Craig, Smith, Peterson & McCollum Urge Federal Agencies to Provide Clarity on Hemp Rules

Today, U.S. Rep. Angie Craig, Sen. Tina Smith and Reps. Collin Peterson and Betty McCollum called on the leaders of four federal agencies to streamline hemp rules. Currently, contradictory federal guidelines are leading to uncertainty in the market and preventing Minnesota farmers and Tribes from fully reaping the economic benefits of growing hemp.

"The bipartisan 2018 Farm Bill legalized hemp in order to create economic opportunities for farmers. Minnesota farmers appreciate the United States Department of Agriculture's (USDA) efforts in implementing the Interim Rule on Establishment of a Domestic Hemp Production Program. However, despite the Interim Rule there are still hurdles in place for Minnesota farmers to fully realize the economic benefits of growing hemp," wrote the lawmakers in their letter to the United States Department of Agriculture (USDA), the Office of Management and Budget (OMB), the Food and Drug Administration (FDA) and the Drug Enforcement Administration (DEA).

Sen. Smith and Reps. Craig, McCollum and Peterson go on to identify some of the inconsistencies that need to be addressed: "The federal regulatory framework has proven to be inconsistent. For example, the USDA's rule stated that farmers will be held accountable – facing possible revoking of their licenses – if their crops test above a .5 percent THC level three times in a five year period. Despite this somewhat onerous and arbitrary level, the Drug Enforcement Agency (DEA) instituted their own rule saying that exceeding .3 percent THC level deems the crop a controlled substance. The burdensome competing rules don't allow for remediation if the crop tests above the deemed inappropriate levels. Farmers should not be penalized for plants that they intended to grow as hemp, but for any number of reasons, the final THC numbers exceeded the arbitrary 0.3% THC level. At the same time, the Food and Drug Administration (FDA) guidance on CBD is still pending at the Office of Management and Budget (OMB), which adds even more uncertainty to the marketplace."

You can access a copy of the letter here or below:

Secretary Sonny Perdue The Honorable Russell T. Vought

U.S. Department of Agriculture Director, Office of Management and Budget

1400 Independence Avenue SW 725 17^th Street NW

Washington, DC 20250 Washington, DC 20503

Commissioner Stephen M. Hahn, M.D. The Honorable Timothy J. Shea

U.S. Food and Drug Administration Acting Administrator

White Oak Campus U.S. Drug Enforcement Administration

10903 New Hampshire Avenue 8701 Morrissette Drive

Silver Spring, MD 20903 Springfield, VA 22152

Dear Secretary Perdue, Director Vought, Commissioner Hahn, and Acting Administrator Shea:

The bipartisan 2018 Farm Bill legalized hemp in order to create economic opportunities for farmers. Minnesota farmers appreciate the United States Department of Agriculture's (USDA) efforts in implementing the Interim Rule on Establishment of a Domestic Hemp Production Program. However, despite the Interim Rule there are still hurdles in place for Minnesota farmers to fully realize the economic benefits of growing hemp.

While many states and tribes are still awaiting approval for their hemp programs from the USDA, the state of Minnesota, the Red Lake Band of Chippewa Indians, and the Lower Sioux Indian Community have all had their applications approved. Interest in growing hemp remains high among farmers. The Minnesota Industrial Hemp Pilot grew from four licensed growers in 2016 to 467 licensed growers in 2020. Despite this interest, farmers face a lack of certitude due to unclear and contradicting federal efforts. This has resulted in fewer hemp acres in Minnesota being planted from 2019 to 2020. In 2019, 7353 acres of hemp were planted. In 2020, that number dropped to 5809 acres.

The federal regulatory framework has proven to be inconsistent. For example, the USDA's rule stated that farmers will be held accountable – facing possible revoking of their licenses – if their crops test above a .5 percent THC level three times in a five year period. Despite this somewhat onerous and arbitrary level, the Drug Enforcement Agency (DEA) instituted their own rule saying that exceeding .3 percent THC level deems the crop a controlled substance. The burdensome competing rules don't allow for remediation if the crop tests above the deemed inappropriate levels. Farmers should not be penalized for plants that they intended to grow as hemp, but for any number of reasons, the final THC numbers exceeded the arbitrary 0.3% THC level. At the same time, the Food and Drug Administration (FDA) guidance on CBD is still pending at the Office of Management and Budget (OMB), which adds even more uncertainty to the marketplace.

Lack of clarity has resulted in under-investments in growing and processing from banks and hemp production companies. In order to create a more stable market for hemp farmers and ease the concerns of investors, the USDA, the DEA, the FDA, and the OMB need to work together and issue federal guidelines that will benefit farmers rather than punish farmers for factors that are out of their control.