Categories: Texas Business NewsTexas ManufacturingTexas News

Texas Senate Bill 3: A Major Shift in the Hemp Industry

News Summary

Texas Senate Bill 3 has passed, proposing a statewide ban on THC products. If signed, it could reshape the $8 billion hemp industry and threaten small businesses reliant on it. Concerns grow among community members about job losses and increased licensing fees for retailers, while public sentiment may favor recreational marijuana legalization.

Texas has moved one step closer to a significant overhaul of its cannabis regulations with the passage of Senate Bill 3, which bans all products containing THC, including various consumable hemp products. Following a late-night vote in the Senate, the bill is now awaiting the signature of Governor Greg Abbott.

This legislation represents a major shift from Texas’ current law, which permits hemp products to contain up to 0.3% THC. If signed into law, this new bill will eliminate the legal status of popular products like delta-8 THC, while allowing non-intoxicating CBD and CBG products to remain available. The new measures are slated to take effect in September if approved by the governor.

The impact of this bill could be significant for the Texas hemp industry, which employs over 50,000 workers and generates an estimated $8 billion in revenue, according to a 2023 study. Many stakeholders, including business owners and workers within the industry, are expressing deep concern over the potential loss of their livelihoods. Entrepreneurs like Judy Corrigan, the owner of CenTex CBD, fear that the bill could lead to the closure of their businesses and layoffs for employees reliant on these jobs.

Proponents of the bill, including Lt. Gov. Dan Patrick, argue that the legislation is essential for protecting children and enhancing community safety. However, the Texas Hemp Business Council has voiced criticism, asserting that the bill unfairly targets legitimate businesses and fails to consider the diverse needs of various stakeholders.

The penalties proposed in this legislation are quite severe. Individuals caught in possession of THC could face fines of up to $500, with repeat violators facing harsher penalties. The sale or manufacturing of THC products could lead to criminal charges classified as third-degree felonies. Additionally, the bill proposes a dramatic increase in licensing fees for retailers, raised from $300 to $20,000, which many believe will adversely affect small family-owned businesses.

While the bill does not repeal Texas’ existing Compassionate Use Program, which permits medical marijuana for select conditions, it nonetheless restricts a broader market for THC-derived products. The discussions on the bill reflected a range of opinions and potential amendments; however, the final vote reinstated the original strict provisions after lobbying from certain legislators.

Importantly, recent polling has indicated broad public support for the legalization of recreational marijuana in Texas, with over 60% of residents in favor, as of January 2025. Yet, as the current legislation stands, the sale of any intoxicating cannabinoids derived from hemp—spanning edibles, beverages, vapes, and other products—will be banned.

As the legislation now awaits the governor’s decision, thousands of Texas-based workers and business owners remain on edge, hoping for a veto or strategic amendments that could allow them to continue their operations. Governor Abbott has not publicly stated his position on the bill, leaving many in the hemp community anxious about the future of their industry.

The situation continues to unfold as Texas grapples with the complexities of cannabis regulation, aiming to balance public safety concerns with the economic realities faced by many within the hemp sector.