HB 328: The Bill That Could Destroy North Carolina’s Hemp Industry

North Carolina’s hemp industry is at a critical crossroads. In 2022, the state made hemp permanently legal under Senate Bill 455, aligning with federal law and paving the way for an industry that now supports over 20,000 jobs and contributes more than $1 billion in economic activity. But now, HB 328 threatens to erase that progress almost overnight.

Behind the veneer of regulation, HB 328 proposes aggressive, industry-dismantling changes that would disproportionately affect small businesses, local retailers, processors, and consumers who rely on safe, legal hemp-derived products. The bill, in its Senate PCS (Proposed Committee Substitute) form, is not a safety bill. It is a targeted strike against the heart of the hemp economy.

Understanding HB 328’s Harmful Provisions

At first glance, HB 328 appears to be a consumer protection bill. But a closer look reveals troubling provisions that would undermine the viability of legal hemp in North Carolina:

Cannabinoid Ban: HB 328 bans all cannabinoids except for Delta-9 THC, even non-psychoactive compounds like CBD. This is a direct contradiction of the federal definition of hemp and would eliminate many therapeutic products that consumers depend on.
Potency Caps: The bill caps edibles at just 10mg of Delta-9 THC per serving. For comparison, most popular hemp-derived gummies on the national market range from 25 to 50mg per serving. These caps would force companies to reformulate or exit the North Carolina market entirely.
Vape Restrictions: It also limits vape cartridges to 3ml total Delta-9 THC—an unrealistic threshold that, from a manufacturing standpoint, is virtually unworkable.
Exorbitant Licensing Fees: HB 328 requires a $25,000 license fee for manufacturers and $500 per retail location with no cap. These costs are far beyond the reach of small operators and would create massive entry barriers that favor large out-of-state corporations.
Criminal Penalties: The bill authorizes criminal charges—including Class H felonies—for unlicensed sales. It also imposes escalating fines and empowers the Alcohol Law Enforcement Division (ALE) to revoke licenses and issue penalties of up to $7,500 per violation.

These are not minor adjustments. These are measures designed to constrict the industry, cut out competition, and centralize the hemp market into the hands of a few.

The False Narrative of “Protecting Youth”

A major talking point from HB 328 supporters is the need to prevent youth access to intoxicating hemp products. That’s a shared goal across the industry. Responsible manufacturers and retailers already implement 21+ restrictions, online age verification, and compliant packaging.

The truth is, HB 328’s language goes far beyond youth protection. It criminalizes possession of hemp products on school grounds, authorizing Class A1 misdemeanors. This adds to the enforcement burden on school resource officers and places young adults at risk of criminal records for carrying federally legal products.

Instead of reasonable enforcement, HB 328 proposes over-policing, harsh penalties, and reactive rules that hurt consumers as much as businesses.

Economic Fallout: Who Pays the Price?

If HB 328 passes in its current form, the consequences will be swift and far-reaching:

Small manufacturers and processors—especially in rural areas—will be forced to close their doors due to unaffordable license fees and per-batch testing costs.
Retailers with multiple storefronts will face thousands in recurring licensing fees with no cost ceiling.
Consumers will lose access to wellness products like full-spectrum CBD, CBG, CBN, and non-psychoactive blends.
The illicit market will grow as consumers seek out higher-potency or affordable alternatives elsewhere.

The state’s own enforcement bodies will be forced to divert resources to monitor a rapidly shrinking market while consumers turn to unregulated sources.

SB 265: The Smarter Alternative

If the legislature truly wants to regulate hemp for safety, Senate Bill 265 offers a more balanced approach. Here’s how:

Sets a 21+ age restriction, aligned with national efforts to protect minors
Implements robust batch testing, using ISO-17025 or DEA-registered labs for consistency and transparency
Sets lower licensing costs ($15,000 or just $1,000 for small businesses) and caps retail fees at $5,000 total
Establishes product caps that are firm but not debilitating—allowing the industry to remain competitive

SB 265 addresses the core safety issues without compromising economic viability. It supports public health, protects minors, and gives law enforcement defined responsibilities. Most importantly, it does so without handing the entire industry to out-of-state conglomerates.

SB 328: The Clean Age Restriction Bill

There is another bill on the table: SB 328, passed in a revised form by the House, which focuses solely on restricting sales of hemp-derived consumable products to those 21 and older. That’s it. No bans. No licensing hikes. No backdoor prohibition.

SB 328 is a clean, bipartisan solution that meets public health goals without harming businesses or consumers.

A Confusing Numbers Game

It’s important to note the intentional confusion surrounding these bill numbers. HB 328 and SB 328 may share the same numeric designation, but they are worlds apart. One is an industry ban wrapped in bureaucratic language; the other is a common-sense safety bill.

The distinction cannot be overstated. Voters, consumers, and business owners must understand this difference to ensure their advocacy is correctly directed.

Call to Action: Make Your Voice Heard

The hemp industry showed up in Raleigh. Now, it’s your turn.

Call your House and Senate representatives. Let them know you oppose HB 328 and support SB 328 and SB 265. Encourage them to protect local businesses and consumer access to legal, tested hemp products.

Here’s how to get involved:

Visit your representative’s website and submit a comment
Call their office and voice your concerns
Share educational content online and with your community

Every voice matters. Silence allows harmful legislation to pass unchecked.

Conclusion

HB 328 does not reflect the values of North Carolina’s hemp farmers, processors, retailers, or responsible consumers. It is a bill written for corporations—not communities. If passed, it will devastate small businesses, eliminate consumer choice, and unravel years of progress in the hemp sector.

We need smart regulation. We need policies that protect—not punish. And we need to speak up now, before it’s too late.

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