The U.S. Department of Agriculture (USDA) released draft rules for hemp manufacturing on Tuesday and said it will soon begin accepting state regulatory plans for the newly legal crop.
The interim final rule on hemp will be formally published in the Federal Register on Thursday, with a 60-day public comment period to follow. Once the rules are finalized, USDA will begin to evaluate states’ and tribes’ submitted regulations plans, and any jurisdictions that do not send proposals will fall under the department’s general guidelines for producing the crop, which was federally legalized under the 2014 Farm Bill.
The regulations cover the requirements for where hemp can be grown, THC testing standards, the disposal process for crops that don’t meet federal standards and licensing protocols.
The regulation provides specific details on the process and criteria for USDA’s review of plans received from states and Indian tribes regarding the production of #hemp.
For more info and resources: https://t.co/E0qdkW3iY9 pic.twitter.com/7lMx3Ou484
— USDA Ag Mktg Service (@USDA_AMS) October 29, 2019
“At USDA, we are always excited when there are new economic opportunities for our farmers, and we hope the ability to grow hemp will pave the way for new products and markets,” USDA Secretary Sonny Perdue said in a press release.
At USDA, we are always excited when there are new economic opportunities for our farmers, and we hope the ability to grow hemp will pave the way for new products and markets. More on our new Domestic Hemp Production Program HERE: https://t.co/7Bz7zcGQmK pic.twitter.com/bkSLcM91mI
— Sec. Sonny Perdue (@SecretarySonny) October 29, 2019
“We have had teams operating with all hands-on-deck to develop a regulatory framework that meets Congressional intent while seeking to provide a fair, consistent, and science-based process for states, tribes, and individual producers who want to participate in this program,” he added.
After the regulations are finalized, USDA said it will make a determination about state or tribal plan applications within 60 days of their submission. Jurisdictions that submit applications to process hemp under USDA’s guidelines rather than their own local rules will be reviewed within 30 days of their submission. Prospective state or tribal applicants can obtain the necessary forms here.
The interim rule will sunset in two years, after which point USDA will issue final regulations.
Multiple lawmakers and industry stakeholders celebrated the announcement, emphasizing that federal guidelines will further empower hemp businesses to thrive.
Shawn Hauser, partner and chair of the hemp and cannabinoids practice group at Vicente Sederberg LLP, said that “there is an undeniable sense of progress that comes with reading federal regulations for hemp farming in the U.S.—something that was outlawed for decades, which so many people fought to achieve.”
But not all of the specific details are positive, she said.
“Many people will be disappointed to see such stringent enforcement provisions related to concerns about hemp exceeding legal THC limits. For example, the rules require disposal of ‘hot hemp’ by a federal agent, even if there are reasonable options to remediate it and avoid loss of a crop,” Hauser said, referring to plants that exceed legal THC limits. “These provisions feel like relics of prohibition and come at a risk and expense to farmers, but they do not come as a surprise. It takes time to transition from prohibition to a regulatory model.”
USDA is simultaneously issuing separate guidelines for sampling and testing procedures for hemp. Samples, which have to be collected about two weeks prior to a crop’s anticipated harvest date, must be tested at Drug Enforcement Administration (DEA)-registered laboratories.
📢📢 @SecretarySonny today announced the establishment of the U.S. Domestic Hemp Production Program. This program, as required by the 2018 #FarmBill, creates a consistent regulatory framework around #hemp production throughout the U.S. https://t.co/5edNG1FnZ3 pic.twitter.com/xgSff5uDJm
— Dept. of Agriculture (@USDA) October 29, 2019
Hemp is defined under the farm bill as having 0.3 percent THC on a dry weight basis. USDA clarified that testing protocol will involve an analysis of the total THC content, including THCA, which can be converted into the traditional psychoactive compound upon decarboxylation.
The plan also establishes “an acceptable hemp THC level” that accounts for uncertainty in the cultivation process.
“For example, if the reported delta-9 tetrahydrocannabinol content concentration level on a dry weight basis is 0.35% and the measurement of uncertainty is +/- 0.06%, the measured delta-9 tetrahydrocannabinol content concentration level on a dry weight basis for this sample ranges from 0.29% to 0.41%,” USDA explained. “Because 0.3% is within the distribution or range, the sample is within the acceptable hemp THC level for the purpose of plan compliance.”
