Colorado's Hemp THC Beverage Bill Died — Here's Why It Matters

A Bill That Never Got Its Hearing

Colorado has long been the laboratory of American cannabis policy. The first state to open recreational dispensaries in 2014, it has spent over a decade building what many consider the most mature cannabis regulatory framework in the country. So when Senate Bill 164 — a proposal that would have allowed hemp-derived THC beverages to be sold in bars, restaurants, and grocery stores — was pulled by its sponsor before even receiving a committee hearing, the industry took notice.

Senator Julie Gonzales withdrew the bill in late April 2026 after concluding it lacked the votes to advance. Her assessment was blunt: the problem wasn't interest, expertise, or public demand. It was political will. The failure of SB 164 reveals a tangle of competing interests, shifting federal policy, and unresolved tensions between the cannabis and hemp industries that extend well beyond Colorado's borders.

What the Bill Would Have Done

SB 164 was designed to create a legal pathway for hemp-derived THC beverages — drinks containing THC extracted from hemp rather than marijuana — to be sold outside the traditional dispensary system. Under the proposal, THC beverages would have been available wherever alcohol is legally served: bars, restaurants, taprooms, grocery stores, and convenience stores.

The bill would have set a 10-milligram THC cap per serving, established labeling and packaging requirements through the Colorado Department of Public Health and Environment, and created a licensing framework for manufacturers and retailers. The vision was straightforward: treat low-dose THC beverages similarly to beer and wine, making them accessible to consumers in familiar social settings.

For the hemp industry, SB 164 represented a lifeline. Hemp-derived THC products have existed in a legal gray area since the 2018 Farm Bill, which legalized hemp and its derivatives at the federal level but left individual states to determine how — or whether — to regulate intoxicating hemp products. Colorado had already restricted certain hemp THC products, and SB 164 was designed to create a clear, regulated market for one specific product category.

Why It Failed: The Three-Front War

The bill's collapse can be attributed to pressures from three directions, each representing a powerful constituency with different interests and concerns.

The licensed marijuana industry was the most vocal opposition. Colorado's cannabis dispensaries have invested billions of dollars in licenses, compliance infrastructure, and retail operations built within a heavily regulated framework. From their perspective, allowing hemp THC beverages in bars and grocery stores amounted to creating a parallel market that could undercut their businesses without requiring the same regulatory overhead.

The concern isn't abstract. In states where hemp THC products are loosely regulated, dispensaries have watched convenience stores and gas stations sell intoxicating products at lower prices, drawing customers away from licensed retailers. Colorado's marijuana operators argued that SB 164 would legitimize exactly this kind of competition without ensuring a level regulatory playing field.

Federal developments added a second layer of complexity. Congress passed legislation last year banning the majority of hemp-derived intoxicating products nationwide, with implementation expected to begin in November 2026. Legislators weighing SB 164 faced an awkward question: why create a state-level regulatory framework for a product category that the federal government was about to restrict? The looming federal ban undermined the bill's urgency and gave fence-sitting legislators a convenient reason to wait.

The third pressure point was public health advocacy. While THC beverages are generally considered lower-risk than many other cannabis products, public health groups raised concerns about product accessibility, particularly regarding youth access if THC drinks were available in the same retail environments as alcohol. The lack of established regulatory precedent for selling THC products outside the dispensary model gave health advocates ammunition to argue that more study and deliberation were needed.

The Bigger Picture: Hemp vs. Marijuana

SB 164's failure is a microcosm of a larger, industry-wide conflict between the hemp and marijuana sectors. The two industries share a plant but operate under fundamentally different regulatory frameworks, and the tensions between them have been building for years.

When Congress legalized hemp in 2018, it defined the plant as cannabis containing less than 0.3 percent THC by dry weight. What legislators apparently didn't anticipate was that this definition created a legal pathway for producing intoxicating products from hemp — particularly through the extraction and concentration of delta-8 THC, delta-9 THC (within the 0.3 percent threshold on a dry-weight basis), and other cannabinoids.

The result was a boom in hemp-derived THC products that could be sold without the licensing, testing, and compliance requirements that govern marijuana businesses. From the marijuana industry's perspective, this was an existential threat — a competing market selling essentially the same intoxicating products without bearing the same regulatory costs.

Colorado's SB 164 attempted to resolve this tension by bringing hemp THC beverages into a regulated framework. The idea was that regulation would address both the marijuana industry's competitive concerns and public health advocates' safety concerns. But the politics of actually implementing that compromise proved too difficult, at least for now.

What Colorado's Failure Means for Other States

The collapse of SB 164 sends a signal to other states grappling with the same hemp-versus-marijuana tensions. Several states have been considering similar legislation to create regulated markets for hemp THC products, and Colorado's experience highlights the political difficulties of threading that needle.

States with established marijuana markets face the strongest opposition from licensed operators who view hemp THC products as competitive threats. States without legal marijuana may have an easier path, since there's no incumbent industry to protect, but they still face the complications of the impending federal ban.

The federal factor may ultimately prove decisive. If Congress follows through on restricting intoxicating hemp products, the question of state-level regulation becomes largely moot for the affected product categories. States that have already created hemp THC frameworks may need to revise them, while states that waited — like Colorado — may find that federal preemption resolves the issue before they need to act.

The Political Will Problem

Senator Gonzales's parting assessment — that the bill died from a lack of political will, not a lack of merit — points to a deeper issue in cannabis policy. Legislators have repeatedly shown a willingness to punt on cannabis questions when the political landscape is uncertain, particularly when multiple powerful constituencies are aligned in opposition for different reasons.

In Colorado's case, the marijuana industry, federal uncertainty, and public health advocacy created a coalition of convenience — groups that don't necessarily agree with each other but shared opposition to SB 164. That kind of alignment is difficult for any bill to overcome, especially one without a natural political champion or public mobilization effort.

The hemp THC beverage market won't disappear because Colorado failed to regulate it. Consumers will continue to purchase these products through whatever channels are available, whether that's online retailers, out-of-state purchases, or the informal market. The question for Colorado — and for every state facing similar dynamics — is whether policy will catch up to reality, or whether the gap between what consumers want and what regulators allow will continue to widen.

For now, Colorado's hemp THC beverage bill is dead. But the underlying tensions that created it aren't going anywhere. The next attempt — whether in Colorado or elsewhere — will face the same fundamental challenge: building a coalition strong enough to overcome the intersection of industry protectionism, federal uncertainty, and political caution.

For readers ready to take the next step, Budpedia maintains the most comprehensive cannabis dispensary directory in the United States — license-verified, with hours, menus, and real reviews for every listing across 48 legal states.