For marijuana businesses, the 2018 Farm Bill is landmark legislation. Congress passed the Bill yesterday awaiting the President’s signature into law.
Transportation Of Hemp Across State Lines Allowed
Federal legalization of Hemp will be astounding for the cannabis industry nationwide. Drafted into 807 pages of law is Sec. 10113 [Hemp Production] and Sec. 10114 [Interstate Commerce] of Title X. Sec. 10113 adds “Hemp” to the list of “agriculture commodities” among other things. Sec. 10114(a) allows for “the interstate commerce of hemp or hemp products” and “the transportation or shipment of hemp or hemp products produced in accordance with [section 10113] . . . through the State or the territory of the Indian Tribe, as applicable.” [Sec. 10114(b)]
Hemp Means CBD
Federal Legislators defined “Hemp” as:
“[T]the plant Cannabis sativa L. and any part of that plant, including the seeds thereof and all derivatives, extracts, cannabinoids, isomers, acids salts, and salts of isomers, whether growing or not, with a delta-9 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.”
States May Regulate Hemp Production, But Not Interstate Commerce
The bill allows States and Indian Tribes to regulate Hemp and expressly provides for “No Preemption” of any law of a State or Indian tribe that “regulates the production of hemp” and is “more stringent” than federal law [Sec. 10113.]
However, Federal lawmakers went on to expressly provide for interstate commerce of Hemp and Hemp products [Sec. 10114] – the express language of the bill further states that “No State or Indian Tribe shall prohibit the transportation or shipment of hemp or hemp products produced in accordance with [Sec. 10113.]”
While the Federal government occupies the field of interstate commerce under any circumstances, it will be interesting to see what happens in light of existing state cannabis regulations which make illegal the transport of marijuana across state lines.
Either way, when the President signs this landmark legislation into law, the entire cannabis industry, and commerce alike, will finally have breathing room. For marijuana businesses, hemp would be fully legal according to the Federal Government. Every barrier to entry in banking, commercial real estate, intellectual property and everything in between will lift – advancing the industry one monumental step further to social acceptance of marijuana as simply a commodity just like any other commodity – like cabbage perhaps.
If you would like a highlighted copy of the legislative text for the hemp sections under the 2018 Farm Bill, contact Eskaton Law.
An experienced corporate litigator having worked in both the private and government sectors, Attorney Robyn Ranke has taken a modern business approach to the cannabis industry and in working with cannabis business startups. Throughout her legal career, Robyn has represented a diverse base of business clientele in a variety of industries involving both complex and novel legal matters. Her diverse experience as a business litigator provides a valuable legal platform from which she is uniquely postured to address the regulatory hurdles, costly pitfalls, unique business transactions, and business litigation risks that confront California cannabis business owners today and into the future as state regulations continue to evolve.
Member Blog: Hemp & CBD Legalization, Regulation & Compliance – Key Language in the Farm Bill
Few developments in the world of cannabis — whether marijuana or hemp — could match the impact of the 2014 Farm Bill. But the 2018 Farm Bill, approved by the House and the Senate this week, promises to do just that.
As a quick reminder, the 2014 Farm Bill created an exception to the federal laws that prohibit the cultivation and sale of cannabis. To simplify, to the extent that a state created a pilot program to study hemp cultivation and the plants were of a sufficiently low level of THC, the resulting plant would be considered “Farm Bill hemp” and not subject to the prevailing federal prohibitions. To state the obvious, this was a very significant change. In fact, as a result of a combination of the magnitude of the change and the narrowness of the exception, apparent confusion led to periodic enforcement actions and court challenges.
As 2018 draws to a close, Congress must once again reauthorize the Farm Bill. It’s worth noting that the periodic reauthorization has nothing to do with hemp policy, and everything to do with the federal legislative process.
And the relatively narrow “exception” for hemp in the 2014 Farm Bill is on the cusp of significant expansion. Hemp, defined as cannabis plants and all their parts, extracts, “cannabinoids,” and derivatives with a THC concentration of less than 0.3%, will be subject to a regulatory scheme devised by the federal Department of Agriculture and will be removed from the federal Controlled Substances Act. States that wish to regulate hemp may propose regulations that the state “shall submit to the Secretary” of Agriculture. Notably, no state “shall prohibit the transportation or shipment of hemp or hemp products” produced in compliance with these new rules.
