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Federal Agency Says USDA’s Hemp Rules “Stifle” Industry Growth And Hurt Small Businesses

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The federal Small Business Administration (SBA) is calling on the U.S. Department of Agriculture (USDA) to make a series of changes to its proposed hemp rules that in their current form threaten to “stifle” the newly legal industry.

The agency’s independent Office of Advocacy said that while it appreciates that USDA reopened a public comment period on its Interim Final Rule for the crop, small businesses “remain deeply concerned about the impact this rule will have on their ability to legally grow hemp should the rule be finalized without any modifications.”

“The rule has already stifled the industry as many farmers have chosen not to grow hemp this year until they are certain about what the requirements are, and whether they can produce compliant crops without the risk of a total loss of their investment due to mandatory destruction of hot crops,” it said in a comment submitted on Thursday, referring to plants that exceed allowable THC limits. “In some instances, [businesses] have noted that the rules are so stringent that they feel as though they are being set up to fail.”

USDA announced it was reopening the comment period last month, citing intense demand from stakeholders who have expressed concern about a number of specific regulations. The department outlined 12 areas where it was seeking additional feedback, including several that industry representatives have identified as very consequential.

SBA subsequently sent a letter to the agency asking it to lengthen a public comment period from 30 to 60 days, but that wasn’t heeded and the feedback period closed again last week.

In its latest comment, SBA focused on five proposed rules that it hopes USDA will revise. That includes regulations concerning prescribed hemp sample collection methods, disposal requirements for so-called “hot hemp,” the 15-day harvest window and the requirement that crops be tested only by labs registered with the Drug Enforcement Administration (DEA).

“Advocacy appreciates [Agricultural Marketing Service] reopening the comment period to consider additional comments and recommendations in advance of issuing a final rule,” SBA wrote. “Advocacy is concerned that if finalized without modification the rule will inhibit small business growth. Advocacy urges AMS to give full and thorough consideration to the above issues and proposed regulatory alternatives.”

SBA’s nine-page letter suggests that USDA’s restrictive rules will benefit large businesses while forcing smaller operators out of the market.

“Because hemp is a nascent industry, it has the potential to attract new farmers provided the regulations are not so restrictive as to inhibit industry growth,” it says. “Only those businesses with adequate capital and capacity for large-scale operations would be able to survive and comply with the requirements of the rule.”

The office also released a one-page fact sheet outlining its concerns about the proposed hemp rules.

While SBA has been an advocate for hemp farmers, the same can’t be said for its position on the broader marijuana industry. For example, the agency in March that cannabis businesses are not eligible for disaster relief loans meant to lessen the blow of the coronavirus pandemic.

All told, it appears that USDA is taking seriously the feedback it’s received and may be willing to make certain accommodations on these particular policies. The department’s rule for hemp, when finalized, is set to take effect on October 31, 2021.

In July, two senators representing Oregon sent a letter to Perdue, expressing concern that hemp testing requirements that were temporarily lifted will be reinstated in the agency’s final rule. They made a series of requests for policy changes.

Senate Minority Leader Chuck Schumer (D-NY) wrote to Perdue in August, asking that USDA delay issuing final regulations for the crop until 2022 and allow states to continue operating under the 2014 Farm Bill hemp pilot program in the meantime.

Sen. Cory Gardner (R-CO) also called on USDA to delay the implementation of proposed hemp rules, citing concerns about certain restrictive policies the federal agency has put forward in the interim proposal.

The earlier pilot program was initially set to expire on October 31, but it was extended to September 2021 through a congressional continuing resolution that the president signed late last month.

The senators weren’t alone in requesting an extension, as state agriculture departments and a major hemp industry group made a similar request to both Congress and USDA in August.

Perdue has said on several occasions that DEA influenced certain rules, adding that the narcotics agency wasn’t pleased with the overall legalization of hemp.

Amid the coronavirus pandemic, hemp industry associations pushed for farmers to be able to access to certain COVID-19 relief loans—a request that Congress granted in the most recent round of coronavirus legislation.

While USDA previously said that hemp farmers are specifically ineligible for its Coronavirus Food Assistance Program, that decision was reversed last month. While the department initially said it would not even reevaluate the crop’s eligibility based on new evidence, it removed that language shortly after Marijuana Moment reported on the exclusion.

Two members of Congress representing New York also wrote a letter to Perdue in June, asking that the agency extend access to that program to hemp farmers.

Hemp farmers approved to produce the crop do stand to benefit from other federal loan programs, however. The department released guidelines for processing loans for the industry in May.

