Iowa bill regulating THC in consumable hemp products headed to Gov. Kim Reynolds’ desk

DES MOINES — Iowa’s burgeoning hemp industry would be significantly regulated under a bill state lawmakers sent to Gov. Kim Reynolds’ desk for a signature Tuesday.

The bill, House File 2605, would restrict the potency of hemp-derived THC products sold in Iowa and place several regulations on the retailers that sell hemp products. Under the bill, products would be limited to less than 4 milligrams of THC per serving and 10 milligrams per package.

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 percent THC by weight. THC is the main chemical in marijuana that causes people to get high.

The laws were intended to address sales of non-intoxicating compounds like CBD, but they also legalized the sale of hemp-derived THC products that have a similar psychoactive effect to traditional marijuana.

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Republican Sen. Dan Dawson of Council Bluffs said 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.”

The bill passed the Senate, 31-18. Three Republicans joined Democrats in voting no.

The bill now heads to Republican Gov. Kim Reynolds' desk for a signature. If signed into law, the regulations would take effect July 1. A spokesperson for Reynolds did not immediately respond to a request for comment.

The changes would affect the growing number of retail shops and bars that sell hemp-based THC products around the state. Iowa hemp retailers have expressed concern about the bill as it’s moved through the lawmaking process, arguing that it would impose too many restrictions on the industry.

Products containing THC sold at shops and bars generally range from 2.5 milligrams to 10 milligrams per serving, but some contain higher concentrations.

Senate Democrats did not speak about the bill during debate Tuesday, but during House debate last month Democrats said the bill would hurt the small businesses in the state that sell consumable hemp. Rep. John Forbes, D-Urbandale, a pharmacist, said it would not only affect intoxicating products, but also those sold for therapeutic purposes.

Products that may contain 2 to 4 milligrams of THC per serving, Forbes said, will have to be sold in packages containing only a few capsules at a time. He said the suppliers of those products would not repackage them, making it difficult for retailers to find products that fit Iowa's law.

"It does have a major impact on, I think, the people here in the state of Iowa that sought out ways to manage their health issues," he said. "A lot of the people that go to these do purchase them because they've been on chronic pain medications and they're trying to reduce that."

Bill heightens regulation, bans sale to minors

In addition to imposing a THC cap on hemp products, the bill would create 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.

It would ban the use and sale of any consumable hemp, including non-psychoactive CBD, by minors. Synthetic THC would be banned, and retailers would need to attach a warning label to consumable hemp products.

An analysis from the nonpartisan Legislative Services Agency said that the bill may lead to a decrease in revenue from consumable hemp registration fees, but it could not calculate the impact.

Lawmakers also have sought other regulations this year on hemp products. A bill that would impose a 25 percent excise tax on hemp products passed out of a Senate committee in March, and another bill imposing greater civil liabilities on bars and restaurants that sell hemp products has passed a Senate subcommittee.