So, inquiring minds might wonder, what happens if 2018 Farm Bill hemp turns out to have a THC concentration of 0.31% instead of the permissible 0.3%? To the extent that higher THC concentration is the result of an honest mistake, Section 297B(e)(2) provides the answer: if the state has developed hemp regulations, and the state concludes the violation was the result of “negligence” (e.g., an unintentional oversight), the producer will be required to take corrective action. If that happens 3 times in a 5-year period, the producer will be ineligible to produce. If the state has not developed hemp regulations, the same standard will be applied by the federal Secretary of Agriculture pursuant to Section 297C(c)(2).
That is, a “negligent” mistake should not place the cultivator at risk of being placed outside of the protections of the Farm Bill (discussion of the reach of those federal laws is fascinating, but beyond the scope of this post). As a result, it will remain advisable for hemp cultivators to implement sufficient compliance efforts to avoid any potential inference that they are intentionally seeking a higher THC concentration.
Barring the unexpected, the 2018 Farm Bill will have a seismic impact on the hemp and hemp-derived CBD industry. With the nation watching, a smooth, well-regulated transition can only help to bolster calls for broader cannabis reform. As a result, once the 2018 Farm Bill becomes law, the industry will undoubtedly be paying close attention to the regulations promulgated by federal and state hemp regulators. And they will be working hard to demonstrate that they are staying within those guidelines.
Michael Cooper is the co-founder and managing member of MadisonJay Solutions LLC, a leading regulatory advisor to the adult-use cannabis industry that helps businesses understand the latest rules and build effective compliance infrastructure to address risk. He is the Vice Chair of the NCIA’s State Regulations Committee, and publishes and speaks frequently on cannabis regulation.
He is a graduate of Harvard College and Harvard Law School, and previously served as General Counsel of MHW, Ltd. and in the litigation department of Cravath, Swaine & Moore LLP. He began his legal career as a law clerk on the U.S. Court of Appeals for the Fifth Circuit. He can be reached at mcooper@madisonjaysolutions.com.
Hemp: One of the Nation’s Oldest, and Now Newest, Agricultural Commodities
by Michelle Rutter, NCIA’s Government Relations Manager
HISTORY
Farming and agriculture has long been a part of North American history. When the Great Depression hit in the 1930’s, both President Franklin Delano Roosevelt and Congress knew that the United States would struggle until the agriculture industry became prosperous again. As a result, many New Deal programs dealt with farming, but arguably the most notable agriculture related legislation was the Agricultural Adjustment Act of 1938, which was the first version of what we know today as simply the “Farm Bill” that is updated roughly every five years.
TODAY
In 2018, a new Farm Bill was introduced with a price tag upwards of $800 billion. One of the most notable provisions in this year’s bill was led by Senate Majority Leader Mitch McConnell (R-KY): hemp legalization. Industrial hemp refers to the cannabis plant with less than 0.3 percent THC content and would include CBD medicinal products — so long as it contains less than 0.3 percent THC and is derived from industrial hemp.
While leadership in the House of Representatives blocked the hemp provision in its version of the bill, the Senate’s version of the bill that passed overwhelmingly in June does include it. That means that when the bill goes to conference in early September, that hemp legalization will be debated. Considering that the Senate Majority Leader is championing this provision, it stands a good chance at being included, though nothing is guaranteed.
Marijuana’s “cousin,” hemp, is generally barred because it is part of the cannabis plant, despite the fact that it contains little of that drug’s key psychoactive ingredient, THC. In 2014, Sen. McConnell secured a hemp pilot program in that year’s farm bill. Since then, at least 35 states have taken up the offer and developed industrial hemp programs, and those states will be eligible to pursue a legal, regulated market if the 2018 Farm Bill is passed with the hemp provision included.
If passed, the Farm Bill would legalize hemp as an agricultural commodity by removing it from the federal list of controlled substances and giving states the opportunity to be the primary regulators of hemp production. In addition to removing hemp from the federal controlled substance list, the Senate farm bill would allow industrial hemp to be eligible for crop insurance, a perk already enjoyed by other, more traditional crops. The bill would also reauthorize commodity, trade, agricultural research, rural development, and food and nutrition programs. Under current law, authorizations will expire September 30 or the end of the applicable crop year.
