Puff, Puff … Pass?

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This is part 3 of “Barely Legal,” The Assembly’s investigation into North Carolina hemp. Learn more here. 

With time running out on the General Assembly’s legislative session, North Carolina’s $3.2 billion hemp industry was hanging on by a thread. 

Businesses had already been bracing for the federal ban on intoxicating hemp that Congress passed last fall. In interviews, industry leaders professed confidence that federal lawmakers would change their minds before the law takes effect on November 12, but their Plan B was Raleigh. State regulations, they believed, could mitigate the damage.   

But legislation to do that had gone nowhere this year. And just before the July 4 weekend, their situation went from precarious to existential. On Thursday morning, a last-minute bill surfaced that, rather than giving the hemp industry a path forward, would codify the federal ban in state law—likely shutting down thousands of retailers and manufacturers. 

State Sen. Bill Rabon pitched that as a feature, not a bug. 

“Are we going to affect businesses? Yes, we’re going to affect 12,000 drug dealers’ businesses,” Rabon said on the Senate floor on Thursday. A top lieutenant of Senate leader Phil Berger, he’d helped craft the bill. “They’re selling it to low-income, to people who are down on their luck, the normal people who buy drugs. But they’re also selling it to teenagers and sub-teenagers, and anyone that they can prey upon.” 

(A study found that there were 2,197 hemp retailers in North Carolina in 2025, though that number does not include convenience stores. An industry source said there are at most 6,000 stores that sell hemp products. Rabon’s office did not respond to an email asking for the source of his figure.)  

Rabon said he’d given up on working with the industry. Hemp leaders had claimed for years that they wanted to weed out the small minority of bad actors in their ranks and keep the public safe. He’d decided they were lying. 

“I’ve had the epiphany that the big players and the people who want to make the money can’t make the money they want to make—they can’t prey upon the people whom they want to prey upon—in a regulated marketplace,” Rabon said. “So if that is the case, we have to do away with all of it.” 

In hemp advocates’ version of events, Senate leaders had rebuffed them. “There’s a difference between wanting regulations and not wanting to be regulated out of business,” said Huntersville-based hemp lobbyist April Byrd. 

The Senate voted overwhelmingly for the bill. But after a long internal meeting, House Republicans punted. It’s not clear what they’ll do when they reconvene at the end of July.  

“Our caucus is looking at it,” House Speaker Destin Hall told reporters on Thursday. “It’s a somewhat complicated bill.” 

“Are we going to affect businesses? Yes, we’re going to affect 12,000 drug dealers’ businesses.”

state Sen. Bill Rabon

For now, intoxicating hemp remains unregulated in North Carolina, as the first two parts of The Assembly’s investigation have detailed. The state doesn’t impose age restrictions, require products to be tested or have accurate labels, or ensure that they are free of bacteria and other contaminants. Nor does it tax hemp the way it does alcohol and tobacco, potentially forgoing hundreds of millions in annual revenue. 

This free-for-all has allowed businesses to thrive. But concerns about rising cannabis-related hospital visits and deteriorating youth mental health made a crackdown seem inevitable. Since 2023, the industry has tried to head it off by lobbying for state regulations. Lawmakers agreed that rules were needed, but not what they should be. 

Now, the feared crackdown looms.   

Banning hemp won’t eradicate demand. North Carolina is one of only seven states that completely prohibit recreational and medical cannabis. Not coincidentally, it also ranks among the country’s largest markets for illicit marijuana and intoxicating hemp. 

A ban will push some consumers into the black market, but it won’t cut off the state’s cannabis supply. The Cherokee reservation in Western North Carolina has legalized marijuana. And now that Virginia’s regulated market for recreational weed is ready to launch, dispensaries will likely line the border by next July. 

In an interview, Gov. Josh Stein told The Assembly that hemp’s proliferation has come with real problems. Consumers have no way to know that products are safe, and some vape shops have opened next to schools and targeted adolescents. 

“That offends me,” Stein said. But in his view, it’s not an argument for complete prohibition. Rather, he wants a regulated market that gives the state control over what’s being sold and who’s selling it—and not just hemp.    

