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DEPARTMENT OF AGRICULTURE guidelines relating to the production of products.1 While hemp was produced hemp under sections 297B and 297C in previously in the United States (U.S.) Agricultural Marketing Service consultation with the U.S. Attorney for hundreds of years, its use General. diminished in favor of alternatives. 7 CFR Part 990 AMS issued an interim final rule (IFR) Hemp fiber, for instance, which had been used to make rope and clothing, [Doc. No. AMS–SC–19–0042; SC19–990–2 on October 31, 2019 (84 FR 58522), and was replaced by less expensive jute and FR] began its initial implementation of the abaca imported from Asia. Rope made program. To date, USDA has approved from these materials was lighter, more Establishment of a Domestic Hemp approximately 45 State and Tribal hemp Production Program buoyant, and more resistant to saltwater plans. However, not all of the States and than hemp rope, which required tarring. AGENCY: Agricultural Marketing Service, Tribes have implemented their plans for Improvements in technology further Department of Agriculture (USDA). various reasons, including the need to contributed to the decline in hemp use. ACTION: Final rule. take additional steps to complete State The cotton gin, for example, simplified legislative or rulemaking processes or to the processing of cotton, which replaced SUMMARY: This final rule supersedes the establish the regulatory scheme as well hemp in the manufacture of textiles. interim final rule that established the as the extension of the 2014 Farm Bill The hemp industry continued in the Domestic Hemp Production Program, as Program. Thus, as of November 2020, U.S. until the Marihuana Tax Act of mandated by the Agriculture twenty States and nine Tribes have 1938. This Act ended the legal Improvement Act of 2018 (2018 Farm submitted reports on their respective production of hemp in the United Bill). This rule includes regulations programs. Based on the reports States, and hemp was added to used by the Department of Agriculture submitted by States and Tribes in 2020, Schedule I of the Controlled Substances (USDA) to approve plans submitted by producers have planted 6,166 acres Act (CSA), 21 U.S.C. 801 et seq. Prior to States and Indian Tribes for the under the 2018 Farm Bill hemp plans, the 2018 Farm Bill, all Cannabis sativa domestic production of hemp. This rule of which approximately 730 acres were L., regardless of delta-9 also includes regulations on the Federal subject to disposal. tetrahydrocannabinol (THC) hemp production plan for producers in As of the effective date of this final concentration level, fell within the CSA States or territories of Indian Tribes that rule, the interim final rule is definition of ‘‘marihuana’’ unless the do not have their own USDA-approved superseded. This final rule replaces the product fell under a narrow range of plans. The program provides IFR at 7 CFR part 990, effective March exceptions (e.g., the ‘‘mature stalks’’ of requirements for maintaining records the plant).2 As a result, many aspects of about the land where hemp is produced, 22, 2021. The Agricultural Marketing Service (AMS), which has been domestic production of what is now testing the levels of total delta-9 defined as hemp was limited to persons tetrahydrocannabinol, disposing of non- delegated authority to administer the U.S. Domestic Hemp Production registered under the CSA to do so. compliant plants, licensing hemp Under the Agricultural Act of 2014 Program, provided multiple producers, and ensuring compliance (2014 Farm Bill), Public Law 113–79, under the new program. opportunities for public comment. AMS State departments of agriculture and accepted comments during an initial DATES: This rule is effective March 22, institutions of higher education were comment period from October 31, 2019, 2021. permitted to produce hemp as part of a through December 31, 2019. This initial FOR FURTHER INFORMATION CONTACT: Bill pilot program for research purposes. comment period was extended for an The authority for hemp production Richmond, Branch Chief, U.S. Domestic additional 30 days on December 18, Hemp Production Program, Specialty provided in the 2014 Farm Bill was 2019 (84 FR 69295), ending January 29, extended until January 1, 2022, by the Crops Program, AMS, USDA; 1400 2020. AMS reopened the comment Independence Ave. SW, Stop 0237, Continuing Appropriations Act, 2021, period for 30 additional days on and Other Extensions Act (Pub. L. 116– Washington, DC, 20250–0237; September 8, 2020 (85 FR 55363), Telephone: (202) 720–2491, Fax: (202) 260) (2021 Continuing Appropriations ending October 8, 2020. A total of 720–8938, or Email: Act). approximately 5,900 comments were [email protected]. Hemp production in the U.S. has seen received during all comment periods a resurgence in the last several years. SUPPLEMENTARY INFORMATION: This rule from States; Indian Tribes; industry and Since importation of seed is covered is issued under the authority of section agricultural organizations; private under USDA’s Animal and Plant Health 10113 of the 2018 Farm Bill (Pub. L. citizens; members of Congress, the Inspection Service (APHIS) regulations, 115–334; December 20, 2018), which scientific community; agencies; and this final rule does not regulate hemp amended the Agricultural Marketing Act individuals involved in the growing, of 1946, as previously amended (7 processing, transporting and marketing 1 Section 297D(c) of the AMA explicitly preserved U.S.C. 1621 et seq.) (AMA), by adding of hemp. A summary of the public the authority of the U.S. Food and Drug Administration (FDA) to promulgate regulations Subtitle G (sections 297A through comments received and AMS’s 297E). Section 297B of the AMA and guidance related to the production of hemp responses appear under ‘‘Comment under the Federal Food, Drug, and Cosmetic Act (21 requires the Secretary of Agriculture Analysis’’ in section IX of this U.S.C. 301 et seq.) (FD&C Act) and section 351 of (Secretary) to evaluate and approve or document. the Public Health Service Act (42 U.S.C. 262) (PHS disapprove State or Tribal plans Act). See section 297D(c)(1) (‘‘Nothing in this regulating the production of hemp. I. Introduction subchapter shall affect or modify . . . the Federal Food, Drug, and Cosmetic Act (21 U.S.C. 301 et Section 297C of the AMA requires the seq.); section 351 of the Public Health Service Act Secretary to establish a Federal plan for Hemp is a commodity with numerous (42 U.S.C. 262); or the authority of the producers in States and territories of industrial and horticultural uses Commissioner of Food and Drugs and the Secretary Indian Tribes not covered by plans including fabric, paper, construction of Health and Human Services . . . ’’ under those materials, food products, cosmetics, Acts). approved under section 297B. Section 2 production of cannabinoids (such as Although the statutory spelling is ‘‘marihuana’’ 297D of the AMA requires the Secretary in the Controlled Substances Act, this rule uses the to promulgate regulations and cannabidiol or CBD), and other more commonly used spelling of marijuana.

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seed imports. APHIS regulates the marijuana, which remains classified as section also includes USDA hemp importation of all seeds for planting to a Schedule I controlled substance license provisions and suspension. ensure safe agricultural trade. Hemp regulated by the Drug Enforcement These two sections provide general seeds can be imported into the U.S. Administration (DEA) under the CSA. provisions that are discussed in more from Canada if accompanied by either: The term ‘‘State’’ means any of one of detail in the comment analysis section. (1) A phytosanitary certification from the fifty States of the United States of Sections containing definitions, Canada’s national plant protection America, the District of Columbia, the severability and the regulatory analysis organization to verify the origin of the Commonwealth of Puerto Rico, and any are included before the regulatory seed and confirm that no plant pests are other territory or possession of the language. The reader may be best served detected; or (2) a Federal Seed Analysis United States. The term ‘‘Indian Tribe’’ by reading the comment section to Certificate (SAC, PPQ Form 925) for or ‘‘Tribe’’ has the same definition as in determine the changes made to this rule. hemp seeds grown in Canada. Hemp section 4 of the Indian Self- II. State and Tribal Plans seeds imported into the U.S. from Determination and Education countries other than Canada may be Assistance Act (25 U.S.C. 5304). This Section 297B (7 U.S.C. 1639p) of the accompanied by a phytosanitary final rule also includes the definition of AMA requires that States or Indian certificate from the exporting country’s ‘‘territory of an Indian Tribe’’ to provide Tribes seeking primary regulatory national plant protection organization to clarity to the term because the AMA authority over the production of hemp verify the origin of the seed and confirm does not define it. The final rule defines in that State or territory of that Indian that no plant pests are detected. ‘‘territory of the Indian Tribe’’ as (a) all Tribe, submit, for the approval of the This final rule does not address the land within the limits of any Indian Secretary, a plan concerning the exportation of hemp. Should there be reservation under the jurisdiction of the monitoring and regulation of such hemp sufficient public interest in exporting United States Government, production. State or Tribal plans must hemp in the future, USDA will work notwithstanding the issuance of any be submitted to USDA and approved with industry and other Federal patent, including rights-of-way running prior to their implementation. Nothing agencies to help facilitate this process. through the reservation; (b) all preempts or limits any law of a State or The 2018 Farm Bill requires USDA to dependent Indian communities within Tribe that regulates the production of promulgate regulations and guidelines the borders of the United States whether hemp and is more stringent than the to establish and administer a program within the original or subsequently provisions in Subtitle G of the AMA. for the production of hemp in the acquired territory thereof, and whether AMS received extensive public input United States. Under this new authority, within or without the limits of a state; on the regulatory requirements for State a State or Indian Tribe that wants to (c) all Indian allotments, the Indian and Tribal hemp plans. Incorporating have primary regulatory authority over titles to which have not been the input received, the following the production of hemp in that State or extinguished, including rights-of-way sections explain the changes to the territory of that Indian Tribe may running through the same; and (d) any regulatory requirements for State and submit, for the approval of the lands title to which is either held in Tribal hemp plans. Secretary, a plan concerning the trust by the United States for the benefit A. Land Used for Production monitoring and regulation of such hemp of any Indian Tribe or individual or production. For States or Indian Tribes held by any Indian Tribe or individual The 2018 Farm Bill and the IFR without an approved plan, the Secretary subject to restriction by the United required that plans include a process by is directed to establish a Departmental States against alienation and over which which relevant information regarding plan to monitor and regulate hemp an Indian Tribe exercises jurisdiction. the land used for hemp production in production in those areas. Under an approved Tribal plan, the their jurisdiction is collected and The 2018 Farm Bill specifies Indian Tribe will have regulatory maintained. Certain information on requirements that all hemp producers authority over hemp production within mailing addresses and hemp production must meet. These include licensing its Territory.3 A full list of terms and sites must be collected for each licensee requirements; recordkeeping definitions relating to part 990 can be covered by the State or Tribal plan. requirements for maintaining found under ‘‘Definitions’’ in section IV. The information required to be information about the land where hemp This rule is divided into several collected includes a legal description of is produced; procedures for testing the sections. The first section provides a the land and geospatial location for each THC concentration levels for hemp; general introduction to the rule. This field, greenhouse, or other site where procedures for disposing of non- section does not go into a detailed hemp is produced. Geospatial location compliant plants; compliance description of all parts of the rule or is necessary because many rural provisions; and procedures for handling about the provisions of the rule that are locations do not have specific addresses, violations. discussed later on in other sections. and these coordinates will assist with For the purposes of 7 CFR part 990, Sections for State and Tribal plans as the proper identification of hemp and as defined in the 2018 Farm Bill, well as the USDA plan contain general production locations. the term ‘‘hemp’’ means the plant information on land use, tribal In addition to the land information species Cannabis sativa L. and any part jurisdiction authority, sampling, testing, required to be collected by the of that plant, including the seeds thereof disposal and remediation, compliance appropriate State or Indian Tribe, AMS and all derivatives, extracts, provisions, information sharing, chose to require licensed producers, cannabinoids, isomers, acids, salts, and certification of resources, and State and including those under the USDA plan, salts of isomers, whether growing or not, Tribal plan approvals. The USDA to report their hemp crop acreage to the with a delta-9 tetrahydrocannabinol Farm Service Agency (FSA). Although concentration of not more than 0.3 3 We note that if an Alaskan Native Corporation many commenters opposed this percent on a dry weight basis. Delta-9 wants to produce hemp on land it owns in fee requirement based on costs around the tetrahydrocannabinol, or THC, is the simple, it would need to have a State or USDA time and travel expense necessary to license, whichever is applicable, because that land primary intoxicating component of does not qualify as Indian Country and the physically visit the appropriate FSA cannabis. Cannabis with a THC level Corporation does not have jurisdiction over that County Office, AMS has determined exceeding 0.3 percent is considered land. that maintaining the FSA reporting

