In the heart of North Austin, Sydney Torabi reflects on the uncertain state of her business – operating a hemp dispensary in a state that is among the last to fully legalize recreational marijuana use.
Torabi’s customer base is diverse. From young adults seeking alternatives to traditional cannabis, those exploring natural remedies and even medical marijuana users searching for relief from various conditions.
Due to the 2018 Farm Bill, Torabi and other Austin business owners have been navigating a sea of state and federal regulations that have affected their businesses in unpredictable ways.
“We’ve been in business for just over six years,” Torabi said. “The Farm Bill opened a lot of doors for us, making a gray area less of a gray area when operating. But over the years, [the Farm Bill] has been interpreted a little bit differently by chemists, other business owners.”
The bill legalized the cultivation and sale of hemp at the federal level, defining hemp as cannabis with less than 0.3% tetrahydrocannabinol, or THC, by dry weight. The bill allowed for hemp to be grown and sold legally, but it also created regulatory holes, particularly around the legal THC limit. This ambiguity has confused small business owners and law enforcement, keeping businesses on edge.
“I would say there’s a lot of bad press surrounding Delta-8,” Torabi said, referencing one of the more popular hemp-derived products that has seen a rise in demand. “But from a lot of our customers’ perspective, it’s a really great product because it’s less psychoactive and more relaxing as opposed to traditional marijuana consumption.”
While Austin’s progressive stance on marijuana has been a boon for businesses, the lack of clear regulations at the state level has complicated the industry. State law allows for hemp products with less than 0.3% THC, but products nearing that limit can easily cross into illegal territory, leading to seizures and legal battles.
“We abide by the rules, pay our taxes, and have our retail and hemp licenses,” Torabi said. “Austin has been very, very welcoming to our business. Other parts of the state, like Tarrant County or El Paso, I've heard, have had more of an issue with law enforcement coming in.”
Courtney Ann Fontaine, policy analyst for Texas Senator Judith Zaffirini, says that the senator’s recent legislative efforts aim to address public safety concerns about cannabis products.
“We received a newspaper article that basically showed a child that was hospitalized and, I believe, ended up dying. He was like five and got some access to some edibles because he thought it was candy,” Fontaine said. “And so that really obviously struck at the senator’s heartstrings because she wanted to do something to regulate that.”
Fontaine said that many in the legislature “really want to protect public safety,” particularly concerning unregulated products like THCA and synthetic cannabis strains.
“For [Senator Zaffirini], it’s often about looking at what’s going on in her district and seeing what she can do to regulate those things,” Fontaine said.
Torabi said that the confusion surrounding the legality of cannabis products has hindered the potential growth of small businesses like hers. According to a report from analytics firm Whitney Economics, sales of hemp-derived cannabinoids in Texas generated more than $8 billion in 2022. However, legislative uncertainty has suppressed that growth.
“For six years, we've been having to adjust what we do on a pretty much a monthly, sometimes weekly basis, just based on what's happening in the law in the world of hemp,” she said. “It’s hard to operate in that kind of environment.”
Torabi remains hopeful that more clear-cut regulation could help legitimate businesses like hers thrive. She said that regulation would not only protect consumers but also eliminate wrongdoers who give the industry a bad name.
“I think regulation will actually help get rid of the bad players so that businesses like ours can really thrive and not run into issues,” Torabi said. “We want to provide high-quality, safe products to our customers, but the current system makes it difficult.”
For Torabi, the future of her business and the hemp industry in Texas depends on policymakers enacting clear and consistent regulations. She believes that well-crafted laws could result in a much safer marketplace and give consumers significantly more access to cannabis for both recreational and medicinal use.
“My dream scenario would be a place for both hemp and marijuana in Texas, where small businesses aren’t taxed to death or pushed out by larger corporations,” she said. “The charm of Austin, the charm of Texas, is letting small businesses thrive as well, without counting them out, without having to tax them heavily, without having to, you know, pay to play, if you will.”
As Austin’s cannabis market continues to grow, Torabi is optimistic but clear-eyed about the future.
“At the end of the day,” she said, “we want to abide by the law, we want to abide by the rules and we just want to make it accessible to consumers to have an alternative to medicine, if they're seeking that.”