Texas hemp and alcohol industry stakeholders are urging officials to ramp down proposed hemp regulations to provide more leniency as the state implements new rules to prevent youth access to intoxicating products. At a Texas Alcoholic Beverage Commission (TABC) public meeting on Thursday, the agency presented draft rules that businesses would need to follow in order to sell consumable cannabinoid products. But while there was consensus around the underlying ban on sales to people under 21, there was pushback against certain proposed definitions and penalties.
The purpose of the meeting was to gain that stakeholder feedback as TABC works to permanently codify rules that the agency issued last month in emergency form in response to an executive order from Gov. Greg Abbott (R). The emergency policy is already in effect but is set to expire within months.
“Our intent is to propose these rules at the upcoming meeting on November 18,” TABC senior counsel Matthew Cherry said, adding that if the commission does vote to propose the rules, another public hearing and comment period will be held before they’re potentially adopted.
Among the more controversial provisions of the proposed rules is an automatic revocation of a business’s liquor license if regulators identify a violation of the age-gating policy. Some participants at Thursday’s meeting, including Total Wine Senior Vice President Robert Shaffer, argued that it may be a “better approach” to focus the penalty on a business’s separate hemp license, rather than imperiling a liquor license unrelated to the hemp violation.
In general, there were questions about the apparent lack of due process considerations of the proposed penalties—without a clear mechanism by which licensees could contest charges—which one stakeholder said would constitute a violation of the Texas Administrative Procedure Act (APA).
There was also talk about the strict compliance requirements for ID verification, with Shaffer pointing out that some elderly alcohol customers are offended when they’re required to present identification showing they’re of age. Cherry said all of the comments will be taken under advisement by the commission, but as contemplated in the proposed rule, businesses would be required to ID every customer who purchases a hemp THC product without discretion.
Mark Borda, executive director of the Hemp Business Council, also expressed concerns “about compliance and market impact—specifically the chilling effect or de facto ban, the heavy handed treatment with license revocation.”
