Significant adjustments have been made to Connecticut House Bill No. 5150, the omnibus cannabis/hemp legislation that is waiting to be taken up by the full House. An amended version of the bill (LCO_3982) was filed this week that, among other changes, appears to create a wholly new product category in the state – “Moderate-THC hemp product” – along with a matching new vendor category – “Moderate-THC hemp product vendor” – neither of which are found in previous versions of HB 5150. A new Sec. 27, which becomes effective Jan. 1, 2025, defines the two brand new categories, as follows:

Moderate-THC hemp product” means raw hemp, or a manufacturer hemp product, that has total THC, as defined in section 21a-240 of the general statutes, as amended by this act, of not less than one-half of one milligram, and not more than five milligrams, on a per-container basis, and (B) does not include an infused beverage, as defined in section 21a-420 of the general statutes, as amended by this act.

“Moderate-THC hemp product vendor” means a person that holds a certificate of registration issued by the Commissioner of Consumer Protection pursuant to this section and is not a cannabis establishment.

The changes would seem to be a correction of course for the legislature, which came under intense criticism by hemp farmers and manufacturers during a recent public hearing. The new plan is apparently to create a regulated pathway to market for these newly coined, but already existing, hemp products that no longer requires them to be sold in cannabis dispensaries, which was the previous plan. The so-called moderate-THC products can still be sold in cannabis dispensaries, but the new iteration of HB 5150 now allows existing hemp vendors to apply to the Commissioner of Consumer Protection (CCP) to become registered “moderate-THC hemp product vendors,” as long as they meet testing standards for manufacturer hemp products and pay a “nonrefundable application fee in the amount of two thousand dollars.”

Applicants would also need to meet additional requirements. “Such application shall, at a minimum, disclose the location in the state where such person sells, at retail, moderate-THC hemp products to consumers, and information sufficient for the commissioner to determine that, during the preceding year, at least seventy-five per cent of the average monthly gross revenue generated at such location was derived from sales, at retail, of moderate-THC hemp products to consumers,” adds the amendment. “The commissioner shall not issue a certificate of registration as a moderate-THC hemp product vendor unless the commissioner has determined that the applicant satisfies such minimum sales threshold. Each such certificate shall expire annually and shall allow the moderate-THC hemp product vendor to sell, at retail, moderate-THC hemp products to consumers at such location.”

In addition to certain age, labeling, and packaging provisions, Sec. 27 also mandates that “each moderate-THC hemp product vendor shall be subject to the investigation and enforcement provisions set forth in section 21a-421p of the general statutes.”

Discounts

The amended bill also includes a partial about-face on the previous version’s comprehensive restriction on discounts or promotions intended to induce purchases. Bowing to logic or pressure, the bill now states that a cannabis establishment shall not “engage in advertising or marketing that includes a discounted price or other promotional offering as an inducement to purchase any cannabis or cannabis product that is not a medical marijuana product, except a discounted price or promotional offering may be offered within a dispensary facility or hybrid retailer as an inducement to purchase cannabis.” So, if one orders ahead of time, as many people do, will the discount continue to appear on the digital menu?

Remediation

The practice of remediation is further codified in the amended HB 5150, and labeling of remediated products is still not required, but there at least seems to be tacit acknowledgment that remediation is not a panacea, and that it comes with risks that require some oversight, though it remains to be seen if the regulator is committed to meaningful oversight of remediation.

The amendment now clarifies that the commissioner shall issue policies and procedures and thereafter final regulation “establishing laboratory testing standards, consumer disclosures concerning mold and yeast in cannabis and permitted remediation practices.” Italics added.

It also includes a reworked section on store signage: “Prescribing signage to be prominently displayed at dispensary facilities, retailers and hybrid retailers disclosing (A) possible health risks related to mold, and (B) the use and possible health risks related to the use of mold remediation techniques.” Italics added.

The House has adjourned for the week. The next full session is TBD. The amended version of HB 5150 can be found here. Because the entirety of Sec. 27 is new, we are including it below:

Sec. 27. (NEW) (Effective January 1, 2025) (a) As used in this section:

(1) “Cannabis establishment” has the same meaning as provided in section 21a-420 of the general statutes, as amended by this act;

(2) “Consumer” has the same meaning as provided in section 21a-420 of the general statutes, as amended by this act;2357

(3) “Container” (A) means an object that is sold to a consumer and directly contains (i) a manufacturer hemp product, or (ii) a moderate-THC hemp product, and (B) does not include an object that indirectly contains, or contains in bulk for transportation purposes, (i) a manufacturer hemp product, or (ii) a moderate-THC hemp product;

(4) “Hemp” has the same meaning as provided in section 22-61l of the general statutes;

(5) “Manufacturer hemp product” has the same meaning as provided in section 22-61l of the general statutes;

(6) “Moderate-THC hemp product” (A) means raw hemp, or a manufacturer hemp product, that has total THC, as defined in section 21a-240 of the general statutes, as amended by this act, of not less than one-half of one milligram, and not more than five milligrams, on a per-container basis, and (B) does not include an infused beverage, as defined in section 21a-420 of the general statutes, as amended by this act; and

(7) “Moderate-THC hemp product vendor” means a person that (A) holds a certificate of registration issued by the Commissioner of Consumer Protection pursuant to this section, and (B) is not a cannabis establishment.

