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USDA 2018 Farm Bill Public Hearing – Testimony On Hemp Legalization Implementation by Courtney

On February 26, the United States Department of Agriculture held a special Public Hearing on the implementation of the 2018 Farm Bill. Due to time constraints, the number of speakers allowed to present was limited.

EARTH Law’s founding principal Courtney N. Moran, LL.M., leading expert on hemp law, was among those who provided testimony.

While the Public Hearing was focused on the 2018 Farm Bill in general, she provided detailed testimony on the importance of USDA’s development of regulations to implement hemp legalization and areas where the industry is looking to USDA for guidance, including access to banking and issues with interstate transportation and commerce.

Please click here to see Courtney’s full testimony. Below is also the written transcript of Courtney’s complete testimony.

USDA Listening Session Testimony Courtney N. Moran, LL.M. February 26, 2019

Hi, I am Courtney Moran, Hemp Attorney and Founding Principal of EARTH Law, LLC, a Cannabis Hemp Law Firm based in Portland, Oregon.

I am the co-founder and Chief Legislative Strategist for Agricultural Hemp Solutions, LLC, an all-inclusive advisory firm guiding the evolution of the U.S. hemp industry through bill passage and comprehensive hemp program implementation. To date having passed 7 bills, in 5 states and one federally.

I am co-founder and President of the Oregon Industrial Hemp Farmers Association, an Oregon non-profit collective of Oregon hemp farmers and handlers. OIHFA has passed 3 bills to date, growing Oregon’s hemp industry from 9 farmers in 2015 to over 570 in just 3.5 years.

I am co-Founder and President of the Pacific Northwest Hemp Industries Association, a regional chapter of the Hemp Industries Association representing Oregon, Washington, and Idaho.

I serve on the Board of Directors for the national Hemp Industries Association, a membership based non-profit trade association formed in 1994 to educate the public and advance the hemp economy for the benefit of our Members, the public, and the planet. We currently have over 1000 members.

I am the elected HIA Board Representative that sits on the Board of the U.S. Hemp Roundtable.

I serve on the Board of Directors of national NORML, and also serve on the Board of Directors for the National Cannabis Bar Association.

Additionally, I had the privilege of working pro-bono, for the previous 2 years, with the offices of Senate Majority Leader Mitch McConnell and Senator Ron Wyden on the drafting of the Hemp Farming Act of 2018, the language of which was included in the 2018 Farm Bill, legalizing hemp. As such, I have first-hand knowledge of the Congressional Intent behind the hemp related sections in the 2018 Farm Bill.

I testify today on behalf of the hemp industry at large.

The 2018 Farm Bill provided key language that supports hemp’s growth as a newly legal agricultural commodity. This includes making the hemp crop eligible for federal crop insurance through sections 11101, 11106, 11113, 11119, and 11121, with oversight by the USDA’s Risk Management Agency.

While not specifically listed in the Federal Register Notice for today’s Listening Session but relevant to the discussion, since USDA is just beginning to develop regulations to implement hemp legalization, including eligibility for crop insurance. Section 10113 of the 2018 Farm Bill instructs the USDA to administer a program that allows individuals to cultivate, grow, and sell hemp and hemp derivatives. This section authorizes states and tribal governments to regulate hemp production in their jurisdictions by establishing, with USDA’s approval, hemp production, cultivation, testing, and distribution plans. Further, section 10114 provides that nothing in the Horticulture Title of the 2018 Farm Bill prohibits the interstate commerce of hemp or hemp products, and further prevents states and tribal governments from prohibiting the transportation of hemp or hemp products through the State or the territory of the Indian Tribe.

These changes are exciting for our industry and provide the framework for positive economic impacts for farmers and agribusinesses owners across the United States.

The eligibility for crop insurance is something hemp farmers across the U.S. are eager to realize, as they have had limited, if any, access to insurance for their crops produced under the agricultural pilot program authorized in the 2014 Farm Bill. Under the pilot programs, domestic production has grown from 3 states growing minimal acreage in 2014 to 24 states growing over 78,000 acres in 2018 (those figures, courtesy of Vote Hemp).

This significant growth and progress has all been achieved in absence of federal research funding. This industry has been built with publicly driven momentum and private funding. The provisions in the 2018 Farm Bill legitimizing hemp research under the National Agricultural Research, Extension, and Teaching Policy Act of 1977 and the Critical Agricultural Materials Act will provide much needed additional research dollars and the industry is excited for this opportunity for further academic advancement.

As USDA begins to develop regulations to implement the hemp provisions in the 2018 Farm Bill, this industry respectfully urges USDA to pay close attention during regulation promulgation to the following:

Farmers are currently preparing for planting for the 2019 production season. Will RMA issue guidance authorizing federal crop insurance for hemp farmers for the 2019 production season? With changing weather patterns and devastating storms such as Hurricane Florence, farmers need this protection as soon as possible.

Additionally, USDA NOP guidance currently does not provide for full hemp plant organic certification, namely for flower production for hemp-derived cannabinoids and the processing of hemp-derived cannabinoids. The industry respectfully requests NOP to issue guidance in time for the 2019 production season clarifying authority for full plant organic certification.

These and the following are examples of issues that have created and continue to create disruption for hemp farmers and businesses that otherwise normal agricultural businesses do not face. The change in the Federal status of hemp and thoughtful regulation by USDA can alleviate these and other concerns.

For example, the news has been full of stories around the country of issues of hemp crop seizures by law enforcement for simple transportation of the commodity. Similarly, some trucking/shipping companies are not offering hemp farmers or hemp business owners transportation/shipping services. The industry needs USDA to develop clear guidance for transportation of hemp as well as protectionary measures to prohibit state-by-state discrimination of interstate hemp commerce and transportation.

Another example is limited access to banking with financial institutions. Farmers and hemp agribusiness owners have struggled during the past four and a half years to secure bank accounts and now federally legal the industry needs the USDA to issue guidance to alleviate the current issues regarding access to banking.

A few additional comments for the record:

With regard to the 2018 Farm Bill’s “felon ban,” it was Congress’ intent to restrict only the individual applicant for a hemp permit from growing hemp and not for the restriction to extend to employees. For entity applicants, it was the intent that a company be eligible for a hemp permit if that company is owned by at least 51 percent individuals without a controlled substance felony in the previous 10 years.

The industry needs standard protocol established for testing the delta-9 THC levels of hemp plants in field with a reliable testing method. We recommend the use of High-performance liquid chromatography or HPLC-MS for the testing of delta-9 THC levels. I re-iterate delta-9 THC levels and Not Total THC levels. The definition for hemp specifically refers to delta-9 and our neighbors to the North, Canada, have had a booming hemp industry for the past 20 years, with no issues testing specifically for delta-9 THC. Additionally, testing of total THC will favor foreign varieties and imports, having a significant negative financial impact on domestic breeders and varieties farmers across the US are currently growing. Rod Kight has submitted detailed comments on this particular issue as well.

The industry needs the USDA to take the lead to put an end to the disruption of basic commerce related to the hemp industry. Thank you for your consideration of these important issues. We look forward to USDA guidance that addresses these issues and provides for a flourishing domestic hemp farming economy.

I’d be happy to help in any way I can if the Agency is seeking industry input, namely from a legal expert with first hand knowledge of Congressional intent.

Thank you.

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