Nebraska

Nebraska is one of the country’s more paradoxical hemp beverage markets — a state where statute remains genuinely permissive but the Attorney General has built one of the country’s most aggressive enforcement campaigns against intoxicating hemp retailers. The Nebraska Hemp Farming Act (LB 657, 2019), signed by then-Gov. Pete Ricketts on May 30, 2019 and codified at Neb. Rev. Stat. §§2-501 to 2-518, mirrors the federal Farm Bill’s 0.3% delta-9 dry-weight standard and includes the sweeping ‘all derivatives, extracts, cannabinoids, isomers, acids, salts, and salts of isomers’ language that hemp retailers have read as covering delta-8, delta-10, HHC, and other derivatives. Nebraska imposes no state-level milligram cap on hemp beverages, no state-level 21+ age requirement, and no separate hemp retail license. Approximately 300-355 THC storefronts operate statewide, generating an estimated $10 million+ in annual sales tax revenue per State Sen. John Cavanaugh’s testimony. Into that permissive framework, AG Mike Hilgers has built a consumer-protection enforcement campaign of unusual scale. Since 2023, Hilgers’ office has issued over 200 cease-and-desist letters, filed at least 16 lawsuits, and pursued civil penalties up to $4,000 per individual sale. The AG’s theory: lab testing shows many hemp-derived intoxicating products exceed the 0.3% delta-9 threshold and therefore qualify as unlawful ‘marijuana’ under Neb. Rev. Stat. §28-401, and mislabeled potency and identity claims are separately actionable under the Nebraska Consumer Protection Act, Uniform Deceptive Trade Practices Act, and Pure Food Act. The AG has stated that lab testing showed roughly 90% of sampled products were mislabeled on cannabinoid content. In August 2025, the AG expanded upstream by suing California-based manufacturer Savage Enterprises, seeking $2,000 per violation and extending liability to distributors. The Nebraska Legislature has tried to formalize what the AG has been doing via enforcement. LB 316 (introduced by Omaha Sen. Kathleen Kauth, prioritized by David City Sen. Jared Storm) would redefine hemp using a total-THC standard, prohibit raw hemp above 0.3% total THC and processed hemp above the lesser of 0.3% total THC by weight or 10mg per package, impose a 10% excise tax on remaining legal CBD products, and provide a consumer ‘safe harbor’ period through the end of 2025. LB 316 advanced first-round 32-15 in May 2025 but was passed over on final reading on May 30, 2025 when Kauth withdrew after failing to secure 33 cloture votes — Sen. Ben Hansen (R-Blair), a critical vote, withheld support without an amendment to protect Nebraska’s voter-approved medical cannabis program. LB 316 carried over to the 2026 session (109th Legislature, 2nd session). It advanced first-round 33-13 in a cloture vote in February 2026, but the 2026 session ended sine die on April 17, 2026 without final passage. Sen. Kauth has indicated intent to continue in a future session. Meanwhile, Gov. Jim Pillen signed an executive order on January 27, 2026 directing the Nebraska Department of Agriculture, Department of Banking and Finance, and Department of Revenue to review applicable statutory authority for restricting synthetic THC products for human consumption. Nebraska voters approved medical cannabis via Initiatives 437 and 438 in November 2024, and Gov. Pillen certified the results December 12, 2024 (creating the Nebraska Medical Cannabis Regulation Act and Nebraska Medical Cannabis Commission, administered within the Liquor Control Commission). The Commission finalized licensing regulations in April 2026 and lawmakers passed the state’s first medical-cannabis bill (46-2) authorizing application fees and background checks. No operating dispensaries yet as of July 2026. For the federal cliff on November 12, 2026, Nebraska is one of the most exposed markets: no state-level Section 781 pre-alignment on potency, an active AG enforcement environment that will accelerate under federal cover, and a growing but still-pre-launch medical program. Section 781 will federally validate what Hilgers has been doing through consumer-protection theory, and expect LB 316 or a successor to advance more easily in the 2027 session as the federal ceiling provides political air cover for state action. Nebraska’s post-cliff market will contract sharply.