Local Government, General

Plain English Breakdown

The official source material does not provide specific details on how local governments will be funded for enforcement, leaving this as an open question.

Local Government Hemp-Derived Cannabinoid Product Regulation Act

This bill allows local governments to create boards that can issue permits and set rules for stores selling hemp-derived cannabinoid products (HDCPs), with penalties for non-compliance.

What This Bill Does

• Allows local governments to form a board by majority vote of its governing body to oversee the sale of HDCPs within their jurisdiction.
• Requires retailers to obtain a permit from the HDCP board if required by the local government, and sets an annual fee of $250 per retail location.
• Gives local law enforcement agencies the power to enforce rules set by the HDCP board and conduct inspections.
• Imposes penalties on retailers who violate the rules or operate without permits, including fines up to $1,000 and permit revocation for a year.
• Requires the HDCP board to report violations to state authorities within 30 days.

Who It Names or Affects

• Local governments that choose to create an HDCP board.
• Retailers of hemp-derived cannabinoid products in areas with local regulations.
• Law enforcement agencies in jurisdictions with HDCP boards.

Terms To Know

Hemp-Derived Cannabinoid Products (HDCPs)

Products made from the cannabis plant that contain certain cannabinoids but not THC, which is the psychoactive component of marijuana.

Local Government

An incorporated city or town, county, or metropolitan government in Tennessee.

Limits and Unknowns

• The bill does not specify how local governments will be funded to enforce these regulations.
• It is unclear what happens if a retailer refuses to comply with the rules set by the HDCP board.
• The effectiveness of enforcement and compliance mechanisms remains uncertain.

Official Summary Text

This bill authorizes

a
local government
to
create, by majority vote of its governing body, a hemp-derived cannabinoid products
(
HDCP
)
board for purposes of permitting retailers of

HDCPs within the jurisdiction of the local government.

An HDCP board may pass an ordinance or resolution

(
i
)
r
equiring
each retailer of HDCPs to obtain a permit from the board authorizing the sale of such products at each retail location of the retailer; and

(
ii
)
i
f the HDCP board requires a retailer to obtain a permit, regulating the sale of HDCPs within its jurisdiction
to the extent that such regulation does not conflict with state law or the rules of the department
of agriculture ("department")
.

This bill provides that t
he annual fee for the permit is $250 per retail location, and must be renewed annually. The HDCP
board
must
prescribe the application form for the issuance and renewal of a permit.

Upon request of an HDCP board, the department
must
issue a notice of good standing to the board for the purposes of issuing or renewing a permit to a retailer. Such notic
e may be requested and provided electronically.

This bill authorizes

t
he local law enforcement agency of a local government that has created an HDCP board
to (i) e
nforce this
bill
and any ordinance or resolution of the local government regulating HDCPs;
(
ii
)
e
nforce the rules of the department with respect to HDCP retailers under an agreement executed with the department that specifies the scope and manner of such enforcement; and

(
iii
)
c
onduct random inspections of the premises of a retailer for purposes
of enforcement within the normal business hours of a retailer.

This bill provides that

a
retailer operating without a permit, or in violation of this
bill
or the rules of the department, is subject to (
i
)
a
civil penalty of $1,000 per violation;

(
ii
)
r
e
vocation of the retailer's permit for a period of up to one year; or

(
iii
)
i
neligibility for permit renewal for up to one year after the period of revocation expires.

The HDCP board
must
notify the department of a violation of its rules by a retailer within 30

days after discovery of the violation.

This bill requires a
nnual permit fees and civil penalties owed by a retailer under this
bill to
be remitted to the office or individual ide
ntified in the ordinance of the local government as being responsible for the collection of such fees and penalties. Fees and penalties remitted under this
bill
must be deposited into the general fund of the local government and accounted for separately,
to be used for the enforcement of this
bill
.

Current Bill Text

SENATE BILL 770
By Briggs

HOUSE BILL 962
By Hawk

HB0962
002071
- 1 -

AN ACT to amend Tennessee Code Annotated, Title 39
and Title 43, Chapter 27, relative to hemp.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF TENNESSEE:
SECTION 1. Tennessee Code Annotated, Section 43-27-202, is amended by deleting
"As used in this part" and substituting "As used in this part and part 3 of this chapter".
SECTION 2. Tennessee Code Annotated, Title 43, Chapter 27, is amended by adding
the following as a new part:
43-27-301.
The requirements of this part are in addition to all other requirements of this
chapter, and must not be construed to prohibit or restrict the ability of the department to
enforce this chapter.
43-27-302.
As used in this part:
(1) "Local government" means an incorporated city or town, county, or
metropolitan government in this state; and
(2) "Retailer" means an establishment licensed pursuant to part 2 of this
chapter that sells hemp-derived cannabinoid products (HDCPs) to consumers at
retail.
43-27-303.
(a) A local government may create, by majority vote of its governing body, an
HDCP board for purposes of permitting retailers of HDCPs within the jurisdiction of the
local government.

- 2 - 002071

(b) An HDCP board formed pursuant to subsection (a) may pass an ordinance or
resolution:
(1) Requiring each retailer of HDCPs to obtain a permit from the board
authorizing the sale of such products at each retail location of the retailer; and
(2) If the HDCP board requires a retailer to obtain a permit, regulating the
sale of HDCPs within its jurisdiction to the extent that such regulation does not
conflict with state law or the rules or regulations of the department.
(c) The annual fee for the permit is two hundred fifty dollars ($250) per retail
location, and must be renewed annually. The HDCP board shall prescribe the
application form for the issuance and renewal of a permit.
(d) Upon request of an HDCP board, the department shall issue a notice of good
standing to the board for the purposes of issuing or renewing a permit to a retailer under
this section. Such notice may be requested and provided electronically.
43-27-304.
(a) The local law enforcement agency of a local government that has created an
HDCP board may:
(1) Enforce this chapter and any ordinance or resolution of the local
government regulating HDCPs;
(2) Enforce the rules and regulations of the department with respect to
HDCP retailers under an agreement executed with the department that specifies
the scope and manner of such enforcement; and
(3) Conduct random inspections of the premises of a retailer for purposes
of enforcement within the normal business hours of a retailer.

- 3 - 002071

(b) A retailer operating without a permit required under § 43-27-303, or that is in
violation of this chapter or the rules or regulations of the department, is subject to one (1)
or all of the following:
(1) A civil penalty of one thousand dollars ($1,000) per violation;
(2) Revocation of the retailer's permit for a period of up to one (1) year; or
(3) Ineligibility for permit renewal for up to one (1) year after the period of
revocation under subdivision (b)(2) expires.
(c) The HDCP board shall notify the department of a violation of its rules and
regulations by a retailer within thirty (30) days after discovery of the violation.
43-27-305.
Annual permit fees and civil penalties owed by a retailer under this part must be
remitted to the office or individual identified in the ordinance of the local government as
being responsible for the collection of such fees and penalties. Fees and penalties
remitted under this section must be deposited into the general fund of the local
government and accounted for separately, to be used for the enforcement of this part.
SECTION 3. This act takes effect July 1, 2025, the public welfare requiring it.