AHAA Weekly Policy Report: March 4, 2026
This week's report tracks 141 bills. The hemp section below highlights developments in South Carolina, Missouri, Connecticut, Tennessee, Indiana, Washington, and Hawaii, with significant movement on both ban proposals and new regulatory frameworks. The complete report includes marijuana, Farm Bill, and additional alternative wellness legislation.
Hemp Regulatory Developments
South Carolina H 4758: Hemp Ban Stalled on House Floor
Status: Debate Adjourned, February 25, 2026 (House Floor)
South Carolina's H 4758 remains on the House floor following another adjournment of debate. The bill would ban the sale, possession, and distribution of consumable hemp products exceeding 0.3% THC on a dry weight basis, effectively eliminating the state's ingestible and inhalable hemp market. Growers and fiber processors are exempt; retailers and distributors carry the full burden. Enforcement costs are projected at nearly $2 million annually beginning in FY 2026-27, with increased court cases and incarceration costs likely to follow.
The bill carries a 59% probability of passing the House and a 67% probability of passing the Senate. The repeated floor adjournments suggest ongoing resistance and negotiation. South Carolina businesses and consumers should continue direct outreach to House members now, before the debate reopens.
See Smart Summary of SC H 4758
Missouri: Three-Bill Threat Still Moving
MO HB 2641: Second Read, Referred to Senate Judiciary, February 26, 2026
MO HB 2765: Referred to Rules, February 26, 2026
MO SB 904: Informal Calendar, Senate Bills for Perfection, March 2, 2026
Missouri continues to advance a dual-track strategy that threatens to eliminate independent hemp retail in the state. MO HB 2641, now in the Senate after passing the House, would fold hemp-derived cannabinoid products entirely into Missouri's marijuana regulatory framework, requiring all retail sales to occur inside licensed marijuana dispensaries. MO SB 904 pursues the same goal from the Senate side and has now reached the Informal Calendar for floor consideration.
Meanwhile, MO HB 2765 offers an alternative licensing framework specifically for hemp beverages, with a 7% excise tax, strict age verification, and licensing for manufacturers, wholesalers, and retailers. Though more structured than an outright ban, it restricts any hemp products with THC above 0.3% and creates a new compliance layer for independent operators.
Missouri industry members should monitor all three bills simultaneously. The marijuana-framework bills (HB 2641 and SB 904) represent the greater existential threat to independent hemp retail.
See Smart Summary of MO SB 904
See Smart Summary of MO HB 2765
Indiana SB 250: Hemp Regulation Bill Fails
Status: Inactive, Failed, 2026 Regular Session
Indiana SB 250, which would have established a comprehensive licensing and compliance framework for hemp-derived cannabinoid products, has been marked inactive by the legislature. The bill would have created permit requirements for manufacturers, distributors, retailers, and carriers, along with strict packaging, labeling, and testing standards overseen by the Alcohol and Tobacco Commission. It had broad Republican sponsorship but did not advance. Indiana hemp businesses remain in a regulatory gray area as a result.
Connecticut HB 5350: Cannabis and Hemp Regulation Bill Set for Public Hearing
Status: Public Hearing Scheduled March 4, 2026 (House)
Connecticut HB 5350, a comprehensive overhaul of the state's cannabis and hemp regulatory framework, is scheduled for public hearing today. The bill would establish new licensing categories for commercial extractors, infused beverage manufacturers, and on-premises consumption venues. It sets updated THC limits for hemp consumables, mandates out-of-state laboratory testing access, and creates stricter packaging and labeling standards. An Office of the Cannabis Ombudsman would be established to oversee industry concerns. Implementation is targeted for October 1, 2026.
