THE SENATE	S.B. NO.	1052
TWENTY-NINTH LEGISLATURE, 2017
STATE OF HAWAII

A BILL FOR AN ACT

RELATING TO HEMP.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the University of Hawaii's research shows significant potential for a successful agricultural hemp industry in Hawaii.  The legislature further finds that the use of hemp in agriculture would lead to efficient and natural phytoremediation, which is the removal of toxins from the soil.  This is important to Hawaii because past agricultural operations left toxins in vast tracts of land.

     The legislature also finds that industrial hemp is versatile and can be used in thousands of products, such as clothing.  Industrial hemp is also an environmentally friendly and efficient feedstock for biofuel.  Existing biodiesel plants meet eight per cent of the State's biodiesel needs for ground transportation.  The use of industrial hemp as feedstock could increase the efficiency of the biodiesel plants, which could lead to a reduction of the State's reliance on imported fuel.

     Act 228, Session Laws of Hawaii 2016, implemented a temporary industrial hemp pilot program for purposes of agricultural or academic research.  The legislature believes that the production of hemp for commercial purposes would also benefit the State.  Furthermore, because hemp lacks a sufficient amount of the tetrahydrocannabinol chemical that makes people feel "high", unlike recreational marijuana, the legislature finds it appropriate to legalize hemp.

     The purpose of this Act is to legalize hemp by:

     (1)  Making the temporary industrial hemp pilot program a permanent program;

     (2)  Expanding the scope of the industrial hemp program to include commercial purposes; and

     (3)  Excluding hemp from state criminal prohibitions against marijuana.

     SECTION 2.  Section 712-1240, Hawaii Revised Statutes, is amended by adding a new definition to be appropriately inserted and to read as follows:

     ""Hemp" shall have the same meaning as "industrial hemp" as defined in section 141-31."

     SECTION 3.  Chapter 141, Hawaii Revised Statutes, is amended by amending the title of part II to read as follows:

"PART II. INDUSTRIAL HEMP [PILOT] REGULATORY PROGRAM"

     SECTION 4.  Section 141-32, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§141-32[]]  Industrial hemp [pilot] program; established.  (a)  There is established within the department of agriculture an industrial hemp [pilot] program to allow the cultivation [of industrial hemp] and distribution of [its seed] industrial hemp in Hawaii [through a pilot program] for [purposes of] agricultural [or], academic research[.], and commercial purposes.  The industrial hemp [pilot] program may be conducted on multiple [test] sites.

     (b)  In order to acquire industrial hemp seed for the [pilot] program, the department of agriculture shall register with the United States Department of Justice, Drug Enforcement Administration, as an importer of controlled substances.

     (c)  The [pilot] program shall establish an agency relationship with licensees, who operate as extensions of the board for the purposes of research on the growth, cultivation, and marketing of industrial hemp[.] or for commercial uses of industrial hemp.

     (d)  The board shall make a reasonable effort to:

     (1)  Inform licensees of the laws and regulations applicable to the production of industrial hemp;

     (2)  Act as a resource for licensees on regulatory questions regarding the industrial hemp [pilot] program; provided that the board shall not provide licensees with legal advice;

     (3)  Provide licensees with industrial hemp seed, upon licensees' request and at licensees' expense, in a quantity and variety determined at the discretion of the board; and

     (4)  Catalog data received, in cooperation with the licensee, other program participants, and institutions of higher education in the State, for improved methods and techniques in growing, cultivating, and marketing industrial hemp."

     SECTION 5.  Section 141-36, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§141-36[]]  Growing of industrial hemp; licensee responsibilities.  The licensee shall:

     (1)  Assume a limited agency relationship with the board for the [sole] purpose of research or the commercial use of industrial hemp and its growth, cultivation, and marketability.  The licensee shall conduct all agricultural operations in a lawful manner consistent with the standards befitting of an official of the State; provided that [such] the standards are subject to the sole discretion and direction of the board;

     (2)  Abide by applicable laws, rules, and regulations incident to the growth, cultivation, or marketing of industrial hemp;

     (3)  Acknowledge that any action, intended or incidental, that is contrary to [such] the laws and regulations, known or unknown, falls outside the agency relationship of the licensee with the board and the licensee's participation in the industrial hemp [pilot] program; provided that this paragraph applies to all actions incident to the licensed production of industrial hemp, including but not limited to any sale or disposition of the resulting plants, plant materials, or seeds for which the licensee may otherwise receive some benefit or consideration;

     (4)  Indemnify, hold harmless, and release forever the State and its departments, agencies, officers, employees, and agents of any kind from all liability claims arising out of the licensee's actions involving the growth, cultivation, or marketing of industrial hemp;

     (5)  Warrant that the licensee is not an employee of the State and shall assume total and sole responsibility for any of the licensee's acts or omissions involving the growth or production of industrial hemp or arising out of the licensee's participation in the industrial hemp [pilot] program;

     (6)  Allow any institution of higher education in the State to access those sites registered by the licensee with the board for production of industrial hemp; provided that [such] access shall be allowed upon notice from the board to the licensee and shall extend for all purposes determined at the discretion of the board related to research of industrial hemp and its growth, cultivation, and marketing;

     (7)  Upon request, allow federal, state, or local authorities to inspect and sample the industrial hemp growing area, plants, plant materials, seeds, equipment, or facilities incident to the growth or production of industrial hemp;

     (8)  Remit to the board all license fees and other expenses of the [pilot] program, including but not limited to all fees related to sampling and analysis of hemp plants and plant materials and destruction of resulting hemp crops found by the board to be noncompliant with applicable laws and regulations;