If the THC content is found to be unacceptable, however, it must be destroyed by someone authorized under the Controlled Substances Act to handle marijuana, such as a DEA registrant. A USDA official confirmed on a press call Thursday that hemp that falls outside of the acceptable THC level will not be covered by federal crop insurance.
Another provision of concern for advocates is the implementation of a 10-year ban on participation in the hemp industry by individuals with prior felony drug convictions. USDA said that ban will only apply to “key participants” such as chief executives who have a direct financial interest in the business. That means personnel such as maintenance workers will be exempt from the ban, which is in line with the narrow interpretation that advocates pushed for.
The draft document does not address the rules around whether smokable hemp flowers may be sold, which is likely because such products would fall under separate jurisdiction of the Food and Drug Administration (FDA). That absence of rules doesn’t necessarily indicate that USDA is permitting smokable hemp but the lack of clarity on the issue for now leaves room for interpretation at the state level.
The public release of the proposed regulations comes days after the White House Office of Management and Budget (OMB) finalized its review of USDA’s interim final rule. Once the regulations are finalized, hemp farmers will be eligible for a series of federal agriculture programs, including crop insurance. Previously, USDA said farmers could only gain coverage under the 2014 version of the farm bill.
The department also clarified the rules on importing and exporting hemp seeds and plants this month—however, the interim rule states that it “does not affect the exportation of hemp” and notes that USDA will work with partners on an exportation plan if there’s sufficient interest. USDA also said in August that it would accept intellectual property applications for seed-propagated hemp.
Meanwhile, lawmakers are still pushing FDA to issue rules for CBD products, which most hemp businesses are using the crop for at this point. The agency said their rulemaking process is complicated by the fact that CBD exists as an FDA-approved drug and hasn’t been previously added to the food supply. Former Commissioner Scott Gottlieb said it may take years before regulations are issued unless Congress takes action.
Read the draft USDA hemp rules below:
This piece was updated to include information about USDA’s proposed regulations and to include comments from Hauser.
Photo courtesy of Pixabay.
Congressman Files New Marijuana Banking Reform Amendment To Large-Scale House Bill
The House sponsor of a bill to protect banks that work with state-legal marijuana businesses announced on Friday that he is seeking to attach an amendment containing the reform to a broader bill dealing with research and innovation in the tech and manufacturing sectors.
Rep. Ed Perlmutter (D-CO), sponsor of the Secure and Fair Enforcement (SAFE) Banking Act, has expressed interest in finding another vehicle to pursue his proposal after it was stripped from a separate defense bill late last year. The congressman’s legislation has cleared the House in five forms at this point, only to stall in the Senate.
His latest attempt to get the reform enacted is by filing an amendment with the SAFE Banking language to the America COMPETES Act, which does not deal specifically with cannabis issues as drafted but was introduced in the House this week.
“Cannabis-related businesses—big and small—and their employees are in desperate need of access to the banking system and access to capital in order to operate in an efficient, safe manner and compete in the growing global cannabis marketplace,” Perlmutter, who is retiring from Congress after this session and committed to passing his bill first, said in a press release.
I have filed #SAFEBanking as an amendment to #AmericaCOMPETES b/c cannabis-related businesses – big and small – are in desperate need of access to capital & the banking system in order to operate in an efficient, safe manner & compete in the growing global cannabis marketplace.
— Rep. Ed Perlmutter (@RepPerlmutter) January 28, 2022
“The SAFE Banking Act is the best opportunity to enact some type of federal cannabis reform this year and will serve as the first of many steps to help ensure cannabis businesses are treated the same as any other legal, legitimate business,” he said. “I will continue to pursue every possible avenue to get SAFE Banking over the finish line and signed into law.”
It remains to be seen whether the America COMPETES Act will serve as a more effective vehicle for the cannabis banking bill than the National Defense Authorization Act (NDAA), where the language was successfully attached on the House side but later removed amid bicameral negotiations. Perlmutter said at the time that Senate leadership, which is working on comprehensive legalization legislation, was to blame for the decision to remove his amendment from the proposal.
The new SAFE Banking Act amendment will still need to be made in order by the House Rules Committee in order to be formally be considered on the House floor when the body takes up the research and innovation package. The deadline to file amendments was Friday, and the panel is set to take them up starting on Tuesday.