The first farm bill conference committee meeting has been set for September 5, 2018. The conferees from the House and Senate will try to iron out differences between their two bills in the panel. Included in the discussions will be 47 members of the House of Representatives and nine Senators. The results of this could mean a new era for the agricultural industry if hemp returns to American farmlands.
Member Blog: The Most Important Things to Consider When Purchasing Bulk or Wholesale Hemp Derived Phytocannabinoids
Folium Biosciences hemp farms are some of the largest in the USA. Location: La Junta, CO.
Hemp, more than any other plant on Earth, is unique in its ability to literally suck the heavy metals and toxic waste out of the environment. Hemp is even being used in phytoremediation at Chernobyl in Russia. What does this mean to consumers of hemp products? Knowing as much information as possible about your hemp is crucial to understanding its legality, limitations, and effectiveness.
Hemp from China, for example, contains some of the most dangerous heavy metals in the world. According to a 2011 study of Chinese hemp strains, the plant was able to absorb dangerously high levels of the heavy metal cadmium without detriment to the plant itself. Cadmium (Cd) is an extremely toxic industrial and environmental pollutant classified as a human carcinogen.
What is the heavy metals and residual solvent content of the hemp oil? Residual solvents and heavy metals can negatively influence the health benefits of the oil.
Besides CBD, what other cannabinoids and terpenoids are present in the extract? A full spectrum profile of synergistic compounds has been shown to be more effective than an extract with only cannabidiol.
Was the hemp grown using clones or seeds? Clones provide a much more consistent end product. With seeds, you never truly know what is going to grow.
Can your supplier provide you with a consistent and reliable product? What good is the product if you cannot get it the exact same way every time and when you need it?
Considering the fact that many people are relying on CBD for their health and wellness, ensuring that your hemp oil is the highest quality is vital to its effectiveness. Prior to purchasing bulk or wholesale CBD oil, make sure you know where your hemp was grown and processed. Ask yourself this question before purchasing imported Chinese or European hemp oil: Would you feed your child milk imported from cows located in China or Eastern Europe? Didn’t think so.
***EDITOR’S NOTE: Federal policy toward hemp-derived CBD products with respect to Section 7606 is currently subject to substantial debate. The USDA’s website states, “[S]ection 7606 did not alter the approval process for new drug applications or any other authorities of the FDA, nor does it alter the requirements of the Controlled Substances Act that apply to the manufacture, distribution, and dispensing of drug products containing controlled substances.”
Ryan Lewis is the VP and Head of Global Sales for Folium Biosciences of Colorado Springs, CO. Folium Biosciences is the largest vertically integrated producer, manufacturer, and distributor of hemp derived phytocannabinoids in the U.S. Folium, along with their exclusive distributor, Entourage Nutritional Distributors, supplies section 7606 US Farm bill compliant hemp derived phytocannabinoids to some of the leading brands and companies in the world. Ryan graduated with high honors from Brown University and attended Pepperdine University Law School and Business School.
NCIA Member Profile: CBCB – Cannabis Buyers’ Club Berkeley
NCIA recently had an opportunity to speak with Aundre Speciale, director of CBCB, a locally-licensed medical cannabis dispensary in Berkeley, California. CBCB is a patient-centered collective with limited membership, bringing patients access to medicine in conjunction with a natural perspective of wellness, and they offer educational seminars, support groups, and a variety of services.
Aundre Speciale of CBCB sits with the late Jack Herer
Cannabis Industry Sector:
Medical Cannabis Provider
Sustaining NCIA Member Since:
2014
How do you uniquely serve the cannabis industry?
My background is a mix of activism, politics, and industry. I have worked for cannabis reform for 25 years as an activist and lobbyist, gaining civil disobedience experience as well as political allies. Through my activism I have been able to hear directly from patients what their needs are, and I now currently operate several dispensaries throughout the state.
My model for dispensing medical cannabis has included opening community centers that provide free services to patients and the local community, working closely with community service providers and city government to create enlightened cannabis policy, and funding major cannabis research and reform projects. I currently share my operational experience by sitting on the boards of a number of licensed dispensaries throughout California. I have been inspired by and learned from the compassionate models of people like Jack Herer, Eddy Lepp, Dennis Perron, Val and Mike Corral with WAMM, Debbie Goldsberry and Don Duncan with Berkeley Patients Group (BPG), and many more.
