investigation, authorities conducted sting operations and surveillance, culminating in the execution of search and seizure warrants at all THC Club locations on September 25th. Officers seized a total of 20.69 pounds of suspected marijuana from each store.
Patrick said Texas has not legalized widespread use of marijuana in any form.
He said that while consumable hemp products are required by law to contain no more than 0.3% THC (the intoxicating parts of the cannabis plant known as delta-8, delta-9, and THCA), The department claims that its products do not contain THC. Texas far exceeds this limit.
Parliament is scheduled to reconvene on January 14th.
On KPRC 2 News at 5 p.m. and 6 p.m., reporter Robert Arnold takes a closer look at the rise in crimes related to THC club businesses.
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