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requirement is essential for several use such as track, field, or subfield, distinct, recognized variety that is reasons. AMS recognizes that in some depending on the specific area. This properly tested and legally labeled. Seed cases producers may travel to FSA designation does not change the certification under the Federal Seed Act offices miles away incurring additional requirements or the information is concerned with many varietal time and cost. These costs are submitted for law enforcement. AMS characteristics, not solely THC incorporated in the expected burden of will amend the form to reflect these concentration. This enables farmers to this program. terms. When reporting to FSA, confidently purchase seed of a suitable First, USDA is statutorily required to producers must provide their State or variety, by purchasing seed certified as provide law enforcement with certain Tribe-issued license or authorization to variety. Using certified seed, as ‘‘real-time’’ information about who is number. A link to FSA information on described in the Federal Seed Act growing hemp, whether their license is how to report hemp crop acreage to FSA regulations and AOSCA standards, is an in good standing with the regulatory is available at https://www.fsa.usda.gov/ option for states and tribes if they have body issuing the license, and the Assets/USDA-FSA-Public/usdafiles/ the data to support that the seed would location(s) where hemp is being grown. FactSheets/2019/crop-acreage- work in their environment. While Having FSA collect the necessary reporting-19.pdf and is available on the varietal certification does not absolutely information enables USDA to provide USDA hemp production program ensure a specific THC content, the fact the most accurate and ‘‘real-time’’ website. is that THC content (or at least a range) information to law enforcement, as As described in the IFR, certain State is a reliable varietal characteristic. required by Subtitle G of the AMA. hemp pilot programs operating under Therefore, if the farmer is able to Second, FSA offices serve as useful the 2014 Farm Bill authority developed confidently purchase seed of a suitable resources to all farmers and, in ‘‘seed certification’’ programs to help variety by purchasing seed certified to collaboration with other USDA producers identify hemp strains with variety, they at least know what to agencies, can provide a wide range of potentially lower THC concentrations. expect from the variety in their area. insurance, risk management, and The term ‘‘certification’’ in this context For this reason, AMS recommends the conservation program guidance and means tested or verified, but it does not use of hemp seed from varieties that information. These offices currently necessarily mean certified for varietal have undergone varietal certification, serve the agricultural industry within purity. USDA acknowledges that this following the process outlined in the their communities, where producers can remains a significant hurdle to the hemp Federal Seed Act Regulations, and establish farm and producer records, industry and is committed to assisting produced following AOSCA standards. record their licensing information, and with the research and development of This recommendation will assist hemp report crop acreage. The producer may compliant hemp varietals. Although farmers to purchase recognized hemp also, with supporting documentation, AMS encourages States and Tribes to varieties that have been tested for purity update their FSA farm records for develop seed-certification programs if and are properly labeled. leases, sub-leases, or land ownership. sufficient data is available, AMS has Additionally, AMS administers the Requiring farmers to visit the FSA office determined, at this time, that requiring Plant Variety Protection Office (PVPO) ensures that they receive information on the use of certain ‘‘compliant’’ varietals that is actively accepting applications of the availability of these helpful tools or establishing National rules for State- seed-propagated hemp for plant variety and programs. This is particularly level certification programs is protection. The PVPO provides important for new farmers, who may not inappropriate. AMS will look at best intellectual property protection to be aware of the wide range of programs practices from States and Tribes to breeders of new varieties of seeds, and services offered by USDA. evaluate if a program would be tubers, and asexually reproduced plants. Further, FSA maintains the applicable to a USDA plan. If Under the U.S. Plant Variety Protection technology necessary for data collection applicable, USDA may develop a Act, PVPO examines new applications and geographical land identification. performance-based sampling program. and grants certificates that protect These tools will provide easy access to Such a program will require USDA to varieties for 20 years (25 years for vines information needed for law enforcement conduct rulemaking and comment and trees). Certificate owners have and for other agricultural programs. procedures. rights to exclude others from marketing AMS has determined, for these reasons, The term ‘‘seed certification,’’ as and selling their varieties, manage the to continue to require the reporting of found in the Federal Seed Act and its use of their varieties by other breeders, hemp crop acreage to FSA. Regulations, refers to a third-party and enjoy legal protection of their work. Based on input from commenters, verification process that assures seed This work, however, does not certify USDA is also clarifying the distinction customers that they are receiving pure seeds for THC content. between the term ‘‘lot’’ as defined in the varieties and high-quality seed for B. Tribal Jurisdictional Authority IFR, and the term ‘‘subfield’’ as it relates planting purposes. The Federal Seed to FSA reporting. Although this final Act grants authority to seed certifying The final rule clarifies the extent of a rule uses the term ‘‘lot’’ to discuss the agencies in each State to administer Tribe’s regulatory authority over hemp land where hemp is grown, when a varietal seed certification standards for production within its Territory. Several producer visits the FSA office to report all major agricultural crops, including commenters stated that language in the hemp crop acreage, FSA staff will help hemp. Recognized seed certifying IFR raised uncertainty as to whether producers determine the applicable agencies are members of the Association Indian Tribes could regulate hemp FSA-specific term for designating the of Official Seed Certifying Agencies production by non-Indians operating on location(s) where hemp is being grown. (AOSCA), and they administer uniform fee lands within a Tribe’s Territory. To The terminology used by FSA to denote AOSCA standards and inspect crops address this uncertainty, § 990.4(b)(4) of land areas include terms like ‘‘farm,’’ being grown for seed throughout the the final rule now provides that ‘‘[u]pon ‘‘tract,’’ ‘‘field,’’ and ‘‘subfield,’’ which production process to maintain varietal USDA approval of a Tribal plan, a Tribe are equivalent to AMS’s term ‘‘lot.’’ FSA purity. These activities protect seed may exercise jurisdiction and therefore staff will not provide a ‘‘lot number’’ to customers in both domestic and export primary regulatory authority over all producers as described in the IFR. FSA markets. Seed produced under these production of hemp in its Territory will use designations that they currently types of certification programs ensure a regardless of the extent of its inherent

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regulatory authority.’’ Thus, as long as Interpretive Rule: Revised Interpretation their hemp programs. AMS is modifying the land at issue qualifies as land within of Clean Water Act Tribal Provision, 81 the sampling provisions as presented in the territory of an Indian Tribe under FR 30183 (May 16, 2016); EPA Final the IFR to allow States and Tribes to § 990.1 of the final rule, an Indian Tribe Rule: Indian Tribes—Air Quality develop performance-based sampling with a USDA-approved plan may Planning and Management, 63 FR 7254 requirements. Performance-based regulate all hemp production on that (Feb. 12, 1998); Arizona Public Serv. Co. sampling achieves defined objectives land. USDA determined that this v. EPA, 211 F.3d 1280 (D.C. Cir. 2000). and focuses on results. It differs additional language is consistent with Moreover, USDA’s decision is significantly from a prescriptive action Congressional intent in the 2018 Farm practicable and prevents piecemeal in which licensees are provided detailed Bill and best ensures that hemp licensing by Tribes and USDA within a direction on how those results are to be production is managed consistently single Tribal Territory. If a Tribe was obtained. A performance-based throughout the Territory of an Indian only able to exercise primary regulatory approach would simply set a Tribe. authority over hemp production within performance objective (e.g., reliability of If an Indian Tribe desires to have its Territory when it could demonstrate 95 percent) and allow the States and primary regulatory authority over the the inherent authority to do so, USDA Tribes considerable freedom in how to production of hemp in its Territory, could be required to regulate some achieve that reliability objective with under the 2018 Farm Bill, the Tribe may hemp production within the Territory— their sampling methodology. submit a plan to USDA. Section 297C of for example, it could foreseeably be Some State hemp regulators have the AMA provides that ‘‘In the case of required to regulate hemp production by successfully developed sampling a State or Indian Tribe for which a State non-Indians operating on fee lands in requirements that ensure adherence to or Tribal plan is not approved under certain cases. Such a system would be State and Federal regulations, while section 297B, the production of hemp in confusing for producers and regulators allowing for flexibilities due to limited that State or the territory of that Indian alike. State resources and State and Tribal Tribe shall be subject to a plan For the foregoing reasons, the final differences. States expressed extensive established by the Secretary to monitor rule now clearly explains that upon concerns about the requirements in the and regulate that production.’’ Hence if USDA approval of a Tribal plan, a Tribe IFR that all lots must be sampled and a Tribe does not regulate hemp may exercise primary regulatory tested, due to significant logistical and production within its Tribal Territory, authority over all production of hemp in fiscal impacts. They explained that, USDA, not a State with an approved its Territory regardless of the extent of since most hemp in a given region is plan, will regulate hemp production its inherent regulatory authority, as harvested at the same time, sampling program within that Territory. reflected in §§ 990.2 and 990.4 of the must be completed within a very short Sections 297B and C plainly show final rule. time frame by only a few individuals. that Congress chose to take a territorial Several States also explained how approach to the Tribal regulation of C. Sampling for Total THC sampling occurs under established State hemp production under the AMA. If AMS is changing certain aspects of programs and described the different Congress only wanted Indian Tribes to the sampling requirements. This section ways that perceived risk determines assume primary regulatory authority addresses performance-based sampling, State requirements. Some States utilize over hemp production in areas within how to sample hemp plants, sampling different sampling requirements for their inherent jurisdictional authority it agents, and the harvest window after broad end-use categories like ‘‘fiber/ could have stated this. Instead, Congress sampling takes place. grain’’ hemp versus ‘‘cannabinoid’’ opted for a land-based approach and hemp, while others base their delegated to Tribes the authority to Sampling Requirements requirements on historical THC assume hemp production regulatory AMS received significant input from concentrations of certain varietals or on authority throughout their territories. In commenters on how hemp sampling the characteristics and growing history consideration of the statutory language procedures and requirements should be of a certain farm or producer. While and the overall statutory scheme of the changed. When referring to ‘‘sampling,’’ these States’ plans have not been 2018 Farm Bill, USDA has determined we mean the process of collecting approved under the 2018 Farm Bill that an Indian Tribe with an approved cuttings from hemp plants for purposes regulations, we believe that providing plan may regulate hemp production of compliance testing. States and Tribes the flexibility to throughout its territory without regard Performance Based Sampling develop sampling plans based on data to the Indian Tribe’s ability to they gather during an extended period demonstrate inherent regulatory The IFR required State and Tribal of time may be an effective method at authority under the factors set forth in hemp programs to collect samples from ensuring the overall acceptable hemp Montana v. United States, 450 U.S. 544 the flower material of the cannabis THC level of hemp grown in the State (1981). Because Congress did not define plant. The IFR also required State and or Tribe. AMS agrees that sampling Territory of the Indian Tribe in the Tribal hemp programs to collect enough requirements should allow States and AMA and did not include discussion in samples to ensure at a confidence level Indian Tribes more flexibility in the the legislative history of the meaning of of 95 percent that no more than one management of their hemp regulatory this term, USDA is exercising its percent (1%) of the plants in the lot programs. authority to issue regulations to would exceed the acceptable hemp THC AMS agrees that requiring sampling implement the provisions in the 2018 level. Guidance issued concurrently from every lot may be burdensome and Farm Bill to define this term in this with the IFR explained these expensive for State and Tribal manner. requirements in greater detail. The regulatory entities and producers. AMS USDA’s decision is in-line with sampling requirements in the IFR did also finds compelling the arguments agency determinations where the agency not consider geography, environmental presented by States’ regulatory agencies determined that Congress delegated a factors, State or Tribal level seed and other commenters that there are Tribe with authority to exercise certification programs, or other factors different risk factors for hemp used for regulatory authority over non-Tribal fee faced by States and Tribes when fiber and grain versus hemp used for land within reservations. EPA developing sampling requirements for cannabinoids. Data submitted with

