The 2014 Farm Bill and 2018 Farm Bill extension gave regulatory authority to the United States Department of Agriculture (USDA) to work with states and Indian Tribes to issue licenses to grow hemp for commercial and research purposes. However, there were a few states that did not opt into the 2018 extension, and the provisions and extensions for the 2014 Farm Bill are now expired.
What does this mean for the legal status of growers and sellers in the United States? The good news is that growers and sellers are still allowed to grow and sell hemp if a state allows for it. In fact, the production of hemp under the 2018 Farm Bill is allowed broadly, not simply for pilot programs for studying market interest in hemp derived products. Growers will need to constantly pay attention to what actions their state is taking and whether the state continues to opt into its regulatory authority under the farm bill. If not, then the grower will need to apply to the USDA in order to continue to grow hemp.
The 2014 farm bill expired in September of 2021. As of January 1, 2022, all states must either have a USDA approved hemp product or cede regulatory oversight over hemp collection to the USDA. If you have a state issued hemp growers license that was issued by a state that did not opt into the 2018 extension , then the license is no longer valid, even if it was not due to expire yet. You should not have any hemp growing, in the field, greenhouse, or grow-room, at this time unless you have a USDA hemp production license. You may still have hemp in your possession that you grew in 2021 or earlier under your state issued license. For states that submitted their own plans and those plans were approved, the state plan will govern the 2022 growing season.
Growing hemp is absolutely still legal, unless a state disallows it. In fact, the production of hemp under the 2018 Farm Bill is allowed broadly, not simply for pilot programs for studying market interest in hemp derived products. The regulatory authority will be shared between the states and the federal government. Pursuant to the Farm Bill 2018, growing hemp is legal in all 50 states, on the federal level, as long as the state submits a plan under which the state or Indian tribe monitors and regulates the production of hemp, and the plan is approved. If a state decides to opt out of its regulatory authority, then the USDA is responsible for hemp regulation in that state. A state has authority to make hemp production illegal if it chooses. The state law can be more restrictive than the 2018 farm bill, but not less restrictive. States cannot disallow transportation of hemp through that state.
The USDA keeps an updated list of the states who have submitted a plan that was approved, and the states that are regulated solely under the USDA. Currently, Hawaii, Mississippi, New Hampshire, North Carolina, Utah and Wisconsin are the only states that have not submitted a regulatory plan to the USDA and are thus regulated by the USDA. Once a plan is formally submitted, USDA has 60 days to approve or disapprove the plan. Once a plan is approved by USDA, it remains in effect unless suspended or revoked by USDA pursuant to the procedures described in the Final Rule, or unless the State or Tribe revises their plan and resubmits it for USDA approval.
Selling hemp is still legal as well, as long as the state does not disallow it. The USDA has stated that it does not have jurisdiction under its program to regulate any processed products. As long as the hemp plant itself tests within the compliance range, then the USDA has no restrictions around whether it can be used for tinctures or edibles or smokeable hemp, smokeable flower, packaged flower etc. The regulations on selling the processed product are deferred to the state law and the state can choose whether it would like to regulate the processed product.
In response to the USDA’s interim final rule, some commentators stated that it is commonly known that the THC levels in initially compliant hemp may rise above the .3 percent delta 9 THC limit during the processing phase, even though the final product results in the compliant .3 percent range. The DEA has said that if, during the processing of the product, at any time, if the level rises above .3 percent, then the product is a controlled substance and is illegal under the CSA. Our next blog post will address this issue specifically.