According to the Legislative Budget Board (LBB), the financial impact of SB 1868 on the state and local governments is indeterminate. This uncertainty stems from a lack of sufficient data to estimate how frequently the bill’s newly created or amended criminal and civil penalties will be enforced. The bill introduces new offenses and expands the scope of existing criminal conduct related to kratom regulation, including offenses for improper labeling, sales to minors, and manufacturing adulterated or synthetic kratom products.

The creation of new criminal offenses may increase demands on the criminal justice system, including courts, community supervision programs, and correctional facilities at both the state and local levels. If individuals are prosecuted under the bill’s provisions, this could result in more people being incarcerated or placed under community supervision, which would have associated costs. However, the extent of this impact is currently unpredictable.

From a revenue perspective, the bill has the potential to generate increased funds for the state through the imposition of civil penalties and court costs. The Comptroller noted this possibility, although it also affirmed that the overall fiscal impact remains indeterminate without better estimates of enforcement rates and penalties assessed. At the local level, counties and municipalities may experience increased revenue collection from civil penalties tied to local enforcement actions, but this, too, depends on the volume of violations.

In summary, while SB 1868 could lead to higher public expenditures related to enforcement and adjudication, it may also create new revenue streams through fines and penalties. Without clear projections of enforcement and compliance activity, however, the bill’s net fiscal impact cannot be quantified at this time.

SB 1868 proposes a sweeping regulatory and criminal framework around the sale, distribution, and possession of kratom and related substances in Texas. While the bill is presented as a public safety measure, it significantly expands state authority, introduces harsh penalties, and places heavy burdens on individuals and small businesses operating in good faith. The legislation moves far beyond consumer protection, venturing into paternalistic overreach by criminalizing peaceful conduct that does not inherently harm others.

The bill imposes mandatory testing, labeling, and packaging requirements that only well-capitalized businesses are likely to meet, shutting out small or independent vendors. It also bans certain common product formats, such as kratom-infused beverages and prepackaged foods, regardless of their safety or consumer demand. In doing so, it limits lawful access for responsible adult consumers and stifles innovation in a growing wellness market. Criminal penalties—including a third-degree felony for falsifying lab reports and a Class A misdemeanor for selling near schools—are disproportionate and reflect an enforcement-heavy model that undermines principles of limited government and free enterprise.

Most critically, the bill violates the principle that individuals should be free to make choices about what they consume, as long as those choices do not harm others. Kratom is a plant-based substance used safely by many Texans, particularly for pain management or as an alternative to opioids. Instead of narrowly targeting dangerous practices such as adulteration or fraudulent marketing, the bill casts a wide net that criminalizes peaceful behavior and expands prosecutorial power unnecessarily.

Given these concerns, the bill represents an unjustified expansion of government authority, imposes an excessive regulatory burden, and disrespects personal autonomy. For these reasons, Texas Policy Research recommends that lawmakers vote NO on SB 1868.

• Individual Liberty: The bill restricts adults' freedom to make personal health and wellness choices by criminalizing the sale and distribution of certain kratom products and banning common product formats (such as kratom beverages and prepackaged foods). It also imposes criminal penalties for behavior that does not inherently harm others, such as selling kratom near schools or in combination with other legal products. This infringes on the principle that individuals should be free to make personal decisions—as long as those decisions do not directly endanger others. The legislation moves beyond protecting consumers from fraud or contamination and into the realm of paternalistic control over peaceful, voluntary behavior.
• Personal Responsibility: Rather than fostering a culture of accountability and informed choice, the bill leans heavily on criminalization and government enforcement. It removes safe harbor provisions that previously protected kratom retailers who acted in good faith, shifting responsibility from individuals and businesses to the state. This discourages self-regulation, consumer awareness, and responsible entrepreneurship, and instead promotes fear-based compliance through punitive measures.
• Free Enterprise: The bill introduces significant regulatory burdens that will disproportionately harm small businesses and independent vendors. Requirements such as in-state ISO/IEC-accredited lab testing, strict labeling rules, and increased civil penalties (up to $10,000 per violation) create a high-cost compliance environment that many small operators cannot afford. The restriction on product types and sales practices reduces market flexibility and limits consumer choice. This is antithetical to the principle of free enterprise, which relies on open competition, innovation, and minimal government interference.
• Private Property Rights: Although the bill does not directly seize or restrict private property, it indirectly affects property rights by imposing criminal liability on individuals and businesses for using or selling kratom in certain locations (e.g., within 1,000 feet of schools). This creates de facto limitations on how property can be used and what can be sold on-site, particularly for businesses near schools or in mixed-use areas.
• Limited Government: The bill expands the authority of state and local governments by creating new criminal offenses, increasing penalties, and empowering regulatory bodies to enforce testing and compliance mandates. It also classifies certain kratom-related compounds under Penalty Group 1 of the Texas Controlled Substances Act—alongside heroin and fentanyl—which elevates enforcement to the most severe tier of drug control. This expansion of government power violates the principle of limited government, which holds that the state should intervene only when absolutely necessary to prevent direct harm to others.