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comments show that the THC levels of will be made aware of the more stable learning, whether a producer has hemp used for cannabinoids are and consistently reliable hemp varietals. consistently produced compliant hemp frequently higher than those of hemp for Any non-compliant plants produced by plants over an extended period of time, fiber and grain. The FDA authorizes the research institutions as a result of and other similar factors. AMS believes marketing of few types of cannabinoid research and development will still this will provide needed flexibility to products. This final rule does not cover need to be disposed and verified States and Indian Tribes to develop cannabinoid products. through documentation. Research and logical and enforceable sampling AMS also acknowledges that research development facilities are still required requirements that take into institutions face special circumstances to be licensed by States and Tribes. consideration their unique when conducting hemp research. Research institutions must follow circumstances. AMS will still require Accordingly, this rule provides licensing and reporting requirements. States and Indian Tribes to submit their sampling and testing flexibility to these In performance-based approaches, individual sampling requirements for institutions and producers working with measurable or calculable parameters are review as a component of the plan them to conduct hemp research. available to determine whether the approval process. Sampling protocols Producers that produce hemp for performance standard is met. These submitted by States and Indian Tribes research, along with the research performance parameters are identified must comply with the thresholds institution itself, must obtain a license to provide measures of performance and established by the 2018 Farm Bill and from a State, Tribal Government, or the opportunity to take corrective action this final rule. If performance-based USDA. However, the hemp that is if performance is lacking. In the case of sampling requirements are not included produced for research is not subject to hemp, the performance parameter is the in a State or Tribal plan, the method the same sampling requirements 0.3 percent THC level and other used for sampling must be sufficient at provided that the producer adopts and measures are included in this final rule a confidence level of 95 percent that no carries out an alternative sampling if the parameter is not achieved such as more than one percent of the plants in method that has the potential to ensure, disposal and remediation. each lot would exceed the acceptable at a confidence level of 95 percent, that USDA finds that in order to increase hemp THC level and ensure that a the cannabis plant species Cannabis regulatory effectiveness, it makes sense representative sample is collected from sativa L. that will be subject to this to allow States and Indian Tribes to every lot, and thereby every producer alternative method will not test above consider performance-based alternatives must be sampled and tested. When the acceptable hemp THC level. when developing sampling plans. If the evaluating sampling protocols Research institutions and producers objective or intended result can be submitted by States and Indian Tribes, growing hemp for research purposes achieved by setting a readily measurable USDA will evaluate the risk of shall ensure the disposal of all non- standard that is enforceable, the producing non-compliant material to compliant plants. Research institutions proposed requirement should merely determine approval or disapproval. In and producers growing hemp for specify the objective or result to be evaluating the risk, USDA will take into research purposes shall also comply obtained rather than prescribe to the consideration whether the performance- with the reporting requirements licensee how the objective or result is to based factors the State or Indian Tribe including reporting disposal of non- be attained. In other words, used have the potential to assure compliant plants. Research institutions requirements should be performance- compliance at a 95 percent confidence that handle ‘‘hot’’ hemp must follow based, and highly prescriptive rules and level. CSA requirements for handling requirements should be avoided absent Since USDA cannot develop marijuana. good cause to the contrary. performance metrics that would be States and Indian Tribes are allowed The sampling requirements for State applicable independently from where to develop performance-based and Tribal plans allow for States and the producer is located, producers requirements for these institutions. Indian Tribes to develop unique licensed under the USDA plan are However, the alternative method must sampling protocols for hemp growing subject to the sampling requirements in have the potential to ensure, at a facilities under their jurisdiction. the rule. USDA guidelines provided on confidence level of 95 percent, that the Sampling protocols must be sufficient at the USDA website at https:// cannabis plant species Cannabis sativa a confidence level of 95 percent that no www.ams.usda.gov/rules-regulations/ L. that will be subject to the alternative more than one percent of the plants in hemp/information-sampling describe method will not test above the each lot would exceed the acceptable best practices for complying with those acceptable hemp THC level. hemp THC level and ensure that a requirements. AMS views this flexibility as representative sample is collected that USDA recognizes that several States necessary to help support research and represents a homogeneous composition and Tribes may include performance- development as it relates to hemp of the lot. Alternatively, the final rule based sampling in their plans and that production. This decision allows these allows States and Indian Tribes to adopt their experience could demonstrate that types of research facilities and a performance-based sampling protocol. their sampling procedures may be institutions to confidently oversee the A performance-based protocol must adaptable to the USDA plan. If USDA study of hemp through trialing and have the potential to ensure, at a finds this to be the case, USDA will genetics research, which AMS believes confidence level of 95 percent, that the explore a performance-based sampling to be critical to the growth of industry, cannabis plants will not test above the scheme for producers under the USDA particularly in its infancy. Over time, acceptable hemp THC level. USDA plan in the future through notice and the flexibility provided by this final rule encourages the alternative protocol to comment rulemaking. will help to stabilize industry by consider seed certification processes or providing greater understanding of process that identifies varieties that Where To Take Samples on the Hemp hemp genetics and how certain varietals have consistently demonstrated to result Plant respond differently to growing in compliant hemp plants in that State AMS will retain the requirement that conditions in various geographic or territory of the Indian Tribe, whether pre-harvest samples be taken from the locations. All producers are expected to the producer is conducting research on flower material of hemp plants. benefit from such knowledge as they hemp at an institution of higher However, this rule clarifies the number

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of inches of plant material needed for Bill authority, AMS is including new Harvest Window the sample and provides greater detail requirements herein. The IFR required harvest within 15 as to where exactly on the plant to make AMS is publishing updated sampling days of sampling. AMS received a cutting. The IFR required that samples guidance concurrently with this final comments regarding the challenges be taken from the ‘‘flower material’’ of rule. This guidance describes how to presented by the 15-day harvest hemp plants. Further, in guidance comply with this requirement regarding requirement, including the logistical material issued concurrently with the where to take the sample from the plant challenges to State and Tribal agencies IFR, AMS explained in greater detail as well as other sampling requirements charged with overseeing the collection where exactly on the plant to make a in the final rule. While the sampling of samples in this short timeframe, the cutting by recommending samples be guidance provides best practices for logistical challenges to producers in taken from the top third of the plant, meeting the requirements, States, Indian harvesting hemp crops in this short ‘‘just underneath a flowering material.’’ Tribes, and USDA licensees may adopt timeframe, and testing challenges faced Many commenters argued that samples sampling procedures that differ from the by laboratories in having to conduct should be taken from the ‘‘whole plant’’ guidance so long as those procedures compliance analyses in this short or that a ‘‘homogenized’’ sample should meet the standards in this final rule. timeframe. Commenters suggested be taken to include the stem, stalk, Sampling Agents lengthening the 15-day harvest leaves, and seeds along with flower requirement to a longer period of time— material. Alternatively, some The IFR required a Federal, State, with some asking for up to 60 days. commenters proposed that samples be local, or Tribal law enforcement agency AMS agrees with the arguments taken post-harvest from shredded whole or other Federal, State, or Tribal presented by commenters and plant material, otherwise known as designated person to collect hemp recognizes the challenges imposed on ‘‘biomass.’’ Advocates of these positions samples for the purposes of testing THC the industry by the 15-day harvest asserted that THC levels of the whole levels in hemp. Comments in response requirement. AMS must also balance the hemp plant are better represented by to the IFR presented several concepts logistical challenges of a harvest samples collected from the entire plant, concerning how sampling agents should window requirement with the fact that and not just from floral material. Other be designated and/or trained. Comments THC concentration in hemp generally commenters advocated for sampling of a mostly suggested the need for enhanced increases the longer the plant is in the certain size or length of cutting. Such training requirements for sampling ground. AMS now understands from commenters advocated adoption of the agents to promote consistency in the data provided in comments that THC sampling methods they or others had ways that samples are collected concentration does not increase linearly used under pilot programs. Many State nationwide. Based on comments and is impacted by a myriad of agriculture departments suggested AMS received regarding sampling agents, environmental factors including AMS will provide additional training continue to require samples taken from moisture, wind, temperature, disease, resources for sampling agents. These flower material. sunlight, and soil, as discussed in the training documents will explain how Comment Analysis section of this rule. Even though many commenters felt sampling agents can meet the sampling The regulatory objective is to ensure, as that whole plant sampling should be requirements of this regulation. States best as possible, harmonization of the allowed, AMS is of the opinion that and Indian Tribes with an approved THC levels in the pre-harvest sample since THC is concentrated in the flower plan may require the sampling agents and that of the harvested material. material of the plant, the flower material used in their jurisdiction to take the Requiring that samples be taken prior to is more appropriate to test than the USDA training, or they may develop harvest is the best way to judge the THC entire plant. AMS will modify the their own custom training incorporating concentration of the plant and the lot sampling requirement to state that the USDA requirements with additional the sample represents. AMS recognizes sample shall be approximately five to State or Tribal requirements. States and that the most accurate measurement eight inches from the ‘‘main stem’’ (that Tribes must maintain information, would be at time of harvest, but also includes the leaves and flowers), available to producers, about trained understands the logistical practicalities ‘‘terminal bud’’ (that occurs at the end sampling agents. discussed above and therefore has of a stem), or ‘‘central cola’’ (cut stem Other comments on the topic of determined the most balanced approach that could develop into a bud) of the sampling agents spoke to the strain on is 30 days. For these reasons, AMS is flowering top of the plant. This change State and Tribal resources of requiring expanding the window within hemp is consistent with the sampling agents to take samples instead of must be harvested after sampling to 30 practices in several States that producers. Commenters presented two days. established hemp programs pursuant to proposals to alleviate this strain— Under this final rule, no more than 30 the 2014 Farm Bill authority. AMS allowing producers to collect their own days prior to the anticipated harvest of determined that this standard strikes an samples and reducing the volume of cannabis plants, a ‘‘sampling agent’’ appropriate balance between the need to farms and plants from which samples must collect samples for compliance collect a sufficiently large portion of the are collected. AMS is retaining the testing. If producers do not harvest plant’s flower (where THC and other requirement that only designated agents within 30 days of sampling, the plant cannabinoids are at their most can collect samples. This ensures that will likely have a higher THC level at concentrated), and the need to avoid there is consistency in sampling harvest than the sample that is being cutting a portion that is so large that it throughout the industry. The tested. This requirement balances the would be logistically difficult to flexibilities provided to States and need for accuracy with the logistical transport, dry, and prepare for lab Indian Tribes with primary regulatory realities faced in the sampling and testing. Based on the information authority over hemp in their jurisdiction testing processes and will yield the most discussed above and the experience and will likely reduce the number of accurate measurement of the THC level expertise of States and other samples required to be collected and at the point of harvest. Increasing the commenters already engaged in hemp thus reduce the burden on designated window within hemp must be harvested production pursuant to the 2014 Farm sampling agents. after sampling from 15 to 30 days will

