On Wednesday, the U.S. Department of Agriculture (USDA) gave stakeholders in the nation’s hemp economy an opportunity to provide input on rules to legally regulate the crop that are currently being developed.
Hemp, which was federally legalized as part of the 2018 Farm Bill signed by President Trump in December, had previously been restricted by the Justice Department as a controlled substance. Now USDA has primary responsibility for overseeing legal cultivation of marijuana’s non-psychoactive cannabis cousin.
But the agency is still in the process of establishing a set of regulations covering areas such as land use, certification, product testing and disposal of hemp containing excess THC. After those federal rules are in place, USDA will begin reviewing proposed hemp plans submitted by state agriculture departments.
Officials from at least seven state governments and a number of Indian tribes gave testimony during the roughly three-hour online feedback session, which was occasionally interrupted by technical difficulties, as did several hemp industry operators.
We didn’t miss the chance to chime in on the first USDA Hemp webinar this afternoon. Kentucky’s hemp program is a national leader and we are fortunate to assist @USDA in implementing the 2018 Farm Bill hemp legalization provisions. pic.twitter.com/pySeg7eb0f
— Ryan Quarles (@RyanQuarlesKY) March 13, 2019
All told, more than 3,000 people tuned in to the webinar to hear three-minute presentations from some 50 scheduled speakers.
The stakeholders registered concerns about testing procedures for hemp, shipping parts of the plant and its derivatives between states, access to banking and hemp’s relation to its still-Schedule-I counterpart, marijuana.
States speak up
After the 2018 Farm Bill was signed into law, Kentucky’s Commissioner of Agriculture Ryan Quarles headed to Washington, D.C. to personally deliver to USDA a plan to regulate hemp, making his state the first to take formal action under the new federal legalization provisions.
“We don’t know if it can replace tobacco,” Quarles said during Wednesday’s event. “But we know it’s becoming part of our greater agriculture portfolio.”
I was proud to participate in a hemp webinar hosted by @USDA Agricultural Marketing Service. I spoke specifically about the need for USDA and FDA to work w/ states on bank lending, the regulation of CBD, & developing uniform testing standards across the nation. #KyAg365 pic.twitter.com/lwFWD46Kft
— Commissioner Quarles (@KYAgCommish) March 13, 2019
The Kentucky Agriculture Department received more than 1,000 applications to participate this year in the state’s limited industrial hemp research pilot program that is authorized under the prior 2014 Farm Bill.
As Kentucky looks toward broader industrialization, Quarles said the state is particularly concerned about hemp farmers’ access to banking.
“These farmers and companies need access to capital just like any other farmer or agri-business,” he said.
Quarles also called for guidance from the Food and Drug Administration (FDA) and Congress about what the federal government plans to do about CBD and other derivatives of industrial hemp—an area of focus for Kentucky’s hemp program.
“If the FDA regulates too hard against CBD, it would really harm small Kentucky family farms,” he said. “We’ve got to develop rules that allow our farmers an opportunity to continue supporting this crop and benefitting economically from it, especially during a period of depressed farm cash receipts.”
Sara Walling, an administrator at the Wisconsin Department of Agriculture, Trade and Consumer Protection, oversees the department where the state’s hemp program resides. She said the application period for growing hemp in the 2019 season yielded 1,461 grower applications and 711 processor applications under the state’s research program.
She described the Badger State’s relation to hemp as “enthusiastic and energetic” but said there is still some confusion among state regulators about how to proceed.
We talked to the USDA today about what we'd like to see in federal rules for industrial hemp programs. Testing and finances were uppermost in our minds. Read more at https://t.co/MNA8xEUQAP. pic.twitter.com/fClANxxb1q
— Wisconsin DATCP (@widatcp) March 13, 2019
“We’re optimistic about the future of hemp as an agricultural crop but we’re in a chicken-and-the-egg process: Which comes first, processing or production?” she said.
Regulatory and legislative officials from Colorado, Kansas, Missouri, North Dakota and Pennsylvania also provided testimony.
Tribal officials weigh in
At least six representatives from groups of indigenous people described their visions for a regulated and equitable industrial hemp program. Angie Kennedy, of the Seneca Nation of Indians, sought clarification on how tribes and sovereign nations can participate in the 2019 planting season. The 2018 Farm Bill allows continued planting of hemp under the earlier 2014 legislation’s research provisions.
“But the 2014 Farm Bill, it does not allow that [tribes] can grow under those requirements,” she said. “When the USDA comes out with the regulations, it’ll be too late for this farming season.”
That concern was echoed in other speakers’ remarks as well.