Stein is the first North Carolina governor to call for legalizing recreational marijuana, though his preferred term is “adult-use cannabis.”   

“We need to have a well-regulated market that puts public safety and public health at its center,” he said. “It protects kids, and it is available for adult use—because adults are using it, and we can’t put our heads in the sand any longer.” 

His argument has fallen on deaf ears in the legislature, where a stalemate has left hemp businesses on tenterhooks and their products entirely unchecked. 

‘It’s a Significant Impact’

Congress intended for the 2018 Farm Bill to provide consumers with access to hemp, a variety of Cannabis sativa L. that has 0.3% or less of the psychoactive compound delta-9 THC but lots of cannabidiol, or CBD, which is associated with various health benefits. But the law’s definition of hemp inadvertently legalized a wide variety of THC products. 

Within five years, the hemp market had swelled to more than $28 billion nationwide. 

Congress attempted to close that loophole last November in a late rider to must-pass legislation, redefining hemp so strictly that the new law will ban most CBD products along with intoxicating hemp. Lawmakers gave businesses a year to prepare. 

That raises an obvious question: Since Congress has largely banned hemp, does it matter what the state does? 

The answer is yes, to a degree. On its own, the federal ban will radically reshape the state’s hemp industry, but it probably won’t put every company out of business. Products will still be legal under state law—and for the most part, state and local cops can’t enforce federal statutes. Federal authorities would pose the biggest threat to retailers and producers.

“In theory, the feds can come down here and enforce [the ban] in the states and charge people with federal crimes,” said Phil Dixon Jr., a professor at the University of North Carolina at Chapel Hill School of Government and an expert on cannabis law. “But we haven’t seen that in a long time for marijuana.” 

For more than a decade, Congress has inserted a provision into the budget forbidding federal agencies from enforcing laws against medical marijuana in states that have legalized it—a provision that might be extended to hemp, Dixon said.

What the Federal Ban Will Do

If Congress’ ban takes effect on November 12, federal law will treat intoxicating hemp like it does marijuana, which means hemp will have to play by the same rules. 

Perhaps the biggest change will be that hemp companies won’t be able to claim credits or deduct expenses from federal taxes. As a result, they’ll face significantly higher rates than other businesses. And if things go south, they can’t file for bankruptcy, either. Because of the risk, they’ll pay much higher interest rates to borrow money. 

Last year, 72% of North Carolina’s hemp businesses were profitable, according to a report from Whitney Economics. But only about a quarter of marijuana companies across the country operate in the black. 

This might not be an issue for long. Earlier this year, the U.S. Drug Enforcement Administration rescheduled medical marijuana—essentially, declaring it less of a threat—and it will likely do the same for recreational weed in the near future. Once that happens, the tax and bankruptcy restrictions will no longer apply. 

Other difficulties will remain, however. Marijuana dispensaries generally can’t accept credit cards, which means they can’t sell products online. That distinction helped keep hemp alive in states that legalized marijuana, Raleigh cannabis lawyer Morgan Davis said. 

“A lot of people don’t feel comfortable walking into a dispensary,” she said. “I don’t. I know a lot of women don’t feel comfortable walking into a dispensary. A lot of older people don’t feel comfortable walking into a dispensary.”

Marijuana companies have also struggled to find banks that will work with them. Federally regulated banks face severe penalties, including asset forfeiture, for processing funds from illicit transactions. Most banks already won’t work with hemp companies.  

First Citizens, which was founded in North Carolina, is an outlier. It launched a program for hemp companies in 2018. The looming federal ban is “creating a lot of the headache and concern for some of our clients,” senior vice president Ryan Palmquest told The Assembly. 

“We need to see this hemp law actually implemented to truly understand the ramifications of what that legislation means,” he said. Palmquest added that he believed “the future is extremely bright for cannabis.” 

There’s one more major hurdle. North Carolina hemp companies currently source products from all 50 states. Under the new system, they’ll likely be allowed to source cannabis from only one: North Carolina. Once cannabis leaves the state’s boundaries, federal laws apply.  

“It’s going to require everybody to build infrastructure within their own state,” Davis said. “Like with regulated cannabis, you’ve got to own it from seed to sale.”

