North Carolina is struggling with wide-open intoxicating hemp THC, which other states that started there have restricted and regulated — not banned. Like North Carolina, Tennessee, Georgia, Alabama, and West Virginia have Republican Legislatures.
Here’s what they do about seed to sale tracking, according to Gemini A.I. (nothing).
What are the pros and cons of allowing cannabis licenses to be transferred for consideration? Does it matter how they were issued (lottery, on the merits, by auction)? As we look at THC licensing in North Carolina, what should we think?
From Gemini A.I.:
Allowing the transfer of cannabis licenses for “consideration” (money or value) is a debated policy point in every state that legalizes. While it encourages investment and market fluidity, it also risks turning public licenses into speculative commodities.
“With hemp THC drugs wide open 24/7 and unregulated in North Carolina now, I see no chance that they will be fully prohibited. So I think the only hope for North Carolina is to regulate them.” — I wrote that in September, but now in November that Congress is treating hemp like marijuana, I’m not so sure. Here’s what I thought back then:
After this post, the NC House stripped out the CBD ban and ended up with only age-gating at 21. The bill moves on to the Senate as of June 26, 2025.
Here’s the original post, for the record:
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The primary intoxicant in marijuana or cannabis is THC. CBD, meanwhile. is universally acknowledged to be non-intoxicating .
But the North Carolina Farm Bill Drug bill that passed the Senate and is heading for the House allows THC but bans CBD. That’s crazy!
A Legislator told me I’m missing something — so I may be wrong here. But I offered a reward on Twitter or X for an explanation of what I’m missing, with no takers.
Let’s take a CBD gummy with no THC of any kind. I think it’s a “prohibited hemp-derived consumable product” under North Carolina House Bill 328.
For history, here are results of local votes on marijuana taxes in California at the time of legalization in 2016– from http://www.drugsense.org/dpfca/votersguide1116.html#LOCALS. Voters liked marijuana taxes better than they liked marijuana legalization. At the end is more detail about counties’ results.
In summary, here’s the percentage of votes for local taxes vs. votes for statewide Proposition 64. These are all the counties where a direct comparison is available.
Calaveras County 67 for local taxation vs 47 for Prop 64
Adelanto – Measure R would impose an excise tax of up to 5% on all types of commercial marijuana activities. PASSED 67-33%
Avalon – Measure X would permit up to two medical marijuana dispensaries, and permit the delivery, cultivation, manufacture and processing of medical marijuana products, subject to a $10,000 annual license tax and a 12% transaction fee/tax on each individual medical marijuana sale. FAILED 36-64%.
Butte County – Measure L would permit commercial cannabis cultivation, distribution, manufacturing and transporatation in most zones, while prohibiting outdoor cultivation in residential zones and establishing an exemption for personal cultivation of up to 100 square feet, and collective cultivation of up to 500 square feet. Read more.FAILED 42.5-57.5%.
Calaveras County – Measure C would impose a $2/square foot commercial cannabis tax on outdoor/mixed light cultivation until the state establishes a track and trace program, at which point the tax will be $45/pound of dry weight trim and $10 per pound of dry weight trim; and $5/sq ft. on indoor culivation until a track-and-trace program is implemented, at which time the tax will be $70/lb. of bud and $15/lb. of trim; and a 7% on gross proceeds from manufacturing or retail medicinal or legal cannabis. Would require legal water source and compliance with regulations issued by the Water Quality Control Board, Fish and Wildlife, etc. PASSED 67-33%.
Some say let everyone grow cannabis, and Oklahoma is hosting a free-for-all, but some Legislators don’t think marijuana is an ordinary commodity, and think limiting its commerce might protect the public’s health. So they limit licenses.
There are various ways of dealing with excess applicants for marijuana licenses, like holding a lottery, as Washington state did; selling licenses to the high bidder, as colonial India did in the 1800s; or, as the Roosevelt Administration did in 1933, considering each application on its merits and deciding yes or no for each application. Voucher privatization, where each voter gets a transferrable fraction of the overall quota, may seem far-fetched, but it may be worth a look in Theoryland.
Marijuana licensing “on the merits” leads to disappointed applicants. At best, merit selection (in the USA) has led to an enormous amount of energy going into appeals and litigation. At worst, it’s corrupt crony capitalism.
Even lotteries require threshold qualification, whose denial can engender appeals and litigation. Social equity licensing adds more complexity if not uncertainty.