Ben Fenner, an attorney with Fredericks, Peebles & Morgan LLP, spoke on behalf of the tribal attorney for the Flandro Sanchi Sioux Tribe in North Dakota. Fenner said that as more hemp is cultivated, tribes cannot afford to miss out on access the market.
“Delaying this out to 2020 or beyond is going to hurt tribes,” he said.
Supply chain concerns
Wednesday’s listening session also included testimony from groups that transport hemp and related products, along with vendors that sell the goods.
Federal regulations for interstate transportation of hemp have not yet been issued and, while the federal agriculture legislation covers the whole nation, hemp production and processing is still illegal under the laws of some states.
Collin Mooney is the executive director of the Commercial Vehicle Safety Alliance, which represents the local, provincial, state and territorial agencies responsible for commercial motor vehicle enforcement throughout the U.S., Mexico and Canada.
“States will need to make the necessary regulatory changes and to make officials aware of those changes,” Mooney said.
Aside from changing the legal status of hemp, Mooney said the roadside enforcement community would face other challenges. While industrial hemp is defined federally as cannabis that is comprised of 0.3 percent or less of THC, it can look and smell similar to marijuana, and available field kits only demonstrate whether THC is present in a sample, regardless of the concentration.
“Since the state drug labs that can make this distinction already have a backlog of work, this can lead to unavoidable delays in traffic stops and maybe even mistaken arrests,” Mooney said.
Regardless of the legal challenges of transporting hemp and hemp products, Peter Matz of the Food Marketing Institute, a lobbying group that represents grocery stores and pharmacies around the country, said the demand for these products is “already pretty staggering, and we know that it’s growing.”
“The fact remains that our members are seeking clarity on everything—which kinds of products can be sold and where, as well as the labeling requirements, as well as sourcing and transporting the ingredients,” he said.
Until USDA’s rules are formalized, hemp farmers are still able to grow under their respective state’s hemp research pilot programs under the 2014 Farm Bill.
Secretary of Agriculture Sonny Perdue said last month that his agency is working to create the new regulatory framework by the 2020 growing season.
“We’re proceeding very judiciously obviously because of the uniqueness of the crop hemp and its relationship to other crops that we’re not encouraging. It’s complex,” he told the House Agriculture Committee.
Dr. Scott Gottlieb, outgoing head of the FDA announced that his agency will hold a similar listening session next month to discuss plans for regulating hemp-derived CBD. FDA is considering pathways to allow cannabis and its derivatives in food and dietary supplements and to permit those products to be marketed and transported between states.
Photo courtesy of Brendan Cleak.
Marijuana Arrests Decline Nationally For First Time In Four Years, FBI Data Shows
Marijuana arrests in the U.S. declined in 2019 for the first time in four years, a new federal report shows.
While many expected the state-level legalization movement to reduce cannabis arrests as more markets went online, that wasn’t the case in 2016, 2017 or 2018, which each saw slight upticks in marijuana busts year-over-year. But last year there was a notable dip, the data published this week shows.
There were a total of 545,601 marijuana arrests in 2019—representing 35 percent of all drug arrests—according to FBI’s Uniform Crime Reporting program. That’s down from 663,367 the prior year and 659,700 in 2017.
Put another way, police across the country made a cannabis bust every 58 seconds on average last year. Of those arrests, 500,394 (92 percent) were for possession alone.
Overall, arrests for drug sales, manufacturing and possession amounted to 1,558,862 for the year—approximately 15 percent of all busts reported to FBI from local and state law enforcement agencies. That’s one new drug case every 20 seconds.
Before 2016, the country had seen a consistent decline in marijuana arrests for roughly a decade. It should be noted, however, that not all local police participate in the federal agency’s program, so these figures are not holistic.
Nonetheless, this data shows that American law enforcement carried out more arrests for marijuana alone than for murder, rape, robbery, burglary, fraud and embezzlement combined.
“At a time when a super-majority of Americans support marijuana legalization, law enforcement continues to harass otherwise law abiding citizens at an alarming rate,” NORML Political Director Justin Strekal told Marijuana Moment. “Now is the time for the public to collectively demand that enough is enough: end prohibition and expunge the criminal records to no longer hold people back from achieving their potential.”
While there’s no solitary factor that can explain the recent downward trend in cannabis cases, there are one-off trends that could inform the data. For example, marijuana possession arrests fell almost 30 percent in Texas from 2018 to 2019, and that seems to be connected to the legalization of hemp and resulting difficulties police have had in differentiating the still-illegal version of the cannabis crop from its newly legal non-intoxicating cousin.
At the federal level, prosecutions for marijuana trafficking declined in 2019, and drug possession cases overall saw an even more dramatic decline, according to a report published by the U.S. Sentencing Commission in March.
