Virginia's hemp crackdown begins

Hemp businesses are beginning to flee Virginia as enforcement ramps up on synthetic THC products.

What's happening: At least two Richmond-based shops shut down last month, announcing plans to move to states with less restrictive laws.

• Meanwhile, newly empowered state regulators began assessing thousands of dollars in fines to stores that have continued selling edible THC products.

Why it matters: Efforts to crack down on the businesses have been controversial and closely watched.

• Some saw the shops as a welcome option to purchase THC products after legalization efforts stalled out. Others worried they raised consumer safety and public health concerns.

State of play: Hemp laws in the state for years offered a loophole for the public sale of THC, but as of July 1, the amount of THC in those products is strictly regulated.

The latest: State regulators assessed fines ranging from $13,000 to $97,500 last month to five businesses that have continued selling the products, the Virginia Mercury reports.

• Infractions ranged from violations of new THC limits to labels that looked too much like big-name snack and cereal brands.

Of note: So far, enforcement has been limited to southwest and northern Virginia localities, and THC products are still widely available in Richmond-area shops.

• The state's ongoing budget standoff has put plans to hire 15 new inspectors to enforce the rules on hold, per the Mercury.

So far only a handful of shops that sell the products have closed.

• Richmond BizSense reported last month that Kultivate Wellness shut down its Short Pump store amid an expansion to North Carolina.
• And Old Manchester Hemp Company closed its Hull Street shop and is seeking a new location in D.C., where it plans to capitalize on new legislation decriminalizing psychedelic mushrooms, per BizSense.

What we're watching: Felony charges are still pending against the owner of Happy Trees, a Richmond chain of marijuana grow-supply shops accused of hosting marijuana pop-up markets at its warehouse.

• The shop had required vendors to pledge that they were only selling hemp products, per court records.
• A trial had been set for the end of last month but was continued until February after the defendants argued it would take months to arrange third-party lab testing of the more than 150 pounds of plant material seized.