South Dakota Tightens Cannabis Regulations: Governor Noem Signs Landmark Bills Impacting Medical Cannabis Businesses and Hemp Products

This week, South Dakota Governor Kristi Noem, a member of the Republican Party, enacted two significant pieces of legislation targeting the cannabis industry within the state. These new laws, focusing on medical cannabis operations and the regulation of hemp-derived products, mark a pivotal moment in South Dakota's approach to cannabis regulation.

Governor Noem, on Monday, ratified a pivotal bill that effectively repeals restrictions previously preventing law enforcement and various government bodies from conducting searches, seizures, prosecutions, or imposing disciplinary measures on businesses within the state's medical cannabis sector.

This legislation, which garnered substantial support in the legislative process, passing the Senate with a vote of 26-7 in January and the House with a vote of 59-10 the following month, is set to be implemented starting July 1. The law modifies protections that were originally put in place by a voter-endorsed law in 2022, aimed at safeguarding dispensaries, cultivators, manufacturers, and testing laboratories within the state.

The subsequent day, Governor Noem approved another law, this time focusing on the hemp industry. This new legislation strictly prohibits the chemical alteration or conversion of industrial hemp into intoxicating substances. Specifically, it outlaws the sale or distribution of hemp products that have been chemically modified or converted, targeting the conversion of CBD into psychoactive compounds such as delta-8 THC, delta-9 THC, delta-10 THC, or any other THC isomer, analog, or derivative.

This measure received overwhelming support from lawmakers, passing the House unanimously in January and securing near-unanimous approval in the Senate, with only Republican Majority Whip Ryan Maher opposing.

The implications of this legislation are significant, introducing penalties for violations that include up to a year in jail, fines up to $2,000, or both. This move by Governor Noem and the South Dakota legislature reflects a stringent stance on the regulation of hemp-derived products, aiming to curb the availability of intoxicating substances derived from hemp, while also tightening oversight on medical cannabis businesses in the state.