Tennessee HB 2241: Tax Cut and Delivery Licensing for Hemp Products
Status: Placed on Subcommittee Calendar for March 4, 2026 (Business and Utilities)
Tennessee HB 2241 would cut the wholesale tax on hemp-derived cannabinoid products in half, from two cents to one cent per milligram. The bill also creates a new licensed delivery framework for retailers, authorizing delivery up to 50 miles with strict age verification, background checks for drivers, and detailed recordkeeping requirements. Direct-to-consumer shipping (outside the licensed delivery system) would be prohibited. New licensing fees range from $300 to over $1,000 depending on fleet size, with mandatory annual reporting beginning January 15, 2028. This bill is scheduled for subcommittee review today.
Illinois SB 3820 and SB 3919: Dual Hemp Framework Bills Advance
Status: Both Referred to Cannabis Committee, February 25, 2026 (Senate)
Illinois is advancing two companion bills in the Senate. SB 3820 aligns state industrial hemp law with recent federal legal changes, updating licensing, testing, and inspection rules and allowing higher education institutions to conduct hemp research. SB 3919 goes further, establishing a full regulatory framework for intoxicating hemp, including an age-21 sales restriction, a dedicated Industrial Hemp Regulatory Fund, and civil penalties for violations. Both bills have moved to the Senate Cannabis Committee.
See Smart Summary of IL SB 3820
See Smart Summary of IL SB 3919
Hawaii SB 2712: Industrial Hemp Economic Development Bill
Status: Passed Second Reading, Referred to WAM/JDC, February 20, 2026 (Senate)
Hawaii SB 2712 establishes the Hawaii Hemp Fiber Special Fund to provide grants to hemp producers, processors, manufacturers, and educational institutions, with a focus on fiber and paper packaging development. A pilot program for hemp paper packaging will direct at least 30% of funds to applicants with environmentally sustainable practices. A 5% surcharge on industrial hemp licenses funds the program. The bill is effective through June 30, 2030, with protections for smallholder farms. Forecast shows a 95% probability of passing both chambers.
Washington HB 2740: Comprehensive Hemp-Derived Cannabinoid Framework
Status: First Reading, Referred to Consumer Protection and Business Committee, February 24, 2026 (House)
Washington HB 2740 proposes a full regulatory framework for hemp-derived cannabinoid products statewide. All hemp-derived products must be registered with the Department of Agriculture. A 10% excise tax on retail sales would be split between a new hemp regulatory account and the state general fund. Licensing requirements for cannabis processors, producers, and retailers would be updated. Implementation is phased, with key provisions taking effect in 2026 and 2027. Anti-price-fixing compliance rules are included.
What This Means for the Industry
The pattern this week is consistent with what we have seen throughout the 2026 legislative session: states are not sitting still. Some are pursuing outright bans. Some are building licensing frameworks. Some are doing both at once, as Missouri demonstrates. The industry cannot afford to treat these as separate, isolated fights.
Indiana's failure to pass SB 250 is a reminder that even broadly supported regulatory frameworks can collapse if momentum is lost. Connecticut's public hearing today is an opportunity to shape a regulatory outcome rather than react to one. Tennessee's tax reduction and delivery licensing bill, if it passes, sets a workable model for regulated access that other states could follow.
South Carolina and Missouri remain the most urgent pressure points. Both states are at inflection moments where direct business owner contact with legislators carries real weight.
Members operating in multiple product categories should review the complete tracking report for comprehensive state-specific updates.
See the Full Weekly Policy Report Here
Take Action
South Carolina: H 4758 debate can reopen at any time. Contact your House representative directly with your business story. Enforcement cost projections and lost sales tax revenue are persuasive arguments with members who care about fiscal impact.
Take Action with SCHAA for South Carolina Now
Missouri: Three bills are moving simultaneously. HB 2641 is now in the Senate. SB 904 is approaching a floor vote. Reach out to your Senator now. Frame this as a small business survival issue, not a cannabis debate.
Connecticut: Public hearing is today, March 4. If you operate in Connecticut, submit written testimony or contact the Joint General Law Committee.
Prepared by the American Healthy Alternatives Association
Tracking hemp policy nationwide to keep our industry informed.
