Legislature(2017 - 2018)BELTZ 105 (TSBldg)
02/20/2017 01:30 PM Senate JUDICIARY
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| Audio | Topic |
|---|---|
| Start | |
| SB20 | |
| SB6 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 20 | TELECONFERENCED | |
| + | SB 6 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 6-INDUSTRIAL HEMP PRODUCTION
2:17:34 PM
CHAIR COGHILL announced the consideration of SB 6. [This is the
first hearing and CSSB 6(RES) is before the committee.] He
stated his intention is to hear the introduction, take questions
and hold the bill for further consideration to ensure that some
of the penalty provisions have been clarified.
2:18:37 PM
SENATOR SHELLY HUGHES, Alaska State Legislature, sponsor of SB
6, related that last spring several farmers in the Mat-Su area
contacted her office to express interest in legislation that
former Senator Johnny Ellis championed to define industrial hemp
as an agricultural product. This bill is a little different due
to new federal statutes. She noted that one of the parties who
expressed interest was former Matanuska-Susitna Borough Mayor
Larry DeVilbiss. The matter continued to be brought to her
attention at town hall meetings and when she had meetings with
constituents.
She explained that the legislation is a little different than
the bill former Senator Ellis introduced because some new
federal statutes and regulations now apply. She deferred
questions about that to her staff. She discussed the use of hemp
throughout the history of the U.S. and noted that some farmers
in Alaska are particularly interested in using hemp as feed for
livestock.
SENATOR HUGHES related that she typically works on innovative
technology such as unmanned aircraft and issues that look
forward, but in the case of industrial hemp it's a matter of
playing catch up because the U.S. halted growth in 1937. She
said the product that has been around for centuries and is
currently used in over 25,000 products. Some farmers in Alaska
are particularly interested in using industrial hemp for
livestock feed.
She described industrial hemp as one more economic opportunity
the state should allow for the agricultural community to try.
Many people believe it would grow well in Alaska.
SENATOR HUGHES said she found it reassuring to hear from the
Division of Agriculture that hemp is not planted the same way as
marijuana. The spacing between plants and rows is very different
for the two products so it would be quite easy for law
enforcement to tell if someone were growing the product for
purposes other than industrial hemp.
She summarized that SB 6 would remove hemp from the criminal
statutes and place it under the jurisdiction of the Division of
Agriculture. The bill is longer than the bill introduced last
year because it includes the new federal requirements for
registration. She deferred further introduction to her staff.
CHAIR COGHILL listed the individuals available to answer
questions.
2:24:18 PM
SENATOR MEYER asked if someone could grow a crop of industrial
hemp but sell it as marijuana.
SENATOR HUGHES opined there wouldn't be much recreational value
for industrial hemp because the THC content is below 0.3 percent
and the cutoff for hallucinogenic effects is 1 percent. She
deferred further explanation to Mr. Whitt.
CHAIR COGHILL asked Mr. Whitt to supplement the answer and then
take the committee through the bill in order of sections.
2:25:36 PM
BUDDY WHITT, Staff, Senator Shelly Hughes, sponsor of SB 6,
stated that the research he has shows that the USDA recognizes
industrial hemp as cannabis with no more than 1 percent THC. At
some point between 1 percent and 3 percent THC there is
potential for the unwanted side effects found in marijuana.
Federal law specifically defines hemp as having no more than 0.3
percent THC to clearly differentiate between the two products.
SENATOR MEYER summarized that hemp could be sold for
recreational purposes, but it would not give the desired buzz or
high.
MR. WHITT pointed out that, should the bill pass, registration
is required to grow hemp. Growing without registration would be
a violation and would bring penalties under Title 3. Also, if a
hemp crop tests higher than 0.3 percent THC, it is classified as
marijuana and the grower would be guilty of having an illegal
marijuana crop.
SENATOR MEYER asked the basis for the statement that hemp would
grow well in Alaska. "Is it based on the fact that it's a lot
like barley or ... have we actually done some testing?"
MR. WHITT related that a constituent sent the sponsor a clipping
from 1918 that reported that in the span of a few month hemp
planted in Palmer, Alaska grew more than four tall. He deferred
further explanation to Rob Carter.
2:29:21 PM
ROB CARTER, Manager of the Plant Materials Center, Division of
Agriculture, Department of Natural Resources (DNR), Palmer,
Alaska, informed the committee that industrial hemp was
successfully grown in an area north of the Mat-Su Valley in
1916. The long hours of sunlight and 100 plus growing days make
it likely that hemp would be successful in Alaska as a biomass.
From an agronomics standpoint it has a lot of potential,
especially for use as a forage crop to feed livestock.
2:31:28 PM
SENATOR MEYER asked if industrial hemp would be harvested like
barley or wheat.
MR. CARTER replied there are many ways to harvest hemp and the
harvest method would depend on the scale of the operation. Large
scale production in Canada is highly mechanized, but if an
individual is growing for the fiber industry they might cut the
plant with a sickle mower.
2:32:55 PM
SENATOR WIELECHOWSKI read the language on page 1, line 12, and
asked if there is some contemplation that an application can be
denied.
MR. WHITT answered yes; the Division of Agriculture would be
able to choose up to 15 growers to start in the pilot program.
He deferred to the division to explain how that number was
derived, but his belief is that would be a manageable number.
The program could be expanded in subsequent years.
CHAIR COGHILL asked Mr. Whitt to go through the sectional
analysis.