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better allow for variables such as testing, territories of Indian Tribes. However, not generally decarboxylate. Results can weather, agricultural practices, and since the IFR was published, numerous be reported for THCA and delta-9 THC equipment delays. laboratories have applied for registration separately. When LC is used, the total and DEA is working diligently to THC needs to be calculated post-testing D. Testing Laboratories process these requests. Given the in order to report results as a ‘‘post- The IFR introduced regulatory limited number of DEA-registered labs decarboxylation’’ delta-9 THC value. requirements for laboratories testing available to hemp producers, delay in The requirement to report the total THC hemp for compliance purposes. AMS enforcement of this requirement is value as the THC content regardless of also issued guidance with the IFR to continued until December 31, 2022. testing methodology used ensures explain best practices for hemp testing AMS anticipates this delay will provide testing consistency across the program. laboratories (www.ams.usda.gov/rules- adequate time for testing facilities to Samples must be tested using post- regulations/hemp). Based on comments obtain DEA registration. decarboxylation or other similarly to the IFR, AMS is changing certain reliable analytical methods by which Laboratory Testing Requirements parts of these regulations and updating the total THC concentration level the accompanying testing guideline. Section 297B(a)(2)(A)(ii) of the AMA reported accounts for the conversion of While the testing guidance provides best requires that State and Tribal plans for THCA into THC. Acceptable testing practices for meeting the regulatory primary regulatory jurisdiction include methodologies currently include gas or requirements, States, Indian Tribes, and a ‘‘procedure for testing, using post- liquid chromatography with detection. USDA licensees may use test procedures decarboxylation or other similarly The total THC, derived from the sum that differ from the guidance so long as reliable methods, delta-9 of the THC and THCA content, shall be those procedures meet the standards in tetrahydrocannabinol concentration determined and reported on a dry the final rule. levels of hemp produced in the State or weight basis. In order to provide territory of the Indian Tribe.’’ Since not Registration With DEA flexibility to States and Tribes in all testing methods include administering their own hemp The IFR required all hemp testing decarboxylation, AMS is requiring that production programs, alternative testing laboratories to be registered with the the total THC, which includes the protocols will be considered if they are DEA in accordance with the CSA (21 potential conversion of comparable to and similarly reliable as U.S.C. 823(f)). On February 27, 2020, tetrahydrocannabinolic acid (THCA) the baseline mandated by section AMS announced a delay in enforcement into THC, be reported and used for 297B(a)(2)(A)(ii) of the AMA and of this requirement until October 31, purposes of determining the THC established under USDA regulations 2020, or the publication of a final rule, content of a hemp sample. and procedures. Updated USDA whichever came first (USDA, DEA The IFR included requirements on procedures for sampling and testing will Provide Options for Labs, Disposal of how laboratories conduct hemp testing be issued concurrently with this rule Non-Compliant Hemp Plants. Thursday, for the purposes of regulatory 4 and will be provided on the USDA Feb. 27, 2020) AMS announced this compliance to assure that total THC website. enforcement delay to allow additional levels were measured. Commenters Reporting requirements for time to increase DEA registered provided extensive input on testing laboratories are discussed later in analytical lab capacity and avoid requirements, particularly the Section X (Regulatory Analysis) of this potential delays to producers in requirement to test for ‘‘total’’ THC final rule. To clarify these requirements, receiving test results. Although AMS instead of only ‘‘delta-9’’ THC. AMS is laboratories conducting testing for received comments in opposition to this retaining this requirement. purposes of monitoring THC requirement, AMS is retaining the AMS looked at current testing concentration throughout the growing requirement in this final rule that any methodologies that would meet the season are not subject to these reporting laboratory testing hemp for purposes of decarboxylation requirement set in the requirements. These tests are for the regulatory compliance must be 2018 Farm Bill. In gas chromatography producer to monitor his or her registered with DEA to conduct (GC) testing, heat is applied to the production as it grows and not to chemical analysis of controlled sample, which decarboxylates THCA, comply with pre-harvest testing substances in accordance with 21 CFR producing delta-9 THC, so that the final requirements in this rule. Only 1301.13. This requirement also applies delta-9 THC result is actually a total laboratories conducting the ‘‘final’’ test to any laboratory testing hemp THC result. GC is the more traditional that will be used to determine whether throughout the growing season to technique used for THC testing and was a sample is compliant are subject to 5 informally monitor THC concentration. the technique used by Dr. Small in his reporting requirements. Registration is necessary because research that derived the 0.3 percent laboratories could potentially handle threshold that was used as a basis for Measurement of Uncertainty cannabis that tests above 0.3 percent the 2018 Farm Bill requirement and is This final rule requires that THC on a dry weight basis, which is, by used by law enforcement as the laboratories calculate and include the definition, marijuana and a Schedule 1 threshold to differentiate hemp from Measurement of Uncertainty (MU) when controlled substance. Instructions for marijuana. In his research papers, the they report THC test results. laboratories to obtain DEA registration, 0.3 percent threshold is based on total ‘‘Measurement of uncertainty’’ is along with a list of approved available delta-9 THC, which is the sum defined as ‘‘the parameter, associated laboratories, are available on the USDA of THCA and delta-9 THC in the plant with the result of a measurement, that Domestic Hemp Production Program material. characterizes the dispersion of the website. AMS is aware that there are Liquid chromatography (LC) testing values that could reasonably be still not enough DEA-registered hemp does not involve the use of significant attributed to the particular quantity testing facilities in some States or heat, so that the THCA in a sample does subject to measurement.’’ This definition is based on the definition of 4 www.ams.usda.gov/press-release/usda-dea- 5 Small, E.; Beckstead, H.D.; Chan, A. The provide-options-labs-disposal-non-compliant- Evolution of Cannabinoid Phenotypes in Cannabis. ‘‘uncertainty (of measurement)’’ in hemp-plants. Economic Botany, 29, 219–232, 1975. section 2.2.3 of the Joint Committee for

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Guides in Metrology 6 100:800, salts of isomers, whether growing or not, applicable State, Tribal, or USDA plan. Evaluation of measurement data— with a delta-9 THC of not more than 0.3 Because of this requirement, producers ‘‘Guide to the Expression of Uncertainty percent on a dry weight basis. Likewise, whose cannabis crop is not hemp will in Measurement’’ (JCGM Guide). The the Federal (CSA) definition of likely lose most of the economic value National Institute of Standards and marijuana continues to include those of their investment. Thus, AMS believes Technology (NIST) Technical Note parts of the cannabis plant as specified that there must be a high degree of 1297, ‘‘Guidelines for Evaluating and in 21 U.S.C. 802(16) (and derivatives certainty that the THC concentration Expressing the Uncertainty of NIST thereof) that contain more than 0.3 level is accurately measured and is in Measurement Results’’ (TN 1297), is percent THC on a dry weight basis. The fact above 0.3 percent on a dry weight based on the JCGM Guide. AMS also foregoing provisions of Federal law basis before requiring disposal of the relied on the Eurachem/Co-Operation remain in effect for purposes of Federal crop. on International Traceability in criminal prosecutions, as well as The NIST Reference on Constants, Analytical Chemistry’s ‘‘Guide on Use Federal, civil, and administrative Units, and Uncertainty states that of Uncertainty Information in proceedings arising under the CSA. ‘‘measurement result is complete only Compliance Assessment, First Edition The definition of ‘‘acceptable hemp when accompanied by a quantitative 2007’’. Colloquially, the measurement of THC level’’ is also retained in this final statement of its uncertainty. The uncertainty is similar to a margin of rule. States and Indian Tribes shall uncertainty is required in order to error. When the measurement of adopt this concept in their plans. This decide if the result is adequate for its uncertainty, normally expressed as a definition explains how to interpret test intended purpose and to ascertain if it ¥ +/ with a number (e.g. +/- 0.05), is results that include the MU with an is consistent with other similar combined with the reported example. The application of the MU to results.’’ 8 Simply stated, knowing the measurement, it produces a range, and the reported delta-9 measurement of uncertainty is necessary the actual measurement has a known tetrahydrocannabinol concentration on to evaluate the accuracy of test results. a dry weight basis produces a probability of falling within that range Comments to the IFR generally distribution, or range. If 0.3 percent or (typically 95%). Laboratories should expressed support for requiring that the 7 less is within the distribution or range, meet the AOAC International standard measurement of uncertainty (MU) be then the sample will be considered to be method performance requirements for accounted for when testing the THC hemp for the purpose of compliance selecting an appropriate method to concentration of hemp, due to the with the requirements of State, Tribal, determine the MU. variability in laboratory testing This final rule requires that or USDA hemp plans. For example, if a equipment and complex mathematical laboratories report the MU as part of any laboratory reports a result as 0.35 principles involved. Comments also hemp test results. The rule also includes percent with a measurement of provided several suggestions on ways to a definition of ‘‘acceptable hemp THC uncertainty of +/¥0.06, the distribution improve the calculation of MU. Many level’’ to account for the uncertainty in or range is 0.29 percent to 0.41percent. comments advocated specifying an MU the test results. The reported THC Because 0.3 percent is within that to create uniformity in testing across the concentration of a sample may not be distribution or range, the sample, and nation. the actual concentration level in the the lot it represents, is considered hemp sample. However, the actual THC for the purpose of compliance with the USDA does not recommend concentration is expected to be within requirements of State, Tribal, or USDA establishing an MU upper limit the distribution or range calculated hemp plans. However, if the MU for that (maximum) because (1) MU is typically when the reported THC concentration is sample was 0.02 percent, the not standardized, but is controlled using combined with the measurement of distribution or range is 0.33 percent to standard test methods, and (2) USDA uncertainty. 0.37 percent. Because 0.3 percent or less does not have the data to set an upper The use of MU for purposes of is not within that distribution or range, limit so setting it would be arbitrary, not determining the acceptable hemp THC the sample is not considered hemp for scientific. The hemp and scientific level does not alter Federal law with the purpose of plan compliance, and the industries are just beginning to discuss regard to the definition of hemp or lot it represents will be subject to standard test methods and the final rule marijuana. As stated above, the 2018 disposal. Thus the ‘‘acceptable hemp does not establish an explicit test Farm Bill defines hemp as the plant THC level’’ is the application of the MU method. Setting an upper limit or species Cannabis sativa L. and any part to the reported delta-9 maximum MU does not resolve the core of that plant, including the seeds thereof tetrahydrocannabinol content on a dry issue and would not encourage or drive and all derivatives, extracts, weight basis producing a distribution or labs to improve accuracy and precision. cannabinoids, isomers, acids, salts, and range that includes 0.3 percent or less. Setting an upper limit would in effect As such, the regulatory definition of be setting a maximum or absolute MU. 6 The Joint Committee for Guides in Metrology is ‘‘acceptable hemp THC level’’ describes This may encourage labs to adopt the composed of international organizations working in how State, Tribal, and USDA plans must maximum MU as their MU, rather than the field of metrology. Its membership includes the account for uncertainty in test results in drive for a smaller uncertainty. USDA Bureau International des Poids et Mesures, the Organisation Internationale de Me´trologie Le´gale, their treatment of cannabis. This may allow for establishing limits in the the International Organization for Standardization, definition affects neither the statutory future, if needed, once methods are the International Electrotechnical Commission, the definition of hemp, 7 U.S.C. 1639o(1), in established and USDA has access to International Union of Pure and Applied Chemistry, the 2018 Farm Bill nor the definition of Proficiency Testing results and the the International Union of Pure and Applied Physics, the International Federation of Clinical ‘‘marihuana,’’ 21 U.S.C. 802(16), in the reported MUs. We encourage States and Chemistry and Laboratory Medicine, and the CSA. Tribes to monitor, review and evaluate International Laboratory Accreditation Cooperation. Sections 297B(a)(2)(A)(iii) and MU to evaluate trends and outliers, 7 USDA established the Association of Official 297C(a)(2)(C) of the AMA require that which may indicate ‘‘lab shopping’’ for Agricultural Chemists in 1884. In 1965, it changed cannabis plants that have a THC higher MUs. The requirement for hemp its name to the Association of Official Analytical Chemists and became an independent organization concentration level of greater than 0.3 in 1979. In 1991, it adopted its current, legal name percent on a dry weight basis be 8 https://physics.nist.gov/cuu/Uncertainty/ as AOAC International. disposed of in accordance with the international1.html.