Read SBA’s comment to USDA on its proposed hemp rules below: 

Advocacy Hemp Comment Lette… by Marijuana Moment

U.S. Government Supports Removing Marijuana From Strictest Global Drug Schedule

Photo courtesy of Brendan Cleak.

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Majority Of Connecticut Residents Back Marijuana Legalization And Expungements, Poll Finds As Reform Bills Advance

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As bills to legalize marijuana in Connecticut move through the legislature, a new poll finds that the reform has strong support among residents.

The survey from Sacred Heart University (SHU), released on Tuesday, found that about 66 percent of people in the state favor legalizing cannabis for adult use, while 27 percent are opposed.

If the policy change is enacted, 62 percent said those with prior marijuana convictions should have their records expunged.

Via SHU.

Younger people and those who identify as Democrats were more likely to back ending prohibition, compared to those 65 and older or Republicans.

Further, the poll asked about perceived harms of cannabis, and 77 percent said they felt the plant carried “fewer effects” or comparable effects as alcohol. About 72 percent drew the same contrast between marijuana and other drugs such as heroin, amphetamines and prescription painkillers.

Via SHU.

These figures are largely consistent with a previous poll that SHU conducted in February.

And like that prior survey, nearly half of Connecticut residents again expressed that they still believe that there are potential negative public safety implications of legalization, even if they support the policy. In this case, 48 percent said they agree that allowing recreational cannabis would lead to a “significant” increase in impaired driving.

Two in five respondents said they agree that marijuana is a gateway to other drugs. The poll involved interviews with 1,000 residents from March 23-31.

But while these figures largely align with the last SHU survey, one thing that has changed is that reform legislation has started to advance in the legislature, including a bill being backed by the governor.

The Judiciary Committee approved Gov. Ned Lamont’s (D) proposal, which was amended to more comprehensively address social equity issues, last week. That said, legislative leaders have indicated that the bill is fluid and will likely see additional revisions down the road.

A competing legalization measure from Rep. Robyn Porter (D) was approved in the Labor and Public Employees Committee last month.

One amendment that was adopted to the governor’s bill would provide for the free erasure of past marijuana convictions for possession or sales of up to four ounces of cannabis or six mature plants—a policy that is evidently backed by most residents in the state.

Lamont, who convened an informal work group in recent months to make recommendations on the policy change, initially described his legalization plan as a “comprehensive framework for the cultivation, manufacture, sale, possession, use, and taxation of cannabis that prioritizes public health, public safety, and social justice.”

For his part, House Speaker Matthew Ritter (D) said last month that “optimism abounds” as lawmakers work to merge proposals into a final legalization bill.

Majority Leader Jason Rojas (D) said “in principle, equity is important to both the administration and the legislature, and we’re going to work through those details.”

To that end, the majority leader said that working groups have been formed in the Democratic caucuses of the legislature to go through the governor’s proposal and the committee-approved reform bill.

In February, a Lamont administration official stressed during a hearing in the House Judiciary Committee that Lamont’s proposal it is “not a final bill,” and they want activists “at the table” to further inform the legislation.

The legislature has considered legalization proposals on several occasions in recent years, including a bill that Democrats introduced last year on the governor’s behalf. Those bills stalled, however.

Lamont reiterated his support for legalizing marijuana during his annual State of the State address in January, stating that he would be working with the legislature to advance the reform this session.

Ritter said in November that legalization in the state is “inevitable.” He added later that month that “I think it’s got a 50–50 chance of passing [in 2021], and I think you should have a vote regardless.” The governor said in an interview earlier this year that he puts the odds of his legislation passing at “60-40 percent chance.”

Should that effort fail, the speaker said he will move to put a constitutional question on the state’s 2022 ballot that would leave the matter to voters. Lamont made similar remarks last week.

The governor has compared the need for regional coordination on marijuana policy to the coronavirus response, stating that officials have “got to think regionally when it comes to how we deal with the pandemic—and I think we have to think regionally when it comes to marijuana, as well.”

He also said that legalization in Connecticut could potentially reduce the spread of COVID-19 by limiting out-of-state trips to purchase legal cannabis in neighboring states such as Massachusetts and New Jersey.

Illinois Gets More Tax Revenue From Marijuana Than Alcohol, State Says

Photo courtesy of Mike Latimer.

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Remembering Cannabis Legalization Pioneer Steve Fox

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This post is a remembrance of longtime cannabis policy activist Steve Fox from his colleagues at VS Strategies and Vicente Sederberg LLP.

