HB 653-FN-A - AS INTRODUCED

2003 SESSION

03-0781

08/09

HOUSE BILL 653-FN-A

AN ACT authorizing the production of industrial hemp.

SPONSORS: Rep. Owen, Merr 34; Rep. Ahern, Belk 29

COMMITTEE: Environment and Agriculture

ANALYSIS

This bill:

I. Authorizes the production of industrial hemp.

II. Requires any person growing industrial hemp to be licensed by the commissioner of agriculture, markets, and food.

III. Provides certain notification requirements.

IV. Gives the commissioner certain rulemaking authority.

V. Requires each applicant for a grower's license to pay a fee which shall be deposited into a dedicated fund, which is continually appropriated to the department of justice to be used by the attorney general for purposes of testing, supervision, and enforcement.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

03-0781

08/09

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Three

AN ACT authorizing the production of industrial hemp.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 New Chapter; Industrial Hemp. Amend RSA by inserting after chapter 433-B the following new chapter:

CHAPTER 433-C

INDUSTRIAL HEMP

433-C:1 Industrial Hemp; Agricultural Seed. Industrial hemp (Cannabis sativa L.), having no more than one percent tetrahydrocannabinol, is recognized as an agricultural seed. Upon meeting the requirements of this chapter, any person in this state may plant, grow, harvest, possess, process, sell, and buy industrial hemp having no more than one percent tetrahydrocannabinol.

433-C:2 Licensure. Any person desiring to grow industrial hemp for commercial purposes shall apply to the commissioner of agriculture, markets, and food for a license on a form prescribed by the commissioner. The application for a license shall include the name and address of the applicant and the legal description of the land area to be used for the production of industrial hemp. If the applicant has completed the application process to the satisfaction of the commissioner, the commissioner shall issue the license, which shall be valid for a period of one year. Any person licensed under this chapter is presumed to be growing industrial hemp for commercial purposes.

433-C:3 Notification Requirements. Each licensee shall file with the commissioner of agriculture, markets, and food documentation indicating that the seeds planted were of a type and variety certified to have no more than one percent tetrahydrocannabinol and a copy of any contract to grow industrial hemp. Each licensee shall notify the commissioner of the sale or distribution of any industrial hemp grown by the licensee, and the names of the persons to whom the hemp was sold or distributed.

433-C:4 Rulemaking. The commissioner of agriculture, markets, and food shall adopt rules, under RSA 541-A, to allow industrial hemp grown pursuant to this chapter to be tested during growth for tetrahydrocannabinol levels and to allow for supervision of the industrial hemp during its growth and harvest.

433-C:5 Fees.

I. To provide sufficient funds to pay costs associated with monitoring and testing industrial hemp in the state, as well as enforcing the provisions of this chapter, the commissioner of agriculture, markets, and food shall assess each applicant a fee of $5 per acre of land used for growing industrial hemp. The minimum fee assessed shall be $150 per applicant.

II. Fees assessed under this section shall be collected by the department of agriculture, markets, and food, and shall be deposited in the industrial hemp monitoring and enforcement fund, hereby established in the office of the state treasurer. Moneys in the fund are continually appropriated to the department of justice and shall be used by the attorney general for the purposes provided in paragraph I.

2 New Subparagraph; Fees Credited to the Industrial Hemp Monitoring and Enforcement Fund. Amend RSA 6:12, I by inserting after subparagraph (lllllllll) the following new subparagraph:

(mmmmmmmmm) Fees collected by the department of agriculture, markets, and food pursuant to RSA 433-C:5, which shall be credited to the industrial hemp monitoring and enforcement fund established in RSA 433-C:5, II.

3 Effective Date. This act shall take effect July 1, 2003.

LBAO

03-0781

1/27/03

HB 653-FN-A - FISCAL NOTE

AN ACT authorizing the production of industrial hemp.

FISCAL IMPACT:

The Department of Safety states this bill will increase state highway fund expenditures by $105,000 in FY 2004, and $56,000 in FY 2005 and each year thereafter, and increase state general fund expenditures by $45,000 in FY 2004, and $24,000 in FY 2005 and each year thereafter. The Departments of Agriculture and Justice state this bill will increase state restricted revenue and state expenditures by an indeterminable amount in FY 2004 and each year thereafter. There will be no fiscal impact on county and local revenue or expenditures.

METHODOLOGY:

The Department of Safety states instrumentation would have to be purchased that would be capable of quantifying levels of THC, CBD in order to distinguish industrial hemp from marijuana, and that additional lab personnel hours would be necessary to run and interpret the analysis. A one-time equipment cost of $70,000 is estimated. The Department states there are approximately 7,540 vegetative-based exhibits per year that take about 30 minutes for lab chemists to run and interpret. Using an hourly rate of $21.24 for a lab chemist, this calculates to approximately $80,000 in ongoing personnel costs annually. The source of funds for the Department of Safety expense would be 70% from the highway fund and 30% from the general fund.

The Department of Agriculture states this bill authorizes the Commissioner to assess a fee of $5.00 per acre of land used for growing industrial hemp, with a minimum fee of $150.00 per applicant. The Department estimates a first year crop acreage of 100 acres and 10 grower/applicants. Estimated revenue would range between $500 and $1,500 in FY 2004 depending on the distribution of acreage among possible applicants due to the minimum fee established per applicant (100 acres x $5 = $500 or 10 applicants x $150 = $1,500). In subsequent years, the Department estimates acreage totaling 300 acres and 30 grower/applicants. This would result in potential revenue between $1,500 and $4,500 (300 acres x $5 = $1,500 or 30 applicants x $150 = $4,500) in FY 2005 through FY 2007. All revenue collected by the Department would be deposited into the newly established Industrial Hemp Monitoring and Enforcement Fund. Money in the fund would be continually appropriated to the Department of Justice for enforcement purposes.

LBAO

03-0781

1/27/03

Page 2

The Department of Justice states this bill will involve the agency in additional litigation. Costs would include the production of documents, research, travel, overtime for support staff, and additional caseloads for attorneys. Exclusive of staff time, the cost of litigation averages $2,388 for civil cases and $1,351 for criminal cases. In addition, any increase in the number of complaints to the agency will increase both workload and the priority in which they are handled.