ARIZONA SB 1556: Regulation of Hemp Beverages

Hemp’s Evolution: A Modern Market For Hemp Beverages

Dispensaries have invested millions into their licenses, pioneering the legal cannabis market in their states. From Massachusetts to California, legal operators paved the way for legalization, taking on regulatory risks and high tax burdens. Now, they’re watching hemp-derived THC products flood the market, often without the same regulations, testing, or licensing fees. It’s no surprise that dispensaries are fighting to protect their investments, and state governments are motivated to follow, considering how much tax revenue dispensaries generate.

Arizona’s SB 1556 and the Role of Liquor Licensing

The proposed Arizona hemp beverage law introduces a compromise—instead of an outright ban, it would restrict sales to businesses with a Series 9 liquor license. 

This means:

✅ Total Wine & BevMo will still be allowed to sell hemp beverages.

❌ Convenience stores, smoke shops, and non-liquor-certified retailers would be blocked from selling them.

This approach protects major retailers while cutting off gas stations and small CBD shops, which make up the largest part of the hemp beverage market today.

Regulatory Trends Across the U.S.

Arizona isn’t alone in this battle. Other states are cracking down on hemp-derived THC products, especially flower, vapes, and now beverages.

Tennessee has already outlawed THC flower and vapes, even though Delta-9 beverages and edibles remain legal under the federal Farm Bill.

Many states are targeting beverages because they contain Delta-9, which was specifically legalized under federal law—while other THC variants (like THC-A, THC-P, or THC-O) remain in a more easily enforced gray area.

Where Do We Go from Here?

This debate isn’t just about dispensaries vs. hemp retailers—it’s about how cannabis markets evolve. If consumers are the priority, then the goal should be clear regulations that ensure safety, access, and fair competition. Some regulation is necessary, but outright bans (or picking winners and losers based on licensing) could limit consumer choice and stifle innovation.

As Arizona decides SB 1556, the real question is: Will this law truly protect consumers, or is it just another way for dispensaries to control the market? Hopefully, whatever happens will benefit consumers, allowing safe and fair access to hemp and cannabis products alike.

Arizona’s SB 1556 & the Fight for Hemp-Derived Beverages

Hemp has long played a crucial role in human civilization, from ancient textiles and medicinal use to modern-day wellness products and industrial applications. Today, the hemp industry in the United States has skyrocketed to an estimated $30 billion annually, generating revenue from products such as gummies, tinctures, chocolates, flower, rosin, live resin, and vape cartridges, all derived from hemp-based cannabinoids. Despite this explosive growth, the industry faces significant regulatory battles, with Arizona’s SB 1556 at the center of the latest debate.

The Push to Regulate Hemp Beverages

Arizona’s Senate Bill 1556 (SB 1556) seeks to create a regulatory framework for adult-use hemp beverages, defining them as products with less than 30mg of THC per serving. This bill would bring hemp drinks under liquor licensing laws, allowing licensed alcohol retailers to sell them while restricting sales to those over 21 years old. While the bill may seem like a necessary step for quality control and public safety, it also highlights a growing tension between dispensaries and convenience stores.

Dispensaries vs. Convenience Stores: The Battle for Market Control

Initially, dispensaries dismissed hemp-derived THC products as inferior to regulated cannabis. However, as testing and consumer feedback have shown these products to be safe and effective, the stance has shifted. Now, the argument from dispensary-backed lobbyists is that hemp products must be heavily regulated to keep them away from children—a claim that echoes previous battles over alcohol, tobacco, and even energy drinks.

But let’s take a step back. Convenience stores and gas stations already handle the sale of alcohol responsibly, as they are legally required to check IDs and follow strict ATF regulations. If they fail to do so, they risk losing their licenses—a consequence that no business is willing to gamble with. The same logic applies to hemp-based products. If gas stations and liquor stores can sell alcohol and tobacco responsibly, why would they fail to regulate hemp drinks?

Hemp in the U.S. vs. Arizona’s Restrictive Approach

In other states, hemp beverages and other cannabinoid-based products are thriving in convenience stores, CBD boutiques, and smoke shops. These products exist alongside tobacco, alcohol, and even unregulated energy drinks—which, despite having no federal age restrictions, are often voluntarily limited by retailers due to health concerns.

