February 6, 2024
This post has turned into an ongoing and updated long look at open and flagrant sales of delta-9 THC in North Carolina.
Here’s a telling quote: “”Marijuana has been legal [in North Carolina] for a while now — we just didn’t realize it.” https://www.wunc.org/politics/2024-04-29/nc-legislature-cbd-hemp-thc-delta-9-regulations] Yes, regular old intoxicating marijuana is being quietly sold in retail storefronts across the state. It’s the tomato model: No licenses, no taxes, no age limits, no regulations. Delta-8 THC is being sold, too, but it’s a side show to the original intoxicant, delta-9.
There are plausible claims of legality for these sales, claims that are largely and unchallenged as a practical matter. Much standard raw plant material or “flower” is said to be legal because it contains less than the federal limit of 0.3% Delta-9 THC. Gummies and other Delta-9 products, thanks to sugar and other non-intoxicants, stay under the 0.3% threshold at retail, too. Maybe this open market benefits from a loophole, or maybe law enforcement is mostly standing down.
In any event, 0.3% looks like a technical glitch in the 2018 farm bill that Mitch McConnell pushed — to create opportunities in hemp cultivation for Kentucky farmers. But he didn’t know what he was doing, or the staffers who drafted the language didn’t. (When I worked for Congress, House Ways and Means and Senate Finance Republicans’ and Democrats’ committee staffs flyspecked legislation. For tax, so did staffs from Treasury, the IRS, and Joint Tax. Might some staff weed fan have spotted this loophole or ambiguity in 2018 and kept quiet? Maybe agriculture bills don’t get anything like the technical scrutiny that tax bills do.)
So far, that marijuana market is thriving. North Carolina cities and counties and the state itself are mostly tolerating this market. Will Congress or our Legislature do anything about it? We’ll see.
Here are three stories:
https://abc11.com/hemp-marijuana-cannibas-stores-north-carolina/12767483/: “In its raw form, the THCa flower meets the legal qualifications of having less than 0.3% Delta-9 THC. But when heat is applied, like when the user smokes or vapes it, more of the product (the THCa) is converted to Delta-9 THC which allows its effect to mirror marijuana products sold in legalized states.”
“Last year, another hemp product hit the [North Carolina] market: THC-A.
“Eating a piece of hemp flower with THC-A, won’t get you high. But that changes when it’s burned, Dills said.
“It becomes Delta 9 once you combust it, once you smoke it. So it’s kind of a loophole if you will,” he said.
“Recreational marijuana is illegal . . . Dills stressed that he’s not selling the illegal Delta 9 THC, but unheated THC-A.”
“But intoxicating, smokable hemp products that get people high are being sold throughout the state, including all over Charlotte. When smoked, THC-A converts to traditional Delta 9 THC and is also an intoxicating substance. It’s become extremely popular in the last year, with stores selling it throughout the city.
. . .
“WFAE asked CMPD [Charlotte-Mecklenburg Police Department] whether its lab can differentiate between legal THC-A and illegal Delta 9 THC-A. The department didn’t respond.
“The Mecklenburg District Attorney’s Office said two weeks ago it will drop all charges against Pierre and Lee [arrested consumers, who were smoking in public]. “
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Sometimes a result is so at odds with legislative intent that a court will find a way around it. But not in North Carolina so far. Meanwhile, fentanyl and meth and “gas station heroin,” https://www.wunc.org/politics/2024-02-13/nc-house-considers-ban-on-gas-station-heroin, are bigger problems. Those drugs are killing people — and some, like “gas station heroin,” are legal. The Legislature is likely to act on those drugs before trying to shut down hemp drug businesses that have spread across the state.
Still, North Carolina’s free and unregulated market in regular old marijuana seems like an unstable equilibrium. I predict that monied interests will point to the lack of product testing and age verification to try to grab hold of this market via the legislature — as with Senate Bill 3, which would license only 10 vertically integrated sellers for medical marijuana.
Here is an instructive and professional documentary on THC-A by Lucy Carlin with private attorney Rod Kight: https://cannabusiness.law/rod-discusses-thca-and-legalization-in-new-documentary-video/. (With some overlap is a technical hour-long YouTube video going into North Carolina’s hemp drug law that features Rod Kight and University of North Carolina School of Government Professor Phil Dixon https://www.youtube.com/watch?v=GLcYbsR5dGs.)
Those videos get into some nuances and enforcement issues that I haven’t mentioned here. (There’s lots of stuff sold as supposedly containing under the 0.3% limit that may actually exceed it. https://www.marijuanamoment.net/more-than-90-of-smokable-hemp-samples-analyzed-by-researchers-contained-illegal-amounts-of-thc-new-federal-study-finds/. )
For more nuance: The federal government doesn’t agree that all these sales are legal. https://www.marijuanamoment.net/dea-says-thca-does-not-meet-the-definition-of-legal-hemp-as-congress-weighs-cannabinoid-recriminalization-in-farm-bill/. And here is rebuttal from attorney Kight. https://cannabusiness.law/thca-deja-vu/
In any event, some jurisdictions within North Carolina may prosecute sellers. In April 2024,
Onslow County Sheriffs Department with the help of Jacksonville Police Department and Kinston Police Department, to name a few, raided local shops today to seize their hemp products known as “THC-A”. According to a local smoke shop worker, undercover agents have spent the last month buying the products from shops in the area to have them sent to a lab for testing levels of THC present in the products. Levels of THC in hemp products must be below .03% in order to be considered legal. Officers also “did field testing” on all products seized today which allegedly showed products with higher than legal levels of THC. https://www.reddit.com/r/OnslowCounty/comments/1bv2qj8/smoke_shops_in_richlands_jacksonville_and/; more here: https://wcti12.com/news/local/onslow-county-cracks-down-on-controlled-substances-in-effort-to-protect-kids.
I think these cases will likely get tossed, like the Mecklenburg case above. But any seized products seem unlikely to get returned to the sellers.
Arrests for possession of these drugs have fallen to the point where you almost have be smoking flower in public or in a vehicle on a public roadway. Arrests for gummies and other ingestibles seem rare. There were more arrests for marijuana paraphernalia than for marijuana possession arrests North Carolina in fiscal 2023. https://www.newsobserver.com/news/state/north-carolina/article287777625.html
Already, at least one powerful Republican Legislator is big in the intoxicating marijuana space. https://www.wunc.org/politics/2024-02-07/nc-house-leader-is-the-new-president-of-a-cbd-hemp-company: “As state lawmakers consider new regulations for CBD and hemp products, House Majority Leader John Bell has become the president of a startup company manufacturing those products.
“Bell said his new role leading Nashville-based Asterra Labs is part of his work at private equity firm Rise Capital, which owns the hemp company.”
His company, https://asterralabs.com/southern-ease/, offers links to online ordering of, for instance, delta-9 THC gummies. https://www.southernease.com/#.
It turns out that Asterra’s gummies, available by mail order, come in under 0.3% THC by weight — a 135 gram pack has 200 milligrams of THC. So the story is that they are legal.
Whether operators like Representative Bell would like to stick with the status quo or to seek legislation to cap licenses and then grab one remains to be seen. In the meantime, the tomato market here is pretty much wide open.
The Center for New Revenue 