There aren’t currently enough hemp farms or processing facilities in the state to accommodate demand. As of January, there were fewer than 500 licensed hemp farms in North Carolina, with only 850 acres of hemp growing statewide, according to a Whitney Economics report. That’s down from 1,502 farms and 16,593 acres, respectively, in 2020, before too much supply caused hemp prices to bottom out.   

Davis expects that problem will be solved. “If there’s enough demand, it’ll happen,” she said.

Many companies won’t take the risk. But others might, especially after investing millions of dollars in building their businesses. 

The industry argues that robust state regulations would help keep them afloat. The U.S. Supreme Court ruled in 1992 that, under the 10th Amendment, Congress can’t intrude on state regulatory structures. This doctrine has also allowed states to legalize marijuana.  

Morgan Davis, a Raleigh attorney who focuses on cannabis law, said that the more structured a state’s system is, the more likely it is to withstand court scrutiny.  

Byrd told The Assembly that she thinks Congress will change its mind before the federal ban takes effect. She said hemp has become too big to ban. “Nationally, you’re talking about $38 billion to $40 billion. It’s a significant impact. And we’re talking over 300,000 jobs.” 

The Devil’s in the Details

Proposals to regulate North Carolina’s hemp industry have tended to share several features. They limit purchases to ages 21 and up. Products have to undergo testing at an accredited laboratory and clear thresholds for bacteria, yeast, mold, heavy metals, solvents, and other potentially hazardous materials. The tests also ensure that the cannabinoids in products match what’s listed on the package. Labels have to disclose all ingredients, and there’s a tracking system for manufacturing conditions and product origins. 

There are restrictions on how much THC consumers can buy and rules about marketing. Packages need to be child-resistant and come with health warnings. Products are taxed, and retailers pay for state licenses, with some of those funds going toward public health education, oversight, and inspections. 

Thorny details and unanswered questions have made a deal elusive, however: Which agency will oversee the program? Will the new regulatory bodies include scientists? 

That’s been an issue in other states, said Laboratory for Forensic Toxicology Research director Michelle Peace, who tested products for The Assembly and previously served on the board of Virginia’s Cannabis Control Authority. 

“For the most part, state regulators don’t have scientists on board to actually evaluate what’s happening in the labs, and so they get it wrong, or they don’t know what to look for, or they focus on the wrong things,” Peace said. 

Other key questions: How aggressive will the state’s standards for toxins be? How will it decide which testing labs are acceptable? What will the tax rate be? (Based on retail sales estimates, the 10.5% tax on intoxicating hemp that the Senate proposed in 2023 would translate to $190 million in annual revenue.)

Will cities and counties be allowed to ban hemp retailers? Will it be legal to smoke hemp where it’s legal to smoke cigarettes? Will the smell of cannabis continue to be a valid basis for police searches? How will cops determine whether a cannabis user is too impaired to drive? After all, there’s no weed equivalent to a Breathalyzer. 

Then there’s the big one: How will the state decide what is legal? Will it continue to define hemp based solely on the concentration of delta-9 THC? Will it ban all synthetic cannabinoids, or prohibit specific compounds—HHC, THCP, delta-6—and play Whack-a-Mole when new ones surface? What will it do about delta-8, which is both naturally occurring and synthetically derived? What will it do about THCA, which converts to delta-9 when heated?

In North Carolina, the industry employs more than 16,000 people, and retail sales generate more than $1.8 billion—and $88 million in sales taxes—per year. 

President Donald Trump asked Congress to revisit the law so that Americans could access “full-spectrum CBD products” while “preserving Congress’ intent to restrict the sale of products that pose health risks.” 

But Congress hasn’t backtracked, and the lingering uncertainty added urgency to industry lobbying as the legislative session began in April. 

‘Protect Consumers, Protect Our Industry’

The General Assembly adopted the Farm Bill’s definition of hemp in 2022 and permanently removed hemp from the state’s Controlled Substances Act. A friction point emerged, however, when House Republicans spiked a Senate bill legalizing medical marijuana—a pet cause of Rabon, a cancer survivor. 

