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New Bipartisan Bill Would Let States Opt Out Of Federal H...
Dario Sabaghi · 2026-04-18 · via Forbes - Vices
Be Well-Substance Loophole

FILE - Products advertised as containing synthetically derived delta-8 THC are offered for sale at a smoke shop in north Seattle on Feb. 25, 2022. (AP Photo/Gene Johnson, File)

Copyright 2022 The Associated Press. All rights reserved.

A new bipartisan bill introduced in the Senate this week aims to create a federal regulatory framework for hemp products containing THC that would give states and Indian tribes flexibility to set their own rules, opting out of the federal ban and effectively providing a lifeline for the hemp industry.

The proposed legislation, filed by Republican Senator Rand Paul from Kentucky, would give more authority to individual states and Tribal governments over how hemp and hemp-derived products are defined and regulated.

Under the bill, states and tribes would be able to enforce their own rules within the federal framework, as long as they meet certain minimum requirements, such as setting a minimum age for purchasing hemp-derived THC products.

The bill would also allow interstate commerce of hemp, even between states or tribes with different regulations, as long as the products comply with the laws of both jurisdictions involved.

The Ban On Hemp Intoxicating Products

The bill comes at a crucial moment for the hemp industry. Last year, Congress closed the loophole that allowed intoxicating hemp-derived products, such as delta-8 THC, to be sold as “hemp,” and has set a one-year transition period before the new restrictions fully take effect in November 2026.

Such a loophole was created by the 2018 Farm Bill during President Donald Trump’s first term. The legislation removed hemp from the Controlled Substances Act and legalized it for industrial use, provided it contains less than 0.3% THC.

The legalization of hemp at the federal level, however, created a market in which businesses began selling products derived from or synthesized from hemp that have intoxicating effects similar to cannabis, which remains illegal at the federal level, while these products were technically sold as hemp-derived products outside the state-licensed cannabis system.

Congress, therefore, closed that gap in 2025 with a ban included in a government funding bill signed by Trump in November. The bill inserted new hemp restrictions into federal law, sharply limiting intoxicating hemp-derived products and certain synthesized cannabinoids.

With this ban, lawmakers aimed to prohibit hemp-derived intoxicating products that they argued could appeal to younger consumers. Products like THC gummies, drinks, vape cartridges, and smokables were widely sold at gas stations and online.

However, the ban is set to disrupt the hemp supply chain, as extractors, manufacturers, and retailers will not be able to handle such products in an industry estimated to generate $28 billion.

Therefore, if passed, the proposed legislation could help stabilize parts of the hemp industry by allowing states and tribes to regulate hemp-derived THC products under a federal framework, especially in places that choose to adopt their own rules.

“We’ve seen prohibition fail before. It fails miserably”

Senator Paul highlighted that the ban “is fully consistent with President Trump’s executive order expanding medical marijuana and CBD research,” he said on X. In December, Trump directed steps toward rescheduling cannabis to Schedule III, as well as expanding research into medical cannabis and hemp-derived CBD products.

Senator Paul also explained that about half of the states, including Kentucky, have already established their own regulatory rules for hemp, stressing that “We’ve seen prohibition fail before. It fails miserably.”

Since 2018, states have taken widely different approaches to hemp THC products, ranging from age limits and testing rules to bans or cannabis-style regulation.

Some states, such as Florida, Texas, and Ohio, have regulated these products. However, other states, such as New York, Nevada, Washington, and Delaware, do not allow the use of delta-8 THC and other intoxicating hemp products, even though these states have legalized cannabis for recreational use.