86R2945 TSR-F
By: Menéndez S.B. No. 116
A BILL TO BE ENTITLED
AN ACT
relating to industrial hemp; requiring an occupational license;
authorizing fees.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 61.001(1), Agriculture Code, is amended
to read as follows:
(1) "Agricultural seed" includes the seed of any
grass, forage, cereal, or fiber crop, any other kind of seed
commonly recognized in this state as agricultural or field seed,
and any mixture of those seeds. The term includes the seed of
industrial hemp, as that term is defined by Section 112.001.
SECTION 2. The heading to Subtitle E, Title 5, Agriculture
Code, is amended to read as follows:
SUBTITLE E. PRODUCTION, PROCESSING, AND SALE OF FIBER PRODUCTS
SECTION 3. Subtitle E, Title 5, Agriculture Code, is
amended by adding Chapter 112 to read as follows:
CHAPTER 112. PRODUCTION OF INDUSTRIAL HEMP
SUBCHAPTER A. GENERAL PROVISIONS
Sec. 112.001. DEFINITIONS. In this chapter:
(1) "Collective yield" means a hammer milled,
pulverized, or ground sample of a whole plant, including roots,
stalks, leaves, flowers, and seeds.
(2) "Compliant use" means the use or recommended use
of a hemp-derived product with a delta-9 tetrahydrocannabinol
concentration of not more than 0.3 percent for any purpose,
including food for human consumption, human application, feed for
animal consumption, animal application, fiber production, or
product manufacturing.
(3) "Hemp-derived product" includes:
(A) a plant segment; and
(B) an end product derived from an industrial
hemp plant or a plant segment, including extract, oil, grain, cake,
meal, flower, resin, fiber, or hurd.
(4) "Industrial hemp" means a plant or any part of a
plant, whether growing or not, of the species Cannabis sativa L.
with a delta-9 tetrahydrocannabinol concentration of not more than
0.3 percent on a dry weight basis.
(5) "Institution of higher education" has the meaning
assigned by 20 U.S.C. Section 1001.
(6) "License" means an industrial hemp producer's
license issued under this chapter.
(7) "License holder" means a person who holds a
license.
(8) "Plant segment" means an individual segment of a
plant, including the roots, stalks, leaves, flowers, or seeds of a
plant.
(9) "THC compliance threshold" means a delta-9
tetrahydrocannabinol concentration of not more than 0.3 percent:
(A) on a dry weight basis for industrial hemp; or
(B) in a hemp-derived product.
Sec. 112.002. COMPLIANCE WITH FEDERAL LAW. Notwithstanding
any other provision of this chapter, a person may grow or cultivate
industrial hemp under this chapter only to the extent allowed by
federal law.
Sec. 112.003. INDUSTRIAL HEMP RESEARCH. (a) The
department, in cooperation with selected institutions of higher
education with expertise in agricultural research, shall promote
the research and development of industrial hemp and commercial
markets for industrial hemp and hemp-derived products.
(b) The department shall research industrial hemp
production through the establishment and oversight of an industrial
hemp research program lasting at least five years. The department
shall select an institution of higher education to manage the
research program. The research program must consist primarily of
demonstration plots planted and cultivated in this state by
selected license holders.
(c) The department shall obtain any federal permit or waiver
necessary to conduct the industrial hemp research program from the
United States Drug Enforcement Administration or the appropriate
federal agency.
(d) As part of the industrial hemp research program, the
department shall, through the institution of higher education
selected under Subsection (b) and other research partners:
(1) oversee and analyze the growth of industrial hemp
by license holders for agronomy research, including analysis of
required soils, growing conditions, and harvest methods for
industrial hemp varieties that may be suitable for the production
of commercial hemp products;
(2) conduct seed research on various types of
industrial hemp that are best suited to be grown in this state,
including seed availability, creation of Texas hybrid types,
in-the-ground variety trials and seed production, and the
feasibility of a program to recognize certain industrial hemp seed
as being Texas heritage hemp seed;
(3) study the economic feasibility of developing an
industrial hemp market for various types of industrial hemp that
can be grown in this state;
(4) report on the estimated value-added benefits,
including environmental benefits, to businesses in this state of
creating a market for industrial hemp produced in this state;
(5) study the agronomy research being conducted
worldwide relating to industrial hemp varieties, production, and
utilization;
(6) research and promote industrial hemp and hemp seed
on the world market that can be produced in this state; and
(7) study the feasibility of attracting federal and
private funding for the research program under this section.