Yet, in Arizona, dispensaries are pushing to ban these competing products, claiming public safety concerns without any evidence of widespread underage sales or misuse. Throughout the SB 1556 hearings in Phoenix, lawmakers heard arguments about the potential risks, yet no concrete examples of minors purchasing or abusing hemp beverages were presented. Given the thousands of convenience stores, gas stations, and specialty shops selling these products nationwide, one would expect at least some anecdotal evidence if this were a real issue.

The Future of SB 1556 & the Hemp Industry in Arizona

Arizona’s final vote on SB 1556 will determine whether hemp beverages remain accessible through open-market distribution or get locked behind dispensary walls. If passed, this bill could set a precedent for other states looking to limit hemp-based product sales, allowing dispensaries to maintain a monopoly on THC products. However, if rejected, Arizona will continue aligning with national trends—where hemp products are safely and widely available to responsible adult consumers.

Ultimately, the battle over SB 1556 isn’t about safety—it’s about market control. Will Arizona embrace a free market approach, or will dispensaries succeed in shutting out competition? The final vote will shape the future of hemp commerce in the state and potentially across the nation.

Texas HB 2155, The Lone Star Hemp State

Texas HB 2155 was filed on January 28, 2025, by district 66 house rep. Matt Shaheen, represents an even more extreme stance on hemp products than Arizona’s SB 1556. Unlike Arizona’s bill, which focuses on regulating and restricting hemp-derived THC beverages, HB 2155 seeks a full prohibition, making it illegal to sell, transfer, or even deliver any hemp-derived product, including cosmetics. The bill also introduces a criminal B misdemeanor offense. Texas is currently selling well over $1 billion dollars worth of hemp products annually.

The most interesting detail? The Texas bill has zero support—no co-authors, no committee assignments, and no legislative action since its filing. This raises questions about its actual viability, though it still serves as an example of how far some lawmakers are willing to push anti-hemp policies. If passed, HB 2155 would go into effect on September 1, 2025, but given its lack of movement, it appears to be more of a symbolic effort rather than a real threat.

While HB 2155 aims for total prohibition, SB 1556 in Arizona takes a more tactical approach, targeting one specific market segment: hemp beverages. The Texas bill would criminalize everyday hemp products, even those without THC, while Arizona’s effort is largely about giving dispensaries control over where hemp drinks can be sold.

Both bills reflect a growing anti-hemp sentiment among certain lawmakers, despite no significant evidence of public harm. As Texas and Arizona navigate these legislative efforts, the broader battle over hemp’s place in the economy continues. 

The question is: Are these bills truly about public safety, or are they about controlling competition?

Q & A

QUESTION: How come hemp products such as vapes and pre rolls are not common in Arizona? 

ANSWER: Attorney General’s enforcement.

OFFICIAL OPINION: In March 2024, Arizona attorney general Kris Mayes issued an opinion stating that the sale of delta-8 THC and other hemp-synthesized intoxicants by unlicensed entities is not permitted under state law. This opinion emphasizes that such products remain classified as Schedule I substances in Arizona and are illegal to sell outside of licensed dispensaries. 

ENFORCEMENT ACTIONS: Following the attorney general’s opinion, there have been increased warnings and potential legal actions against retailers selling unregulated hemp derived products. This enforcement has led many retailers to cease sales of hemp flower and vape products to avoid prosecution. In summary, the scarcity of hemp flower and vape products in Arizona is due to specific state regulations that restrict the sale of certain hemp-derived products and active enforcement by the attorney general’s office. Retailers are adhering to these regulations and guidance to avoid legal repercussions.

SB 1556 TIMELINE

As of February 19, 2025, Arizona Senate Bill 1556 (SB 1556) has undergone the following legislative actions:

FEBRUARY 10, 2025: Introduced in the senate and assigned to the regulatory affairs and government efficiency (rage) committee and the rules committee.

FEBRUARY 11, 2025: Read for the second time in the senate.

FEBRUARY 13, 2025: The rage committee recommended a “do pass” with a vote of 6-1.

The bill is currently pending review by the senate rules committee. A specific date for a full senate vote has not been scheduled yet. to stay updated on the bill’s progress and any upcoming votes, you can monitor the official Arizona state legislature website or consult the bill’s tracking page.