February 21, 2018Client Alert

Wisconsin DATCP Poised to Release Industrial Hemp Rules

The Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) is expected to release emergency administrative rules governing the cultivation of industrial hemp in Wisconsin on March 2, 2018. The rules are the next step in efforts to re-introduce industrial hemp to Wisconsin farm fields.

2017 Wisconsin Act 100 directs DATCP to create an industrial hemp pilot program which will allow production of industrial hemp subject to certain state regulatory limitations. Despite the fact that hemp production would otherwise be prohibited under the federal Controlled Substances Act, the 2014 Farm Bill allows states to create research pilot programs for the cultivation of industrial hemp. Act 100 gives DATCP the authority to create such a pilot program in Wisconsin and to allow the cultivation of industrial hemp in the state “to the greatest extent allowed under federal law.” The National Conference of State Legislatures reports that Wisconsin is one of 27 states to authorize industrial hemp research or pilot programs, though the scope of these programs varies by state.

Industrial hemp, as defined in state and federal law, refers to the plant Cannabis sativa and its parts (including the seeds) with a delta-9-tetrahydrocannabinol (THC) concentration of no more than 0.3 percent on a dry weight basis. While federal law currently regulates all cannabis as a controlled substance, industrial hemp plants contain THC levels far below what would be required for any psychoactive effect and bear little resemblance to cannabis plants grown for marijuana. Cultivated as both a grain and fiber crop, industrial hemp is lauded for its versatility and high number of uses.

Act 100 requires DATCP’s rules to include provisions for the agency to issue licenses that authorize growers to plant, cultivate, process, transport, and transfer the industrial hemp. Applicants must provide GPS coordinates for every field on which industrial hemp will be grown. DATCP must also create a system to register those who seek to sample, test, process, transport, transfer, import, or export industrial hemp in the state. Act 100 requires criminal background checks to be conducted on any applicant for a license to grow hemp or to  and to deny a license or registration to any applicant who has been convicted of violating the controlled substance laws of any state or the federal government. DATCP must also create a form to accompany any transfer of industrial hemp; this form will maintain a “chain of custody” over the product until it is processed.

DATCP’s Plant Industry Bureau has been tasked with writing the rule and administering the hemp program in Wisconsin. Act 100 provides that DATCP’s emergency rule will remain in effect until July 2020 or until a permanent rule is promulgated, whichever comes first. While there will be no opportunity for public comment on the emergency rule, the permanent rulemaking process will include opportunity for public input.

In a recent public presentation, DATCP emphasized that Act 100 and federal law authorize the state to create a research pilot program. Growers who obtain a license will be subject to recordkeeping requirements as part of the program’s research component, and will be required to pay an initial licensing fee. Under Act 100, DATCP may also impose an annual registration fee to recoup the costs of regulating industrial hemp activities via rulemaking.

Efforts to grow hemp during the 2018 growing season may be hampered by the availability of certified seed in the state. DATCP is recommending that growers only use certified seed. Act 100 provides immunity from prosecution under state and local law for hemp grown from certified seed. Using certified seed also greatly lowers the risk that a crop would need to be destroyed for failure to comply with THC limits in state law. Importing certified seed requires a federal Drug Enforcement Agency (DEA) seed importer registration. Act 100 allows DATCP to seek federal approval to act as an importer of seed. DATCP has stated that it does not appear that the agency will be registered in time to import seed for 2018—meaning that producers will need to look to independent suppliers.

DATCP has created a website compiling information on the industrial hemp pilot program and plans to post additional information as it becomes available.

Please contact David A. Crass or Taylor T. Fritsch if you are in need of further information.

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