North Carolina Officials Weigh Marijuana and Hemp Policies as Federal Law Remains in Flux

North Carolina officials are weighing how to regulate intoxicating hemp products and whether to prepare for a potential legal cannabis market, even as federal marijuana and hemp policies remain uncertain. The state's Advisory Council on Cannabis is examining lab testing, oversight, and lessons from other states, with final recommendations due to the governor by the end of the year.

North Carolina lawmakers returning in November will again confront how to regulate intoxicating hemp products after the House and Senate deadlocked in July over House Bill 328. The proposed conference text would prohibit finished hemp-derived consumable products exceeding 0.4 milligrams of total THC per container, rather than applying that quantity to all hemp. It would also restrict possession and sale of hemp-derived consumable products for people under 21. House members chose to wait until after the November midterm elections, wary of disrupting a $4 billion industry that employs 16,000 people in the state.

Federal policy is also shifting. The hemp industry received a one-month reprieve from a national ban on intoxicating hemp products as part of a short-term funding bill, with the U.S. House voting to delay the ban until December 11. At the same time, the Trump administration has asked the U.S. Department of Justice to reclassify marijuana as a Schedule III drug, the same class as Tylenol with codeine.

The North Carolina Advisory Council on Cannabis, appointed in June 2025 by Gov. Josh Stein, has been meeting for months to develop a comprehensive approach to regulating cannabis sales and creating a safe legal market for adults that protects children. Nearly 40 states have enacted cannabis regulations, but no two are the same, according to Yasha Kahn, co-founder of MCR Labs, who presented to the council last week.

Kahn described the patchwork of state rules as 39 individual policy experiments with data available for analysis. He said cannabis has the potential to be a multi-billion-dollar industry for North Carolina, but policymakers will need to decide who handles testing and at what point products are tested, along with batch sizes, packaging, total THC definitions, and regulatory audits.

The advisory committee must also decide whether to use private labs or state labs to test cannabis purity and potency. Kahn recommended requiring all lab results to be made public and shared with state agencies. He cautioned that privatized testing carries fraud risks, including pressure on labs to inflate THC results, and said this deception becomes easier to trace when labs share data with the state and results are public.

Establishing an accredited lab from scratch could take around a year and a half, Kahn said, though existing hemp labs might be willing to expand into cannabis testing. In Colorado, THC potency inflation and failures to identify mold and other contaminants have led lawmakers to consider shifting testing to the Colorado Department of Public Health and Environment and having regulators collect samples from dispensaries.

Despite the advisory council's work, Dr. Larry Greenblatt, state health director and co-chair of the council, said legalization is not a foregone conclusion. The group's final recommendations, including a detailed look at lab testing, will be included in a report to the governor at the end of this year. It would then be up to the legislature to decide whether to use the information as a foundation for a cannabis market in North Carolina.

Gov. Stein has said he supports legalization for adults, but Republican lawmakers are divided. Recent attempts to legalize medical marijuana have died in the state House despite backing from Senate leaders, and neither chamber has ever voted to legalize recreational use. Virginia's Cannabis Control Authority schedules retail sales for July 1, 2027. By February 1, 2027, it plans to open conversion applications for pharmaceutical processors and industrial hemp processors or growers, along with applications for some microbusiness licenses; that is not a general opening for every retail applicant.

Clarification — September 5, 2026: This story has been updated to specify the unit used in HB 328's proposed limit and the categories covered by Virginia's early application window. Links to the official documents have been added.