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testing laboratories to incorporate a MU E. Disposal and Remediation of Non- final rule, producers have several is being retained in this regulation. Compliant Plants options on how to handle non- compliant plants. Producers do not need Laboratory Accreditation State and Tribal plans are currently required to include procedures for to use a DEA-registered reverse In the IFR, AMS requested input on ensuring effective disposal or distributor or law enforcement to establishing a fee-for-service hemp remediation of plants produced in dispose of non-compliant plants. laboratory approval process or a violation of part 990. Plants that are Producers may dispose of the plants requirement for laboratories to obtain removed as a result of poor plant health, using one or more of the means ISO 17025 accreditation for labs that pests, disease, or weather events, along described by AMS at https:// www.ams.usda.gov/rules-regulations/ wish to offer THC testing services. with removal of male or hermaphrodite hemp/disposal-activities. It is the Comments reflected a range of views plants as part of a cross-pollination Agency’s intent that these methods across the industry, both in support of prevention plan, are not subject to the allow producers to apply common on- and in opposition to additional disposal requirements herein. This final farm practices as a means of disposal rule retains the disposal requirements laboratory certification requirements. In while rendering the controlled explained in the IFR but clarifies what general, commenters preferred more substance non-retrievable or non- ‘‘disposal’’ means and explains how the regulatory flexibility to address the ingestible. Under this final rule, State process must be conducted. This final widespread concern of insufficient and Tribal plans must still include rule also includes remediation as an laboratory capacity as a result of procedures to verify disposal. This may option to remove non-compliant plants. laboratory certification/registration/ come in the form of in-person As explained in the IFR, if a producer accreditation requirements. Other verification by State or Tribal grows cannabis exceeding the legal 0.3 commenters were opposed to representatives, or alternative percent THC level, the material must be accreditation requirements due to the requirements the direct growers to disposed of in accordance with the CSA cost. While AMS strongly encourages provide pictures, videos, or other proof and DEA regulations because such laboratories to be accredited to ISO/IEC that disposal occurred successfully. material constitutes marijuana, a 17025 (by an International Laboratory Producers under the USDA plan must Schedule I controlled substance under Accreditation Cooperation Mutual document the disposal of all non- the CSA. The material must be collected Recognition Agreement (ILAC MRA) compliant plants. States and Indian for disposal by a person authorized signatory accreditation body), we also Tribes operating under approved hemp acknowledge that ISO 17025 under the CSA to handle marijuana, production plans and producers under accreditation requires significant time such as a DEA-registered reverse the USDA plan must notify USDA of and financial commitment to pursue distributor, or a duly authorized any occurrence of non-conforming and maintain. The time and cost Federal, State, Tribal, or local law plants or plant material and provide the involved is most challenging for smaller enforcement officer. In the final rule, disposal record of those plants and and start-up labs. The initial AMS is incorporating flexibilities for materials monthly. accreditation can cost $5,000–$10,000 disposal that were announced on State and Tribal plans must include (and in some case more) and yearly February 27, 2020 (https:// procedures to verify disposal, whether ongoing costs are $3,000–$8,000. www.ams.usda.gov/rules-regulations/ through the use of in-person verification Smaller labs may not have the resources hemp/enforcement). Some of these new by State or Tribal representatives, or to pursue accreditation in a timely options include, but are not limited to, requirements for producers to provide manner or they may have to spend plowing under non-compliant plants, pictures, videos, or other proof that additional time and money for composting into ‘‘green manure’’ for use disposal did in fact occur. State and consultants to assist them in setting up on the same land, tilling, disking, burial, Tribal plans must also include a quality management system and to or burning. These methods are intended requirements to submit to AMS the navigate the application and audit to allow producers to apply common monthly disposal and remediation on-farm practices for the disposal of processes. report documenting any on-farm non-compliant plants. One of the top disposals or remediations that occurred Based on insufficient laboratory considerations in making this change during the prior month. As of November capacity at this time and the cost was to minimize, to the extent possible, 2020, twenty States and nine Tribes involved in adding this requirement, the resource impact to State, Tribal, and operating under the 2018 Farm Bill AMS will not provide an AMS local law enforcement in handling hemp reported 4,192 licensed producers administered lab approval program or that is out of compliance. In addition, representing 6,166 acres planted. Of require ISO 17025 accreditation. we are confident that any disposal these acres planted, there were 231 However, AMS remains committed to options make the product unusable and disposals representing 730 acres assisting the hemp laboratory testing therefore is not at risk for entering any disposed due to not meeting the 0.3 community and is available to assist in streams of commerce. Based on percent acceptable hemp THC level. the development of a laboratory comments received, AMS is AMS did not provide additional approval program in the future. As permanently retaining these on-farm remediation options in the IFR. The explained in the IFR, if such hemp disposal flexibilities. only remediation alternative was to laboratory approval program is AMS received comments on this completely dispose of the non- developed by AMS, such process will be requirement describing the expense compliant material. AMS is adding conducted by USDA, AMS Laboratory associated with destroying cannabis in remediation to this final rule based on Approval Service, which administers accordance with the CSA, primarily the comment. AMS received many the Laboratory Approval Program (LAP). requirement that disposal be conducted comments suggesting the inclusion of State and Tribal plans are free to offsite by a reverse distributor or other procedures to allow for non-compliant include certain additional requirements law enforcement officer. Based on this cannabis to be ‘‘remediated.’’ AMS for hemp testing laboratories, including input, AMS, in coordination with DEA agrees with this suggestion and is ISO accreditation or other proficiency partners, delayed enforcement of the publishing remediation techniques schemes. disposal requirements in the IFR. In the concurrently with this rule that can be

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followed to remediate non-compliant ed. 2014) (defining negligence as ‘‘[t]he care that a reasonably prudent person plant material into compliant form. As failure to exercise the standard of care would exercise if the plant does not described in the IFR, hemp exceeding that a reasonably prudent person would have a THC concentration of more than the acceptable THC level may not be have exercised in a similar situation’’). 1.0 percent on a dry weight basis. AMS further handled, processed, or enter the This final rule increases the arrived at this increased tolerance based stream of commerce. AMS believes that negligence threshold from 0.5 to 1.0 on input from commenters, particularly hemp producers should have the percent THC and clarifies how States State agriculture departments that opportunity to remediate non-compliant and Indian Tribes determine when to operated hemp research programs under crops in order to minimize financial risk suspend or revoke a producer’s license. the 2014 Farm Bill, along with data associated with the loss of investment in AMS believes that raising the negligence provided by laboratories testing hemp their hemp crop. For this reason, this threshold from 0.5 percent to 1.0 subject to 2018 Farm Bill requirements. final rule allows remediation activities, percent THC will increase flexibility to The 0.5 percent was based on data from either disposing of flower materials and farmers as they learn more about how to three states participating in the 2014 salvaging the remainder of the plant or grow compliant hemp and as the Farm Bill pilot program. AMS believes blending the entire plant into biomass availability of stable hemp genetics raising the negligent violation threshold plant material. Through both forms of improves. In developing the compliance from 0.5 percent to 1.0 percent in the remediation, producers may be able to requirements for State and Tribal plans, final rule provides a greater buffer and minimize losses, and in some cases AMS recognizes that there may be reduces farmers’ exposure to risk of produce a return on investment while significant differences across States and violation accrual and license ensuring that non-compliant material Indian Tribes in how they will suspension. does not enter commerce. administer their respective hemp AMS recognizes the violation If a producer elects to perform programs. This final rule provides that threshold may incentivize (or remediation activities as allowable a producer shall not be subject to more disincentivize) innovation by research under this final rule’s provisions than one negligent violation per institutions and producers. AMS (referenced above), an additional calendar year. acknowledges more innovation and sampling and testing of the post- State and Tribal hemp plans must still research across industry will bring more remediated crop must occur to include requirements to conduct annual stability to stakeholders. AMS believes determine THC concentration levels. inspections of, at a minimum, a random the 1.0 percent threshold incentivizes Only those successfully remediated sample of hemp producers to verify innovation across industry more so than crops will be allowed to enter the hemp is not being produced in violation a 0.5 percent violation threshold. stream of commerce, and all other of this rule, along with a procedure for Further, comments addressed the remaining non-compliant crops must handling violations. negative impact of the accrual of then be disposed. In accordance with the 2018 Farm negligent violations on the financial AMS believes the inclusion of Bill, States and Indian Tribes with their stability of the individual business. remediation and post-harvest sampling own hemp production plans have They described how a hemp grower’s into the final rule provides the certain flexibilities in determining access to credit and insurance is additional flexibility requested by whether hemp producers have violated jeopardized when negligent violations commenters that expressed the need for their approved plans. However, there accumulate and lead to a determination producers to have greater opportunity are certain compliance requirements of culpable negligence. Comments for success as established and beginning that all State and Tribal plans must explained that lending institutions and farmers entering hemp production. contain. This includes procedures to insurance providers look for risk factors. identify and attempt to correct certain They also raised questions about how F. Compliance With Enforcement negligent acts, such as failing to provide Procedures, Including Determination of the accrual of negligent violations may a legal description of the land on which be interpreted by lender or providers. Negligence and Annual Inspection of the hemp is produced, not obtaining a Hemp Producers Comments said that many insurers will license or other required authorizations not cover crop losses if losses are due The IFR required State and Tribal from the State or Tribal government, or to the growers’ negligence. plans to include compliance procedures producing plants exceeding 0.3 percent AMS acknowledges institutional to ensure hemp was being produced in total THC. States and Indian Tribes may lenders view violations as risk factors in accordance with the requirements of include additional requirements in their decision making. AMS also notes that this part. Comments to the IFR were plans. not all culpable violations are derived generally opposed to the compliance This final rule specifies that hemp from the accrual of negligent violations. requirements, particularly as they relate producers do not commit a negligent Culpable violations may be the result of to the definition of negligence. violation if they produce plants that producers violating other parts of the Producers, along with State and Tribal exceed the acceptable hemp THC level 2018 Farm Bill. However, the 2018 Farm regulatory agencies, found the and use reasonable efforts to grow hemp Bill explicitly considers certain actions negligence requirements in the IFR and the plant does not have a THC as constituting negligent violations. overly harsh and strict. This final rule concentration of more than 1.0 percent AMS’s intention is to provide a changes these compliance procedures, on a dry weight basis. AMS recognizes threshold between 0.3 percent THC particularly how ‘‘negligence’’ is that hemp producers may take the level and what would be considered a determined. In the context of this necessary steps and precautions to negligent violation so not all hemp that regulation, negligence is defined as a produce hemp, such as using certified tests over the 0.3 percent be considered failure to exercise the level of care that seed, using other seed that has reliably a negligent violation. Because a a reasonably prudent person would grown compliant plants in other parts of producer will not have committed a exercise in complying with the the country, or engaging in other best negligent violation every time he or she regulation. The definition employed in practices, yet still produce plants that grows hemp with a concentration of this rule is derived from the definition exceed the acceptable hemp THC level. hemp above the 0.3 percent level, this of negligence in Black’s Law Dictionary. AMS believes that a hemp producer in will assist producers when requesting See BLACK’S LAW DICTIONARY (10th that scenario has exercised a level of loans or other financial assistance.

