Arizona Hemp Wars: Inside the Intense Political and Industry Clash

Arizona Hemp Wars

Inside the Intense Political and Industry Clash

As the Executive Director of the Hemp Industry Trade Association of Arizona (HITA-AZ), it is critical to address the ongoing discussion surrounding the hemp regulation bill currently under consideration in the Arizona State Legislature, known as HB2406.

HB2406 aims to establish a comprehensive hemp regulatory framework encompassing licensing for various stakeholders in the hemp industry, including farmers, processors, transporters, harvesters, manufacturers, and retailers within Arizona.

For over a decade, hemp products have circulated in Arizona and nationwide without formal regulation, devoid of catastrophic outcomes such as injuries or fatalities. However, the absence of oversight necessitates action to safeguard consumers, particularly minors.

Recognizing that hemp products are federally legal and lawful in Arizona is important. They will continue to be accessible to Arizonans, regardless of regulatory measures. At HITA, we advocate for stringent regulations, firmly believing that responsible governance is essential for industry sustainability and consumer protection. Despite a lack of regulation, hemp products have proliferated in Arizona in recent years. Hemp’s widespread availability has been driven by substantial consumer demand.

The estimated $28.4 billion hemp industry, as reported by Forbes, underscores the significant economic impact and consumer demand driving this sector. Total demand potential for hemp products in Arizona is an estimated $699M. The post-regulated Arizona hemp market would create 8,091 jobs, pay approximately $324.8M in wages, and generate up to $39.1M in sales taxes. This estimate is based on projections from the roughly 850 smoke shops, vape stores, CBD stores, and wellness centers in the state. It does not include projected hemp product sales in breweries, restaurants, liquor stores, grocery stores, gas stations, convenience stores, festivals, or the nation’s largest big-box retailers. When those numbers are extrapolated out, the total Arizona hemp market size could approach $1B, create tens of thousands of jobs, generate close to $500M in payroll, and north or $50M in taxes for the state. As any industry can experience, this heightened economic opportunity has attracted bad actors looking to cash in on an unregulated environment.

Recent incidents include alleged racketeering by national marijuana brands masquerading as hemp brands to illegally sell marijuana. This alleged racketeering raises questions about regulatory compliance within the industry. Similarly, prominent marijuana brands and Multi-State Operators (MSO’s) engage in the manufacturing and distribution of hemp products, despite lobbying against hemp regulatory measures.

Therefore, we must scrutinize any motivations behind the opposition to hemp regulation. Misguided anti-hemp campaigns perpetuated by certain segments of the marijuana industry hinder legislative progress. Misinformation schemes jeopardize the welfare of consumers and minors, and inhibit the enactment of sound policy, exemplified by HB2406.

We have an imperative to discern the true intentions driving opposition to hemp regulation. The Arizona hemp industry rejects monopolistic endeavors that seek to stifle competition and undermine the growth of the hemp industry. Firm regulation, not prohibition or monopolization, is the prudent path forward.

Establishing a comprehensive hemp regulatory framework at the state level is a complicated and nuanced uphill battle. But with the collective and collaborative efforts of the hemp industry at large, and with the help of our mounting allies in sister industries, we are making progress, and “they” are losing ground.

The Arizona hemp regulation bill (HB2406) represents three years of drafting and extensive stakeholder engagement, culminating in a balanced and complete regulatory framework. A growing number of politicians within the Arizona legislature are voicing their support for proper hemp regulation. Moreover, for three years in a row, legislators have voted against all proposed hemp ban bills that would have enacted hemp prohibition and entrenched marijuana monopolization. Furthermore, an increasing majority are rejecting anti-hemp propaganda campaigns promoted by certain segments of the Arizona marijuana industry.

Despite bipartisan challenges and fear-mongering tactics, HB2406 has passed the state Senate and House, and is currently back in the Senate for new amendments. As the Arizona legislative session draws to a close this summer, the fate of Arizona’s blossoming hemp industry, and the dominance of Arizona’s well-established and ever-rooting marijuana monopolies, hang in the balance.

In navigating this complex landscape, we remain steadfast in our commitment to advancing sensible regulations that promote industry integrity and consumer safety. Our stance is clear: precise and effective hemp regulation offers the most viable solution for responsibly managing the sale of hemp products in Arizona.