Federal prosecutions of drug-related crimes increased in 2019, but cases involving marijuana dropped by more than a quarter, according to an end-of-year report released by Supreme Court Chief Justice John Roberts in December.
A study released by the Cato Institute in 2018 found that “state-level marijuana legalization has significantly undercut marijuana smuggling.”
California Governor Approves Changes To Marijuana Banking And Labeling Laws
California Gov. Gavin Newsom (D) signed a handful of marijuana bills into law on Tuesday, making a series of small adjustments to the nation’s largest legal cannabis system. More sweeping proposals such as overhauling the state’s marijuana regulatory structure will have to wait until next year, the governor said.
Among the biggest of the new changes are revisions to banking and advertising laws. With many legal marijuana businesses are still unable to access financial services, Newsom signed a bill (AB 1525) to remove state penalties against banks that work with cannabis clients.
“This bill has the potential to increase the provisions of financial services to the legal cannabis industry,” Newsom wrote in a signing statement, “and for that reason, I support it.”
Democrats in Congress, meanwhile, have been working for months to remove obstacles to these businesses’ access to financial services at the federal level. A coronavirus relief bill released by House Democratic leaders on Monday is the latest piece of legislation to include marijuana banking protections. Past efforts to include such provisions have been scuttled by Senate Republicans.
In his signing statement on the banking bill, Newsom directed state cannabis regulators to establish rules meant to protect the privacy of marijuana businesses that seek financial services, urging that data be kept confidential and is used only “for the provision of financial services to support licensees.”
Another bill (SB 67) the governor signed on Tuesday will finally establish a cannabis appellation program, meant to indicate where marijuana is grown and how that might influence its character. The system is similar to how wine regions are regulated.
Under the new law, growers and processors under the new law will be forbidden from using the name of a city or other designated region in product marketing unless all of that product’s cannabis is grown in that region. Similar protections already apply at the county level.
For outdoor growers, the new law recognizes the importance of terrior—the unique combination of soil, sun and other environmental factors that can influence the character of a cannabis plant. For indoor growers, it provides a way to represent a hometown or cash in on regional cachet.
Most of the other new changes that the governor signed into law are relatively minor and will likely go unnoticed by consumers. One, for example, builds in more wiggle room on the amount of THC in edibles (AB 1458), while another would allow state-licensed cannabis testing labs to provide services to law enforcement (SB 1244).
The bills were approved by state lawmakers earlier this month, as the state’s legislative session drew to a close.
Other pieces of cannabis legislation passed by the legislature this session were met with the governor’s veto. On Tuesday, Newsom rejected a proposal (AB 1470) that would have allowed processors to submit unpackaged products to testing labs, which industry lobbyists said would reduce costs. Currently products must be submitted in their final form, complete with retail packaging. Newsom said the proposal “conflicts with current regulations…that prevent contaminated and unsafe products from entering the retail market.”
“While I support reducing packaging waste, allowing products to be tested not in their final form could result in consumer harm and have a disproportionate impact on small operators,” Newsom said in a veto statement.
Those changes to testing procedures should instead be considered next year, Newsom said, as part of a pending plan to streamline California’s cannabis licensing and regulatory agencies.
“I have directed my administration to consolidate the state regulatory agencies that currently enforce cannabis health and safety standards to pursue all appropriate measures to ease costs and reduce unnecessary packaging,” he wrote. “This proposal should be considered as part of that process.”
Newsom also last week vetoed a bill (AB 545) that would have begun to dissolve the state Bureau of Cannabis Control, which oversees the legal industry. In a statement, the governor called that legislation “premature” given his plans for broader reform.
“My Administration has proposed consolidating the regulatory authority currently divided between three state entities into one single department,” Newsom wrote, “which we hope to achieve next year in partnership with the Legislature.”
Earlier this month, the governor signed into law one of the industry’s top priorities for the year—a measure (AB 1872) that freezes state cannabis cultivation and excise taxes for the entirety of 2021. The law is intended to provide financial stability for cannabis businesses in California, where taxes on marijuana are among the highest in the nation.
The state’s leading marijuana trade group, the California Cannabis Industry Association (CCIA), applauded the governor’s moves. All the bills approved by Newsom this week had the industry group’s support.
“We thank Governor Newsom for prioritizing these bills, which seek to reduce regulatory burdens, improve enforcement, expand financial services and enhance the state’s cannabis appellation’s program,” CCIA Executive Director Lindsay Robinson said in a message to supporters on Wednesday. “Like so many, the cannabis industry has faced a series of unexpected challenges and setbacks in 2020. We look forward to continuing to work with the Newsom Administration, and the Legislature, as we pursue a robust policy agenda in 2021.”