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Several comments suggested that a 0.5 This final rule provides that a producer The 2018 Farm Bill does not define percent negligence threshold threatens shall not be subject to more than one what it means to ‘‘participate in the the survival of farmers in an emerging negligent violation per calendar year. As [State or Tribal] program.’’ AMS is not industry. Comments suggested that the it is customary in agriculture, practices requiring States and Indian Tribes to low threshold is a barrier to entry for vary due to many factors such as adopt a specific definition. Instead, they new farmers or farmers with no weather, availability of labor, must define who those persons are in experience growing hemp, who risk transportation and storage capacity and their plan. The definition must include high initial capital investments to more. Due to many factors, producers one individual for whom a criminal establish operations. Comments argued make determinations about planting and history records check can be conducted that the low threshold favors larger harvest cycles. In certain circumstances, for each license or authorization that the farms using industrialized hemp producers may plant before the first State or Indian Tribe issues. The final varieties and production practices, and cycle has been harvested specially when rule identifies and defines ‘‘key that the low negligence threshold in the they plant in multiple locations. participants’’ as those participating in IFR would unnecessarily criminalize Calendar year is easier to administer the USDA plan. State and Tribes may, farmers working with a legal and will allow for various growing but are not required, to adopt this agricultural commodity. Increasing this seasons. definition for their plans. threshold to 1.0 percent benefits Each geographical area has a growing The State or Indian Tribe will need to producers, including small and new season based on specific temperature, review criminal history reports for each farmers, that intended to grow hemp but weather, soil or other factors in that individual identified as participating in whose crops tested ‘‘hot’’ even though region, therefore this rule is defining its program. The final rules defines they made reasonable efforts to grow growing season as a calendar year. This ‘‘criminal history report’’ as the Federal hemp. will allow flexibility, including a year- Bureau of Investigation’s Identity In cases where a State or Indian Tribe round season if States and Indian Tribes History Summary. The State or Indian determines a negligent violation has have a warmer climate or greenhouse Tribe may review additional reports or occurred, a corrective action plan shall growing. checks to determine whether an be established. The corrective action Negligent violations are still not individual may participate in its plan. plan must include a reasonable date by subject to criminal enforcement action Finally, any person found by the USDA, which the producer will correct the by local, Tribal, State, or Federal State, or Tribal government to have materially falsified any information negligent violation. Producers operating government authorities under this under a corrective action plan must also submitted to the program will be regulation. periodically report to the State or Tribal ineligible to participate. State and Tribal plans also must government, as applicable, on their contain provisions relating to producer G. Information Sharing compliance with the plan for a period violations made with a culpable mental of not less than two calendar years The IFR included requirements for following the violation. A producer who state greater than negligence, meaning State and Tribal plans to contain negligently violates a State or Tribal acts made intentionally, knowingly, or procedures for reporting specific plan three times in a five-year period with recklessness. This definition is information to USDA. Limited will be ineligible to produce hemp for derived from the definition of comments were received on these a period of five years from the date of negligence in Black’s Law Dictionary. requirements. This information has been the third violation. See BLACK’S LAW DICTIONARY (10th transmitted already by many States and Several comments explained how ed. 2014) (giving as a definition of Tribes to USDA. This information meets these requirements as written in the IFR negligence ‘‘[t]he failure to exercise the the requirements set in the 2018 Farm were confusing and difficult to standard of care that a reasonably Bill. Therefore, the following administer. Particularly, commenters prudent person would have exercised in requirements are the same as required explained how a producer could easily a similar situation’’). If it is determined under the IFR and are in subpart F of receive three negligent violations during a violation was committed with a this final rule. This is separate from the one growing season, which would lead culpable mental state greater than requirement to report hemp crop to an automatic licensing revocation for negligence, the State agriculture acreage with FSA as discussed above. the following five years. For example, a department or Tribal government, as The information required includes producer may grow hemp in three applicable, shall immediately report the contact information for each hemp different locations. If the hemp becomes producer to the Attorney General, producer covered under the plan, non-compliant cannabis, all in one USDA, and the chief law enforcement including name, address, telephone season, the producer would lose the officer of the State or Indian Tribe. number, and email address (if license in one season. Commenters State and Tribal plans also must available). If the producer is a business described this as too strict and too prohibit any person convicted of a entity, the information must include the severe a penalty for honest mistakes that felony related to a controlled substance full name of the business, address of the many first-year hemp producers will under State or Federal law from principal business location, full name certainly make. AMS agrees and wishes participating in the State or Tribal plan and title of each employee for whom the to clarify that this is not the intent of the and from producing hemp for 10-years entity is required to submit a criminal regulation. AMS acknowledges that following the date of conviction. An history report, and an email address if producers may have more than one exception applies to a person who was available, and Employee Identification production area and that they may lawfully growing hemp under the 2014 Number (‘‘EIN’’) of the business entity. harvest at different times. Tests results Farm Bill before December 20, 2018, Producers must report the legal may be over the allowable limit on those and whose conviction also occurred description and geospatial location for production areas but the planting was before that date. This exemption each hemp production area, including performed at the same time using the language must be included in all State each field, greenhouse, or other site same seeds. Allowing for only one and Tribal hemp plans, whether they used by them, as stated in section A of violation per season would help administered a 2014 Farm Bill research this preamble. The report also shall minimize duplication of enforcement. pilot program or not. include the status of the license or other

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required authorization from the State or to continue working with and sharing and this regulation, it will not be Tribal government, as applicable, for information with AMS. States and approved. However, USDA has worked each producer under a hemp production Tribes may need to change plans based with many States and Tribes submitting plan. States and Indian Tribes will on changes in this final rule because plans to assist them in meeting the submit this information to USDA not their State or Tribal laws may no longer requirements and obtaining approval for later than 30 days after the date it is match the requirements in this final their plans. received using the appropriate reporting rule. Even though some of the changes If a plan is not approved, USDA requirements as determined by USDA. in this final rule are less burdensome, provides a letter of notification These reporting requirements are State and Tribal plans must follow their outlining the deficiencies identified. found at § 990.70 in this final rule. own legislations. Accordingly. They The State or Tribal government may Further explanation of the specific must amend their plans. During the plan then submit an amended plan for information to be submitted, the development and/or revision process, review. If the State or Tribe disagrees appropriate format, and the specific due States and Indian Tribes are encouraged with the determination made by USDA dates for the information is discussed in to contact USDA so we may provide regarding the plan, a request for Section X (Regulatory Analysis) of this technical assistance in developing plan reconsideration can be submitted to final rule. This information submitted specifics. Since the publication of the USDA using the appeal process as from each State and Tribal plan, along IFR, USDA approved over 60 State and outlined in section V of this document. with the equivalent information Tribal plans within the 60-day Plans submitted by States and Indian collected from individuals participating requirement. USDA approved plans that Tribes must be approved by USDA under the USDA plan, will be comply with the 2018 Farm Bill and before they can be implemented. assembled and maintained by USDA with the provisions of the IFR. For the States and Indian Tribes can submit and made available in real time to 2021 planting season, the 2018 Farm their plans to USDA through electronic Federal, State, Tribal, and local law Bill, amended by the Continuing mail at [email protected] or by enforcement, as required by the 2018 Resolution (CR) (Agriculture postal carrier to USDA. The specific Farm Bill. All information supporting, Improvement Act of 2018 (7 U.S.C. 5940 mailing address is provided on the verifying, or documenting the note; Pub. L. 116–260)), provided that USDA Domestic Hemp Production information submitted to USDA must be States and institutions of higher Program website. maintained by the States and Indian education can continue operating under If the State or Tribal plan application Tribes for at least three years. the authorities of the 2014 Farm Bill is complete and meets the criteria of this Under § 990.70(c), States and Indian until January 1, 2022. AMS clarified the part, USDA issues an approval letter. Tribes must also submit annual reports avenues for Tribal participation under Approved State and Tribal plans, regarding the total planted, harvested, authorities in the 2014 Farm Bill to including their respective rules, and disposed acreage. Additionally, grow industrial hemp for research regulations, and procedures, are posted because the final rule provides for purposes. This clarification is available on USDA’s hemp program website. remediation of plants, the final rule on the AMS website: https:// A USDA-approved State or Tribal requires all remediated acreage to be www.ams.usda.gov/content/usda- plan will remain in effect, unless reported as well. Similarly, under clarifies-industrial-hemp-production- approval is revoked by USDA pursuant § 990.71(c), all USDA hemp plan indian-Tribes. to the revocation procedures discussed producers must submit annual reports Due to this extension, many States in this section or unless the State or to USDA detailing total planted acreage, decided to remain under the 2014 Farm Tribe makes substantive revisions to total acreage disposed and remediated, Bill provisions and rescinded their their plan or their laws that alter the and total harvested acreage. previously approved plans. All States way the plan meets the requirements of are eligible to remain or start programs this regulation. Additionally, changes to H. Certification of Resources under the 2014 Farm Bill provisions. As the provisions or procedures under this All State and Tribal plans submitted a result, USDA will oversee 20 State and rule or to the language in the 2018 Farm for USDA approval must also have a 20 Tribal plans under the 2018 Farm Bill may require plan revision and certification stating the State or Indian Bill until new States and Tribes submit resubmission to USDA for approval. Tribe has the resources and personnel more plans under the 2018 Farm Bill Changes to applicable Federal and State necessary to carry out the practices and provisions. or Tribal statutes may also require plan procedures described in their plan. As of November 2020, States and revision and resubmission to USDA for Section 297B of the AMA requires this Tribes operating under the 2018 Farm approval and may lead to plan certification, and the information is Bill reported 4,192 licensed producers revocation if the plan is not amended. important to USDA’s approval of State representing 6,166 acres planted. Of Should States or Indian Tribes have and Tribal plans, in that all such plans these acres planted, there were 231 questions regarding the need to must be supported by adequate disposals representing 730 acres resubmit their plans, they should resources to effectively administer them. disposed due to not meeting the 0.3 contact USDA for guidance. This section has not changed from the percent acceptable hemp THC level. A State or Tribal government may IFR. This data is limited because even submit an amended plan to USDA for though many States and Tribes have approval if: (1) The Secretary I. State and Tribal Plan Approval, approved plans, they have not all been disapproves a State or Tribal plan; or (2) Technical Assistance and USDA fully implemented. USDA expects more the State or Tribe makes substantive Oversight data will be available as the 2021 season revisions to their plan or to their laws Since the publication of the IFR, AMS begins and States and Tribes implement that alter the way the plan meets the has worked extensively with States and their programs. requirements of this regulation, or as Indian Tribes in developing hemp USDA will use the procedures in this necessary to bring the plan into production plans. As States and Indian rule, which are substantively similar to compliance with changes in other Tribes begin the work of modifying their those in the IFR, to review and approve applicable law or regulations. plans to incorporate the changes herein, State and Tribal plans. If a plan does not If the plan previously approved by we encourage States and Indian Tribes comply with the requirements of the Act USDA needs to be amended because of