(e) In addition to the research and analysis under
Subsection (d), the department shall:
(1) coordinate with an institution of higher education
to study the use of industrial hemp in new energy technologies,
including:
(A) an evaluation of the use of industrial hemp
to generate electricity and to produce biofuels and other forms of
energy resources;
(B) the growth of industrial hemp on reclaimed
oil and gas lands, mine sites, and wind farms;
(C) the use of hemp seed oil in the production of
fuels; and
(D) an assessment of the production costs,
environmental issues, and costs and benefits involved with the use
of industrial hemp for energy; and
(2) promote awareness of the financial incentives that
may be available to agribusiness and manufacturing companies that
manufacture industrial hemp into hemp-derived products in order to
diversify the agricultural economy of this state, attract new
businesses to this state, create new job opportunities for
residents of this state, and create a commercial market for
industrial hemp.
(f) The department may solicit and accept gifts, grants, and
donations from public and private sources to implement the research
program under this section.
(g) Not later than December 31 of each year, the department
shall report on the status and progress of the research program
under this section to the governor and the legislature.
Sec. 112.004. LEGISLATIVE INTENT REGARDING COMPLIANCE
RESPONSIBILITIES. It is the intent of the legislature that:
(1) license holders be responsible for growing and
cultivating department-approved certified industrial hemp seed,
cultivars, and clones that meet the THC compliance threshold and
are in compliance with other applicable laws;
(2) manufacturers of hemp-derived products for human
consumption be responsible for meeting the THC compliance threshold
and complying with applicable food manufacturing laws;
(3) manufacturers of hemp-derived products not for
human consumption be responsible for meeting the THC compliance
threshold and complying with other applicable laws; and
(4) wholesalers, retailers, and consumers of
hemp-derived products not be responsible for unknowingly buying or
selling products that do not meet the THC compliance threshold,
unless the person intentionally or knowingly adulterates the
product.
SUBCHAPTER B. POWERS AND DUTIES OF DEPARTMENT
Sec. 112.051. RULES. (a) The department shall adopt rules
to regulate industrial hemp production in this state, including:
(1) license application and renewal procedures;
(2) requirements for license applicants and license
holders to provide global positioning system coordinates for each
location where the person grows or cultivates, or intends to grow or
cultivate, industrial hemp;
(3) plant inspection requirements;
(4) procedures to notify law enforcement officials of
the licensed growth or cultivation of industrial hemp;
(5) requirements for license holders to post notice of
industrial hemp cultivation; and
(6) provisions governing acquisition of certified
seed, cultivars, and clones by license holders and institutions of
higher education.
(b) Rules adopted under this chapter must be comparable to
similar rules governing the production of other crops.
Sec. 112.052. FEES. (a) The department shall prescribe
reasonable license application and renewal fees, inspection fees,
and plant sample testing fees in amounts comparable to fees
associated with the production of other crops.
(b) Fees collected under this chapter may be appropriated
only to the department for the purpose of administering this
chapter.
Sec. 112.053. INSPECTIONS. (a) The department may inspect
plants grown or cultivated by a license holder to determine whether
the plants meet the THC compliance threshold and are being grown or
cultivated in compliance with department rules.
(b) Inspections and testing under this chapter shall be
conducted according to best practices established by the department
and institutions of higher education.
SUBCHAPTER C. INDUSTRIAL HEMP PRODUCER'S LICENSE
Sec. 112.101. LICENSE REQUIRED. A person may not grow or
cultivate industrial hemp in this state unless the person is a
license holder.
Sec. 112.102. ISSUANCE OF LICENSE. (a) An applicant for a
license must apply to the department and pay the required
application fee.
(b) The application must:
(1) be notarized to affirm the applicant's identity;
(2) include the global positioning system coordinates
of each location where the applicant will grow or cultivate
industrial hemp; and
(3) include the contact information, including an
electronic mail address if available, of the sheriff for each
county where the applicant will grow or cultivate industrial hemp.
(c) The department shall issue a license to a qualified
applicant not later than the 60th day after the date the department
receives the completed application and the required fee.
(d) The department shall send a copy of each license issued
under this chapter to the sheriff for each county where the license
holder will grow or cultivate industrial hemp, including the global
positioning system coordinates of each location where the license
holder will grow or cultivate industrial hemp.