During the 2023 legislative session, Byrd said, hemp leaders recognized that their industry was “turning into the wild, wild West” and told lawmakers they wanted to help fix it. They pitched rules “to protect consumers, protect our industry, and help law enforcement identify the bad actors,” Byrd said. 

The House unanimously passed legislation from state Rep. Jeffrey McNeely that included age restrictions, packaging requirements, dosing limits, and licensing rules. But the Senate added taxes and medical marijuana, a deal-killer for many House Republicans. 

“There’s a difference between wanting regulations and not wanting to be regulated out of business.”

April Byrd, hemp lobbyist

Medical marijuana remains a nonstarter in the lower chamber. “Some of the House members are not ready to pass a medical program because they believe that it will usher in recreational use, and that is not what the constituents in those districts want,” McNeely, an Iredell County Republican, told The Assembly in an email. 

McNeely tried passing another version of his bill in 2025. Sen. Todd Johnson, a Union County Republican, offered a similar proposal in the upper chamber, though McNeely’s had stricter testing requirements and potency limits. Neither measure advanced.

“There’s not many places you’ll go anywhere and volunteer to be regulated and taxed and get turned away,” Neal Orr, executive director of the industry advocacy group Cultivating Breakthroughs In Healthy Development (CBHD), told colleagues at an event in March. 

By last year, policy disputes had intermingled with palace intrigue. Berger was staring down a primary challenge that he would ultimately lose, and his team focused its attention on state Rep. John Bell, chair of the House’s rules committee. Bell ran the hemp company Asterra Labs, a subsidiary of a private equity firm owned by former UNC System Board of Governors chair Harry Smith, with whom Berger had a falling out. Berger operatives believed Smith was maneuvering against the Senate leader.  

In June 2025, the Senate passed a bill that banned hemp products containing any cannabinoid other than delta-9—including, perhaps accidentally, CBD and other nonpsychoactive compounds. Bell said it would put him out of business. (Bell has since left Asterra, and Smith’s firm has sold it.) 

The bill languished in Bell’s rules committee for 10 months. Then, seemingly out of nowhere, House leaders brought it up for a vote in April; it was overwhelmingly rejected. 

The House’s goal was to force the Senate into negotiations over an “omnibus-style bill,” Byrd said. The negotiations eventually took place, but they didn’t go the way hemp supporters hoped.

‘We Have Tried the Nice Way’

This year, hemp advocates rallied behind Johnson’s bill. They thought that if they could get it out of the Senate rules committee, both chambers would approve it. 

But Rabon, who chairs the committee, never brought it to a vote. Industry leaders suspected that he wouldn’t do anything to help them unless medical marijuana was attached.   

Internal politics also played a role. Soon after Berger lost his primary in March, Johnson announced a bid to replace him as Senate leader. Berger’s team is said to be more aligned with contender Mike Lee, whom Senate Republicans elevated to majority leader last year. (Johnson did not respond to interview requests.)

But there were other reasons Johnson’s bill didn’t budge. Negotiations over the long-delayed budget consumed most of this session’s oxygen. More importantly, some Senate Republicans didn’t see a point in acting after the federal ban, a source close to Senate leaders told The Assembly. 

Byrd said CBHD, the advocacy group, encouraged consumers and business owners to call legislators’ offices, and by early June, the industry saw movement. The bill’s supporters pitched their case to the Senate GOP caucus, and advocates felt good about their chances. 

“We had overwhelming support in both caucuses to get hemp regs done,” CBHD vice chair Dustin Brauns said. If not Johnson’s bill, Senate Republicans seemed likely to consider straightforward age-restriction legislation that had already cleared the House but stalled in Rabon’s committee. 

That legislation, Byrd said, wouldn’t solve all of the problems created by the federal ban, but “it would be better than doing nothing. An age restriction would show that the state has the intent to regulate.” 

Weeks passed, and nothing happened. Then, on June 23, legislative leaders revived the bill the House shot down in April and sent it to a conference committee. The seven Republicans they chose to hash out a compromise between the House and Senate telegraphed the leaders’ intentions. 

