I appreciate the opportunity to provide public comment on the Texas Department of State Health Services’ proposed rules governing the manufacture, distribution, and retail sale of consumable hemp products.
I want to begin by acknowledging and commending DSHS for proposing several important regulatory improvements that have been missing from Texas’ hemp framework. In particular, the requirements for formal recall procedures and consumer complaint documentation represent a meaningful advancement in consumer protection. Establishing systems to track adverse effects, investigate safety complaints, document corrective actions, and remove unsafe products from the market is essential for effective oversight. These tools will allow regulators to identify patterns of harm and hold bad actors accountable, and they align with best practices in other regulated consumer-product industries.
I also recognize and appreciate the department’s efforts to strengthen regulatory enforcement and coordination across agencies, as well as the establishment of a clear 21-and-over age restriction with ID verification. Preventing youth access is a legitimate and widely supported policy goal, and regulation—rather than prohibition—is the appropriate way to achieve it.
That said, I have serious concerns that other elements of the proposed rules may undermine consumer safety and market stability rather than improve them.
First, the proposed licensing and registration fees are extraordinarily high and appear disconnected from the actual cost of administering the consumable hemp program. Increasing manufacturer licenses from $250 to $25,000 per facility per year and retail registrations from $150 to $20,000 per location is not a modest adjustment—it is a fundamental restructuring of who can afford to operate legally in Texas.
I submitted an open records request at the beginning of 2025 to better understand the costs and revenues associated with the consumable hemp program. The information provided appears to show that the department is spending only about 30 percent of the revenue it collects from the program. At the same time, DSHS’s fiscal analysis assumes that nearly all currently registered retailers will pay the proposed $20,000 fee, generating more than $200 million in annual revenue. This assumption is unrealistic. Many small businesses simply cannot absorb this level of cost and will be forced to shut down rather than renew.
Business licensing and registration fees should not be punitive. They should be structured to recover the reasonable costs of effective regulation—not to function as a revenue mechanism that drives compliant businesses out of the regulated market. The department’s own estimates show that the increased costs of administering these rules are minimal. In that context, it is unclear why such dramatic fee increases are necessary or justified.
Second, I am deeply concerned about the proposed shift in THC testing standards, particularly the move to regulate consumable hemp products based on total THC rather than delta-9 THC alone. While I understand that this approach is intended to align with the Governor’s executive order, it does not appear to align with current Texas law.
Changing which THC molecules are restricted under state law would require a change to the Texas Controlled Substances Act, either through legislative action or through appropriate administrative action grounded in existing statutory authority. Rulemaking alone should not be used to redefine controlled substances in a way that effectively bans products that have been lawful under existing law.
The practical effect of this change would be to eliminate hemp flower—the most widely used, least processed, and most natural form of hemp—from the legal Texas market. Removing regulated access to hemp flower will not eliminate consumer demand. Instead, it will push consumers into unregulated markets where there are no testing standards, no age verification, no recall mechanisms, and no systems for tracking adverse effects. That outcome runs counter to the public-health objectives these rules are meant to advance.
In closing, I urge DSHS to preserve the consumer-protection provisions in this proposal—particularly recalls, complaint tracking, and age restrictions—while reconsidering the excessive fee structure and the shift in THC testing standards. Regulation should improve safety, transparency, and accountability, not price compliant businesses out of existence or push consumers into unregulated and unsafe markets.
Thank you for the opportunity to comment and for your consideration of these concerns.
Toward Liberty,
Heather Fazio Texas Cannabis Policy Center