A letter to California’s Assembly Committee on Business and Professions argues a proposed 10mg THC-per-package cap would eliminate 93% of beverage sales — and more than $21 million in annual tax revenue. But the bill has a longer backstory rooted in child safety, audit findings, and a statewide crackdown on unregulated hemp products.
A broad coalition of California cannabis operators, trade associations, and supply chain companies has formally opposed AB 2532, legislation authored by Assemblymember Jacqui Irwin (D-Ventura) that would cap the total THC content of cannabis beverages at 10mg per package. In a letter submitted to the Assembly Committee on Business and Professions, the group argues the measure would effectively eliminate a legal category generating $79 million in annual retail sales — but the bill’s origins stretch back years, to a state audit Irwin herself requested and a wider political battle over unregulated intoxicating hemp products flooding California’s general retail market.
The backstory: audits, ER visits, and a hemp gray market
Irwin has been focused on cannabis packaging and youth safety for several legislative cycles. She requested a state audit of cannabis packaging practices, which found that enforcement by the Department of Cannabis Control against repeat violators was inconsistent and that existing rules on what constitutes youth-appealing packaging lacked clarity. One finding from that audit stood out and appears to have directly shaped AB 2532: 100mg THC beverages — ten times what regulators consider a standard adult dose — were being sold with no built-in mechanism for a consumer to easily take a smaller amount.
Irwin also pointed to rising calls to California Poison Control Centers and increases in emergency room visits involving children who had ingested cannabis products, arguing those incidents weren’t coming exclusively from the illicit market. That framing was disputed during legislative hearings: researchers noted that some of the steepest increases in poison control calls came after 2019, when hemp was descheduled at the federal level and intoxicating hemp-derived products proliferated in mainstream retail — and that distinguishing legal-market from illegal-market incidents in those statistics is difficult.
Context: Irwin’s previous cannabis bill, AB 762, originally proposed banning all-in-one cannabis vaping devices. The industry fought it and secured amendments removing vapes from the bill’s scope. That precedent — broad legislation followed by industry negotiation — is likely informing both sides’ strategies on AB 2532.
The bill also arrives amid an aggressive statewide crackdown on the intoxicating hemp gray market. Governor Newsom issued emergency regulations in September 2024 requiring hemp food and beverage products to contain no detectable THC per serving, and he set a minimum purchase age of 21. The state conducted nearly 15,000 business inspections and removed thousands of illegal products from shelves. That enforcement push culminated in AB 8, which mandated that all intoxicating hemp-derived products transition out of general retail and into licensed cannabis dispensaries, primarily in beverage format. The irony now raised by the industry coalition: the state just directed those products into the regulated beverage category, and AB 2532 would eliminate that category before the transition is complete.
What the bill would do — and what the industry says it would cost
Products containing more than 10mg of THC currently account for 93% of all cannabis beverage sales in California dispensaries. The 100mg format alone represents $66 million — roughly 84% of total category revenue. A 10mg cap, the signatories contend, would reduce the viable market to approximately $5 million, making the economics of maintaining a beverage supply chain untenable for most operators.
The coalition breaks down the fiscal impact in detail: the lost $74 million in sales would translate to roughly $12 million in foregone state cannabis excise tax, $6 million in state sales tax, and $3 million in state income tax — a combined state-level loss of approximately $21 million annually, before accounting for local cannabis taxes that often run 5–10% or higher. This comes at a moment when total California cannabis tax revenue declined approximately 7% year-over-year in 2025, according to CDTFA data, while the beverage category grew an estimated 5–10% over the same period.
“Beverages grew an estimated 5–10% over the same period, one of the only functioning growth engines in the legal market.”
The illicit market concern — and why beverages are different
Opponents of the bill make an unusual argument when it comes to illicit market dynamics: unlike flower or edibles, cannabis beverages are structurally impossible to replicate outside the licensed supply chain. The category requires sophisticated manufacturing, cold chain logistics, and licensed retail distribution. While more than half of all cannabis flower consumed in California is purchased outside the licensed market, the coalition argues that beverages have zero illicit leakage. Eliminating the one category the state captures entirely within its taxed system, they contend, runs counter to every stated goal of cannabis regulation.
A safety record and an unresolved tension
The coalition points to five years of adverse event data in the FDA’s CAERS database showing zero instances of adverse events involving children from licensed cannabis beverages, a safety record they argue is unmatched by any other cannabis product category. They contend that the child safety concerns cited in support of AB 2532 are products of the illicit and hemp-derived gray market, not of licensed operators, and that the bill would penalize compliant businesses while leaving non-compliant actors untouched.
Irwin and her allies point to Poison Control data and audit findings suggesting the legal market isn’t entirely blameless, while the industry argues those incidents can’t be cleanly attributed to licensed products and that the regulatory infrastructure already in place, mandatory dispensary consultations, third-party lab testing, child-resistant packaging, and age verification, provides multiple layers of consumer protection that general retail never had.
What they’re proposing instead
Rather than a blanket dosage cap, the signatories put forward a set of alternatives: standardized per-serving THC disclosure requirements with minimum font size standards; uniform warning label mandates clearly indicating multi-dose formats; consistent child-resistant packaging standards across all manufacturers; restrictions on single-serve marketing language; and a funded statewide consumer education campaign modeled on alcohol responsibility programs.
The letter was addressed to Chair Marc Berman and members of the Assembly Committee on Business and Professions, with a copy to Assemblymember Irwin. The signatories close by requesting a direct meeting with committee staff to discuss alternatives, echoing the same strategy that secured amendments to Irwin’s earlier vaping bill. Whether it works a second time may hinge on how willing the legislator is to treat the beverage category as meaningfully different from the packaging and potency concerns that originally motivated her focus on this space.