Congressional Update

Last week, Reps. Andy Barr (R-KY) and Angie Craig (D-MN) introduced the bipartisan Lawful Hemp Protection Act, comprehensive legislation intended to preserve lawful hemp commerce while establishing a federal regulatory framework for hemp-derived consumer products.

The bill represents a true alternative to the federal hemp restrictions enacted in the fiscal year 2026 agriculture appropriations law, which are currently scheduled to take effect in November. Rather than prohibiting hemp-derived products outright, the legislation would establish federal standards governing product composition, labeling, packaging, age verification, manufacturing, distribution, taxation, and interstate commerce. Most importantly, the bill would replace the 0.4 milligram total THC-per-container standard scheduled to take effect in November. It would instead direct FDA to establish science-based serving limits through notice-and-comment rulemaking. If FDA does not complete that process within one year, statutory limits would take effect at:

• 5 milligrams of THC per serving for ingestible products;
• 50 milligrams of THC per serving for inhalable products; and
• 50 milligrams of THC per serving for topical products.

The Lawful Hemp Protection Act would establish a federal regulatory pathway for lawful hemp-derived consumable products, including national standards for labeling, packaging, testing, product quality, age verification, and restrictions on synthetic or artificially modified cannabinoids. It would require covered products to be cultivated, processed, manufactured, packaged, and labeled in the United States, create a federal TTB permitting and oversight structure for manufacturers and hemp-derived beverage wholesalers, establish a three-tier distribution system for hemp-derived beverages, and impose new excise taxes on both beverages and other cannabinoid products. The bill would also preserve interstate transportation of compliant products, allow states, territories, and Tribes to adopt more stringent requirements, and permit certain hemp-derived cannabinoid products to be offered as supplemental benefits under Medicare Advantage plans. Overall, the proposal represents a significant regulatory alternative to the prohibition-oriented framework scheduled to take effect in November, although its tax structure, domestic sourcing requirements, distribution rules, and treatment of specific cannabinoids would require careful company-specific review.

Also, last week, Rep. Harriet Hageman (R-WY) has introduced a resolution, H.J. Res. 202, aimed at repealing a 2009 greenhouse gas waiver that allowed California to set stricter vehicle emissions standards. This legislative action is part of a broader effort by the Trump administration and congressional Republicans to use the Congressional Review Act (CRA) to dismantle federal waivers that grant California the authority to establish air pollution rules often adopted by other states. This follows a pattern from the previous year, when Congress repealed Biden-era waivers that Republicans characterized as an electric vehicle mandate. The current push targets a second batch of four waivers recently sent to Congress by the EPA. These include mandates for Advanced Clean Cars I, which set requirements through model year 2025, and a rule regarding the electrification of non-road engines, such as lawn equipment. While the California rules technically only apply through 2025, critics argue they effectively create a national standard because the EPA has revoked all federal greenhouse gas rules for vehicles.

Hageman, who is running for the Senate, frames the move as a way for the 119th Congress to reclaim its Article I authority over the “administrative state” and stop “climate lunacy”. California is currently legally contesting the CRA resolutions signed last year, as well as the EPA’s recent transmission of the four additional waivers. A key legal point of contention is the Trump administration’s assertion that actions taken under the CRA are not reviewable by the courts.

Meanwhile, Speaker Mike Johnson (R-LA) and the House Republican Conference achieved a significant legislative trifecta just before the August recess, passing three major pieces of legislation: the FY2027 National Defense Authorization Act (NDAA), a $95-billion budget resolution, and a quasi-ban on stock trading for members of Congress. The budget resolution is particularly noteworthy as it creates a path for Republicans to pursue a third reconciliation bill. Despite the narrow GOP majority, these victories were secured through a combination of leadership maneuvering and, in some cases, critical support from across the aisle. The passage of the NDAA and the budget resolution involved close collaboration between the House GOP leadership and the White House’s legislative affairs team. The NDAA passed with a slim 216-212 margin, requiring six Democratic votes to offset seven Republican defections. Notably, Rep. Anna Paulina Luna (R-FL) maintained her “no” vote on the defense package even after leadership agreed to her demand of including the SAVE America Act. The bill to restrict congressional stock trading passed more easily (232-198) with the support of 13 Democrats, even though the legislation was paired with a voter ID mandate for federal elections. While this bill allows lawmakers to sell equities if they provide advance notice to House authorities, its future is uncertain; the Senate currently shows little interest in the measure, and the House has not yet moved to implement these restrictions through its own internal rules. Many of the Democrats who crossed party lines to support this high-profile bill are currently facing competitive reelection bids or are running for higher office.

Senate Majority Leader John Thune (R-SD) announced on Tuesday his intention to bring a short-term stopgap funding bill to the Senate floor for a vote before the upcoming August recess. While the House is already in recess the Senate has one more week ending on the 31^st. Senate Appropriations Chair Susan Collins (R-ME) is currently leading negotiations with Democrats to establish a bipartisan deal that would keep the government funded until after the November election. Thune noted that the Senate’s version of the stopgap is the more likely legislative vehicle because it incorporates “spending anomalies” requested by the White House, which were excluded from the House’s Republican-crafted version. While expressing hope for a bipartisan resolution, Thune warned that Republicans are prepared to pursue a party-line spending bill via the reconciliation process if a deal cannot be reached. This strategy involves using a House budget resolution to fund the government and has received support from conservative members like Sen. Rick Scott (R-FL), who view it as a necessary backup to meet the September 30 funding deadline. Thune emphasized that while reconciliation remains a possibility, if necessary, he would prefer to avoid that route.

Looking ahead, Freshman Senator Dave McCormick (R-PA) is positioned to potentially lead Republicans on the Senate Energy and Natural Resources Committee next year. This leadership opportunity arises from a domino effect triggered by the death of Sen. Lindsey Graham, which may lead the current chair, Mike Lee (R-UT), to move to the Judiciary Committee. Although other Republicans have more seniority, they are either ineligible or expected to remain in their current leadership roles, clearing a path for McCormick’s remarkable rise. McCormick’s leadership would represent a significant shift for the committee, as he would be the first top Republican from an East Coast state in decades. Unlike his predecessors from Western states who focused heavily on public lands and national monuments, McCormick is expected to prioritize energy production.