Dear Family, Friends, and Colleagues,

We are truly heartbroken to share news of the passing of our partner and dear friend Steve Fox. Steve served as managing partner of VS Strategies since co-founding it in 2013, and he was a leader at Vicente Sederberg LLP since its formation in 2010.

We welcome the celebration of Steve’s life through the sharing of thoughts and memories, and we ask for respect and privacy for his family, friends, and coworkers who are still reeling from this loss. We have also started a GoFundMe page to support Steve’s wife and daughters as they navigate their way through this extremely difficult time—https://www.gofundme.com/f/support-the-family-of-steve-fox

With wisdom beyond his years and a pioneering spirit, Steve was an “old soul” with a knack for seeing things in a new light. He was strongly principled, deeply empathic, and fiercely kind. And despite his usually soft-spoken and lighthearted demeanor, his opinions rarely went unheard and always carried significant weight.

His passion for politics and policy were exceeded only by his passion for people—his family, friends, and colleagues, as well as the multitude of strangers that he knew were being affected every day by politics and policy. He had a burning desire and uncanny ability to envision and effect positive change, both societally and in those closest to him. He was not just a remarkable human being, but a truly transformational leader.

Steve was always the first to volunteer and the last to seek credit. He was beyond generous with his time and patience, and perpetually understanding. He relished opportunities to provide counsel and guidance, and the feeling was mutual for those who received it. He was warmly regarded as a mentor by no fewer than a dozen current and former members of our firm, including all seven of us.

Steve was one of the first political professionals to enter the marijuana advocacy space. At a time when cannabis policy was just a blip on the political radar and most savvy up-and-comers were unwilling to dip a toe into the space, Steve dove in headfirst. While many viewed it as a losing cause that wasn’t worth the fight, he saw it as a cause worth fighting until it was won. And in working to legalize and regulate cannabis for medical and adult use, he found a way to fight simultaneously for several of his core values: To promote justice and compassion, to advance freedom and liberty, and to nurture and inspire the human spirit. Humbly righteous, judiciously aggressive, and relentlessly ethical, he was committed to doing the right thing, doing it the right way, and doing whatever it takes to get it done.

When he joined the Marijuana Policy Project in 2002, Steve was the only full-time cannabis lobbyist on Capitol Hill. He would remain at the forefront of the cannabis policy reform movement for nearly two decades, playing pivotal roles in several major victories at the federal and state levels.

Steve was a lead drafter of Colorado’s historic Amendment 64, which legalized cannabis for adult use, and he managed all aspects of the successful campaign behind its passage and implementation. He also conceptualized and co-founded Safer Alternative For Enjoyable Recreation (SAFER), which laid a lot of groundwork for the legalization effort and contributed to a seismic shift in the U.S. cannabis policy debate. In 2009, he co-authored the book “Marijuana Is Safer: So why are we driving people to drink?,” which is based on the SAFER strategy.

Steve was always thinking step ahead of the rest. Long before cannabis was legalized, he envisioned a legal, organized, and responsible cannabis industry. He played leading roles in conceptualizing and establishing several of the nation’s largest and most influential cannabis trade organizations, including the National Cannabis Industry Association, the Cannabis Trade Federation, and the U.S. Cannabis Council. He regularly led working group meetings and calls, and he was a frequent speaker at cannabis conferences.

Steve’s role in cannabis community cannot be overstated. He was a trailblazer in the movement to end prohibition, and he was an architect and caretaker of the legal industry that is quickly replacing it. He beat the path, built the shelter, and worked tirelessly to make it as welcoming, accessible and beneficial as possible. He always put the mission—the wellbeing of others and the betterment of society—ahead of himself.

No one was more reluctant to sing their own praises while being so deserving of a louder refrain.

In 2013, Steve received a highly esteemed award from the Drug Policy Alliance in recognition of his long-term spearheading of the Colorado legalization effort. With an audience of hundreds and the spotlight squarely on him, he used the better part of his brief acceptance speech to give recognition to the people and organizations who had supported and worked alongside him. He reserved only the final thought for his own personal message and dedication. It was to his parents, for raising him to believe in the Jewish philosophy “Tikkun olam”—to “repair or heal the world” through beneficial and constructive acts. That is what drove Steve to take on the cause of cannabis policy reform. And it was what drove Steve to be the person he was.

Tikkun olam. Mission accomplished, dear friend.

