Governor Kay Ivey signed House Bill 445 (HB 445) into law on May 14, 2025, instituting comprehensive regulations on hemp-derived THC products in Alabama. The legislation, effective July 1, 2025, with full compliance required by January 1, 2026, introduces several key provisions:
Key Provisions of HB 445:
- Product Restrictions: The law prohibits smokable hemp products, including vapes, buds, and flowers. Only edibles and beverages are permitted, with a maximum of 10 milligrams of THC per serving and 40 milligrams per package.
- Licensing and Regulation: The Alabama Alcoholic Beverage Control (ABC) Board is authorized to license manufacturers, wholesalers, and retailers of consumable hemp products. Retailers must pass a criminal background check and pay an annual licensing fee of $1,000.
- Sales and Distribution: Sales are restricted to individuals aged 21 and older. Online sales and on-premises consumption are prohibited. Products must be sold in child-resistant packaging and cannot feature marketing that appeals to children, such as cartoon imagery.
- Taxation: A 10% excise tax is imposed on the retail sale of consumable hemp products, with 90% of the revenue allocated to the State General Fund and the remaining 10% distributed to local municipalities and counties.
- Enforcement: The ABC Board is authorized to seize unlawful hemp products without a warrant. Penalties are established for selling to minors and for selling products without proper licensing.
Industry and Public Response:
The enactment of HB 445 has elicited strong reactions from various stakeholders:
- Business Owners: Many hemp product retailers express concern that the new regulations will severely impact their operations. For instance, Jenni Otwell, owner of Magic City Organics, stated that her business would need to relocate operations out of state to continue serving customers.
- Local Government: Birmingham Mayor Randall Woodfin criticized the bill, describing it as “a step backwards and harmful to small businesses in Birmingham.” WBMA
- Advocacy Groups: Some conservative organizations argue that the bill does not go far enough in restricting THC products, while others, such as the Alabama Cannabis Coalition, believe it overreaches and could inadvertently promote black market activity.
Further Information:
For more detailed information on HB 445 and its implications:
This legislation marks a significant shift in Alabama’s approach to regulating hemp-derived THC products, with substantial implications for businesses, consumers, and regulatory bodies within the state.
"Instead of moving us closer to justice and equity, this bill risks dragging us back to an era of cannabis criminalization, overregulation, and lost opportunity" - Birmingham Mayor Randall Woodfin (D)
