Amended in Assembly August 27, 2013

Amended in Assembly August 7, 2013

Amended in Assembly June 19, 2013

Amended in Senate May 24, 2013

Amended in Senate April 11, 2013

Amended in Senate April 1, 2013

Senate BillNo. 566


Introduced by Senator Leno

(Principal coauthor: Assembly Member Mansoor)

February 22, 2013


An act tobegin insert amend Section 221 of, toend insert add Division 24 (commencing with Section 81000) to, and to repeal Sectionbegin delete 81009end deletebegin insert 81008end insert of, the Food and Agricultural Code, and to amend Section 11018 of, and to add Section 11018.5 to, the Health and Safety Code, relating to industrial hempbegin insert, and making an appropriation thereforend insert.

LEGISLATIVE COUNSEL’S DIGEST

SB 566, as amended, Leno. Industrial hemp.

Existing law makes it a crime to engage in any of various transactions relating to marijuana, as defined, except as otherwise authorized by law, such as pursuant to the Medical Marijuana Program. For purposes of the provisions defining criminal conduct, marijuana is defined as not including the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks, except the resin extracted therefrom, and fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination.

This bill would revise the definition of “marijuana” so that the term would exclude industrial hemp, as defined, except where the plant is cultivated or processed for purposes not expressly allowed. The bill would define industrial hemp as a fiber or oilseed crop, or both, that is limited to the nonpsychoactive types of the plant Cannabis sativa L. and the seed produced therefrom, having no more than 310 of 1% tetrahydrocannabinol (THC) contained in the dried flowering tops, and that is cultivated and processed exclusively for the purpose of producing the mature stalks of the plant, fiber produced from the stalks, oil or cake made from the seeds of the plant, any other compound, manufacture, salt, derivative, mixture, or preparation of the mature stalks, except the resin or flowering tops extracted therefrom, fiber, oil, or cake, or the sterilized seed of the plant that is incapable of germination.

The bill would enact provisions relating to growing industrial hemp that would impose specified procedures and requirements on a person who grows industrial hemp, except as specified, that would become operative when authorized under federal law. The bill would require a grower of industrial hemp, as specified, and a seed breeder, as defined, to register, and to renew that registration every 2 years, with the county agricultural commissioner and to pay abegin insert registration or renewalend insert fee,begin insert asend insert determined by thebegin delete commissioner, as specified, to cover the reasonable costs of the registration and renewal process. The bill would also require the Department of Food and Agriculture to establish an assessment rate, to be paid by growers of industrial hemp and seed breeders, to defray the reasonable costs of the county agricultural commissioner in implementing and enforcing these provisions. Theend deletebegin insert Department of Food and Agriculture. The bill would require the fees collected pursuant to these provisions to be deposited into the Department of Food and Agriculture Fund, to be continuously appropriated to cover the costs of implementing, administering, and enforcing these provisions. By establishing a new source of revenue for a continuously appropriated fund, this bill would make an appropriation.end insert

begin insertTheend insert bill would require a registrant growing industrial hemp to obtain, before the harvest of each crop, a laboratory test of a random sample of the crop to determine the amount of THC in the crop. The bill would require the laboratory test report to be issued by a laboratory registered by the federal Drug Enforcement Administration and would require the registrant growing industrial hemp to make the report available to law enforcement officials and specified other persons. The bill would require all industrial hemp seed sold for planting in California to be from a crop having no more than 310 of 1% THC contained in a random sampling of the dried flowering tops and tested under these provisions, and would require the destruction of crops exceeding that content, as specified.

The bill would provide that authorization to grow industrial hemp shall not be construed tobegin delete authorize,end deletebegin insert authorizeend insert certain other conduct, including, among other things, the possession, outside of a field of lawful cultivation, of resin, flowering tops, or leaves that have been removed from the hemp plant, except as necessary to perform the required laboratory testing. The bill would require the Attorney General and the Industrial Hemp Advisory Board to submit reports to the Legislature by January 1, 2019, or 5 years after the provisions of the measure are authorized under federal law, whichever is later, regarding the economic and law enforcement impacts of industrial hemp cultivation.

The bill would establish the Industrial Hemp Advisory Board, with a prescribed membership, and would authorize the board to advise the Secretary of Food and Agriculture on matters pertaining to these provisions.

