Tennessee’s New Law
Tennessee’s new hemp law slams Hemp House, threatening the nine‑year‑old retailer’s existence as shelves go empty and revenue plunges. The crackdown forces the store to remove most products, leaving the interior stark and silent.
State lawmakers passed House Bill 1376 and Senate Bill 1413 in April, targeting products with more than 0.3% THC on a dry‑weight basis and THCA over 0.1%. The legislation aims to curb what officials call an unregulated “wild west” of hemp products.
Senator Richard Briggs called the market “the wild west” in a floor speech before the vote. He argued that the lack of regulation endangers consumers.
‘Back to the Black and Gray Market’
Hemp House CEO Dwayne Madden reported an 80% revenue drop since July 1, projecting closure for his three East Ridge, Hixson and Ooltewah locations. He warned that the business may not survive beyond October.
Madden said customers now ask only about flower, noting that “the new state law” limits all other products. He explained that many shoppers are confused and seeking alternatives.
Inside the Lab
New Bloom Labs, founded by John Kerns in 2019, tests every gummy, beverage, candy and raw material for pesticides, mold, heavy metals and THC levels. The lab’s comprehensive testing aims to ensure product safety.
Kerns warned that most in‑state hemp businesses have either reduced operations or shut down, leaving the lab with few local clients. He noted that the sector’s rapid contraction limits new customers.
A Growing Hole in the Budget
State revenue from hemp fell $8.5 million short of the July 2026 estimate, dropping from a projected $9.4 million to $427,000. The shortfall highlights the financial strain the law places on state coffers.
The Department of Finance and Administration revised the 2027 forecast down $46.2 million, to $9.6 million, after missing earlier targets. Officials say the loss will be offset by higher collections in other tax categories.
How Lawmakers are Responding
Republican Senate candidate Marsha Blackburn backs the ban, saying “Marijuana’s addictive nature and troubling effects have no place in Tennessee.” She emphasizes protecting children from exposure in convenience stores.
Democrat Aftyn Behn argues the law hurts businesses, citing a 60% sales drop at an East Nashville shop, and urges legalization to “grow the coalition” and protect consumers. She warns that the policy pushes consumers toward unsafe black‑market sources.
Democratic gubernatorial nominee Jerri Green also opposes the law, aligning with Behn’s push for legalization. She calls the regulation “misguided” and urges a shift toward legal markets.
Closing the Farm Bill Loophole
The 2018 Farm Bill defined hemp as containing ≤0.3% delta‑9 THC, a limit that excludes THCA under a new federal rule set for the end of the year. The change effectively reclassifies THCA‑rich products as marijuana under federal law.
President Trump’s April executive order reclassifies medical marijuana from Schedule I to Schedule III, but does not affect the state’s hemp restrictions. The move signals a broader federal shift but leaves Tennessee’s hemp rules unchanged.
‘Coming to an End’
Madden plans to close his East Ridge store on October 31, citing the inevitable impact of the law and the need to reassess numbers. He says the closure is the only realistic option given the regulatory environment.
He adds that “we saw this coming,” and that “the black market will thrive unless safe, legal options return.” Madden urges policymakers to reconsider the overregulation that drives consumers underground.
