BILL ANALYSIS AB 388 Page 1 GOVERNOR'S VETO AB 388 (Strom-Martin) As Amended June 12, 2002 2/3 vote ----------------------------------------------------------------- |ASSEMBLY: | |(June 6, 2001) |SENATE: |23-10|(August 8, | | | | | | |2002) | ----------------------------------------------------------------- (vote not relevant) ----------------------------------------------------------------- |ASSEMBLY: |45-30|(August 15, | | | | | | |2002) | | | | ----------------------------------------------------------------- Original Committee Reference: NAT. RES. SUMMARY: Requests the University of California (UC) to assess the economic opportunities of specialty or alternative fiber crops, including industrial hemp, kenaf, and flax utilizing information from other states and countries. The research shall include market demand, identification of potential barriers, production, and processing. The UC shall complete the report by January 1, 2004, at which time it shall be distributed to the Assembly Committee on Agriculture and the Senate Agriculture and Water Resources Committee. The Senate amendments delete the Assembly version of this bill, and instead: 1)Request the UC to conduct an assessment on the economic opportunities of growing specialty and alternative fiber crops in California. The assessment is to include industrial hemp, kenaf, and flax, and to extrapolate from existing data on productivity and costs of other states and countries. 2)Require the report to include, but not be limited to, an estimation of the demand and likely crop prices, identification of potential barriers to profitability, identification of production and processing, and marketing issues that need to be addressed for future demonstration AB 388 Page 2 research or pilot commercial trials. 3)Request the report to be completed by January 1, 2004 and be given to the Assembly Committee on Agriculture and the Senate Agriculture and Water Resources Committee. AS PASSED BY THE ASSEMBLY , this bill required an annual appropriation of $125,000 for expenditures to the Office of Oil Spill Prevention and Response (OSPR) to develop and conduct training of staff and other personnel to respond to toxic spills requiring the rescue of wildlife. The bill appropriated $135,000 to OSPR for allocation to the nonprofit Marine Mammal Center for research into the effects of toxic substances on marine mammals. FISCAL EFFECT : This bill passed out of the Senate Appropriations Committee under Senate Rule 28.8. Any additional state costs are not significant and do not and will not require the appropriation of additional state funds, and the bill will cause no significant reduction in revenues. COMMENTS : This bill was substantially amended in the Senate and the Assembly-approved provisions of the bill were deleted. AB 448 (Strom-Martin) dealt with establishing rules and regulations for the licensure and cultivation of industrial hemp; it failed passage in the Assembly Committee on Agriculture (May 21, 2001). AB 388 takes a different tack in preparing background and data to discover if such fiber crops as industrial hemp, flax, and kenaf would be a viable commodity if grown in California. The market for products made from such alternative fiber crops has grown in recent years and other agricultural producing regions of the world have expanded their production. GOVERNOR'S VETO MESSAGE : This bill would request that the University of California conduct a study of the economic opportunities associated with the production of alternative fiber crops, including industrial hemp, AB 388 Page 3 flax, and kenaf. There are a number of significant concerns regarding the legality of producing industrial hemp in the United States. The U.S. Department of Agriculture concluded that 'legal issues currently preclude research into the viability of industrial hemp fiber production in the United States.' In addition, the Drug Enforcement Administration applies the same strict controls of industrial hemp as it does to marijuana. That is, it is a Schedule I Controlled Substance under federal law. For these reasons, I am returning this bill without my signature. Analysis Prepared by: Dawn Clover / AGRI. / (916) 319-2084 FN: 0008182