BILL ANALYSIS AB 448 Page 1 Date of Hearing: May 21, 2001 ASSEMBLY COMMITTEE ON AGRICULTURE Barbara S. Matthews, Chair AB 448 (Strom-Martin) - As Amended: May 15, 2001 SUBJECT : Industrial hemp: license for commercial purposes. SUMMARY : Directs the Secretary (Secretary) of the California Department of Food and Agriculture (CDFA), in consultation with the Attorney General to establish rules and regulations for the licensure and growing of industrial hemp. Provides definitions and makes it a crime to violate any provision of this division. Specifically, this bill : 1)Provides findings and declarations regarding industrial hemp's history, its benefits as a raw material for multiple products and that it has no hallucinatory properties. 2)Provides definition for "industrial hemp" as parts and varieties of cannabis sativa that is cultivated or possessed by a licensed grower containing tetrahydrocannabinol (THC) levels of 3/10 of 1 percent (.003) or less by weight. States that "industrial hemp" does not include marijuana. 3)Defines that THC is the natural or synthetic equivalents from the plant in the resinous extracts of cannabis and their related elements with similar chemical structure and pharmacological activities. 4)Authorizes any person meeting specified requirements to be properly licensed to plant, grow, harvest, possess, process, sell, or buy industrial hemp for commercial purposes. 5)Requires any person wanting to plant, grow, harvest, possess, process, sell, or buy industrial hemp for commercial purposes, apply to CDFA for a license. Requires CDFA, in consultation with the Attorney General, to develop related forms for this purpose. 6)Requires applicants for licensure to provide their full name, address, and legal description of production sites, a set of fingerprints taken by law enforcement, and other background information necessary for criminal history checks. Requires the review of the criminal histories to be done with the AB 448 Page 2 Department of Justice (DOJ) and the Federal Bureau of Investigation (FBI). Such investigative information is required to be confidential and permits CDFA, in consultation with and at the discretion of the Attorney General, to deny licensure of an individual with a criminal record. 7)Requires applicants to be responsible for all costs associated with background checks. Licenses will be valid for one year and provides the legal presumption that licensed growers are growing industrial hemp. 8)Requires all licensees to provide CDFA with certification that the seeds have no more than 3/10 of 1 percent of THC and is to be provided by the seed suppliers. Licensees are required to provide a copy of any contract to grow industrial hemp to CDFA. 9)Requires that licensees promptly notify CDFA of sale or distribution of crop and to provide names of purchasers of industrial hemp or to whom it was distributed. 10)Creates a misdemeanor to violate any provision of this statute. 11)Permits the Secretary to adopt rules, regulations, and fees to further this statute and to provide for testing of THC levels, supervision of growth and harvest of industrial hemp by the Attorney General. EXISTING LAW prohibits the growing or possessing of any "cannabis" varieties, except as permitted by the United States Drug Enforcement Administration (DEA). Federal statutes preempt state authority to deal with industrial hemp by defining "cannabis" as a Class 1 drug prohibiting its cultivation, sale or procession. FISCAL EFFECT : Unknown COMMENTS : There has been a concerted effort over the last decade to reauthorize the growing of industrial hemp. Last year the California Assembly adopted HR 32 (Strom-Martin) that stated the Legislature should consider directing universities and other agencies to prepare studies on the cultivation, processing, and marketing of industrial hemp. AB 448 Page 3 The National Conference of State Legislatures, in December of 2000, adopted a policy paper and forwarded it to President Clinton supporting "flexible policies to allow states to determine the viability of industrial hemp." In their letter they "strongly urge the U.S. Department of Agriculture, the DEA, and the Office of National Drug Control Policy to collaboratively develop and adopt an official definition of industrial hemp, as per those nations currently producing hemp." Further, they urge an amendment to the U.S. Codes to differentiate between industrial hemp and marijuana. According to information provided by the author, there are currently 24 countries that permit some type of production of industrial hemp. Most notably, Canada had over 30,000 acres licensed and planted in 1999. Some other countries include Chile, China, France, Great Britain, India, Japan, Spain, Korea and Egypt. Within the US, 20 states have introduced or passed legislation dealing with this product. Hawaii was granted a quarter acre experimental plot in 1999 by its Legislature and permitted by DEA. The committee may wish to consider technical amendments to clarify the proposed program. Add to page 4, line 16, after the word "production," the words "processing, distribution, or storage." While processors and distributors are required to apply for a license, the location of their operations and where the product will be held is not required to be included. On page 5, line 11, the address of the purchaser and the intended use should be provided. Further, defining a person or entity would be helpful. If a partnership or corporation applies for a license, who is required to be fingerprinted and have the criminal history search taken? What criteria is used if a member of the management of such a partnership or corporation does have a criminal history? REGISTERED SUPPORT / OPPOSITION : Support Representative Cynthia Thielen, State of Hawaii Representative David Monson, State of North Dakota Alternative Undies Appal Energy Arizona Industrial Hemp Council Artisan Gear AB 448 Page 4 Bee Bright Business Alliance for Commerce in Hemp Campaign for Agricultural and Industrial Renewal Capital Resources Coalition for Agricultural and Industrial Renewal Community Alliance with Family Farmers Co-op America Business Network County of Mendocino Sheriff-Corner Dr. Bronner's Magic Soaps Fitness Foods dba Govinda's GCM Farms Hemp Traders Humboldt State University Association of Students North American Hemp Company Nutiva Spectrum Organic Products, Inc. The Body Shop 47 individuals Opposition Committee on Moral Concerns 1 individual Analysis Prepared by : Jim Collin / AGRI. / (916) 319-2084