Members of the Montana Department of Revenue and other stakeholders within the cannabis industry experienced a rude shock. A discovery- that the state’s legalization framework bill – HB 701 prohibits license holders from growing, selling hemp and in extension producing and selling CBD or CBD-derived products.
What is CBD?
Legally, the classification of CBD refers to products that contain a THC level of 0.3% or less. This spurred a wave of CBD products sold in various forms. Popular options include edibles, tinctures, vape cartridges, topicals or as a smokable plant material. Today, CBD is popular all over the continent for its innocuous and calming effects.
According to the new ruling, the only products fit for sale are the vaporizer cartridges. These will still be available legally by dispensaries if and only if, the CBD within the product is an extraction from plants that contain more than 0.3% of THC. That would therefore disqualify them from being hemp.
In what should be a momentary relief, the ban goes into effect on the first of January 2022. This is the same day recreational cannabis sales begin within Montana. Dispensaries have between now and then to sell out their inventory.
Fallout of Montana CBD Ban
Rightfully, the ban has thrown numerous dispensary owners into a state of confusion and anger. Some owners are exploring potential legal workarounds in order to continue selling the products. Others are facing no choice but to stop stocking the product completely. But for the thousands of users who are left with the short end of the stick, this ban might as well be a direct attack on their way of life.
Although the intent communicated within the bill language is to preserve and protect Montana’s burgeoning hemp industry by placing a clear distinction between the hemp and marijuana industries, numerous critics see the codification of the distinction as a loss.
Hearing Back From Those Impacted
According to one dispensary owner, DOR’s Kristan Barbour – “I’ll be candid. I’ve spoken to folks in the hemp industry. They’re frustrated as well. Montana hemp farmers are growing quality hemp and having it … sold in a medicinal environment. This was a hit and a surprise to them.” Today, it is still quite unclear who sponsored the bill exactly and Rep. Mike Hopkins, HB 701’s sponsor was not responsive to multiple requests for comment.
As the ban affects only holders of the retail cannabis license within the state, it is possible that this ban could push consumers towards consuming CBD sold at gas stations or other shady locations. These spots tend to sell unscrupulous CBD products which could be contaminated and mislabeled.
For example, in 2019, a Denver-based testing laboratory called Ellipse analytics ran a study on more than 250 popular CBD products and discovered that over 70% of them possessed harmful quantities of heavy metals, pesticides or they even showed inaccurate information showing the amount of CBD or even THC.
In addition to this, this ban also places Montana in direct opposition to the forecasted growth of the CBD industry. According to a recent report from Graphical Research estimated that the North American market will surpass $60 billion by 2027.
Other Options for Montana CBD Retailers
Some dispensaries are also exploring the option of launching separate businesses under a different address, adjacent or within their stores.
However, there isn’t short of objections as well. Some dispensaries that rent their retail space are worried their landlords might raise objections. Thus, preventing them from taking the necessary steps to establish separate business addresses, which may require building a wall to separate the two entities.
Only time will tell how Montana businesses are able to get around this bizarre ruling. We hope they’re able to figure something out quickly. The people of Montana and those working in the cannabis industry in Montana deserve to be able to buy and sell CBD with ease.
