Colorado lawmakers are aiming to legalize hemp-derived THC beverages in traditional hospitality venues like bars and restaurants despite a looming federal ban.
Introduced in the state Legislature on April 16, the “Regulation of Lawful THC Beverages” bill proposes allowing the sale of low-dose hemp-based THC drinks to adults 21 and older – and outside the state-regulated cannabis market.
How would hemp THC beverages be regulated in Colorado?
If passed, SB26-164 would allow licensed alcohol establishments – including bars, restaurants, music venues and liquor stores – to obtain an additional license to serve hemp-derived beverages containing up to 10 milligrams of THC per serving.
Those businesses would be forbidden from selling or allowing the use of cannabis.
Grocery and convenience stores could sell lower-potency products with up to 3 mg of THC.
According to a news release, the bill proposes hemp beverages be regulated with:
- Oversight comparable to alcohol, encompassing licensing, product standards and labeling requirements
- Enhanced safety protocols, including rigorous product testing and supply chain oversight for both in-state and out-of-state products
- Venue-specific training, requiring education for staff on responsible service, ID verification and the effects of cannabinoids
- Defined enforcement and compliance measures, such as inspections and penalties
It remains to be seen how state-level hemp THC regulations would fare after a federal ban on most hemp-derived cannabinoid products goes into effect in November.
Brian Vicente, a prominent cannabis attorney, recently told The Denver Post that Colorado is free to regulate and tax the sale of hemp beverages regardless of federal law.
However, cannabis businesses aren’t keen on potential competition in the THC beverage market, the newspaper reported.
How would the taxes on hemp THC beverages be structured?
The legislation comes as Colorado faces a projected $1.5 billion budget deficit.
“This law will produce an estimated $55 million in annual revenue at a moment when Colorado urgently needs to fund key services like healthcare and education that help our communities thrive,” bill sponsor state Sen. Julie Gonzales said in a statement.
“Even better, we can create a new source of revenue by giving consumers the very simple thing that they want: responsible access to THC beverages in licensed venues.”
Andrew Livingston, an economist at the cannabis law firm Vicente, came up with the $55 million figure based on Minnesota’s hemp beverage market, adjusting the figures to reflect Colorado’s population.
Livingston’s analysis found that the revenue breakdown includes:
- $15.3 million from a 10% wholesale tax
- $8.8 million from the standard 2.9% state retail tax
- $30.5 million from a special 10% hemp beverage tax
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Brian Vicente, a founding partner of Vicente and a key architect of Amendment 64 – Colorado’s 2012 adult-use legalization – views the legislation as a logical next step for the state.
“This bill represents a natural evolution of the market that Amendment 64 created and offers an opportunity for legislators, business owners and members of the community to build on that legacy,” Vicente said in a statement.
