Iowa retailers warn of ‘unintended consequences’ in Hemp bill
Iowa Hemp Retailers Warn of "Devastating Consequences" from New Legislation.
Iowa consumable hemp retailers warn legislation recently passed by the Legislature that's awaiting Gov. Kim Reynolds' signature will have "devastating consequences" for the consumable hemp market in Iowa.
Rick Wagaman owns HW CBD in West Des Moines. The business sells a variety of hemp products, including gummies, drinks, capsules, soft gels, oils, balms, lotions and creams.
Lawmakers earlier this month passed House File 2605 that would restrict the potency of hemp-derived products sold in Iowa and place several regulations on retailers.
Under the bill, products would be limited to less than 4 milligrams of tetrahydrocannabinol concentration (THC) per serving and 10 milligrams per package. THC is the main active chemical in cannabis that causes a high.
Consumable hemp products were legalized in the 2018 federal Farm Bill and later the Iowa Hemp Act. The laws allow for the sale of hemp products that contain less than 0.3% THC by weight.
The laws were intended to address sales of non-intoxicating compounds like cannabidiol (CBD), but they also legalized the sale of hemp-derived THC products that have a similar psychoactive effect to traditional marijuana.
Products containing THC sold at shops and bars generally range from 2.5 milligrams to 10 milligrams per serving, but some contain higher concentrations.
The legislation would not only affect intoxicating products, but also those sold for therapeutic purposes.
Wagaman asserts by lumping hemp-derived THC products with psychoactive effects under the same definition as non-intoxicating consumable hemp products, the bill effectively restricts access to safe, legal products.
“It will make it next to impossible to provide our thousands of customers with the non-intoxicating, legal consumable hemp products they have come to depend on for years now,” Wagaman said. “Yes, we agree there are loopholes that need to be fixed, but the language in this bill throws the baby out with the bathwater.”
If signed into law, the regulations would take effect July 1. Reynolds’ office did not respond to a request for comment Friday.
Rick Wagaman owns HW CBD in West Des Moines (contributed photo)
Legislation 'desperately needed' to regulate industry, lawmaker says
In addition to imposing a THC cap on hemp products, the bill would ban the use and sale of any consumable products, including non-psychoactive CBD, to anyone under the age of 21.
The bill includes civil and criminal penalties for businesses that sell consumable hemp without first registering with the state. It would also allow the state Health and Human Services Department to confiscate non-compliant products from retailers.
Synthetic THC would be banned, and retailers would need to attach a warning label to consumable hemp products.
Republican Sen. Dan Dawson of Council Bluffs said during floor debate the bill was “desperately needed” to regulate the consumable hemp industry. Republican supporters of the bill have said they did not intend to legalize intoxicating products when they passed the Iowa Hemp Act in 2019.
“In the last four years, we have seen the Iowa Hemp Act metastasize into some things we expected and some things we didn’t expect,” Dawson said. “Now we are here today with a bill before us to try to put some desperately needed regulations on this industry.”
Dawson did not immediately respond to a request for comment Friday.
Retailers: Bill would block therapeutic products
Rebecca Ramker owns several CBD stores in Cedar Rapids, Iowa City and the Quad Cities.
Like Wagaman, she is licensed by the state and sells a mix of full- and broad-spectrum CBD products. The former includes a small amount of THC.
She said all products sold are third-party lab-tested and certified organic.
Consumable hemp products naturally have trace amounts of THC that grow within the hemp plant. And while most of the products she sells have less than 4 milligrams of THC per serving, a traditional container which provides a 30-day supply of product contain 30 milligrams to 60 milligrams of THC on average — well above the 10 milligram cap included in the legislation.
"That would bring it down to four to five gummies in a pack, compared to 30 right now,“ Ramker said.
Suppliers would not repackage their products, she said, making it difficult for retailers to find products that fit Iowa's law.
“That’s going to make it more expensive for us and hit the pockets of customers, which is very sad,” Ramker said. “It’s going to be costly.“
She estimated the legislation would affect 70% of the non-intoxicating products sold in her stores.
She said the business serves about 800 customers a month of all ages, who use the products for treating anxiety, depression, seizures and difficulty sleeping, as well for pain management.
Consumable hemp and other products for sale at Central Iowa Vapors in Des Moines, Iowa on Tuesday, March 5, 2024. (Nick Rohlman/The Gazette)
Nick Rohlman
Industry supportive of 'sensible' regulations
Ramker and Wagaman agree guardrails are necessary to regulate THC intoxicating products, and age restrictions should be implemented to ensure responsible consumption.
“However, it's essential to recognize that many Iowan families rely on these products for their therapeutic benefits, and criminalizing access to these products would disproportionately harm these Iowans,” Wagaman said.
“Furthermore, both federal and state laws recognize the right of Iowans to access consumable hemp products safely and legally,” he said.
“Rather than enacting sweeping measures that inadvertently restrict access to beneficial products, policymakers should focus on crafting targeted regulations that safeguard public health, while preserving access to non-intoxicating hemp derivatives.”
Industry representatives argue that approach ensures that consumers can continue to benefit from the therapeutic properties of hemp without undue restrictions.
“The problems is the people in Des Moines would not give us the opportunity to educate them,” Ramker said.
She, Wagaman and others in Iowa’s hemp industry note Georgia recently passed a bipartisan hemp law by working with the industry to create “sensible regulation.” The Georgia law requires testing for hemp-infused edibles, drinks and other consumable hemp products and restrict their sales to those 21 years of age and older.
The measure requires those that sell or manufacture hemp edibles, gummies, oils and other products to obtain a license from the state. And state-licensed labs must test products to measure the amount of THC, CBD, CBDA and other cannabinoids and ensure they are properly labeled, Axios reported.
New Cedar Rapids store on hold
Wagaman and Mike Thorson, owner of Don’t Worry Be Hempy in Cedar Rapids, said the lack of definition between psychoactive and non-psychoactive products in the bill creates confusion and uncertainty among businesses and consumers alike, hindering economic growth of a burgeoning industry.
Thorson said he has shelved plans to open a second store in Cedar Rapids, because of uncertainty over how the legislation will impact Iowa’s consumable hemp market.
“It makes it very hard for shop owners like myself or manufacturers to know what’s going on,” he said.
Wagaman said the state stands to lose tens of millions in tax revenue by forcing consumers in Iowa to go to neighboring states or online to get the non-intoxicating wellness products that are legal across the country.
"It’s essential that the governor’s office truly understand the impact of HF 2605 to ensure it accurately reflects the intended scope of regulation, without unfairly penalizing the consumable hemp market in Iowa,” he said.