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changes to the State’s or Tribe’s laws or All hemp produced in a jurisdiction licenses on a rolling basis to better regulations, such resubmissions should without an approved State or Tribal accommodate the needs of producers. be provided to USDA within 60 days plan must meet the requirements of the AMS continues to encourage the from when the new State or Tribal law USDA plan. The requirements for submission of applications well before or regulations are effective. Producers producers operating under the USDA the planting season so AMS has will be held to the requirements of the plan are similar to those operating adequate time to process the previous plan until such modifications under approved State and Tribal plans. applications. All applications must are approved by USDA. If State or Tribal Regulatory requirements for comply with the requirements as government regulations in effect under producers licensed under the USDA described below. The license the USDA-approved plan change, but plan in this final rule differ in some application is available online at the the State or Tribal government does not cases from corresponding requirements USDA Domestic Hemp Production resubmit a modified plan within 60 in the IFR and are explained in the Program website at https:// days of the effective date of the change, following section. Comments submitted www.ams.usda.gov/rules-regulations/ USDA will issue a notification to the to the IFR generally did not address hemp/information-producers. State or Tribal government that approval these requirements specifically; rather Applications may be submitted of its plan will be revoked. The they focused on the broader electronically or by mail. revocation will be effective no earlier requirements around sampling, testing, The producer license application than the beginning of the next calendar and disposal, to which all hemp requires contact information such as year. If a plan is revoked, producers producers are subject, whether licensed name, address, telephone number, and previously subject to an approved plan by a State, a Tribe, or USDA. email address (if available). If the applicant represents a business entity, would be eligible to apply to USDA for A. USDA Hemp Producer License and and that entity will be the producer, the a license. This is a change from the IFR Criminal History Report that allowed for resubmission because application will require the full name of of a change in State or Tribal law or To produce hemp under the USDA the business, address of the principal regulations within a calendar year. This plan, producers must apply for and be business location, full name and title of modification is due to USDA’s need to issued a license from USDA. USDA has the key participants on behalf of the know in a timelier manner, since such been accepting applications from entity, an email address if available, and laws and regulations are the foundations producers since October 2019. Any EIN of the business entity. All of the hemp plans. The words of the license issued by USDA prior to applications must be accompanied by a plans do not have meaning if they are publication of this final rule will remain completed criminal history report. not aligned with current authorities. in effect and subject to the original Several comments to the IFR expressed USDA has the authority to audit expiration date. As of the issuance of opposition to this requirement. AMS is States and Tribes to determine if they this final rule, USDA has issued 380 retaining this requirement since are in compliance with the terms and licenses under the USDA plan. verification of compliance with the conditions of their approved plans. If a While a State or Tribal government felony restriction is a statutory State or Indian Tribe is noncompliant has a draft hemp production plan requirement. If the application is for a with their plan, USDA will work with pending for USDA approval, USDA will business entity, a completed criminal that State or Indian Tribe to develop a not issue USDA hemp production history report must be provided for each corrective action plan. However, if licenses to individual producers located key participant. additional instances of noncompliance within that State or Tribal territory. Some commenters expressed concern occur, USDA has the authority to revoke Once USDA approves a hemp with the requirements pertaining to the approval of the State or Tribal plan production plan from a State or Tribe, ‘‘key participants,’’ particularly with the for one year or until the State or Tribe it will deny any license applications requirement that all key participants become compliant. AMS still believes from individuals located in the undergo a background check. To the that one year is sufficient time for a applicable State or Tribal territory. If extent the commenters equated a noncompliant State or Indian Tribe to USDA disapproves a State or Tribal criminal history check with a evaluate problems with their plan and hemp production plan, individual background check, AMS is retaining this make the necessary adjustments. Should producers located in the State or Tribal requirement, since key participants are USDA determine the approval of a State territory may apply for a USDA hemp those individuals responsible for or Tribal plan should be revoked, such production license, unless hemp ensuring compliance with the regulatory a revocation would begin after the end production is illegal in the State or requirements contained herein. If key of the current calendar year, so Tribal territory where they intend to participants are not subject to criminal producers will have the opportunity to produce hemp. history checks, AMS cannot ensure adjust their operations as necessary. Comments to the IFR described statutory restrictions on individuals This will allow producers to apply for confusion around the application with felony convictions related to a license under the USDA plan so that window for when USDA would receive controlled substances are met per their operations do not become and process applications as described in Section 297B(e)(3)(B)(i) of the AMA. disrupted due to the revocation of the the IFR. The IFR said that for the first AMS notes that it will not conduct any State or Tribal plan. year after USDA began to accept other checks into the background of key applications, applications could be participants. III. Department of Agriculture Plan submitted any time. For all subsequent Key participants are a person or The 2018 Farm Bill requires USDA to years, license applications and license persons who have a direct or indirect administer a hemp production plan for renewal applications would have to be financial interest in the entity producing producers in jurisdictions where hemp submitted between August 1 and hemp, such as an owner or partner in a production is legal but is not covered by October 31. AMS requested input on partnership. A key participant also an approved State or Tribal plan. The this application window, and includes a person in a corporate entity USDA licensing remains available to commenters were generally opposed. at executive levels including the chief producers in States and Tribal territories Under this final rule, USDA will accept executive officer, chief operating officer, without a USDA-approved hemp plan. applications for USDA hemp production and chief financial officer. This does not

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include other management positions option of resubmitting a revised in the information provided on the like farm, field, or shift managers. The application. If the application was license application. final rule also specifies that the denied for other reasons, the applicant B. Sampling for THC definition of key participant does not will have the opportunity to appeal include a member of the leadership of USDA’s decision in accordance with the The IFR stated that all hemp a Tribal government who is acting in appeals process outlined in the production must be sampled and tested their capacity as a Tribal leader, except regulation in subpart D. for THC concentration levels. It is the when that member exercises executive Once a license application has been responsibility of the licensed producer managerial control over hemp approved, USDA will issue the producer to pay any fees associated with production. AMS added this license. Licenses are not transferrable in sampling. AMS issued guidance on specification to address concerns raised any manner. An applicant whose sampling procedures that meet the by Indian Tribes regarding issues that application has been approved will not sampling requirements to coincide with can arise when a Tribal leader is also be considered a licensed producer publication of the IFR and will update involved in the production of hemp in under the USDA plan until the the guidance with this final rule. AMS their capacity as a Tribal leader. While applicant receives their producer is requiring that all samples tested for AMS understands the issues that can license. Licenses do not renew THC concentration levels be conducted arise when a Tribal leader is subject to automatically and must be renewed in DEA-registered laboratories. the felony conviction restriction, AMS every three years. However, this requirement will not be must also ensure that all required Applications for renewal will be applicable until December 31, 2022. entities operating under a USDA plan subject to the same terms and approved Significant input was received on the comply with Section 297B(e)(3)(B) of under the same criteria as initial IFR sampling requirements. Please refer the AMA. Therefore, the definition of applications unless there has been an to section B under State and Tribal intervening change in the applicable key participants still encompasses plans above and the discussion of law or regulations since approval of the Tribal leaders who exercise executive comments below for a summary of initial or last application. In such a case, managerial control over hemp findings. Producers under the USDA the subsequently enacted law or production. plan are subject to the sampling and regulation shall govern renewal of the USDA will not accept criminal history testing requirements as outlined in the license. Licenses will be valid until reports completed more than 60 days USDA guidelines for sampling and December 31 of the year that is at least before the submission of an application, testing. Since USDA cannot develop a because the 60-day window provides three years after the license is issued. one size fits all performance-based USDA with an expectation that the This date is not tied to the harvest and sampling program, all producers findings of the report are reasonably planting season. For example, if a licensed under the USDA plan must current and accurate. producer applies for a license on August The criminal history report must 1, 2021, and is granted a license on comply with the USDA sampling indicate the applicant has not been September 15, 2021, the license would guidelines. USDA licensed producers convicted of a State or Federal felony expire December 31, 2024. A December are responsible for obtaining the related to a controlled substance for the 31 expiration date will allow licensed services of sampling agents and hemp 10 years prior to the date of when the producers time to apply for a license testing laboratories themselves. USDA is report was completed. An exception renewal prior to their prior license’s updating guidance on sampling applies to a person who was lawfully expiration and prevent a gap in procedures and training for sampling growing hemp under the 2014 Farm Bill licensing. agents with this rule. USDA does not before December 20, 2018, and whose A producer licensed by USDA must provide sampling or testing services and conviction also occurred before that report their hemp crop acreage to FSA. will not pay for those services. date. Producers must provide specific State and Tribal hemp regulators have In addition to providing the information to FSA, including, but not successfully developed sampling information specified, the application limited to, USDA license number, the requirements that ensure adherence to will also require license applicants to specific location where hemp is State and Federal regulations, while certify they will adhere to the produced and the acreage, greenhouse, allowing for flexibilities due to limited provisions of the plan. building, or site where hemp is State resources and State and Tribal Once all the necessary information produced. The specific location where differences. They explained that, since has been provided, applications will be hemp is produced must be identified, to most hemp in a given region is reviewed by USDA for completeness the extent practicable, by the geospatial harvested at the same time, sampling and to determine an applicant’s location. FSA will provide assistance in must be completed within a very short eligibility. USDA will approve or deny identifying the hemp growing location. time frame by only a few individuals. license applications unless the Please refer to the Section II of this Several States also explained that applicant is intending to produce hemp document on State and Tribal hemp perceived risk determines State in a jurisdiction that has submitted a production program requirements for requirements. Some States utilize plan to USDA or has a plan approved further discussion on FSA reporting different sampling requirements for by USDA, in which case the application requirements. broad end-use categories like ‘‘fiber/ for a USDA license will be denied. If at any time there is a change to the grain’’ hemp versus ‘‘cannabinoid’’ Applicants will be notified if they have information submitted in the license hemp, while others base their been granted or denied a license either application, a license modification is requirements on historical THC by mail or email. required. A license modification is concentrations of certain varietals or on If an application is denied, the required if, for example, the licensed the characteristics and growing history applicant will receive a notification business is sold to a new owner or hemp of a certain farm or producer. AMS letter or email specifying why the will be produced in a new location not agrees that sampling requirements application was denied. If an described on the original application. should allow States and Indian Tribes application is denied because it is Producers must notify USDA more flexibility in the management of incomplete, the applicant will have the immediately should there be any change their hemp regulatory programs.