Sec. 112.103. LICENSE TERM. A license is valid for one year
and may be renewed as provided by department rule.
Sec. 112.104. REVOCATION. The department shall revoke a
license if the department finds that the license holder violated
this chapter or a rule adopted under this chapter, or is
intentionally or knowingly growing plants with the intent to
produce marihuana.
SUBCHAPTER D. INDUSTRIAL HEMP SEED, CULTIVARS, AND CLONES
Sec. 112.151. SEED, CULTIVAR, AND CLONE CERTIFICATION. (a)
The department or the State Seed and Plant Board may certify under
Chapter 61 or 62 industrial hemp seed and industrial hemp plants,
cultivars, and clones.
(b) The department or the State Seed and Plant Board may
adopt rules necessary to implement this section.
Sec. 112.152. ACQUISITION OF SEEDS AND PLANTS. (a) A
license holder, the department, or an institution of higher
education may transport and use industrial hemp plants, cultivars,
and clones from states that allow the cultivation of industrial
hemp in compliance with federal law.
(b) The department shall acquire any necessary permits from
the United States Drug Enforcement Administration to acquire
industrial hemp seed from domestic and foreign sources.
Sec. 112.153. INDUSTRIAL HEMP EXCEEDING THC COMPLIANCE
THRESHOLD. (a) The department shall suspend the certification of
certified industrial hemp seed, cultivars, or clones if the
collective yield and average samplings from seed, cultivar, or
clone inspections exceed the THC compliance threshold.
(b) Seed, cultivars, or clones for which the collective
yield and average samplings exceed the THC compliance threshold
shall be destroyed at the license holder's expense according to
department rules.
SUBCHAPTER E. EXCEPTIONS FROM MARIHUANA LAWS FOR INDUSTRIAL HEMP
Sec. 112.201. APPLICABILITY OF OTHER LAW. (a) The term
"marihuana," as defined by Section 481.002, Health and Safety Code,
does not include:
(1) industrial hemp grown or cultivated by the
department, an institution of higher education, or a license
holder; or
(2) a hemp-derived product that meets the THC
compliance threshold.
(b) Except as provided by Subsection (c), a person does not
violate Section 481.120, 481.121, 481.122, or 481.125, Health and
Safety Code, if the person:
(1) manufactures, delivers, or possesses a
hemp-derived product for a compliant use;
(2) manufactures, delivers, or possesses equipment
used for the manufacture or processing of a hemp-derived product
for a compliant use;
(3) grows industrial hemp, without intent, as the
result of the natural spread of seeds onto property owned or
controlled by the person; or
(4) is the department, an institution of higher
education, or a license holder and:
(A) grows, cultivates, manufactures, delivers,
or possesses industrial hemp;
(B) manufactures, delivers, or possesses
equipment used for the cultivation or processing of industrial
hemp; or
(C) without intent, grows or cultivates a plant
from a department-approved certified seed, cultivar, or clone that
on inspection is found to exceed the THC compliance threshold if the
person destroys the plant in accordance with department rules as
soon as practicable after learning the plant exceeds the THC
compliance threshold.
(c) Subsection (b) does not apply to a person who
intentionally or knowingly grows a plant or produces a product with
the intent to produce marihuana.
SECTION 4. Section 481.002(26), Health and Safety Code, is
amended to read as follows:
(26) "Marihuana" means the plant Cannabis sativa L.,
whether growing or not, the seeds of that plant, and every compound,
manufacture, salt, derivative, mixture, or preparation of that
plant or its seeds. The term does not include:
(A) the resin extracted from a part of the plant
or a compound, manufacture, salt, derivative, mixture, or
preparation of the resin;
(B) the mature stalks of the plant or fiber
produced from the stalks;
(C) oil or cake made from the seeds of the plant;
(D) a compound, manufacture, salt, derivative,
mixture, or preparation of the mature stalks, fiber, oil, or cake;
[or]
(E) the sterilized seeds of the plant that are
incapable of beginning germination; or
(F) an item described by Section 112.201(a),
Agriculture Code.
SECTION 5. Not later than January 1, 2020, the Department of
Agriculture shall adopt rules necessary to implement Chapter 112,
Agriculture Code, as added by this Act.
SECTION 6. This Act takes effect September 1, 2019.