BILL ANALYSIS                                                                                                                                                                                                    



                            SENATE AGRICULTURE COMMITTEE
                          Senator Abel Maldonado, Chairman

          BILL NO:  AB 684                      HEARING:  6/19/07
          AUTHOR:  Leno                         FISCAL:  Yes
          VERSION:  6/13/07                     CONSULTANT:  John Chandler
          
                                  Industrial hemp.

          BACKGROUND AND EXISTING LAW

          "Industrial hemp" or "hemp" refers to low level psychoactive  
          chemical tetrahydrocannabinol (THC), varieties of Cannabis  
          sativa L.  For centuries countless consumer and industrial  
          products have been produced from hemp around the world.  Hemp  
          can be cultivated as a fiber or a seed crop.  Hemp fiber can be  
          used for textiles, paper, construction materials, auto parts,  
          and home furnishings while hemp seeds can be used for body care  
          products, industrial oils, pharmaceuticals, and food.  Despite  
          its many uses, hemp is commonly lost in the shadow of its famous  
          Cannabis relative "Marijuana" most commonly used as a narcotic  
          due to its high THC content.

          Hemp has been grown in the United States before the founding of  
          our nation.  Some of the early growers included our founding  
          fathers, George Washington and Thomas Jefferson.  However, by  
          the 1890's demand for natural fibers began to be met by imported  
          fibers while the greater cost effectiveness of machine harvested  
          cotton became more competitive for clothing fabric.

          Beginning in 1937 with the federal Marijuana Tax Act, the  
          government began to excersize control of the production of  
          Cannabis plants.  Following World War II, the competition of  
          synthetic fibers and a growing anti-drug public resulted in the  
          decline of hemp production.  In 1970, the Controlled Substances  
          Act tightly restricted all Cannabis plants regardless of THC  
          content.  This resulted in all hemp and hemp products being  
          imported or manufactured from imported hemp.  

          Drug Enforcement Agency (DEA) is the federal agency that  
          determines if any industrial hemp production authorized by state  
          statute is permitted.  The DEA also enforces standards for the  
          security conditions under which industrial hemp must be grown if  
          permitted.

          In 1998 Canada, a growing importer of hemp to California, lifted  
          their 50 year ban on industrial hemp cultivation.  Farmers could  
          grow hemp only after meeting specific registration requirements  
          such as registering the location of each hemp field and  




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          certifying that the THC levels of the plant are below 10 parts  
          per million. 

          AB 388 (Strom-Martin) of 2002 was vetoed by Governor Davis.   
          That bill would have requested that the University of California  
          assess the economic opportunities of specialty or alternative  
          fiber crops, including industrial hemp, and report to the  
          legislature by January 1, 2004.

          A nearly identical bill, AB 1147 (Leno) of 2006, was vetoed by  
          Governor Schwarzenegger last year.  In his veto message, the  
          governor stated that hemp is still considered a cannabis plant  
          regardless of its THC content and therefore illegal under  
          federal law.  

          PROPOSED LAW

          AB 684 would permit the cultivation of industrial hemp in  
          California.  Specifically, this bill would:
                 Define "industrial hemp" as an agriculture field crop of  
               Cannabis sativa L. with no more than 3/10 THC grown  
               exclusively to produce the mature plant stalks and stalk  
               products, oil or cake made from the seeds, and other  
               by-products except the resin or flowering tops.
                 Clarify that "industrial hemp" shall include the defined  
               hemp products in the 2007 Harmonized Tariff Schedule of the  
               United States.
                 Specify that industrial hemp seed may only be imported  
               according to the federal laws or California seeds from  
               feral plants, cultivated plants, or plants grown for  
               research.
                 Require that before harvest, industrial hemp growers  
               obtain a laboratory test report of randomly sampled dried  
               flowering tops from a DEA registered laboratory identifying  
               if the crop meets the California industrial hemp limit of  
               no more than 3/10 percent and includes the Global  
               Positioning System coordinates and total acreage of the  
               crop.  This report shall be retained by the grower for two  
               years.
                 Prohibit the cultivation, production, or possession of  
               resin, flowering tops, or leaves removed from the field and  
               are separate from the rest of the plant.  The only  
               exception to this prohibition is for the purposes of  
               sampling for the required laboratory test of the flowering  
               tops.  
                 Prohibit transportation or sale of any Cannabis sativa  
               L. seed capable of germination across state borders except  





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               as permitted by federal law. 
                 Specify that hemp may only be grown for research or as  
               an agriculture field crop.
                 Make legislative declarations and findings on industrial  
               hemp.