Even some Republicans are scratching their heads about how Democrats have so far failed to pass the modest banking reform with majorities in both chambers and control of the White House. For example, Rep. Rand Paul (R-KY) criticized his Democratic colleagues over the issue last month.
In the interim, federal financial regulator Rodney Hood—a board member and former chairman of the federal National Credit Union Administration (NCUA)—recently said that marijuana legalization is not a question of “if” but “when,” and he’s again offering advice on how to navigate the federal-state conflict that has left many banks reluctant to work with cannabis businesses.
Ohio Lawmakers Will Be Forced To Consider Marijuana Legalization As State Validates Activist Signatures
Ohio activists have collected enough signatures to force the legislature to take up the issue of marijuana legalization, the secretary of state’s office confirmed on Friday.
This comes about two weeks after the Coalition to Regulate Marijuana Like Alcohol (CTRMLA) submitted a final round of signatures for the measure. The petitions’ formal validation triggers the legislative review of legalization, but it does not require lawmakers to enact the reform.
The legislature now has four months to consider the campaign’s cannabis reform proposal. Lawmakers can adopt the measure, reject it or pass an amended version. If they do not pass the measure, organizers can then collect an additional 132,887 valid signatures from registered voters to place the issue on the ballot in November.
CTRMLA previously submitted petitions for the initiative but the state said they were short some 13,000 signatures, requiring activists to go back and make up the difference.
“We are ready and eager to work with Ohio legislators over the next four months to legalize the adult use of marijuana in Ohio,” CTRMLA spokesman Tom Haren said in a press release. “We are also fully prepared to collect additional signatures and take this issue directly to voters on November 8, 2022, if legislators fail to act.”
The measure that lawmakers will be required to consider would legalize possession of up to 2.5 ounces of cannabis for adults 21 and older, and they could also have up to 15 grams of marijuana concentrates. Individuals could grow up to six plants for personal use, with a maximum 12 plants per household.
A 10 percent sales tax would be imposed on cannabis sales, with revenue being divided up to support social equity and jobs programs (36 percent), localities that allow adult-use marijuana enterprises to operate in their area (36 percent), education and substance misuse programs (25 percent) and administrative costs of implementing the system (three percent).
A Division of Cannabis Control would be established under the state Department of Commerce. It would have authority to “license, regulate, investigate, and penalize adult use cannabis operators, adult use testing laboratories, and individuals required to be licensed.”
The measure gives current medical cannabis businesses a head start in the recreational market. Regulators would need to begin issuing adult-use licenses to qualified applicants who operate existing medical operations within nine months of enactment.
The division would also be required to issue 40 recreational cultivator licenses and 50 adult-use retailer licenses “with a preference to applications who are participants under the cannabis social equity and jobs program.” And it would authorize regulators to issue additional licenses for the recreational market two years after the first operator is approved.
Individual municipalities would be able to opt out of allowing new recreational cannabis companies from opening in their area, but they could not block existing medical marijuana firms even if they want to add co-located adult-use operations. Employers could also maintain policies prohibiting workers from consuming cannabis for adult use.
Further, regulators would be required to “enter into an agreement with the Department of Mental Health and Addiction Services” to provide “cannabis addiction services,” which would involve “education and treatment for individuals with addiction issues related to cannabis or other controlled substances including opioids.”
With respect to social equity, some advocate are concerned about the lack of specific language on automatic expungements to clear the records of people with convictions for offenses that would be made legal under the legislation. That said, it does include a provision requiring regulators to “study and fund” criminal justice reform initiatives including expungements.
Ohio voters rejected a 2015 legalization initiative that faced criticism from many reform advocates because of an oligopolistic model that would’ve granted exclusive control over cannabis production to the very funders who paid to put the measure on the ballot.
Activists suspended a campaign to place another measure on the 2020 ballot due to the coronavirus pandemic.
Aside from the new voter initiative, state lawmakers from both parties are separately working to advance marijuana reform.
A legalization bill that was the first of its kind to be introduced in the Ohio legislature last year would legalize the possession, sale and cultivation of cannabis by adults. It’s being championed by Reps. Casey Weinstein (D) and Terrence Upchurch (D).
