Will the 2023 Farm Bill Address Hemp Industry Pain Points and Public Safety Concerns?

By Andrea Golan

Oct 31, 2022

The 2018 Farm Bill, which legalized the cultivation and possession of hemp at the federal level by removing it from the list of controlled substances, is set to expire in September 2023 (the Farm Bill expires and is updated every five years). While the descheduling of hemp brought unprecedented growth to the industry, it has not been a smooth ride. Burdensome inflexible requirements such as DEA-registered testing labs, a short testing window, background checks for hemp growers, and the low THC limit are significant pain points for the industry. Less foreseeable by the ‘framers’ of the 2018 Farm Bill is the growth of a new and unregulated market for products containing intoxicating cannabinoids derived from hemp, not marijuana. As Congress considers the next Farm Bill, industry stakeholders and state lawmakers are strongly advocating for a number of specific reforms that both protect public safety and benefit the hemp industry. Read on to learn about the suggested reforms.

Increasing the Hemp THC Limit from 0.3% to 1% THC 

Advocates would like to see the federal definition of hemp amended to raise the total allowable delta-9 THC concentration in the hemp plant from 0.3% delta-9 THC on a dry weight basis to 1% delta-9 THC. As a reminder, the imposed THC threshold applies to the hemp plant, not to finished products. “The Hemp Advancement Act of 2022,” introduced by Representative Pingree of Maine earlier this year, would do just that. Raising the THC limit would give producers additional leeway to harvest, rather than destroy, crops that test above the low THC limit but remain below 1%. Doing so would also increase flexibility concerning genetics research. 

Allowing Higher THC Content for “Work-in-Progress” Hemp Extract

The current Farm Bill extends only to hemp cultivation; it does not address the manufacture, distribution, or sale of finished hemp products or hemp extract at the interim processing stage, often referred to as “work-in-progress hemp extract.” When dry hemp is converted into hemp extract, the THC concentration often spikes above 0.3% at this interim processing stage. This makes processors susceptible to potential civil penalties, criminal misdemeanor, or felony charges for possessing and transporting work-in-progress hemp extract that exceeds the legal definition of hemp and is therefore considered marijuana. A solution to this challenge is included in the Hemp Advancement Act, which proposes a definition for “hemp extract” that exceeds 1% on a dry weight basis and is stored, transported, and processed by following procedures that the USDA would establish. 

Removing the DEA-registered Laboratory Hemp Testing Requirement 

Hemp stakeholders would like to remove the requirement outlined in the USDA Final Rule that hemp be tested for potency by a DEA-registered lab. The DEA registration requirement stems from the concern that labs handling hemp testing above 0.3% THC are in possession of marijuana—which is still a Schedule I controlled substance—and it is unlawful to possess marijuana without a DEA registration. The DEA registration has proven to be highly impractical due to the scarcity of DEA-registered labs, thus requiring growers to send their samples to other states. It would certainly make sense to allow testing by labs that also test marijuana in states where marijuana is legal. The same labs can also perform hemp and hemp product safety testing (e.g., testing for pesticides, residual solvents, and other potentially dangerous compounds).

Removing the Ban Prohibiting People with Drug-Related Felony Convictions from Obtaining a Hemp License

Under the current Farm Bill, any person convicted of a felony relating to a controlled substance under State or Federal law is ineligible to cultivate hemp for ten years following the date of conviction. Removing the ten-year ban on people with drug-related felony convictions would ideally serve to increase access to the hemp industry by those disproportionately impacted by legacy drug policies.

Closing the Loop on Intoxicating Cannabinoids Derived from Hemp

The recent proliferation of hemp products sold in convenience stores, gas stations, online, and elsewhere that can get a person just as high as a product sold in a regulated cannabis dispensary can largely be attributed to the definition of “hemp” in the 2018 Farm Bill. This definition allows for all “derivatives,” “extracts,” and “isomers” of hemp, and limits only the THC concentration of delta-9 THC, but is silent as to any other potentially intoxicating cannabinoids such as delta-8 and delta-10 THC, THC-O, HHC, and others that have yet to be discovered or created. 

While common sense dictates that Congress did not intend to allow the unregulated sale of intoxicating hemp products when it passed the Farm Bill, the reality is that the broad definition of “hemp” under the current Farm Bill opened the door for the sale of these products notwithstanding other federal laws that may prohibit their sale. 

Notably, the 2018 Farm Bill expressly preserved FDA’s authority to regulate hemp products, which unambiguously includes the authority to establish safety levels of potentially intoxicating compounds. Yet, to date, FDA has not amended its regulations to regulate hemp products. The agency’s enforcement actions have generally been limited to companies making impermissible disease claims.  

This shortcoming in the Farm Bill was affirmed by a recent Ninth Circuit ruling holding that delta-8 THC in an e-cigarette liquid “fit([s] comfortably within the statutory definition of “hemp,” – i.e., the liquid properly understood as a derivative, extract, or cannabinoid originating from the cannabis plant and containing ‘not more than 0.03% percent’ delta-9 THC.” (AK Futures LLC v. Boyd St. Distro, LLC, 35 F.4th 682, 691 (9th Cir. 2022). The Court concluded that any congressional intent that the Farm Bill legalize only hemp and not a potentially psychoactive substance like delta-8 THC, “appears neither in hemp’s definition nor in its exemption from the Controlled Substances Act.” (AK Futures LLC, 35 F.4th. at 693).

What the Ninth Circuit did not address was the legality of products containing delta-8 THC pursuant to the Federal Food Drug & Cosmetic Act (FDCA). While the 2018 Farm Bill removed hemp and its derivatives, extracts, and isomers from the Controlled Substances Act, when the hemp ingredient is added to a product such as a food, cosmetic, or dietary supplement, it is subject to the FDCA and its enforcement arm, the FDA. Also left unaddressed by the Ninth Circuit is the Federal Analogue Act. The Analogue Act will generally be implicated if the hemp-derived extract, cannabinoid, or isomer is deemed ‘synthetic’ and has a pharmacological effect similar to or greater than delta-9 THC.  

Industry stakeholders and state lawmakers alike continue to express frustration with the lack of federal regulatory oversight. A number of hemp bills introduced in Congress over the last two years would address some of these frustrations. Perhaps the provisions of one of these pending hemp bills will get wrapped into the 2023 Farm Bill in the same way Senator McConnell’s ‘Hemp Farming Act of 2018’ was wrapped into the 2018 Farm Bill.

Two of the bills that would explicitly grant FDA more authority over hemp-derived compounds if included in the 2023 Farm Bill are Representative Schrader’s “Hemp and Hemp-Derived CBD Consumer Protection and Market Stabilization Act of 2021” (HR 841) and Senators’ Wyden, Paul, and Merkley’s “Hemp Access and Consumer Safety Act” (S. 1698). Both bills would permit CBD and other hemp-derived ingredients to be used in dietary supplements subject to the FDCA product safety standards. S. 1698 would also permit such ingredients in food. 

Let’s hope Congress is listening and will address and resolve these issues to help make the hemp industry more accessible and workable while providing a pathway for reasonable regulatory oversight to protect the public from unsafe products. 

Contact VS's Hemp & Cannabinoids Department if you have questions related to any of the suggested reforms above.

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