The bill would state the findings and declarations of the Legislature relating to industrial hempbegin insert, and would make nonsubstantive changesend insert.

By revising the scope of application of existing crimes relating to marijuana, this bill would impose a state-mandated local program.

By specifying the conditions of cultivation, the violation of which would be a misdemeanor pursuant to other provisions of existing law, this bill would impose a state-mandated local program.

By increasing the duties of local officials, this bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

This bill would provide that the provisions of this act would not become operative unless authorized under federal law and, if the provisions become operative, would require the Attorney General to issue an opinion, as specified, and to post the opinion on the office of the Attorney General’s Internet Web site.

Vote: majority. Appropriation: begin deleteno end deletebegin insertyesend insert. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P4    1

SECTION 1.  

This act shall be known, and may be cited, as the
2California Industrial Hemp Farming Act.

3

SEC. 2.  

The Legislature finds and declares all of the following:

4(a) Industrial hemp is an agricultural crop produced in at least
530 nations, including Canada, Great Britain, France, Germany,
6Romania, Australia, and China, and is used by industry to produce
7thousands of products, including paper, textiles, food, oils,
8automotive parts, and personal care products.

9(b) The United States Court of Appeals for the Ninth Circuit
10has ruled in Hemp Industries Association v. Drug Enforcement
11Administration, (9th Cir. 2004) 357 F.3d 1012, that the federal
12Controlled Substances Act of 1970 (21 U.S.C. Sec. 812(b))
13explicitly excludes nonpsychoactive hemp from the definition of
14marijuana, and the federal government has declined to appeal that
15decision.

16(c) The federal Controlled Substances Act of 1970 specifies the
17findings to which the government must attest in order to classify
18a substance as a schedule I drug and those findings include that
19the substance has a high potential for abuse, has no accepted
20medical use, and has a lack of accepted safety for use, none of
21which apply to industrial hemp.

22(d) According to estimates by the Hemp Industries Association,
23sales of industrial hemp products in the United States have grown
24steadily since 1990 to more than $500 million annually in 2012.

25(e) California manufacturers of hemp products currently import
26from around the world tens of thousands of acres’ worth of hemp
27seed, oil, and fiber products that could be produced by California
28farmers at a more competitive price, and the intermediate
29processing of hemp seed, oil, and fiber could create jobs in close
30proximity to the fields of cultivation.

31(f) In 1999, the Assembly passed House Resolution 32, which
32resolved that “the domestic production of industrial hemp can help
33protect California’s environment, contribute to the growth of the
34state economy, and be regulated in a manner that will not interfere
35with the enforcement of marijuana laws.”

P5    1(g) Assessment of the economic benefits of industrial hemp
2cultivation and determination of possible impacts on the
3enforcement of laws prohibiting illicit marijuana cultivation are
4important concerns.

5(h) It is the intent of the Legislature that law enforcement not
6be burdened with tetrahydrocannabinol (THC) testing of industrial
7hemp crops when cultivation is in compliance with Section 11018.5
8of the Health and Safety Code; therefore, the cultivation of
9industrial hemp shall be tightly controlled pursuant to Division 24
10(commencing with Section 81000) of the Food and Agricultural
11Code, as added by Section 3 of this bill, which includes provisions
12consistent with all of the following:

13(1) Farmers shall not cultivate industrial hemp in acreages
14smaller than five acres at the same time, and no acreage of
15industrial hemp shall be comprised of plots smaller than one acre.
16The tending of individual plants, as well as ornamental and
17clandestine cultivation, is expressly prohibited.

18(2) Farmers are required, before harvest, to obtain a laboratory
19test report from a federally registered laboratory documenting that
20the THC content of their crop is within the legal limit and farmers
21shall destroy crops that fail the THC test.

22(3) Farmers shall retain an original copy of the THC test report
23for the planting seed and the harvested crop for two years, make
24original copies available to law enforcement officials upon request,
25and are required to provide an original copy to each person
26purchasing, transporting, or otherwise obtaining the fiber, oil, cake,
27or seed of the plant from the farmer.

28(4) Although they have no psychoactive effect, any resin,
29flowering tops, or leaves of the industrial hemp plant that are
30removed from the lawful field of cultivation shall be, by definition,
31marijuana and subject to prosecution. Farmers should take care to
32ensure that all flowering tops and leaves remain in the lawful field
33of cultivation after the harvest of seed or fiber, and the possession
34of those tops and leaves outside of the field of cultivation is
35prohibited. There is no lawful reason to harvest, collect, or process
36the flowering tops of industrial hemp.