     (9)  Agree that with respect to the licensee's production of industrial hemp, the board's role is to fulfill regulatory oversight of the production and, where possible, to facilitate receipt of viable seed; provided that the licensee understands and agrees that the licensee shall not receive compensation or wages from the board and the board shall not offer financial resources, tangible products, or commercial labor in support of the licensee's industrial hemp crop;

    (10)  [Adhere] If the licensee attained the license for agricultural or academic research purposes, adhere narrowly to the research focus for which the licensee is participating in the industrial hemp [pilot] program, if applicable, to include one or more of the following:

         (A)  Planting and growing--tracking vital statistics and yield rates with respect to industrial hemp varieties and growing variables, including seed planting rate, soil composition, water usage, and planting and growing season;

         (B)  Pest--tracking the occurrence of pests and effectiveness of various preventative measures in correlation with industrial hemp varieties;

         (C)  Cost centers and financing--tracking average cost estimates of producing industrial hemp varieties, taking into account costs of participation in the industrial hemp [pilot] program, product acquisition, water usage, equipment, labor, and security measures and reporting financial resources available for production of industrial hemp; or

         (D)  Marketing and industry development--reporting market demand for industrial hemp varieties' raw materials and end products, including identification of actual or potential hemp products, processors, product manufacturers, wholesalers, retailers, and targeted consumers;

    (11)  Complete and submit all reports and statements requested by the board relative to the licensee's production of industrial hemp; provided that a failure to submit any required or requested report may result in revocation of the licensee's industrial hemp license;

    (12)  Understand and agree that any industrial hemp grown in Hawaii without an active industrial hemp license issued by the board falls outside the licensee's limited agency with the board, is considered to be marijuana [under state law,] and constitutes impermissible growth of industrial hemp under federal law; provided that the licensee shall understand that [such] the action will be prosecuted in accordance with all applicable laws;

    (13)  At the discretion of the board, destroy or dispose of any industrial hemp crop, plant, plant material, or seed determined by the board or law enforcement to be noncompliant with applicable laws or regulations;

    (14)  Use best management practices for growth and production of industrial hemp, as available, and take reasonable precaution to prevent unauthorized growth or distribution of industrial hemp, including but not limited to:

         (A)  Keeping records of all persons with access to the growing area or hemp plants, plant materials, or seeds;

         (B)  Using case hardened locks and chains to limit access to storage areas where hemp plants, plant materials, or seeds are kept;

         (C)  Marking equipment and plants, if possible, with owner applied numbers;

         (D)  Blocking private access roads to the growing area with gates or barricades and posting "No Trespassing" signs on gates, barricades, and other landmarks near the growing area and facilities;

         (E)  Installing reasonable security measures to prevent theft and posting signs indicating that cameras are used to record activity on the growing area property;

         (F)  Inspecting and recording regularly the condition of the growing area, facilities, and equipment used in the production of industrial hemp;

         (G)  Conducting regular inventory counts of hemp plants, plant materials, and seeds in order to recognize more quickly if a theft has occurred;

         (H)  Contacting local law enforcement to help identify additional security measures and encourage patrols near the growing area;

         (I)  Reporting to local law enforcement any suspicious activity and the presence of strangers near the growing area or facility;

         (J)  Reporting stolen, lost, or missing hemp plants, plant materials, or seeds to the board and law enforcement authorities as soon as the items are noticed to be missing; and

         (K)  Reducing the likelihood of cross pollination between varieties of industrial hemp and among other plants by:

              (i)  Separating any growing area from other self-pollinating plants by more than ten feet;

             (ii)  Separating any growing area from other wind and insect pollinating plants by more than three hundred feet; and

            (iii)  Employing a physical barrier such as a hoop house or row cover to isolate industrial hemp from other plants; and

    (15)  Comply with any direction of the chairperson with respect to the growth, cultivation, or marketing of industrial hemp not otherwise contemplated in this section."

     SECTION 6.  Section 141-40, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§141-40[]]  Rulemaking.  The board shall adopt rules concerning industrial hemp production:

(1) For agricultural or academic research no later than July 1, 2017[,]; and

(2) For commercial purposes not later than July 1, 2018,

including rules establishing reasonable fees for licenses, permits, or other necessary expenses to defray the cost of implementing and operating the industrial hemp [pilot] program in this State on an ongoing basis."

     SECTION 7.  Section 329-1, Hawaii Revised Statutes, is amended by amending the definition of "marijuana" to read as follows:

     ""Marijuana" means all parts of the plant (genus) Cannabis whether growing or not; the seeds thereof, the resin extracted from any part of the plant; and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or resin.  It does not include 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), fiber, oil, or cake, or the sterilized seed of the plant which is incapable of germination[.], or industrial hemp as defined in section 141-31."

     SECTION 8.  Section 712-1260, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§712-1260[]]  [Industrial hemp.] Hemp. The possession, cultivation, sale, receipt, or transfer of [industrial] hemp [as authorized under part II of chapter 141] shall not constitute an offense under this part.

     SECTION 9.  Act 228, Session Laws of Hawaii 2016, section 8, is amended to read as follows:

     "SECTION 8.  This Act shall take effect on July 1, 2016[, and shall be repealed on June 30, 2021]."

     SECTION 10.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 11.  This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Industrial Hemp; Legalization; Commercial Purposes

Description:

Legalizes hemp.  Makes the temporary industrial hemp pilot program a permanent program.  Expands the scope of the industrial hemp program to include commercial purposes.  Excludes hemp from state criminal prohibitions against marijuana.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.