By Christine Lafferty

Colorado is faced with the largest budget deficit in recent memory — calculated to be a $1.5 billion hole according to the state’s Joint Budget Committee. Legislators have been scrambling to address this gap, which signals massive cuts to important state services such as education, climate management, and health care. It’s time for legislators to get creative to address this funding crisis.

One idea was to tax alcohol and cannabis to fund mental health services — an idea that Legislators recently voted down. Cannabis already carries one of the steepest tax rates on any consumer product in Colorado, some 10 to 15 times higher than beer on a per-unit basis. Meanwhile, alcohol sales are down nationwide. An industry already carrying a heavy tax burden, and another facing a shrinking revenue base, hardly has the short- or long-term resources to address Colorado’s budget woes reliably.

But there’s another option on the table, one backed by an industry that is actively raising its hand to help.

Colorado’s hemp beverage industry is volunteering to be taxed and can deliver more than $50 million in new annual revenue to the state.

Unlike other types of cannabis, Colorado’s low-dose hemp drinks are currently taxed at a paltry 2.9%. A bill to be introduced soon at the Capitol proposes raising this rate to 20%. This bill provides a sensible statewide regulatory structure — overseen by Colorado’s Department of Health and also the Liquor Enforcement Division — and will allow 21-plus Coloradans to purchase low-dose THC drinks where alcohol is currently sold. This bill addresses the growing consumer demand for a healthier drinking option for adults while generating meaningful new revenue in a challenging time.

Most of us don’t want to pay more in taxes. I get that. I also know firsthand how hard it can be to thrive in Colorado’s cannabis industry. I’ve spent years trying to find my footing as a woman entrepreneur building a business at the intersection of science and agriculture. In part due to rising demand for low-dose THC beverages, my company, EVG Extracts, has been able to employ more than 40 people in farming and manufacturing on Colorado’s Eastern Plains.

Low-dose, hemp-derived THC drinks including seltzers, teas, and single-serving shots, are currently sold in bars, restaurants, and retail establishments in 37 states. National sales topped $1 billion in 2024, and the market continues to grow quickly, even as beer, wine, and spirits sales decline. Yet, Colorado currently taxes hemp beverages at just 2.9%, the same rate as for an energy drink or a bottle of water.

Sponsored by state Sen. Julie Gonzales and Reps. Matt Martinez and Steven Woodrow, the Regulation of Lawful THC Beverages bill would create a clear regulatory framework for the sale of low-dose hemp beverages, defined as up to 10 milligrams of THC per serving to adults 21 and over in licensed venues where alcohol is already legally sold, including bars, restaurants, music venues, and liquor stores.

Colorado is facing real budget pressure, and the options keep getting harder: cut Medicaid, shrink the workforce, or defer the problem to next year and do it all again. Or listen to the industry that’s already saying yes.

The Regulation of Lawful THC Beverages bill is a practical, revenue-generating solution that modernizes an outdated regulatory gap, protects consumers, and puts new money into services Coloradans depend on, without burdening industries already stretched thin.

I’m asking Colorado legislators to support this bill. And I’m asking fellow business owners, hospitality operators, hemp farmers, and community members to make their voices heard. Testimony and stakeholder support matter at this stage of the process. Colorado has a hole in its budget. The THC beverage industry is offering to pour fresh revenue into it.

Christine Lafferty is co-owner of EVG Extracts, an Arvada -based hemp and THC beverage company, and a member of the Colorado THC Beverage Coalition.