The Senate paired Berger allies Rabon and Lee with Tom McInnis, a staunch cannabis opponent. The House’s delegation included stalwart social conservatives Neal Jackson and Donnie Loftis, along with Majority Leader Brenden Jones and Reece Pyrtle. 

“These are not members of our caucus that are generally going to be open to a really wide-open hemp industry,” a source close to House leadership told The Assembly. 

Indeed, they weren’t. 

Like the federal ban, their proposal prohibited any product with more than 0.4 milligrams or 0.3% of total THC—meaning not just delta-9, but any THC—as well as products with synthetic cannabinoids. As with the federal ban, that definition will also proscribe many nonintoxicating CBD products.     

The bill restricted sales of the few remaining legal hemp products to people 21 and over. It also applied that age limit to kratom, a tree whose leaves can produce both stimulant and sedative effects, and banned synthetic kratom.

The committee’s members reached an agreement on July 1. Before noon the next day, though, it had become clear that House Republicans weren’t on board—at least not yet. 

“Generally, our caucus’ desire is to make sure that we’re keeping the bad products out and not letting people under 21 buy these products,” Hall told reporters. The bill had come in late the day before, and “folks basically wanted some time to be able to review it. So we’ll see if it’s something that we do when we come back.” 

Three sources familiar with the situation told The Assembly that some House members worried that Rabon was using it to create a path for medical marijuana. The legislation does not directly address medical marijuana, though the issue appears to have come up during the House Republicans’ meeting on Thursday morning. 

“I know our caucus has no interest in doing any sort of marijuana, medicinal or otherwise,” Hall told reporters afterward. A spokesperson said it was his most definitive statement on the issue to date. 

Byrd and Brauns said they believe that language in the bill could potentially legalize medical marijuana if the federal government approves its use as a prescription drug. The federal government is currently reviewing marijuana’s status. 

“You would need some legislative tweaks” to create a medical marijuana system once federal law changed, Byrd said. “But it would move the ball in that direction.”

“I know our caucus has no interest in doing any sort of marijuana, medicinal or otherwise.” 

House Speaker Destin Hall

Before the Senate vote, Lee expressed disappointment in his House colleagues. “We have approximately eight overdose deaths per day—and that’s a reduction off of where we were,” he said in a Senate speech. (Those overdose deaths are from all narcotics, however, including fentanyl and cocaine. No fatal overdoses have been attributed solely to cannabis.) “And that’s not a mistake. The progress isn’t an accident. They have the opportunity in that chamber to make the policy decision to prevent what is happening to adults and our children in North Carolina.” 

The General Assembly is scheduled to return the week of July 27. The hemp industry will likely mount a full-court press before then. CBHD released an ad before the Senate vote attacking McInnis as a “RINO,” or Republican in Name Only. The ad, which has since been taken down, accused the Moore County conservative of opposing Trump’s efforts to “fix our economy” and “keep North Carolina’s hemp industry strong.” 

On the surface, targeting McInnis made little sense. McInnis was reelected in 2024 with 63% of the vote. Senate Democrats don’t see him as vulnerable this year. Going after Lee—who is both in a swing district in New Hanover County and seeking a leadership post—would seem more logical. 

Brauns said CBHD “definitely had some strategy around Lee,” adding that the group wants “his district to understand that he was very positive toward hemp at the beginning of the year—saw it as an economic boom—and now he’s completely flipped to just ban it all.” 

But Brauns said his group believed McInnis, a MAGA loyalist, would “freak out” at being called a RINO and “cause a huge amount of conversation and ruckus.” McInnis is also a close ally of Rabon, which CBHD saw as icing on the cake. 

“The thought was, instead of poking Rabon right between the eyes and potentially making matters worse, McInnis was the better option,” Brauns said. “And it worked.”

Brauns said CBHD is just getting started. 

“We have tried the nice way,” he said. “We have tried and tried and tried to make friends and to incentivize and to become educators and to give the optics of the industry that yes, we 100% agree, we want the bad actors out, too. But that has gotten us nowhere except spit in the face.”  

‘Societies Change’ 

Stein was attorney general when hemp became ubiquitous—and when a vape shop opened near his kids’ high school. But he realized that as long as these products remained unregulated, he was powerless to stop their sales to minors. 