37(5) In addition to plant structure, height, and method of planting,
38the horticultural tending of cannabis plants indicates to law
39enforcement that it is marijuana and not industrial hemp. Signs of
40horticultural tending include, but are not limited to, pathways or
P6    1rows within the field that provide access to each plant, the pruning
2of individual plants, or the culling of male plants from the field.

3begin insert

begin insertSEC. 3.end insert  

end insert

begin insertSection 221 of the end insertbegin insertFood and Agricultural Codeend insertbegin insert is
4amended to read:end insert

5

221.  

begin insert(a)end insertbegin insertend insert The “Department of Food and Agriculture Fund,”
6which is a special fund, is continued in existence. Any money that
7is directed by law to be paid into the fund shall be paid into it and,
8unless otherwise specifically provided, shall be expended solely
9for the enforcement of the law under which the money was derived.
10The expenditure from the fund for the enforcement of any law
11shall not, unless otherwise specifically provided, exceed the amount
12of money that is credited to the fund pursuant to the law.

begin delete

13Notwithstanding

end delete

14begin insert (b)end insertbegin insertend insertbegin insertNotwithstandingend insert Section 13340 of the Government Code,
15all money deposited in the fund under the provisions enumerated
16begin delete belowend deletebegin insert in subdivision (c)end insert is hereby continuously appropriated to
17the department without regard to fiscal years for expenditure in
18carrying out the purposes for which the money was deposited and
19for making the refunds authorized by Section 302.

begin delete

20All money

end delete

21begin insert (c)end insertbegin insertend insertbegin insertAll moneysend insert deposited in the fund under the provisions
22enumerated below is hereby exempted from Sections 13320 to
2313324, inclusive, of the Government Code:

begin delete

24(a)

end delete

25begin insert(1)end insert Article 7 (commencing with Section 5821) and Article 7.5
26(commencing with Section 5850) of Chapter 8 of Part 1 of Division
274, Chapter 1 (commencing with Section 6701) of Part 3 of Division
284, and Chapter 5 (commencing with Section 53301) of Division
2918.

begin delete

30(b)

end delete

31begin insert(2)end insert Article 5 (commencing with Section 6001) of Chapter 9 of
32Part 1 of Division 4.

begin delete

33(c)

end delete

34begin insert(3)end insert Article 8.5 (commencing with Section 6047.1) of Chapter
359 of Part 1 of Division 4.

begin delete

36(d)

end delete

37begin insert(4)end insert Articlebegin delete 4.5 (commencing with Section 6971) and Articleend delete 5
38(commencing with Section 6981) of Chapter 2 of Part 3 of Division
394.

begin delete

40(e)

end delete

P7    1begin insert(5)end insert Chapter 4 (commencing with Section 14200), Chapter 5
2(commencing with Section 14501), and Chapter 6 (commencing
3with Section 14901) of Division 7.

begin delete

4(f)

end delete

5begin insert(6)end insert Part 1 (commencing with Section 16301) and Part 2
6(commencing with Section 17401) of Division 9.

begin delete

7(g)

end delete

8begin insert(7)end insert Sections 19225, 19227, 19312, and 19315.

begin delete

9(h)

end delete

10begin insert(8)end insert Division 10 (commencing with Section 20001).

begin delete

11(i)

end delete

12begin insert(9)end insert Division 11 (commencing with Section 23001).

begin delete

13(j)

end delete

14begin insert(10)end insert Part 4 (commencing with Section 27501) of Division 12.

begin delete

15(k)

end delete

16begin insert(11)end insert Division 16 (commencing with Section 40501).

begin delete

17(l)

end delete

18begin insert(12)end insert Chapter 9 (commencing with Section 44971) of Division
1917.

begin delete

20(m)

end delete

21begin insert(13)end insert Chapter 1 (commencing with Section 52001) of Division
2218.

begin delete

23(n)

end delete

24begin insert(14)end insert Chapter 2 (commencing with Section 52251) of Division
2518.

begin delete

26(o)

end delete

27begin insert(15)end insert Chapter 3 (commencing with Section 52651) of Division
2818.