Shawn Hauser
Josh Kappel
Andrew Livingston
Christian Sederberg
Mason Tvert
Brian Vicente
Jordan Wellington

And the entire VSS and VS family

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Biden’s Pick To Lead DEA Voiced Openness To State Medical Marijuana Program

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President Joe Biden’s nominee to lead the Drug Enforcement Administration (DEA) previously described a New Jersey medical marijuana bill as “workable” while serving at the state’s attorney general.

Although the former top state prosecutor, Anne Milgram, doesn’t appear to have publicly detailed her personal views on cannabis reform, the limited comments she made over a decade ago signal that, at the very least, she’s open to allowing states to enact their own marijuana policies despite federal prohibition.

That’d be a big deal, as far as advocates are concerned. Having a DEA administrator who appears flexible with respect to state cannabis reform efforts would be a notable development given the role that the official plays in federal marijuana policy.

However, Milgram’s on-the-record remarks on the issue are admittedly minimal. In 2009, when the New Jersey legislature was considering a medical cannabis legalization bill, she called the proposal “workable,” according to a one-word quote included in an Associated Press report.

After the legislation was amended, a spokesperson for the then-attorney general said the change “tightens up the provisions…that could have become loopholes by people seeking to divert marijuana for illicit purposes.”

Biden announced Milgram as his pick to be the next DEA administrator on Monday, and now her nomination heads to the Senate. It is possible that she will be asked to elaborate on her views during a confirmation hearing before the Judiciary Committee.

Milgram’s prior statements are far from an explicit endorsement of medical cannabis legalization, but they do indicate that the nominee is not vociferously opposed to state-level reforms as has been the case for prior DEA administrators. And in combination with other Biden cabinet picks, that bodes well for advocates.

Attorney General Merrick Garland made clear during his oral and written testimony before the Senate, for example, that he does not feel the Justice Department should use its resources to go after people acting in compliance with state marijuana laws. That stands in contrast with President Donald Trump’s first selection for attorney general, Jeff Sessions, who rescinded Obama-era guidance deprioritizing prosecutions over state-legal cannabis activity.

The DEA, with authority delegated from the Department of Justice, plays an important role in determining the schedule status of marijuana and other drugs. If the agency’s administrator were to acknowledge the medical benefits of cannabis, it would deeply undermine its current classification in Schedule I, which is supposed to be reserved for substances with no therapeutic value.

That said, while the Justice Department and DEA play a key role in federal scheduling, a medical and scientific review by the Department of Health and Human Services (HHS) and the Food and Drug Administration is binding on the attorney general’s classification decision.

To that end, the former attorney general of California, Xavier Bacerra, was confirmed by the Senate to lead HHS, and he has a considerable record supporting cannabis reform and working to protect California’s legal program from federal interference.

Meanwhile, Biden has yet to nominate someone to run the federal Office of National Drug Control Policy (ONDCP), despite earlier reporting that a selection was imminent.

The presumed leading candidate to be White House drug czar—Rahul Gupta, the former chair of the West Virginia Medical Cannabis Advisory Board—has played a critical role in overseeing the implementation and expansion of a state medical marijuana program and has publicly recognized both the therapeutic and economic potential of cannabis reform.

But while any pro-reform appointment is notable in the new administration, the DEA administrator has played a historically antagonistic role opposing federal or state policy changes as they concern cannabis. And so Milgram would stand out as an especially significant pick to that end.

The nominee would be taking over the defense to a number of pending lawsuits from marijuana and psychedelics reform advocates and patients if confirmed.

For example, Seattle doctor hoping to expand access to psilocybin mushrooms for terminally ill cancer patients is taking DEA to court over the agency’s recent denial of an application to legally use the psychedelic in end-of-life treatment.

Scientists and veterans sued the federal agency last year, arguing that the legal basis DEA has used to justify keeping marijuana in Schedule I of the Controlled Substances Act is unconstitutional. They asked for a review of its decisions to reject rescheduling petitions in 2020, 2016 and 1992. DEA subsequently requested that the court dismiss that suit.

The agency has also been taken to court over delays in approving additional cannabis manufacturers for research purposes.

The Scottsdale Research Institute alleged that DEA has been deliberately using delay tactics to avoid approving cultivation applications. A court mandated that the agency take steps to make good on its promise, and that suit was dropped after DEA provided a status update.

In March 2020, DEA finally unveiled a revised rule change proposal that it said was necessary due to the high volume of applicants and to address potential complications related to international treaties to which the U.S. is a party.

New Mexico Governor Signs Marijuana Legalization Bill, Making State Third To Enact Reform Within Days

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