Heat oven to 350°F and line 2 baking sheets with parchment paper.
Combine 2 cups flour, 2 teaspoons cornstarch, 1 teaspoon baking powder, 1/2 teaspoon baking soda, and 1/2 teaspoon salt in a medium bowl. Whisk to incorporate and break up any lumps.
Combine 1 stick softened butter, 3 tablespoons shortening, 1 cup sugar, and 1 tablespoon lime zest in the bowl of a stand mixer fitted with the paddle attachment. Beat on medium-high until light and fluffy, about 4 minutes.
Add 1 egg, 1 tablespoon honey, 1/2 teaspoon vanilla, the 1/4 cup lime juice, and 3-4 drops green food coloring to reach desired intensity of color (if using). Mix to combine. Add dry ingredients and mix on low speed until fully incorporated.
Place sanding sugar in a bowl. Scoop about 2 tablespoons of dough at a time and roll in the sanding sugar. Transfer to the baking sheets, placing about 2 inches apart.
Bake about 12-15 minutes or until firm and golden on the edges, but still soft in the middle. Let cool on the baking sheet a few minutes, then remove to a wire rack to cool completely.