THC Poison Pill - Government Funding Bill Provision Will Destroy THC Drink Industry & Harm Small Businesses
Minnesota innovated low-dose THC beverages—now federal law threatens to out-gun that innovation.
THE ISSUE:
On November 12, President Trump signed the government funding bill ending the longest government shutdown in American history. Unfortunately for Minnesota businesses in the budding microbrewery, cannabis, and hemp-derived products industry, the bill included a provision that threatens their very livelihood - and very imminently if corrective action isn’t taken by Congress.
The legislation included a provision that imposes a cap of 0.4 mg of THC per container on hemp-derived products, effectively wiping out the legal low-dose THC beverage market. The new cap replaces the 2018 Farm Bill’s definition of hemp which was based on THC concentration and allowed products with less than 0.3% THC by weight instead of total amount.
WHAT IS MEANS FOR MINNESOTA:
In 2022, Minnesota legalized low‐dose hemp‐derived edibles and beverages under a state regulated program, allowing age‐gated, licensed retail and testing.
That model faces collapse once federal law overrides state rules, meaning local breweries, cideries and hemp processors will lose a growing revenue stream.
The cap sends consumers back to unregulated markets and jeopardizes jobs and tax revenue in Minnesota.
In practice, Minnesota’s regulated THC-drink industry enters a transition period.
Although enforcement is delayed, the policy shift signals a regulatory sea-change—businesses must plan for either:
1) winding down legalized THC drinks, or
2) pushing for legislative change at the federal level (or risk being left behind).
HOW TO RESPOND - SOLUTIONS FOR MINNESOTA’S FEDERAL AND STATE POLICY MAKERS
There is still time for Congress to act, but they must act swiftly as the law’s hemp prohibition is set to take effect November 13, 2026.
Fortunately, both Minnesota Senators Amy Klobuchar and Tina Smith have been outspoken opponents of the hemp prohibition provision from the start (they both voted against the overall government funding bill as well) and will likely continue advocating for its repeal. However, the U.S. House delegation has been less united in its vocal opposition with Democratic House Members raising concerns and Republican Members largely avoiding the issue to date instead choosing to focus on other pieces of the bill.
To resolve this issue and save countless Minnesota small businesses increasingly relying on this growing revenue stream, Minnesota’s congressional delegation should advocate for:
raising the THC cap for state-regulated programs to allow 5-10 mg per container;
carving out state-licensed hemp‐derived beverage programs from the blanket cap;
clarifying the difference between fully intoxicating cannabis and regulated low-dose hemp drinks.
At the state level, Minnesota leaders could respond by exploring transitional support (grants, tax credits) for impacted businesses and/or fast-tracking a regulatory path for adult-use cannabis beverages, so if hemp drinks get shut out, a legal alternative exists.
BOTTOM LINE:
Minnesota innovated low-dose THC beverages—now federal law threatens to out-gun that innovation. Time is short and decisions matter. The funding bill is a blow—but not yet a knockout. Minnesota can still shape how the next 18 + months play out for its THC-drink market. But only if its elected leaders act quickly.