He also determined that trying to regulate hemp products differently from marijuana had become a fool’s errand.  

“There actually used to be a distinction in the law,” Stein said. “The two plants, naturally grown, had different THC levels. You’d smoke hemp, it would take a whole lot to get you high—and it might not. Once hemp was legalized, both growers and sellers realized you could genetically modify hemp plants and increase the level of THC. 

“Cannabis is cannabis,” he said. “It doesn’t make sense to try to distinguish between two varieties of the same plant, and what we really care about is, is this product going to get you high or not? That’s why we must regulate the THC molecule.” 

Several experts The Assembly interviewed for this series agreed with that sentiment. 

“One major challenge for state regulators across the country has been managing multiple regulatory models for essentially the same products,” Cannabis Regulators Association Executive Director Gillian Schauer wrote in an email. “For example, when states have one set of regulations for a 100-milligram THC brownie made from hemp, and another set of regulations for a 100 mg THC brownie made from marijuana, it can complicate regulatory implementation and leave regulatory gaps.”

Berger, the Senate leader, expressed a similar thought last week. “The problem we have is that while we don’t have recreational marijuana, we don’t have medical marijuana, what we have are products that, for all practical purposes, have the same effect on people, and they’re totally unregulated,” he told reporters. 

Berger’s solution was to ban all of it. Stein argues that crackdowns are futile and fly in the face of increasing public support for legalization. A regulated market, he says, allows the state to protect consumers from harmful products and keep children safe.  

The degree to which legalizing cannabis would protect young people isn’t clear. Studies indicate that adolescents don’t use cannabis more after states legalize marijuana—and recreational weed doesn’t lead to more substance use overall. Use has, however, increased among young adults ages 18 to 25. Legalization has also been associated with more impaired driving and cannabis-related hospital visits.   

Last June, Stein convened an advisory council to figure out what a regulated cannabis market should look like. The council, consisting of more than two dozen lawmakers, health and law enforcement officials, and cannabis industry representatives, issued a preliminary report in early April. 

Minding the Gaps

The N.C. Advisory Council on Cannabis, which Gov. Josh Stein formed last year, released a preliminary report in April that identified 12 “regulatory gaps” it traced to the General Assembly’s failure to regulate hemp. 

• Age restrictions: Though many hemp retailers require patrons to be 21 or older, there’s no legal requirement.     
• Packaging or marketing restrictions: Police often complain that products are packaged to appeal to children, and court records indicate that they are sometimes designed to resemble name-brand snacks. There is no requirement that packaging contain warning labels. 
• Labeling requirements: Many products The Assembly tested in part 1 of this series had cannabinoid levels that did not match what packages promised. There’s no requirement that they do so—or that the label specifies what’s in the product.   
• Purchase limits: States that regulate cannabis can limit how much a person may buy at one time. 
• Licensing requirements: Currently, retailers don’t need a state license to sell intoxicating hemp, so anyone can do it (which is why you can buy blunts at gas stations). That not only means retailers aren’t vetted, but there’s also no way to limit the number of retailers in an area. 
• Zoning and school buffers: Nothing in state law says vape shops and dispensaries can’t open next door to a school or playground. 
• Public health: The advisory council argued that the lack of warning labels, dosing guidance, and public health education might confuse customers about “impairment, workplace policies, and driving under the influence laws.”
• Lab testing: There’s no requirement that products be tested in an accredited lab for cannabinoid levels, bacteria, heavy metals, or other potential hazards. 
• Inspections, recalls, and enforcement authority: No agency currently oversees hemp retailers. There’s also no one in charge of ensuring that stores comply with recalls. 
• Supply chain oversight: There’s no system to track intoxicating products throughout the manufacturing process, so the state has little insight into products’ origins or manufacturing conditions.   
• Legal ambiguity: As The Assembly reported in part 2 of this series, the lack of clear rules has led to confusion among law enforcement and regulators. 
• Taxation: The state collects retail sales taxes on hemp products, but not the excise taxes that it assesses on alcohol and tobacco. Whitney Economics, which analyzes cannabis markets, said that intoxicating hemp generated about $1.8 billion in retail sales in North Carolina in 2025. That means a 10.5% excise tax, which the state Senate proposed in 2023, would bring in about $190 million a year. Expanding excise taxes to all cannabis could generate more than $500 million a year.