          COMMENTS

          1.Proponents of this bill state that America's $270 million hemp  
            sales are entirely from imported industrial hemp.  Under the  
            current federal law, California farmers are denied the ability  
            to grow and sell hemp to fulfill our domestic demand.  Because  
            California's state laws are silent on the cultivation of hemp,  
            this bill would clarify state law allowing California growers  
            to participate in the hemp market.

            In addition to the potential economic benefits to growers,  
            proponents state that hemp provides a suitable rotation crop  
            that helps improve the soil and requires fewer pesticides or  
            herbicides than many other crops.  Hemp is harvested for its  
            stalks and seeds rather than the flowering tops for which  
            marijuana is harvested.  Advocates maintain that should hemp  
            and marijuana commingle and cross pollinate, the resulting  
            plants would be undesirable for traditional marijuana use or  
            as industrial hemp. 
             
            In 2004 the U.S. 9th Circuit Court ruled that hemp products  
            could be sold legally in the United State, overturning a DEA  
            regulation attempting to ban all products from sale that  
            contained any amount of THC.  Since this ruling, the federal  
            government has decided not to appeal this decision allowing  
            hemp seed and oil products to be sold and consumed in the U.S.

          2.Opponents of this bill state that since marijuana and hemp are  
            so closely related, legalizing the cultivation of hemp would  
            hinder law enforcement efforts to suppress marijuana.   
            Marijuana farmers could potentially camouflage their fields  
            within hemp fields.  They also see this as a possible stepping  
            stone to further relax regulations on all Cannabis plants.   
            The federal government continues to consider the cultivation  
            of hemp illegal.  California would then conflict with federal  
            law. California also faces challenges with the hemp industry  
            competing against subsidized hemp growers in Chinese and  
            European countries.

          3.Permitting the cultivation of industrial hemp in California  
            would essentially be introducing a new agriculture product to  





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            the state.  While hemp is grown in over 30 other countries  
            worldwide, the variety and cultural practices vary widely from  
            country to country due to such factors as the different  
            climates or soil.  In California there has not been thorough  
            research into the growing of industrial hemp.  Previous  
            legislation addressing cultivating industrial hemp in  
            California has focused on research rather than on the  
            cultivation of hemp.  The committee may want to consider if  
            the bill should focus on research of this issue before  
            permitting the general cultivation of hemp.

          4.Of the products produced from hemp, many are already grown in  
            California with different commodities such as cotton for fiber  
            and olives for oil.  In California cotton plantings have  
            shrunk over the years due to foreign competition.  Similarly,  
            the influence of foreign competition hurt the hemp industry in  
            the 1890's reducing its economic appeal to growers.  It seems  
            that hemp production in California would be for a limited  
            nitch market.  The committee may want to consider if it is  
            appropriate to expose the state to conflict with the federal  
            government for a potential nitch crop when it could prove more  
            beneficial to focusing that energy on improving existing  
            crops.   

          5.The Senate Rules Committee has doubled referred this bill to  
            the Senate Public Safety Committee as the second committee of  
            referral.  Therefore, if this measure is approved by this  
            committee, the motion should include an action to re-refer the  
            bill to the Senate Committee on Public Safety.

          PRIOR ACTIONS

          Assembly Floor   41-29
          Assembly Appropriations11-5
          Assembly Public Safety5-2

          SUPPORT

          Agriculture and Land-Based Training Association
          American Federation of State, County, and Municipal Employees
          California Certified Organic Farmers
          California Coastkeeper Alliance
          California League of Conservation Voters
          California State Grange
          Community Alliance With Family Farmers
          Dynamic Nutraceuticals Inc.
          Fiddler's Green Farm, Inc





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          Hemp Industries Association
          Imperial County Farm Bureau
          Nutiva
          Organic Consumers Association
          Planning and Conservation League
          Sensuous Beauty, Inc
          Sierra Club California
          Ultra Oil
          Whole Foods Market

          OPPOSITION
          
          Association for Los Angeles Deputy Sheriffs
          California District Attorneys Association
          California Fraternal Order of Police
          California Narcotic Officers Association
          California Peace Officers' Association
          California Police Chiefs Association
          Long Beach Police Officers Association
          Los Angeles County Professional Peace Officers Association
          Riverside Sheriffs' Association
          Santa Ana Police Officers Association