On Friday, December 19, 2025, Ohio Governor Mike DeWine officially signed Senate Bill 56 into law, delivering a huge blow to the state’s hemp industry and fundamentally altering the recreational cannabis framework approved by voters.
While the signing of the bill was anticipated following its passage through the legislature, Governor DeWine added a final twist by issuing a line-item veto that accelerated the ban on specific products. This legislation has once again reignited the battle between state officials and cannabis advocates in Ohio, prompting an immediate launch of a citizen referendum effort to block the law from taking effect.
For those who have followed the trajectory of Ohio’s legal cannabis market, this signing is the culmination of a long-standing desire by the administration to tighten control over a market they believe is too loose.
However, for advocates and industry stakeholders, this is viewed as a direct defiance of the 57% of Ohio voters who passed Issue 2. The new law does not merely tweak regulations; it overhauls the landscape by banning “intoxicating” hemp products outside of licensed dispensaries, capping the number of dispensaries statewide, and re-introducing criminal penalties for consumers regarding how they transport their legally purchased products.
The Line-Item Veto: Accelerating the Ban on THC Beverages
The version of Senate Bill 56 that reached the Governors desk included a “grace period” provision that would have allowed the sale of THC-infused beverages—often sold in liquor stores or specialized hemp retailers—to continue until the end of 2026. This provision was originally intended to give businesses time to transition or sell off inventory while federal regulations were clarified.
Governor DeWine struck that provision down with his pen. In his veto message, he argued that allowing these products to remain on shelves for another year would create “confusion” and “lack of conformity” with federal law. By vetoing this grace period, the Governor effectively ensured that the ban on these beverages will begin when the rest of the law takes effect in 90 days, rather than offering a year-long runway.
This leaves manufacturers and retailers of THC seltzers and sodas scrambling to liquidate inventory, with many facing the prospect of immediate closure or drastic business model pivots in just three months.
Line Item Veto: Disqualifying Offenses
Another significant component of the recent legislative actions was the Governor’s use of a line item veto to address the list of disqualifying offenses.
Originally, the proposed legislation contained specific stipulations that outlined offenses which would disqualify individuals from participating in the cannabis industry.
However, the Governor’s veto removed these restrictions, arguing that they could impose unnecessary barriers to entry and limit opportunities for rehabilitation and equitable participation.
This is likely to significantly impact the industry by giving individuals with prior convictions—excluding certain serious offenses—a second chance to participate in Ohio’s legal cannabis market.
A “Purge” of the Hemp Industry
The core of Senate Bill 56 is its aggressive stance on what the state terms “intoxicating hemp products.” The new law bans gas stations, convenience stores, and dedicated CBD shops from selling products containing Delta-8 THC or other hemp-derived cannabinoids that exceed 0.4 milligrams of total THC per container. Instead, the state’s licensed marijuana dispensary system must handle all sales of these products exclusively.
This effectively wipes out a massive segment of the independent hemp market in Ohio. Small business owners, who have operated legally under the 2018 Farm Bill provisions, now face a reality where their primary revenue streams are illegal.
The legislation frames this as a public safety measure to prevent access to children, but critics argue it is a regulatory capture that hands a monopoly on all THC products to a limited number of licensed marijuana operators while decimating small businesses that have been serving adult consumers for years.
Altering the Voter-Approved Cannabis Market
Beyond the hemp ban, Senate Bill 56 makes substantive and restrictive changes to the adult-use marijuana program that voters approved in 2023. The bill introduces potency caps that were not present in the original citizen initiative.
Moving forward, adult-use marijuana extracts will be capped at 70% THC, a reduction from the 90% previously allowed, while flower potency will be capped at 35%. These arbitrary limits restrict consumer choice and may inadvertently fuel the illicit market for those seeking higher-potency products that are no longer available legally.
Furthermore, the bill re-introduces elements of criminalization that legalization advocates fought to remove. The new law mandates that marijuana must be transported in its “original, unopened packaging” or stored in the trunk of a vehicle.
This creates a legal trap for consumers; if you simply have a legally purchased joint in your pocket while driving, you could now be committing a crime.
Additionally, the bill prohibits bringing legally purchased marijuana from another state back into Ohio, further tightening the net around consumers. The state has also placed a hard cap of 400 on the number of dispensaries allowed statewide, artificially limiting the market’s growth and accessibility.
Ohioans for Cannabis Choice Launches Referendum
In response to the Governor’s signature, cannabis advocates are not going quietly. On the same day the Governor signed the bill, a group called Ohioans for Cannabis Choice officially launched a referendum effort to repeal the legislation. The group has already filed its initial petition with the Ohio Attorney General and Secretary of State.
The goal of the referendum is to prevent Senate Bill 56 from taking effect. To succeed, the group must collect approximately 250,000 valid signatures from registered voters across 44 of Ohio’s 88 counties.
They must submit these signatures by mid-March, before the 90-day effective date of the new law kicks in. Successful signature collection will stall the law until voters decide its fate at the ballot box in November 2026.
Dennis Willard, a spokesperson for Ohioans for Cannabis Choice, stated that the bill “forcefully defies the will of the voters of Ohio” and framed the referendum as a necessary check on government overreach.
The group argues that the legislature has ignored the clear mandate of Issue 2 and is attempting to dismantle the free market that voters chose. While the Ohio Cannabis Coalition (representing licensed dispensaries) supports the bill for “closing loopholes,” the referendum effort highlights the deep divide between corporate cannabis interests and the broader coalition of consumers and independent hemp operators.
The Clock is Ticking
The signing of Ohio Senate Bill 56 marks an important and contentious moment in Ohio’s cannabis history. With the 90-day countdown clock now running, the state is bracing for a chaotic transition. Retailers are preparing to pull products, consumers are facing new restrictions, and advocates are gearing up for a frantic signature-gathering campaign during the winter months.
The outcome of the referendum effort will determine whether Ohioans will live under the restrictive rules signed by Governor DeWine or if the voters will once again assert their authority over the state’s cannabis laws.