Why should patients looking for medical cannabis services go to Cannabis Buyers’ Club Berkeley (CBCB)?
CBCB was started in 1996 by patients with a desire to help other patients. It continues in the same spirit. We have two employees who have worked at the collective for more than 15 years, and we have patients who have been with the collective since its beginning. I became director in 2007.
CBCB’s style is uniquely Berkeley, as are its compassionate patient-centered programs. We offer many support groups, educational seminars, wellness programs, and a compassion program that provides free medicine for patients, including children with epilepsy, chemo patients, veterans, and end-of-life patients. Many programs and services are run by patient volunteers, “patients helping patients.” CBCB believes in community responsibility and not only funds and supports cannabis research, campaigns, and advocacy, but also supports community events, projects, and organizations. Our patient volunteers walk the neighborhood daily picking up all trash, while an extra CBCB security guard patrols the neighborhood greeting neighbors. Our employees are compassionate and cannabis-educated and are happy to spend as much time as patients need to assist them in finding the medicine that works best. CBCB has an unusually large range of products to serve the individual needs of our patients. We offer free fruit, coffee, and tea, and hugs are handed out liberally. Our official motto is ‘choose love.’
Tell us about your past involvement in the California medical marijuana community. Where do you see the laws and culture heading in California in the future?
Aundre Speciale stands next to the Hemp Bus, 1991
My passion for cannabis advocacy began in 1989 at the height of the “just say no” era when my neighbor, Jack Herer, asked me to join him on the Hemp Bus, touring California and the country promoting hemp for fuel, food, fiber, fun, and medicine. Thus began my life-long love for and dedication to cannabis reform. I have been involved in countless cannabis campaigns and projects, including the federal hemp foods ban protests, and I was key organizer on behalf of defendants in the first federal trials of medical cannabis providers. I’m a founding member of Americans for Safe Access, where I developed its popular peer counseling program, gathered data for lawsuits protecting and expanding patientsʼ rights, and provided best-practices training for dispensary operators. I served on the board of the Marijuana Policy Project for three years, holding the vice chair position. I have been an early dispensary operator, opening dispensaries and working with several cities to craft medical cannabis regulations, including San Francisco, Sacramento, Venice Beach, Berkeley, South Lake Tahoe, and Oakland.
California has had a thriving cannabis culture for generations, and it is hard to get everyone to all agree what direction cannabis regulations should go. But I see California, along with the rest of the country and world, having access to adult-use cannabis, as well as hemp products, in the very near future. People are looking for safer, more natural products, from their medicine to their paints, and cannabis is the answer. Cannabis is the “new” in thing.
Why did you get involved in NCIA?
I love NCIA. I know NCIA’s executive director Aaron Smith from the amazing work he did with the Marijuana Policy Project (MPP), and he has a long record of successful campaigns. With NCIA, he has proven to be a strong, effective leader who has assembled an incredible staff. I appreciate the caliber and experience of NCIA speakers and members, truly the best in the industry, with whom I can truly learn and exchange ideas about timely and relevant industry information.
If you are a member of NCIA and would like to contribute to the NCIA blog, please contact Development Officer Bethany Moore by emailing bethany@thecannabisindustry.org.
An experienced corporate litigator having worked in both the private and government sectors, Attorney Robyn Ranke has taken a modern business approach to the cannabis industry and in working with cannabis business startups. Throughout her legal career, Robyn has represented a diverse base of business clientele in a variety of industries involving both complex and novel legal matters. Her diverse experience as a business litigator provides a valuable legal platform from which she is uniquely postured to address the regulatory hurdles, costly pitfalls, unique business transactions, and business litigation risks that confront California cannabis business owners today and into the future as state regulations continue to evolve. 
Ryan Lewis is the VP and Head of Global Sales for Folium Biosciences of Colorado Springs, CO. Folium Biosciences is the largest vertically integrated producer, manufacturer, and distributor of hemp derived phytocannabinoids in the U.S. Folium, along with their exclusive distributor, 
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