Despite media reports, the report didn’t call for legalizing marijuana. It said that was the General Assembly’s decision; the council’s task was to figure out a framework if lawmakers went that route.

But the report strongly implied that the legislature didn’t have much of a choice: “The question is whether the General Assembly will allow intoxicating products to continue to be sold without enforceable state standards, or whether it will establish a regulatory system designed to protect public health and public safety.” 

“An adult-access market with protections for medical consumers” in which cannabis is purchased through state-licensed retailers offered the greatest revenue potential while addressing regulatory gaps, the report argued. A legal market would also avoid the red tape and loopholes inherent to medical marijuana programs, it said. 

“Cannabis is cannabis. It doesn’t make sense to try to distinguish between two varieties of the same plant, and what we really care about is, is this product going to get you high or not?” 

Gov. Josh Stein

The council is supposed to issue a final report in December. Its preliminary recommendations received a cool reception from some Republicans. 

“It’s remarkable that we’re going to put money into psychosis treatment and opioid treatment at the same time we have a report out that is trying to legalize marijuana,” state Rep. Timothy Reeder, an emergency physician from Pitt County and chair of the House’s health care committee, said during a hearing. 

Stein acknowledged that reform won’t be easy, but he thinks it’s a matter of when, not if. 

“People change,” Stein said. “Society changes. I can remember when you couldn’t buy alcohol here in the supermarket on a Sunday, and you couldn’t buy wine in a supermarket at all, and you couldn’t get mixed drinks in the majority of the counties in North Carolina. What I’m trying to do is advance the conversation.”

‘Just Semantics’

Brauns, the CBHD vice chair, said there’s “not a snowball’s chance in hell” that Stein will sign the hemp ban if the House passes it. “He’s been very pro-hemp, very pro-marijuana since the day he took office,” Brauns said. 

Byrd, the lobbyist, wasn’t so sure, and the governor’s office did not comment on his plans. 

Regardless, the state’s hemp industry isn’t likely to accept whatever lawmakers do—or don’t do—this year as the final word. By next year, the House could have more cannabis-friendly members, and they might have a perceived ally at the Senate’s helm if Johnson wins the leadership race. 

“We have tried and tried and tried to make friends and to incentivize and to become educators and to give the optics of the industry that yes, we 100% agree, we want the bad actors out, too. But that has gotten us nowhere except spit in the face.”  

Dustin Brauns, CBHD vice chair

Advocates also believe the public supports them. In late April, CBHD released a survey from Republican operative Paul Shumaker that found that 63% of North Carolina voters supported legislation to “allow the state-regulated sale of hemp-derived consumable products.” 

Time might be on their side in Washington, D.C., as well, with Democrats expected to make big gains this fall. But for now, hemp businesses are awash in uncertainty. 

“It just doesn’t seem fair,” said Shawn Stokes, owner of Hops & Flower in Durham. Stokes opened his shop in January, but his venture had been in the works for well over a year; he’d taken out $150,000 in loans and signed a five-year, $8,000-a-month lease last September. 

His store also sells coffee and sandwiches, but cannabis products account for about half of its revenue, Stokes said. Now a federal ban on those products looms. 

“I don’t see how I can make it work,” he said. 

Stokes said the demand is obvious. “The space has gotten really crowded in just the last year. The number of shops out there has increased substantially,” Stokes said. If anything, the legal uncertainty is holding more back. “There’s still so much confusion in the marketplace among consumers.” 

Stokes hopes Congress changes course. If not, he said his best-case scenario is a regulated state market that “prohibits ingredients that shouldn’t be in the products, and instills trust and confidence in the public.”

“The problem is, to do that, you have to concede that everything we’re selling is exactly the same thing as what we would be selling in a recreational cannabis state,” Stokes said. “It’s all just semantics.”

Additional reporting by Bryan Anderson and Tori Newby.