The Montana Department of Revenue’s Cannabis Control Division told the Senate Business, Labor and Economic Affairs Committee that it licenses and enforces Montana’s legal marijuana market while fielding emerging problems from synthetic and intoxicating hemp products.

Director Bridal Beatty introduced Kristen Barber, administrator of the Cannabis Control Division, who outlined the division’s responsibilities and the industry’s size. Barber said the division issues and oversees roughly 900 business licenses, more than 5,000 worker permits and about 14,000 registered medical cardholders, and inspects licensees across five regions with 12 inspectors.

The agency highlighted the program’s fiscal and regulatory scale: the adult-use tax rate set under state law is 20 percent (medical 4 percent) with a local option of up to 3 percent, estimated cannabis sales for January–November 2024 at about $920,000,000 and estimated related tax collections at $152,000,000. Barber told the committee the division’s FY budget supports 35 full-time positions and totals about $10,900,000 (personal services about $6,200,000; operating about $4,700,000).

Barber and Director Beatty also identified two enforcement challenges: illegal “synthetic” products and naturally derived intoxicating hemp. Barber said the laboratory auditing program moved from the Department of Public Health and Human Services to the Revenue Department in 2023 and is responsible for on-site audits and continuous monitoring of third‑party testing laboratories. She described synthetics as hemp-derived products chemically modified in a lab to produce a high similar to marijuana’s THC; House Bill 948 (2023) created a dedicated synthetics inspection position that drove roughly 30,000 miles and inspected 252 locations in its first year.

Barber warned the committee that the 2018 federal Farm Bill created a legal pathway for some hemp derivatives and a regulatory gap at state level: "once a product is harvested, there is no one in the state of Montana who has any regulation over these" intoxicating hemp products, she said, adding the Food and Drug Administration’s enforcement is limited.

Committee members asked whether the division consults tribal governments on licensing and about local limits on dispensaries. Barber and Beatty said the statute implementing the adult‑use law (House Bill 701 and the voter initiative I‑190) does not require tribal consultation and that the department has largely deferred to local county decisions for licensing inside county boundaries. Beatty acknowledged he previously attempted direct tribal outreach and had to step back because the statute does not authorize a formal tribal consultation process. "We went down that road. I stepped outside the lines of 701... I own that mistake," Beatty said.

Senators pressed the agency on inspection capacity as storefront dispensaries have proliferated. Barber said the division conducts annual and complaint‑based inspections and urged legislators and constituents to report suspected violations so inspectors can follow up. Director Beatty and committee members discussed resources and enforcement: Beatty said the department could use more investigators if the Legislature and executive branch allocate funding, but noted broader enforcement bottlenecks beyond the divisions control, including district court backlogs and local law enforcement priorities.

Several lawmakers raised public health concerns about high‑THC products and youth psychosis. Senator Curti asked whether the department had discussed lowering the statutory THC limit (35 percent for flower, as recorded), and Beatty said policy changes are for the Legislature to make: "The department doesn’t make policy. If you decide as policymakers to lower that number, we would definitely implement."

Barber closed by urging lawmakers to watch for coming bills, including proposals to extend or modify the current moratorium on new licenses (the division said a moratorium is in place until July 1, 2025) and to address hemp product regulation.

The presentation combined program data, enforcement updates and policy flags for the session: large tax revenue, a growing but regulated marketplace, ongoing inspections and dispute‑resolution work, and a gap in state authority over intoxicating hemp products and non‑tribal, unlicensed synthetic sellers. Barber and Beatty offered department staff as resources to lawmakers drafting statutory fixes or funding requests.