begin delete

29(p)

end delete

30begin insert(16)end insert Chapter 4 (commencing with Section 52851) of Division
3118.

begin delete

32(q)

end delete

33begin insert(17)end insert Chapter 6 (commencing with Section 55401), Chapter 7
34(commencing with Section 56101), and Chapter 7.5 (commencing
35with Section 56701) of Division 20.

begin delete

36(r)

end delete

37begin insert(18)end insert Section 58582.

begin delete

38(s)

end delete

P8    1begin insert(19)end insert Chapter 1 (commencing with Section 61301), Chapter 2
2(commencing with Section 61801), and Chapter 3 (commencing
3with Section 62700) of Part 3 of Division 21.

begin insert

4(20) Division 24 (commencing with Section 81000).

end insert
begin delete

5(t)

end delete

6begin insert(21)end insert Chapter 5.5 (commencing with Section 12531) of Division
75 of the Business and Professions Code.

begin delete

8(u)

end delete

9begin insert(22)end insert Chapter 7 (commencing with Section 12700) of Division
105 of the Business and Professions Code.

begin delete

11(v)

end delete

12begin insert(23)end insert Chapter 14 (commencing with Section 13400) and Chapter
1315 (commencing with Section 13700) of Division 5 of the Business
14and Professions Code.

15

begin deleteSEC. 3.end delete
16begin insertSEC. 4.end insert  

Division 24 (commencing with Section 81000) is added
17to the Food and Agricultural Code, to read:

18 

19Division 24.  Industrial Hemp

20

 

21

81000.  

For purposes of this division, the following terms have
22the following meanings:

23(a) “Board” means the Industrial Hemp Advisory Board.

24(b) “Commissioner” means the county agricultural
25commissioner.

26(c) “Established agricultural research institution” means a public
27or private institution or organization that maintains land for
28agricultural research, including colleges, universities, agricultural
29research centers, and conservation research centers.

30(d) “Industrial hemp” has the same meaning as that term is
31defined in Section 11018.5 of the Health and Safety Code.

32(e) “Secretary” means the Secretary of Food and Agriculture.

33(f) “Seed breeder” means an individual or public or private
34institution or organization that is registered with the commissioner
35to develop seed cultivars intended for sale or research.

36(g) “Seed cultivar” means a variety of industrial hemp.

37

81001.  

(a) There is in the department an Industrial Hemp
38Advisory Board. The board shall consist of 11 members, appointed
39by the secretary as follows:

P9    1(1) Three of the board members shall be growers of industrial
2hemp that are registered pursuant to the provisions of this division.
3A member of the board who is a grower of industrial hemp shall
4be a representative of at least one of the following functions:

5(A) Seed production.

6(B) Seed condition.

7(C) Marketing.

8(D) Seed utilization.

9(2) Two of the board members shall be members of an
10established agricultural research institution.

11(3) One member of the board shall be a representative of the
12California State Sheriffs’ Association or other law enforcement
13association who has experience or a background in agricultural
14issues.

15(4) One member of the board shall be a county agricultural
16commissioner.

17(5) One member of the board shall be a representative of the
18Hemp Industries Association or its successor industry association.

19(6) One member of the board shall be a representative of
20industrial hemp product manufacturers.

21(7) One member of the board shall be a representative of
22businesses that sell industrial hemp products.

23(8) One member of the board shall be a member of the public.

24(b) It is hereby declared, as a matter of legislative determination,
25that growers and representatives of industrial hemp product
26manufacturers and businesses appointed to the board pursuant to
27this division are intended to represent and further the interest of a
28particular agricultural industry, and that the representation and
29furtherance is intended to serve the public interest. Accordingly,
30the Legislature finds that persons who are appointed to the board
31shall be subject to the conflict-of-interest provisions described in
32Section 87103 of the Government Code.

33(c) The term of office for a member of the board is three years.
34If a vacancy exists, the secretary shall, consistent with the
35membership requirements described in subdivision (a), appoint a
36 replacement member to the board for the duration of the term.

37(d) A member of the board shall not receive a salary but may
38be reimbursed by the department for attendance at meetings and
39other board activities authorized by the board and approved by the
40secretary.

P10   1(e) The board shall advise the secretary and may make
2recommendations on all matters pertaining to this division,
3including, but not limited to, industrial hemp seed law and
4regulations, enforcement, annual budgets required to accomplish
5the purposes of this division, and the setting of an appropriate
6assessment rate necessary for the administration of this division.

