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Tennessee cannabis products industry worries: Could new regulations stop sales in state?

Michael Soloman, one of Tennessee's leading sellers of legal cannabis, believes the state is engaging in regulatory bait and switch.

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On the one hand, a new law went into effect last year, regulating the sale of hemp-derived products to those 21 and older, seemingly cementing into place what had already become a growing, Tennessee-based industry of legalized non-marijuana cannabis. After all, such products have been legal nationally since 2018.

On the other, the state's Department of Agriculture, which is drafting specific rules for the new law, is considering restrictions on a chemical in certain hemp products, THC-A (tetrahydrocannabinolic acid). THC-A is legal but mimics the effects of a traditional marijuana "high" when it's burned or turned into certain edible products.

THC-A products are, by far, the most popular products being sold now in Tennessee, Soloman said, and people want them for a variety of reasons. And, a state ban on sales, he added, wouldn't prohibit a Tennessean from buying these products online.

But it could impact Nashville business owners.

"It's really just killing the local industry," said Soloman, the owner of a chain of legal cannabis shops in Tennessee known as The Holistic Connection. He also owns Buds and Brews, a cannabis-themed restaurant in Nashville, and Tri-Star Medical & Craft Cannabis

"It's not making these products illegal. It's just going to make these products illegal to sell (in Tennessee). "These products are some of the most sought-after products that the people want for many different reasons."

No such restriction on THC-A was written into the law itself, so many hemp product supporters feel betrayed by the state and believe it could ruin the burgeoning Tennessee industry.

Meanwhile, thse products are still federally legal, thus obtainable through the mail.

In Maryville, Tennessee, Lori Nanney, the owner of Tokers Inc., is worried about the future of her business.

"THC-A is 85% of all retail sales," Nanney said. "It's going to eliminate most consumables, all smokeables, all cartridges, all dabs (a concentrated form of cannabis commonly smoked or vaped), all flower( the leafy form of cannabis), and it's going to eliminate most edibles.

"This is going to destroy the entire industry. These people (in the business) are not going to have homes in a few months if this goes the way it's going."

On Thursday, the Department of Agriculture held a hearing to receive opinions from the public on the proposed rule changes. As of this week, it received more than 2,000 written public comments.

Scores turned out to mostly criticize the inclusion of THC-A in the new rules. Some said they'd turn to the black market or travel out of state for marijuana if that happened. Others, who operate legal cannabis businesses, said they'll be forced to shut down.

Others complained of government overreach.

Kim Doddridge, the spokesperson for the department, did not respond directly to such claims. She said only: "After this, what I will call a 'listening session' we're going to take those comments and what changes need to be made to the proposed rules."

Isn't marijuana illegal in Tennessee?

Yes. It is illegal to possess or sell marijuana for recreational and nearly all medical reasons in Tennessee. However, state law allows for some exceptions for low-THC/high-CBD oils for use by people with certain health conditions.

Otherwise, penalties start at up to one year in jail and a $250 fine for a first-time offense for possessing up to a half-ounce of marijuana.

However, in 2018, the U.S. Congress removed hemp and hemp products from the Drug Enforcement Administration's list of controlled substances, opening the door to products that approximate the effects of marijuana, such as THC-A and "Delta-8" THC products.

Some states have outlawed them. That has not happened in Tennessee.

What's the difference between "traditional" marijuana and Delta-8?

Traditional marijuana highs come from what's known as "Delta-9" THC products. There are hemp-derived Delta-9 products sold in Tennessee, but they must contain less than 0.3% Delta-9 THC by weight.

Delta-8 THC products have not been traditionally regulated as a controlled substance but can be manufactured from hemp and, thus is widely legal — including in Tennessee. Users say it produces a milder high. However federal regulators have warned that it can produce adverse effects.

Another legal hemp product that has been on the market for a while, CBD, does not produce a high.

Hazy legal distinction

The confusing set of state and federal laws governing cannabis is driving much of this current controversy.

At issue is the inclusion of the currently legal THC-A in the definition of the currently illegal THC in rules governing legal hemp products in Tennessee.

THC provides the psychoactive effect that marijuana is known for. THC-A doesn't unless it's exposed to heat, a process known as decarboxylation. THC-A plant flowers are also grown in such a way that they are considered hemp and don't run afoul of federal law.

It's a hazy legal distinction.

Because of this, Tennessee hemp-product industry insiders say, THC-A products constitute the vast majority of the market here. They also note that banning their sale here won't stop their use. They're legal federally and thus available to buy online. State law also does not prohibit their use or possession.

The Department of Agriculture will review all comments received by Feb. 9 and work to develop final rules. They will then be sent to the state Attorney General's Office for review and forwarded to the Secretary of State's Office. They will be effective 90 days after that. There are no further public hearings planned on the matter.

Ultimately, the new rules must be in place by July 1.


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