A pair of Ohio Republican lawmakers similarly filed a bill to legalize marijuana in the state in December. Reps. Jamie Callender (R) and Ron Ferguson (R) first announced their plan to push the legislative reform proposal in October and circulated a co-sponsorship memo to build support for the measure.
There are also additional local reform efforts underway in Ohio for 2022.
After voters in seven cities approved ballot measures to decriminalize marijuana possession during last November’s election—which builds on a slew of previous local reforms in the state—campaigns are now looking to enact decriminalization in Marietta, Rushville, Rutland, Shawnee, McArthur and Laurelville.
Ohio marijuana activists already successfully proved that they turned in enough valid signatures to put a local decriminalization initiative before Kent voters after having missed the 2021 ballot due to a verification error on the part of county officials. That measure is now expected to go before voters this November.
Top Federal Drug Official Says Marijuana Use ‘Stable’ Among Youth At Prohibitionist-Hosted Panel Sponsored By D.A.R.E.
A top federal drug official participated in a panel hosted by a prohibitionist group and sponsored by D.A.R.E.—and she again reiterated that data shows youth marijuana use has remained stable “despite the legalization in many states.”
While National Institute on Drug Abuse (NIDA) Director Nora Volkow expressed concerns about certain cannabis trends related to potency, commercialization and use by pregnant women, she affirmed that surveys funded by her own federal agency have demonstrated that adolescent marijuana use is “stable,” despite repeated arguments from prohibitionists that legalization would lead more young people to experiment with cannabis.
The event was hosted by Smart Approaches to Marijuana (SAM), an anti-legalization group. SAM President Kevin Sabet and the organization’s co-founder former Rep. Patrick Kennedy (D-RI) led the discussion.
“The higher the content of THC, the greater the likelihood that you will become addicted to the drug… The content of THC has gone up at least 4-fold.”
– Dr. Nora Volkow, M.D., Director of the National Institute on Drug Abuse (NIDA)
— SAM (@learnaboutsam) January 28, 2022
Sabet said that data on youth use has showed varying results in states that have legalized cannabis and asked Volkow to weigh in on the issue. She replied that federal data “have not been able to see large differences in terms of prevalence” of cannabis consumption among young people in legal and non-legal states.
The official made similar comments in an interview with Marijuana Moment late last year.
That said, Volkow said that they have seen some differences when it comes to consumption rates among adolescents for edible cannabis products.
“But the effects are not large, and one of the things that also certainly surprised me [is] the rate overall, the prevalence rates of marijuana use among teenagers, have been stable despite the legalization in many states,” she said, adding that there are some concerns about increased frequency of use and limitations in data collection with respect to dosages being taken.
Volkow also commented on a recent federally funded survey that found illicit drug use by young people has taken a significant plunge in the last year, though she largely attributed that to the reduced social interaction resulting from COVID-19 policies across the country.
“Interestingly what we’ve observed during the COVID pandemic is, across schools in the United States, the prevalence of drug use has gone down,” she said, “which likely very much reflects the fact that kids don’t have the opportunity to interact with others, and drug taking at that stage is a peer pressure behavior.”
The official also briefly addressed the fact that she feels criminalizing people over drugs in the first place is the wrong policy approach—a point she’s made repeatedly in interviews and blog posts.
She said that “criminalization has created a system for that allows a structural racism to be implemented, you can control people, and that’s a horrible policy. This criminalization actually opens up our eyes that well, yes, we need to change that.”
However, she said that “liberalizing and making the drugs widely available, with no counter messaging,” is not the alternative she would recommend.
“We need to provide them [addicts] with treatment, so just to say ok we are going to liberalize everything… and not support treatment for those people under those conditions, I actually think it is quite irresponsible.”
– Dr. Nora Volkow, M.D., Director of NIDA
— SAM (@learnaboutsam) January 28, 2022
While the SAM-hosted event did not touch specifically on psychedelics policy, Volkow has also recently discussed that issues, especially as data has shown an increase in use of the substances among adults.
She said people are going to keep using substances such as psilocybin—especially as the reform movement expands and there’s increased attention being drawn to the potential therapeutic benefits—and so researchers and regulators will need to keep up.
Volkow also mentioned that NIDA is “pleased” the Drug Enforcement Administration recently announced plans to significantly increase the quota of certain psychedelic drugs to be produced for use in research.
Photo courtesy of Philip Steffan.