7(f) The board shall annually elect a chair from its membership
8and, from time to time, other officers as it deems necessary.

9(g) The board shall meet at the call of its chair or the secretary,
10or at the request of any four members of the board. The board shall
11meet at least once a year to review budget proposals and fiscal
12matters related to the proposals.

13

81002.  

(a) Except when grown by an established agricultural
14research institution or by a registered seed breeder developing a
15new California seed cultivar, industrial hemp shall only be grown
16if it is on the list of approved seed cultivars.

17(b) The list of approved seed cultivars shall include all of the
18following:

19(1) Industrial hemp seed cultivars that have been certified on
20or before January 1, 2013, by member organizations of the
21Association of Official Seed Certifying Agencies, including, but
22not limited to, the Canadian Seed Growers Association.

23(2) Industrial hemp seed cultivars that have been certified on
24or before January 1, 2013, by the Organization of Economic
25Cooperation and Development.

26(3) California varieties of industrial hemp seed cultivars that
27have been certified by a seed-certifying agency pursuant to Article
286.5 (commencing with Section 52401) of Chapter 2 of Division
2918.

30(c) Upon recommendation by the board or the department, the
31secretary may update the list of approved seed cultivars by adding
32or removing seed cultivars.

33

81003.  

(a) Except for an established agricultural research
34institution, and before cultivation, a grower of industrial hemp for
35commercial purposes shall register with the commissioner of the
36county in which the grower intends to engage in industrial hemp
37cultivation.

38(1) The application shall include all of the following:

39(A) The name and address of the applicant.

P11   1(B) The legal description, Global Positioning System
2coordinates, and map of the land area on which the applicant plans
3to engage in industrial hemp cultivation.

4(C) The approved seed cultivar to be grown and whether the
5seed cultivar will be grown for its grain or fiber, or as a dual
6purpose crop.

7(2) (A) The application shall be accompanied by a registration
8fee, as determined pursuant to Sectionbegin delete 81006end deletebegin insert 81005end insert.

9(B) A registration issued pursuant to this section shall be valid
10for two years, after which the registrant shall renew his or her
11registration and pay an accompanying renewal fee, as determined
12pursuant to Sectionbegin delete 81006end deletebegin insert 81005end insert.

13(b) If the commissioner determines that the requirements for
14registration pursuant to this division are met, the commissioner
15shall issue a registration to the applicant.

16(c) A registrant that wishes to alter the land area on which the
17registrant conducts industrial hemp cultivation shall, before altering
18the area, submit to the commissioner an updated legal description,
19Global Positioning System coordinates, and map specifying the
20proposed alteration. Once the commissioner has received the
21change to the registration, the commissioner shall notify the
22registrant that it may cultivate industrial hemp on the altered land
23area.

24(d) A registrant that wishes to change the seed cultivar grown
25shall submit to the commissioner the name of the new, approved
26seed cultivar to be grown. Once the commissioner has received
27the change to the registration, the commissioner shall notify the
28registrant that it may cultivate the new seed cultivar.

29

81004.  

(a) Except when grown by an established agricultural
30research institution, and before cultivation, a seed breeder shall
31register with the commissioner of the county in which the seed
32breeder intends to engage in industrial hemp cultivation.

33(1) The application shall include all of the following:

34(A) The name and address of the applicant.

35(B) The legal description, Global Positioning System
36coordinates, and map of the land area on which the applicant plans
37to engage in industrial hemp cultivation.

38(C) The approved seed cultivar to be grown and whether the
39seed cultivar will be grown for its grain or fiber, as a dual purpose
40crop, or for seed production.

P12   1(D) If an applicant intends to develop a new California seed
2cultivar to be certified by a seed-certifying agency, the applicant
3shall include the name of the seed-certifying agency that will be
4conducting the certification and what industrial hemp varieties
5will be used in the development of the new Californiabegin insert seedend insert cultivar.

6(2) (A) The application shall be accompanied by a registration
7fee, as determined pursuant to Sectionbegin delete 81006end deletebegin insert 81005end insert.

8(B) A registration issued pursuant to this section shall be valid
9for two years, after which the registrant shall renew its registration
10and pay an accompanying renewal fee, as determined pursuant to
11Sectionbegin delete 81006end deletebegin insert 81005end insert.