MR. WHITT read the following sectional analysis for SB 6:
Sec. 1 AS 03.05.078
(a) Industrial Hemp will be classified as an
agricultural crop in the state of Alaska.
(b) An individual who is registered with the state of
Alaska may produce industrial hemp.
(c) Those wishing to produce industrial hemp must
register with the Division of Agriculture with
information that must include but is not limited to:
name, address, and global positioning coordinates of
the area to be used for production.
MR. Whitt noted that provision is specifically included to
address the 2014 federal Farm Act.
(d) Registration is valid for one year and
registrants may renew on an annual basis.
(e) The Division of Agriculture shall assign
application, registration, or renewal fees necessary
to regulate the industrial hemp industry and shall
review those fee structures annually to ensure those
fees collected cover regulatory costs.
(f) The Division of Agriculture may issue a stop sale
order or issue a violation notice if someone is
producing industrial hemp without a current
registration.
(g)A person registered with the Division of
Agriculture may use any propagation method needed to
produce industrial hemp.
(h)The Division of Agriculture, a registered producer,
or any institution of higher education may import
and/or sell industrial hemp seeds.
(i)A person with a registration may retain hemp seeds
for the purpose of growing hemp in the future.
(j)A person registered with the Division of
Agriculture to produce industrial hemp may retain and
recondition hemp that tests between .3 percent and 1
percent THC on a dry weight basis, but industrial hemp
intended for consumption in any form cannot exceed a
.3 percent THC level.
(k) Division of Agriculture may create regulations
for approved shipping documentation for transporting
industrial hemp.
(l) Registered producers of industrial hemp must
retain record of sale for three years, including the
name and address of the person who received the
industrial hemp and the amount sold.
(m) Records in section (l) are to be made available
to the department during normal business hours and the
department must give three days' notice of inspection.
Sec. 2 AS 03.05.079
In keeping with federal law, this section adds
language regarding a pilot program for industrial
hemp, that the Division of Agriculture, institute of
higher education or a registered grower may
participate in the pilot program and the Division of
Agriculture may adopt regulations for this section.
Sec. 3 AS 03.05.100
The definition of industrial hemp, which meets the
definition is federal statute, is the plant Cannabis
Sativa L containing less that 0.3 percent delta-9
tetrahydrocannabinol (THC).
Sec. 4 AS 11.71.900
Amendment in statute to remove industrial hemp as
defined in AS 03.05.100 from the list of controlled
substances.
Sec. 5 AS 17.20.020
Food containing industrial hemp as defined in AS
03.05.100 is not considered adulterated.
Sec. 6 AS 17.38.900
Amendment is statute to further remove industrial hemp
as defined in AS 03.05.100 from marijuana definitions.
CHAIR COGHILL said the committee will be asking what activity
should have a criminal sanction and what activity is
appropriately sanctioned with a fine.
MR. WHITT read the existing AS 03.05.090(a) and (b) that talk
about penalties for violations under the Division of
Agriculture. He described potential changes to the bill: 1)
adding that the Division of Agriculture has regulatory authority
for the pilot program; 2) refine the language in subsection (j)
on page 2, lines 18-21, to protect a farmer from having to
destroy an entire crop.
2:45:55 PM
CHAIR COGHILL asked if the THC level is based on the genetic
strain or soil and water quality.
MR. CARTER explained that strains have been developed and
selected to maintain THC below 0.3 percent, but there hasn't
been much research in the past 70 years so it's unclear whether
environmental conditions may push a crop above that level. If a
crop did test higher than 0.3 percent, it could be blended with
a crop that was significantly below the threshold to ensure the
entire lot was in compliance.
CHAIR COGHILL asked if marijuana and hemp look and dry the same
and if this could open a new industry.
MR. CARTER replied hemp leaves are phenotypically like what is
grown in the recreational cannabis industry. He discounted the
idea that this could open a new industry because there are
plenty of legal products that could in turn be adulterated with
some other product. The hope and intent of the division is to
support the agricultural industry and he believes the farmers
are of a similar mindset.
SENATOR WIELECHOWSKI asked if there would be a tax on hemp other
than a corporate income tax.
SENATOR HUGHES said the bill removes hemp from the marijuana
statutes, so the tax does not apply. She said she isn't sure
about corporate taxes.
CHAIR COGHILL said it would depend on how the farmer organized
the business.
SENATOR WIELECHOWSKI suggested removing subsection (e) on page
2, lines 5-9, relating to fees since the fiscal notes are zero.
MR. WHITT said the language would allow the Division of
Agriculture to limit the number of growers, should there be
limited funds to keep the program going. The idea is to keep
from relying on unrestricted general funds.
SENATOR WIELECHOWSKI reviewed the fiscal note and pointed out it
anticipates 25 farms with 10 percent growth each year. He
emphasized that, despite the zero fiscal note, this program is
clearly going to cost money and the committee should know about
that. He also pointed out that if there are only 15 farms and
the state hires one person at a range 22 or 24 the fees will
jump astronomically and potentially put the industry out of
business.
SENATOR HUGHES said she appreciates the concern and would
entertain the idea of striking that provision if that is the
committee's will. The division is committed to this industry and
she believes it will do what it can to keep the costs down.
CHAIR COGHILL suggested the committee hear from the division
before making a decision and emphasized the need for truth in
implementation.
2:55:59 PM
CHAIR COGHILL held SB 6 in committee for further consideration.