BREAKING NEWS: California Hemp Laws Get Revamped

On October 12, 2019, Governor Newsom announced that he had signed SB-153, a bill aimed at making significant changes to California’s hemp cultivation law. As I’ve written before, the bill is a major change for California hemp laws for the following reasons:

• The bill adds a new definition of “industrial hemp”.  There are now separate (and slightly different) definitions for hemp generally under the California Health and Safety Code, and now under the Food and Agriculture Code relative just to hemp cultivation.
• California is required to submit a 2018 Farm Bill-compliant hemp production plan to the U.S. Department of Agriculture by May 2020. This is required under federal law, in order for states to comply with the 2018 Farm Bill. We still are awaiting USDA regulations to see how the submission process will work, but CA is now locked into submitting a plan.
• SB-153 narrows the scope of who qualifies as an established agricultural research institution (“EARIs”) to be more consistent with federal law.  Under current California hemp cultivation laws, the definition of EARIs is much broader than under federal law. SB-153 will, once the USDA approves of CA’s hemp production plan, narrow the scope of who qualifies as an EARI to be consistent with federal law.
• California mandates registration for commercial and non-commercial growers who don’t qualify as EARIs. Previously, only commercial growers must register. These modifications, in combination with the narrowed definition of EARIs, require that some current hemp cultivators who qualify as EARIs will then need to register as non-commercial cultivators.
• California now also mandates registration for EARIs and require them to submit “research plans” to their local county agricultural commissioner that detail what their cultivation operations will look like. This is a brand new concept that was not included in the original California Industrial Hemp Farming Act and is likely going to be a major change for cultivators across the state operating under research memoranda of understanding with EARIs.
• SB-153 creates enforcement provisions, penalties for false statements on applications, and a bar on persons from being a part of the industrial hemp program if they had a conviction relating to controlled substances in the prior 10-year period.
• SB-153 clarifies that hemp can’t be cultivated in a licensed cannabis premises, but that if it is, it will be considered cannabis.

Now that SB-153 is the law, hemp businesses across the state will need to adjust how they operate to ensure compliance with the law. It’s not clear from SB-153’s text when certain parts take effect, and we don’t yet have any official guidance by the California Department of Food and Agriculture (which regulates hemp cultivators) on compliance, so compliance may be a mess—as usual. Stay tuned to the Canna Law Blog for more California hemp cultivation updates.