12(b) If the commissioner determines that the requirements for
13registration pursuant to this division are met, the commissioner
14shall issue a seed breeder registration to the applicant.

15(c) A registrant that wishes to alter the land area on which the
16registrant conducts industrial hemp cultivation shall, before altering
17the area, submit to the commissioner an updated legal description,
18Global Positioning System coordinates, and map specifying the
19proposed alteration. Once the commissioner has received the
20change to the registration, the commissioner shall notify the
21registrant that it may cultivate industrial hemp on the altered land
22area.

23(d) A registrant that wishes to change the seed cultivar grown
24shall submit to the commissioner the name of the new, approved
25seed cultivar to be grown. Once the commissioner has received
26the change to the registration, the commissioner shall notify the
27registrant that it may cultivate the new seed cultivar.

28(e) The commissioner shall transmit information collected under
29this section to the department.

begin delete
30

81005.  

The department shall establish, and each commissioner
31shall collect, an assessment rate to be paid by growers of industrial
32hemp for commercial purposes and seed breeders, not including
33an established agricultural research institution, to defray the
34reasonable costs of each commissioner in implementing and
35enforcing the provisions of this division.

end delete
begin delete
36

81006.  

The commissioner of each county shall process
37registrations and renewals within his or her county as economically
38as possible. Each commissioner shall establish a registration fee
39and a renewal fee to be imposed on industrial hemp growers and
40seed breeders, to cover the reasonable costs of the registration and
P13   1renewal process pursuant to Sections 81003 and 81004. A renewal
2fee shall not exceed more than one-half of the registration fee.

end delete
begin insert
3

begin insert81005.end insert  

(a) The department shall establish a registration fee
4and appropriate renewal fee to be paid by growers of industrial
5hemp for commercial purposes and seed breeders, not including
6an established agricultural research institution, to cover the costs
7of implementing, administering, and enforcing the provisions of
8this division.

9(b) Fees collected by the commissioners upon registration or
10renewal pursuant to Section 81003 or 81004 shall be forwarded,
11according to procedures set by the department, to the department
12for deposit into the Department of Food and Agriculture Fund to
13be used for the administration and enforcement of this division.

end insert
14

begin delete81007.end delete
15begin insert81006.end insert  

(a) (1) Except when grown by an established
16agricultural research institution or a registered seed breeder
17developing a new California seed cultivar, industrial hemp shall
18be grown only as a densely planted fiber or oilseed crop, or both,
19in acreages of not less than five acres at the same time, and no
20portion of an acreage of industrial hemp shall include plots of less
21than one contiguous acre.

22(2) Registered seed breeders, for purposes of seed production,
23shall only grow industrial hemp as a densely planted crop in
24acreages of not less than two acres at the same time, and no portion
25of the acreage of industrial hemp shall include plots of less than
26one contiguous acre.

27(b) Ornamental and clandestine cultivation, as well as the
28pruning, culling, and tending of individual plants, of industrial
29hemp is prohibited. All plots shall have adequate signage indicating
30they are industrial hemp.

31(c) Industrial hemp shall include products imported under the
32Harmonized Tariff Schedule of the United States (2013) of the
33United States International Trade Commission, including hemp
34seed, per subheading 1207.99.03, hemp oil, per subheading
351515.90.80, true hemp, per heading 5302, true hemp yarn, per
36subheading 5308.20.00, and woven fabrics of true hemp fibers,
37per subheading 5311.00.40.

38(d) Except when industrial hemp is grown by an established
39agricultural research institution, a registrant that grows industrial
40hemp under this section shall, before the harvest of each crop and
P14   1as provided below, obtain a laboratory test report indicating the
2tetrahydrocannabinol (THC) levels of a random sampling of the
3dried flowering tops of the industrial hemp grown.

4(1) Sampling shall occur as soon as practicable when the THC
5content of the leaves surrounding the seeds is at its peak and shall
6commence as the seeds begin to mature, when the first seeds of
7approximately 50 percent of the plants are resistant to compression.

8(2) The entire fruit-bearing part of the plant including the seeds
9shall be used as a sample. The sample cut shall be made directly
10underneath the inflorescence found in the top one-third of the plant.