Image element courtesy of Gage Skidmore
Mixed Arizona Marijuana Polls Raise Questions About Legalization Ballot Measure’s Prospects
Reform advocates are anxious to see how a marijuana legalization initiative in Arizona will fare this November. But predicting the outcome is complicated by a new pair of dueling polls that show mixed results.
The campaign behind the legalization measure, Smart and Safe Arizona, shared an internal poll on Wednesday with Marijuana Moment that showed 57 percent of likely voters in support for the effort, with 38 percent in opposition.
The survey, which was conducted September 24-29, shows that 83 percent of supporters say they are certain to vote for the measure. Opposition was just as certain, however, by a margin of 82 percent to 12 percent.
Seventy-two percent of Democrats support the legal cannabis initiative, as do 70 percent of independents and 42 percent of Republicans.
But while those results are largely consistent with several surveys this year have shown varying degrees of majority support for adult-use legalization among Arizona voters, a separate poll released on Tuesday that’s being touted by opponents indicates that the margin is slimmer than advocates would hope—with 46 percent of respondents saying they want the policy change and 45 percent saying they don’t.
n= 600 LVs, MOE +/- 4.0%, Survey Conducted 9/8- 9/10
— OHPI (@OHPredictive) September 29, 2020
When the same firm, OH Predictive Insights (OHPI), conducted a poll asking the same basic question about legalizing cannabis in July, 62 percent of likely voters said they favor legalization. The month prior, about 65 percent said they back the legal cannabis ballot measure in a survey from a different pollster, HighGround.
The notable dip based on the new OHPI poll appears to be largely attributable to declining support among people over 55, those who live in rural areas, independents and Republicans.
“As election day nears, voters appear to be focusing on what’s on the ballot. And while the campaign to oppose marijuana legalization is anemic compared to 2016, voters still have concerns about the effort,” OHPI Chief Mike Noble said in a press release, referring to an earlier legalization initiative that Arizonans rejected four years ago after a campaign in which the opposition received significant funding, including from a pharmaceutical company.
#AZPOP #POLL: “As election day nears, voters appear to be focusing on what’s on the ballot, and while the campaign to oppose marijuana legalization is anemic compared to 2016, voters still have concerns about the effort,” says @MikePNoble
— OHPI (@OHPredictive) September 29, 2020
But the reform campaign isn’t deterred. Far from it, actually. In addition to sharing their internal poll, a spokesperson told Marijuana Moment that the memo for the separate survey showing dwindling support actually bolstered its contributions by another $250,000—in the early part of the day alone.
“We’re giving this poll as much credence as we should—none. It’s absurd to think that while Arizona is on pace to sell a record amount of cannabis ($1.25B) to a record number of cardholders, popularity is waning,” Smart and Safe Arizona Campaign Manager Stacy Pearson told Marijuana Moment, referring to purchases in the state’s existing medical cannabis system. “Cash register receipts and internal polling do not align with OH’s prediction.”
“That said, their polling memo has certainly helped our cause. We have generated more than $250,000 in contributions today, and it’s not even noon,” she said on Tuesday morning.
In the campaign’s internal poll, 65 percent of those surveyed believe the measure, Prop. 207, would have a positive effect on the state’s economy, compared to 26 percent who said it would have a negative effect.
The OHPI poll involved interviews with 600 likely Arizona voters from September 8-10. The internal campaign poll involved 800 respondents.
Colton Grace, communications associate for the prohibitionist group Smart Approaches To Marijuana, told Marijuana Moment after viewing only the OHPI poll that it’s “great to see that the support for marijuana legalization—which is never as popular as the industry claims it is in the first place—is dropping rapidly ahead of the vote in Arizona.”
“This effort is no different than that of 2016 in that it is nothing more than a for-profit scheme that benefits a select group of investors while unleashing serious harms on the majority of the state,” he argued.
Another survey released this month from a separate firm showed that a slim majority of voters (51 percent) support the ballot measure.
Under the legalization initiative, adults could possess up to an ounce of marijuana at a time and cultivate up to six plants for personal use.
The measure also contains several restorative justice provisions such as allowing individuals with prior marijuana convictions to petition the courts for expungements and establishing a social equity ownership program
Cannabis sales would be taxed at 16 percent. Tax revenue would cover implementation costs and then would be divided among funds for community colleges, infrastructure, a justice reinvestment and public services such as police and firefighters.
The Department of Health Services would be responsible for regulating the program and issuing cannabis business licenses. It would also be tasked with deciding on whether to expand the program to allow for delivery services.
Read the full internal poll from the Arizona marijuana legalization campaign below:
Photo courtesy of Mike Latimer.