On March 19, the Texas Senate voted 26-5 to pass SB 3, a bill that would effectively crush Texas' thriving hemp industry. As one of Lt. Governor Dan Patrick’s legislative priorities, SB 3 would overhaul hemp industry regulation, resulting in material impacts to state revenues and local economies.

State and Local Revenue Impacts

A fiscal note from the Legislative Budget Board (LBB), estimates a negative impact of $19.27 million to general revenue-related funds during the biennium ending August 31, 2027. That net loss climbs to a cumulative $52.86 million when revenue impact is projected over five years. It should be noted that this estimate is quite conservative compared to other reports estimating that Texas hemp industry revenue is actually more than $200 million annually.

And that’s just the impact to state revenue. Local municipalities such as cities, counties and transit authorities stand to take a hit to revenue as well. Looking at the same 5-year impact analysis, cities are staring down a cumulative loss of $9.48 million. This kind of loss could cause local governments to re-evaluate their budgets and public services.

A Death Knell For Texas Small Businesses

Texas has approximately 7,000 hemp industry small businesses, employing more than 40,000 Texans. SB 3 would be a huge hit to the livelihoods of these tens of thousands of Texans who have legally built businesses and helped fuel their local economies. 

Kevin Hale, LPTexas Legislative Coordinator said it best in a Texas Tribune article wherein he said that SB 3 is “blatant government overreach” and “pulls the rug out from under” hemp business owners who spent the last six years “investing in storefronts, payrolls, marketing and supply chains.”

“Libertarians believe in a free and open, transparent market. This bill does the opposite, pushing consumers and suppliers back into the black market, where the labels and ethics are unchecked.” - Kevin Hale

Another Day, Another Win for the Prison-Industrial Complex

Let it not be said that there are no winners with this bill, though. SB 3 mandates jail time - and hefty fines - for the victimless crime manufacturing and/or delivering any product that contains THC. This would include products containing Delta-8 which are widely recognized as helping with anxiety, pain relief and increased appetite for cancer patients.

 

• 443.251(a):

“A person commits an offense if the person knowingly manufactures, delivers, or possesses with intent to deliver a consumable hemp product that contains any amount of a cannabinoid other than cannabidiol (CBD) or cannabigerol (CBG).”

 

This means if a hemp product contains any THC at all, then manufacturing or delivering that product - or even possessing it with the intent to deliver - becomes a third‐degree felony. In Texas, a third-degree felony carries a prison sentence of 2 to 10 years, with the possibility of a fine up to $10,000. For reference, this is on par with someone who has committed their third DWI offense.

Join the Fight

While SB 3 has passed in the Texas Senate, it still needs to make its way through the Texas House before becoming law. Here’s how you can help fight back and stop SB 3 in its tracks:

1. 1. Email your the House State Affairs Committee to voice your opposition to SB 3 (Click the “Edit and Send Email” button to the right.
   2. Donate to the LPTexas Legislative Action Fund so that we can continue to put pressure on Texas legislators with boots on the ground.
   3. Share this via social media to encourage your friends and family to do the same!