11(3) The laboratory test report shall be issued by a laboratory
12registered with the federal Drug Enforcement Administration, shall
13state the percentage content of THC, shall indicate the date and
14location of samples taken, and shall state the Global Positioning
15System coordinates and total acreage of the crop. If the laboratory
16test report indicates a percentage content of THC that is equal to
17or less than three-tenths of 1 percent, the words “PASSED AS
18CALIFORNIA INDUSTRIAL HEMP” shall appear at or near the
19top of the laboratory test report. If the laboratory test report
20indicates a percentage content of THC that is greater than
21three-tenths of 1 percent, the words “FAILED AS CALIFORNIA
22INDUSTRIAL HEMP” shall appear at or near the top of the
23laboratory test report.

24(4) If the laboratory test report indicates a percentage content
25of THC that is equal to or less than three-tenths of 1 percent, the
26laboratory shall provide the person who requested the testing not
27less than 10 original copies signed by an employee authorized by
28the laboratory and shall retain one or more original copies of the
29laboratory test report for a minimum of two years from its date of
30sampling.

31(5) If the laboratory test report indicates a percentage content
32of THC that is greater than three-tenths of 1 percent and does not
33exceed 1 percent, the registrant that grows industrial hemp shall
34submit additional samples for testing of the industrial hemp grown.

35(6) A registrant that grows industrial hemp shall destroy the
36industrial hemp grown upon receipt of a first laboratory test report
37indicating a percentage content of THC that exceeds 1 percent or
38a second laboratory test report pursuant to paragraph (5) indicating
39a percentage content of THC that exceeds three-tenths of 1 percent
40but is less than 1 percent. If the percentage content of THC exceeds
P15   11 percent, the destruction shall take place within 48 hours after
2receipt of the laboratory test report. If the percentage content of
3THC in the second laboratory test report exceeds three-tenths of
41 percent but is less than 1 percent, the destruction shall take place
5as soon as practicable, but no later than 45 days after receipt of
6the second test report.

7(7) Paragraph (6) does not apply to industrial hemp grown by
8an established agricultural research institution if the destruction
9of the industrial hemp grown will impede the development of types
10of industrial hemp that will comply with the three-tenths of 1
11percent THC limit established in this section.

12(8) A registrant that intends to grow industrial hemp and who
13complies with this section shall not be prosecuted for the cultivation
14or possession of marijuana as a result of a laboratory test report
15that indicates a percentage content of THC that is greater than
16three-tenths of 1 percent but does not exceed 1 percent.

17(9) Paragraph (8) does not apply to industrial hemp grown by
18an established agricultural research institution. Established
19agricultural research institutions shall be permitted to cultivate or
20possess industrial hemp with a laboratory test report that indicates
21a percentage content of THC that is greater than three-tenths of 1
22percent if that cultivation or possession contributes to the
23development of types of industrial hemp that will comply with the
24three-tenths of 1 percent THC limit established in this section.

25(10) Except for an established agricultural research institution,
26a registrant that grows industrial hemp shall retain an original
27signed copy of the laboratory test report for two years from its date
28of sampling, make an original signed copy of the laboratory test
29report available to the department, the commissioner, or law
30enforcement officials or their designees upon request, and shall
31provide an original copy of the laboratory test report to each person
32purchasing, transporting, or otherwise obtaining from the registrant
33that grows industrial hemp the fiber, oil, cake, or seed of the plant.

34

begin delete81008.end delete
35begin insert81007.end insert  

This division shall not be construed to authorize any
36of the following, and all of the following are prohibited:

37(a) The possession, outside of a field of lawful cultivation, of
38resin, flowering tops, or leaves that have been removed from the
39hemp plant, except as is necessary to perform testing pursuant to
40subdivision (d) of Sectionbegin delete 81007end deletebegin insert 81006end insert.

P16   1(b) Any ornamental or clandestine cultivation of the industrial
2hemp plant.

3(c) Any pruning, culling, or tending of individual industrial
4hemp plants, except when the action is necessary to perform the
5THC testing pursuant to subdivision (d) of Sectionbegin delete 81007end deletebegin insert 81006end insert.

6(d) Any cultivation of industrial hemp in acreages of less than
7five acres, or any acreage comprised of plots of less than one
8contiguous acre, except when the industrial hemp is grown by an
9established agricultural research institution or seed breederbegin insert in
10accordance with Section 81006end insert
.

