BURLINGTON, Vt. (June 8, 2018) – An attempt to make Vermont’s industrial hemp licensing program federally compliant failed this year, allowing farmers in the state to continue developing a viable hemp industry and nullifying federal prohibition in effect.
The comprehensive farm bill (S276) passed by the Senate included provisions modifying the state’s industrial hemp licensing program.
“The intent of this chapter is to establish policy and procedures for growing hemp in Vermont that comply with federal law so that farmers and other businesses in the Vermont agricultural industry can take advantage of this market opportunity.”
The introduced version of S276 did not include the hemp provisions. They were approved by the Committee on Natural Resources and Industry after they were introduced by committee chair Sen. Christopher Bray (D- New Haven). The version including the hemp provisions was passed by the Senate
The House Appropriations Committee approved an amendment proposed by Rep. Carolyn Partridge (D-Windham) to strike the hemp provisions out of the bill. That version ultimately passed the House and was approved by the Senate. That means Vermont farmers will be able to continue growing industrial hemp for commercial purposes despite federal law to the contrary.
The provisions in the farm bill weren’t the only efforts to align Vermont’s hemp laws with federal policy. Rep. John Rodgers (D-Glover) introduced a standalone bill to conform the Vermont hemp program to federal law. S286 never received a hearing in the Senate Agriculture Committee. A bipartisan coalition of eight representatives introduced a similar bill in the House. It also died in committee without a hearing.
The fact that several Vermont legislators tried to bring Vermont’s hemp program into federal compliance indicates they know it does not conform to federal law and chose to continue that status quo.
In 2013, the Vermont legislature passed a law legalizing and licensing hemp production at the state level. The Vermont law does not limit hemp cultivation to research purposes, as required under federal law. When Gov. Peter Shumlin signed the Vermont hemp bill, he emphasized that cultivation was still illegal under federal law.
“Although the growing of hemp will now be legal under Vermont law, it remains subject to federal anti-drug statutes. That means that farmers who choose to grow hemp do so at their own risk and need to be aware of the possible consequences”
The minimal possibility of federal prosecution has not stopped some growers from taking advantage of the opportunities they see with the door now cracked open to develop a hemp market in the state.
Hemp cultivation in Vermont has grown each year. In 2014, Netaka White planted 8×8 foot plot of hemp with seed she obtained illegally from France. Several other growers planted small plots that year. By 2016, Vermont had about 60 acres of hemp growing in 12 locations. Officials say they expect growers to harvest about 2,000 acres of hemp during the 2018 growing season.
“The hope is that the folks that are interested in producing products with CBD and growing it for seed. Also for animal feed, or whatever they want to grow, and have an easier time of doing it,” Partridge told WVNY.
FEDERAL FARM BILL
In 2014, Congress cracked the door open for hemp in the U.S. with an amendment to the 2014 Farm Bill. The law allows hemp cultivation for research purposes, but prohibits “commercial” production.
The “hemp amendment” included in the 2014 farm bill —
…allows State Agriculture Departments, colleges and universities to grow hemp, defined as the non-drug oil-seed and fiber varieties of Cannabis, for academic or agricultural research purposes, but it applies only to states where industrial hemp farming is already legal under state law.
In 2016, the U.S. Department of Agriculture and Drug Enforcement Agency released a “statement of principles” to guide interpretation of the hemp section in the Farm Bill. It states, “The growth and cultivation of industrial hemp may only take place in accordance with an agricultural pilot program to study the growth, cultivation, or marketing of industrial hemp established by a State department of agriculture or State agency responsible for agriculture in a State where the production of industrial hemp is otherwise legal under State law.”
In short, the current federal law authorizes farming of hemp – by research institutions, or within state pilot programs – for research only. Farming for commercial purposes by individuals and businesses remains prohibited.
The definition of “commercial” and the extent to which sales and marketing are allowed under the rubric of “research” remains murky. This has created significant confusion.
The statement of principles also asserted that industrial hemp programs are limited to fiber and seed. It didn’t mention the CBD oil or other edible hemp products. The DEA has apparently interpreted that to mean they remain illegal. The agency has flat-out said CBD cannot be sold under any circumstances. An Indiana TV station interviewed DEA spokesman Rusty Payne who said, “It’s not legal. It’s just not.”
Several other states with federally-compliant hemp programs, such as Kentucky, North Dakota, Minnesota and New York, have grown significant acreage under federally-approved research programs. This takes the first step, but with federal shackles in place, these states are not legally allowed to develop any kind of commercial market. Ironically, many of these “federally compliant” programs are not actually federally compliant.
Recognizing its limited research program was hindering the development of the industry, West Virginia dumped its federally compliant hemp program during the 2017 legislative session and will now issue federally non-compliant commercial licenses to growers. West Virginia Public Broadcasting confirmed limits imposed by the old program due to its conformity with federal law were holding back the development of a viable hemp industry and everyday farmers cannot benefit.
“But because of the strict requirements under the 2014 bill, growers are not able to sell their plants and cannot transport them across state lines to be turned into those usable products. That’s limited the ability to create a real hemp industry in the state.”
OTHER STATES
Other states, including Colorado, Oregon, and Maine have simply ignored federal prohibition and legalized industrial hemp production within their state borders.
Colorado was the first state with widespread commercial hemp production. Farmers began growing hemp in southeast Colorado back in 2013 and the industry is beginning to mature. The amount of acreage used to grow industrial hemp in the state doubled in 2016 to nearly 5,000 acres, and nearly doubled again in 2017.
The Oregon legislature initially legalized industrial hemp production in 2009. While it was technically legal to grow hemp in the state, farmers didn’t take advantage of the opportunity for nearly five years. When the Oregon Department of Agriculture finally put a licensing and regulatory program in place early in 2014, farmers began growing hemp. The initial regulatory structure placed significant limits on hemp farming and effectively locked small growers out of the market. In 2016, Gov. Kate Brown signed House Bill 4060 into law. It relaxed state laws regulating hemp already on the books and made the crop more like other agricultural products. Within months, the Oregon Department of Agriculture had already promulgated new rules under the reformed law. According to Oregon’s Cannabis Connection, the rules set the stage to creates a “massive” medical hemp market. The state produced 3,469 acres of hemp in 2017.
Colorado, Oregon and Vermont all demonstrate how loosening rules at the state level encourage the market and allow hemp a legitimate commercial hemp industry to develop.
HUGE MARKET FOR HEMP
According to a 2005 Congressional Research Service report, the U.S. is the only developed nation that hasn’t developed an industrial hemp crop for economic purposes.
Experts suggest that the U.S. market for hemp is around $600 million per year. They count as many as 25,000 uses for industrial hemp, including food, cosmetics, plastics and bio-fuel. The U.S. is currently the world’s #1 importer of hemp fiber for various products, with China and Canada acting as the top two exporters in the world.
During World War II, the United States military relied heavily on hemp products, which resulted in the famous campaign and government-produced film, “Hemp for Victory!”