(b) Beginning on January 1, 2025, no person shall sell any moderate-THC hemp product in the state unless such person is a cannabis establishment or holds a certificate of registration issued by the Commissioner of Consumer Protection pursuant to this section.

(c)(1) Beginning on January 1, 2025, a person seeking a certificate of registration as a moderate-THC hemp product vendor shall submit to the Commissioner of Consumer Protection, in a form and manner prescribed by the commissioner, an application accompanied by a nonrefundable application fee in the amount of two thousand dollars. Such application shall, at a minimum, disclose the location in the state where such person sells, at retail, moderate-THC hemp products to consumers, and information sufficient for the commissioner to determine that, during the preceding year, at least seventy-five per cent of the average monthly gross revenue generated at such location was derived from sales, at retail, of moderate-THC hemp products to consumers. The commissioner shall not issue a certificate of registration as a moderate-THC hemp product vendor unless the commissioner has determined that the applicant satisfies such minimum sales threshold. Each such certificate shall expire annually and shall allow the moderate-THC hemp product vendor to sell, at retail, moderate-THC hemp products to consumers at such location.

(2) Each certificate issued pursuant to this section shall be renewable for additional one-year periods. Each moderate-THC hemp product vendor seeking renewal shall submit to the Commissioner of Consumer Protection, in a form and manner prescribed by the commissioner, a renewal application accompanied by a nonrefundable renewal application fee in the amount of two thousand dollars. Such application shall, at a minimum, disclose information sufficient for the commissioner to determine that, during the preceding registration year, at least seventy-five per cent of the average monthly gross revenue generated at the moderate-THC hemp product vendor’s registered retail location was derived from sales, at retail, of moderate-THC hemp products to consumers. The commissioner shall not issue a renewal to a moderate-THC hemp product vendor unless the commissioner has determined that the moderate-THC hemp product vendor satisfied such minimum sales threshold.

(3) All fees collected by the department under this section shall be deposited in the consumer protection enforcement account established in section 21a-8a of the general statutes.2415

(d) No person may act as a moderate-THC hemp product vendor, or represent that such person is a moderate-THC hemp product vendor, unless such person has obtained and actively holds a certificate of registration as a moderate-THC hemp product vendor issued by the Commissioner of Consumer Protection pursuant to this section.

(e) No cannabis establishment or moderate-THC hemp product vendor, or agent or employee of a cannabis establishment or moderate-THC hemp product vendor, shall sell a moderate-THC hemp product to any individual who is younger than twenty-one years of age. Prior to selling any moderate-THC hemp product to an individual, the cannabis establishment, moderate-THC hemp product vendor, agent or employee shall first verify the individual’s age with a valid government-issued driver’s license or identity card to establish that such individual is twenty-one years of age or older.

(f) No person shall sell any moderate-THC hemp product intended for human ingestion in packaging that includes more than two containers.

(g) All moderate-THC hemp products shall meet the standards set forth for manufacturer hemp products in subsections (v), (w) and (x) of section 22-61m of the general statutes, as amended by this act.

(h) All moderate-THC hemp products shall meet (1) the testing standards for manufacturer hemp products established in, and any regulations adopted pursuant to, section 22-61m of the general statutes, as amended by this act, or (2) such other testing standards for manufacturer hemp products as the Commissioner of Consumer Protection, in the commissioner’s discretion, may designate.

(i) Each moderate-THC hemp product container shall prominently display a symbol, in a size of not less than one-half inch by one-half inch and in a format approved by the Commissioner of Consumer Protection, that indicates that such moderate-THC hemp product is not legal or safe

for individuals younger than twenty-one years of age.

(j) No cannabis establishment or moderate-THC hemp product vendor, or agent or employee of a cannabis establishment or moderate- THC hemp product vendor, shall gift or transfer any moderate-THC hemp product at no cost to a consumer as part of a commercial transaction.

(k) Each moderate-THC hemp product vendor shall be subject to the investigation and enforcement provisions set forth in section 21a-421p of the general statutes.

(l) Following a hearing conducted in accordance with chapter 54 of the general statutes, the Commissioner of Consumer Protection may impose an administrative civil penalty, not to exceed five thousand dollars per violation, and suspend, revoke or place conditions upon any moderate-THC hemp product vendor that violates any provision of this section or any regulation adopted pursuant to subsection (m) of this section. Any administrative civil penalty collected under this subsection shall be deposited in the consumer protection enforcement account established in section 21a-8a of the general statutes.

(m) The Commissioner of Consumer Protection shall adopt regulations, in accordance with the provisions of chapter 54 of the general statutes, to implement the provisions of this section. Notwithstanding the requirements of sections 4-168 to 4-172, inclusive, of the general statutes, the commissioner shall, prior to adopting such regulations and in order to effectuate the provisions of this section, issue policies and procedures to implement the provisions of this section that shall have the force and effect of law. The commissioner shall post all policies and procedures on the Department of Consumer Protection’s Internet web site and submit such policies and procedures to the Secretary of the State for posting on the eRegulations System, at least fifteen days prior to the effective date of any policy or procedure. Any such policy or procedure shall no longer be effective upon the earlier of either the adoption of the policy or procedure as a final regulation under section 4-172 of the general statutes or forty-eight months from July 1, 2024, if such regulations have not been submitted to the legislative regulation review committee for consideration under section 4-170 of the general statutes.