11

begin delete81009.end delete
12begin insert81008.end insert  

(a) Not later than January 1, 2019, or five years after
13the provisions of this division are authorized under federal law,
14whichever is later, the Attorney General shall report to the
15Assembly and Senate Committees on Agriculture and the Assembly
16and Senate Committees on Public Safety the reported incidents,
17if any, of the following:

18(1) A field of industrial hemp being used to disguise marijuana
19cultivation.

20(2) Claims in a court hearing by persons other than those
21exempted in subdivision (d) of Sectionbegin delete 81007end deletebegin insert 81006end insert that marijuana
22is industrial hemp.

23(b) A report submitted pursuant to subdivision (a) shall be
24submitted in compliance with Section 9795 of the Government
25Code.

26(c) Pursuant to Section 10231.5 of the Government Code, this
27section is repealed on January 1, 2023, or four years after the date
28that the report is due, whichever is later.

29

begin delete81010.end delete
30begin insert81009.end insert  

Not later than January 1, 2019, or five years after the
31provisions of this division are authorized under federal law,
32whichever is later, the board, in consultation with the Hemp
33Industries Association, shall report the following to the Assembly
34and Senate Committees on Agriculture and the Assembly and
35Senate Committees on Public Safety:

36(a) The economic impacts of industrial hemp cultivation,
37processing, and product manufacturing in California.

38(b) The economic impacts of industrial hemp cultivation,
39processing, and product manufacturing in other states that may
40have permitted industrial hemp cultivation.

P17   1

begin delete81011.end delete
2begin insert81010.end insert  

This division shall not become operative unless
3authorized under federal law.

4

begin deleteSEC. 4.end delete
5begin insertSEC. 5.end insert  

Section 11018 of the Health and Safety Code is
6amended to read:

7

11018.  

“Marijuana” means all parts of the plant Cannabis sativa
8L., whether growing or not; the seeds of that plant; the resin
9extracted from any part of the plant; and every compound,
10manufacture, salt, derivative, mixture, or preparation of the plant,
11its seeds or resin. It does not include industrial hemp, as defined
12in Section 11018.5, except where the plant is cultivated or
13processed for purposes not expressly allowed for by Division 24
14(commencing with Section 81000) of the Food and Agricultural
15Code.

16

begin deleteSEC. 5.end delete
17begin insertSEC. 6.end insert  

Section 11018.5 is added to the Health and Safety
18Code
, to read:

19

11018.5.  

“Industrial hemp” means a fiber or oilseed crop, or
20both, that is limited to nonpsychoactive types of the plant Cannabis
21sativa L. and the seed produced therefrom, having no more than
22three-tenths of 1 percent tetrahydrocannabinol (THC) contained
23in the dried flowering tops, and that is cultivated and processed
24exclusively for the purpose of producing the mature stalks of the
25plant, fiber produced from the stalks, oil or cake made from the
26seeds of the plant, or any other compound, manufacture, salt,
27derivative, mixture, or preparation of the mature stalks, except the
28resin or flowering tops extracted therefrom, fiber, oil, or cake, or
29the sterilized seed of the plant that is incapable of germination.

30

begin deleteSEC. 6.end delete
31begin insertSEC. 7.end insert  

No reimbursement is required by this act pursuant to
32Section 6 of Article XIII B of the California Constitution because
33a local agency or school district has the authority to levy service
34charges, fees, or assessments sufficient to pay for the program or
35level of service mandated by this act or because costs that may be
36incurred by a local agency or school district will be incurred
37because this act creates a new crime or infraction, eliminates a
38crime or infraction, or changes the penalty for a crime or infraction,
39within the meaning of Section 17556 of the Government Code, or
P18   1changes the definition of a crime within the meaning of Section 6
2of Article XIII B of the California Constitution.

3

begin deleteSEC. 7.end delete
4begin insertSEC. 8.end insert  

(a) This act shall not become operative unless
5authorized under federal law.

6(b) If this act becomes operative, the Attorney General shall
7issue an opinion on the extent of that authorization under federal
8law and California law, the operative date of those provisions, and
9whether federal law imposes any limitations that are inconsistent
10with the provisions of this act.

11(c) The Attorney General shall post the opinion described in
12subdivision (b) on the office of the Attorney General’s Internet
13Web site.



O

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