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AMS agrees that requiring sampling the producer is located, producers testing methodologies meeting these from every lot may be burdensome and licensed under the USDA plan are requirements include gas or liquid expensive for State and Tribal subject to the sampling requirements in chromatography with detection. As regulatory entities and producers. the rule. USDA guidelines provided on discussed earlier and stated in AMS finds that it makes sense to the USDA website at https:// § 990.25(g), if a testing laboratory allow States and Indian Tribes to www.ams.usda.gov/rules-regulations/ utilizes alternative testing methods, they consider performance-based alternatives hemp/information-sampling describe must be reviewed and approved by when developing sampling plans that best practices for complying with those USDA to assess their reliability, take into account unique sampling requirements. However, USDA would accuracy, and compliance with the protocols for hemp growing facilities consider a performance-based sampling requirements. under their jurisdiction. The sampling scheme for producers under the USDA As explained earlier in this document, requirements for State and Tribal plans plan, and amend the sampling AMS is requiring that all testing of allow for States and Indian Tribes to requirements accordingly, if information samples for THC concentration levels be develop unique sampling protocols for collected by USDA in the future is conducted in DEA-registered hemp growing facilities under their sufficient to make this determination. laboratories. Enforcement of this jurisdiction. Sampling protocols must Data must be reliable and able to be requirement has been delayed until be sufficient at a confidence level of 95 applicable across the production areas December 31, 2022. Non-DEA-registered percent that no more than one percent in the U.S. labs can continue testing hemp for THC of the plants in each lot would exceed Samples must be collected by a concentration until that time. Labs the acceptable hemp THC level and USDA-approved sampling agent, or a testing hemp for THC must meet ensure that a representative sample is Federal, State, Tribal, or local law standards of performance described in collected that represents a homogeneous enforcement agent authorized by USDA this regulation. Standards of composition of the lot. Alternatively, to collect samples. As explained above, performance ensure the validity and States and Indian Tribes may adopt a USDA is expanding the training reliability of test results; that analytical performance-based sampling protocol. A requirements for sampling agents and method selection, validation, and performance-based protocol must have will provide a list of authorized verification are appropriate (fit for the potential to ensure, at a confidence sampling agents on the USDA website. purpose); and that the laboratory can level of 95 percent, that the cannabis It is the responsibility of the licensed successfully perform the testing. plants will not test above the acceptable producer to pay any fees associated with Furthermore, the standards ensure hemp THC level. USDA encourages that sampling and testing. Sampling and consistent, accurate, analytical the alternative protocol consider seed testing guideline documents are being performance and that the analytical tests certification processes or process that updated as part of this proceeding and performed are sufficiently sensitive for identifies varieties that have are available on the USDA website. the purposes of the detectability consistently demonstrated to result in The sampling procedures are requirements under this final rule. compliant hemp plants in that State or designed to produce a representative Laboratories conducting THC testing territory of the Indian Tribe, whether sample for testing. They describe must also be registered with DEA to the producer is conducting research on procedures for entering a growing area handle controlled substances under the hemp at an institution of higher learning and collecting the minimum number of CSA (21 U.S.C. 822 and 21 U.S.C. 844) or that is funded by a Federal, State, or plant specimens necessary to accurately and DEA regulations (21 CFR part 1301). Tribal government, whether a producer represent the THC content, through USDA is adopting this requirement has consistently produced compliant laboratory testing, of the sample to be because of the potential for these hemp plants over an extended period of tested. laboratories to handle cannabis products testing above 0.3 percent THC. Such time, and other similar factors. AMS C. Testing Laboratories believes this will provide needed products are, by definition, marijuana, flexibility to States and Indian Tribes to The THC level in representative and a controlled substance. DEA develop logical and enforceable samples must be at or below the registration requirements verify a sampling requirements that take into acceptable hemp THC level. Testing laboratory’s ability to properly handle consideration their unique must be conducted using post- controlled substances. circumstances. AMS will still require decarboxylation or other similarly As previously explained in the States and Indian Tribes to submit their reliable methods where the total THC requirements for State and Tribal plans, individual sampling requirements for concentration level measured includes AMS is not adopting requirements that review as a component of the plan the potential to convert THCA into THC. hemp testing laboratories be approved approval process. If a State or Tribal Further, test results should be under a USDA Laboratory Approval plan lacks a sampling protocol, every determined and reported on a dry Program or undergo ISO accreditation. lot, and thereby every producer must be weight basis, meaning the percentage of It is the responsibility of the licensed sampled and tested. THC, by weight, in a cannabis sample, producer to select the DEA-registered When evaluating sampling protocols after excluding moisture from the laboratory that will conduct the testing submitted by States and Indian Tribes, sample. The moisture content is and to pay any fees associated with USDA will evaluate the risk of expressed as the ratio of the amount of testing. Laboratories performing THC producing non-compliant material to moisture in the sample to the amount of testing for hemp produced under this determine approval or disapproval. In dry solid in the sample. program are required to share test evaluating the risk, USDA will take into Based on AMS’s review of scientific results with the licensed producer and consideration whether the performance- studies, internal research and USDA. USDA will provide instructions based factors the State or Tribe used information gathered from the United to all approved labs on how to have the potential to ensure compliance Nations Office on Drugs and Crime: electronically submit test results to at a 95 percent confidence level. ‘‘Recommended Methods for the USDA. Laboratories may provide test Since USDA cannot develop Identification and Analysis of Cannabis results to licensed producers in performance metrics that would be and Cannabis Products’’ (ISBN 978–92– whatever manner best aligns with their applicable independently from where 1–148242–3), AMS has determined that business practices, but producers must

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be able to produce a copy of test results. researchers’ compliance with this have greater flexibility in remediating For this reason, providing test results to standard as part of its normal oversight that product. USDA producers are producers through a web portal or and compliance program. required to follow procedures for through electronic mail, so the producer USDA licensees shall ensure the ensuring effective disposal of cannabis will have ready access to print the disposal of all non-compliant plants. plants produced in violation of this rule. results when needed, is preferred. USDA licensees shall also comply with Plants that are removed as a result of Samples exceeding the acceptable the reporting requirements including poor plant health, pests, disease, hemp THC level are marijuana and will reporting disposal of non-compliant weather events, along with removal of be handled in accordance with the plants. Research institutions that handle male or hermaphrodite plants as part of procedures discussed in section C ‘‘hot’’ hemp must follow CSA a cross-pollination prevention plans, are below. requirements for handling marijuana. not subject to the disposal requirements Any licensee may request that the Performance based plans from herein. This final rule retains the laboratory retest pre-harvest samples, if research institutions where a State or disposal requirements explained in the it is believed the original THC Tribal plan is not in place will be IFR, but clarifies what ‘‘disposal’’ means concentration level test results were in reviewed by USDA. Notice and and explains how the process must be error. The licensee requesting the retest comment requirements under the PRA conducted. If a producer grew cannabis of the second sample would pay the cost process will be followed before a final exceeding the acceptable hemp THC of the test. The retest results would be determination is made by USDA to level, the IFR required that the material issued to the licensee requesting the move forward with approving be disposed of in accordance with the retest, and a copy would be provided to performance-based plans for those CSA and DEA regulations because such USDA or its agent. producers under the USDA plan. material is marijuana, a Schedule I States and Indian Tribes are allowed controlled substance under the CSA. Research Institutions Sampling and to develop performance-based Testing The IFR required that material be requirements for these institutions. collected for disposal by a person AMS also acknowledges that research However, the alternative method must authorized under the CSA to handle institutions face special circumstances have the potential to ensure, at a marijuana, such as a DEA-registered when conducting hemp research. Under confidence level of 95 percent, that the reverse distributor, or a duly authorized the IFR, researchers and research cannabis plant species Cannabis sativa Federal, State, Tribal, or local law institutions were required to comply L. that will be subject to the alternative enforcement officer. with the same production requirements method will not test above the As explained earlier, AMS is now as commercial producers. Under this acceptable hemp THC level. allowing the flexibility to conduct on- final rule, and as described in detail The research institutions must follow farm disposals and also allowing for below, research institutions and the reporting requirements. AMS believes remediation options. producers working with them are this exception is necessary to help If the results of a test conclude that afforded greater sampling and testing support research and development as it the THC levels exceed the acceptable flexibility to facilitate continued hemp relates to hemp production. This hemp THC level, the laboratory will research. Producers that produce hemp decision allows these types of research promptly notify the producer and USDA for research must obtain a USDA facilities and institutions to confidently or its authorized agent. If a licensed license. However, the hemp that is oversee the study of hemp plants producer is notified that they have produced for research is not subject to through trialing and genetics research. produced cannabis exceeding the the same sampling requirements AMS believes this exception to be acceptable hemp THC level, the provided that the producer adopts and critical to the growth of industry, cannabis must be disposed of in carries out an alternative sampling particularly in its infancy. Over time, accordance with the on-farm disposal method that has the potential to ensure, the exception provided by this final rule options described herein. at a confidence level of 95 percent, that will help to stabilize the industry by Licensed producers notified they have the cannabis plant species Cannabis providing greater understanding of produced cannabis plants exceeding the sativa L. that will be subject to this hemp genetics and how certain varietals acceptable hemp THC level must alternative method will not test above respond differently to growing arrange for disposal or remediation of the acceptable hemp THC level. The conditions in various geographic the lot represented by the sample in rule includes a performance-based locations. All producers are expected to accordance with the procedures as standard for sampling for all licensed benefit from such knowledge as they specified above and described on the producers in section 990.24: ‘‘at a will be made aware of the more stable USDA website at https:// confidence level of 95 percent that no and consistently reliable hemp varietals. www.ams.usda.gov/rules-regulations/ more than one percent (1%) of the Any non-compliant plants produced by hemp/disposal-activities. plants in the lot would exceed the research institutions as a result of Producers must document the acceptable hemp THC level.’’ The research and development will still disposal or remediation of all non- performance-based standard for research need to be disposed and verified compliant cannabis. This can be is a modification of that standard: ‘‘the through documentation. Research accomplished by providing USDA with potential to ensure, at a confidence level institutions must follow licensing and a copy of the documentation of disposal of 95 percent, that the cannabis plant reporting requirements. or remediation using the reporting species Cannabis sativa L. that will be requirements established by USDA. D. Disposal of Non-Compliant Product subject to this alternative method will These reports must be submitted to not test above the acceptable hemp THC Under the IFR, non-compliant USDA following the completion of the level.’’ We are comfortable with this product was required to be disposed of disposal or remediation process. modification to recognize that by persons authorized to do so under researchers may need flexibility to the CSA and had to be destroyed. As E. Compliance conduct their research and because the explained below, under this final rule, As described below, this final rule research hemp cannot enter the stream producers may handle non-compliant changes the THC threshold for a of commerce. USDA will monitor product disposal on the farm, and they negligent violation from 0.5 percent

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under the IFR to 1.0 percent. Further, based on a review of producer records. whose license has been suspended may rather than being liable for multiple USDA will use a calendar year as a be required to comply with a corrective negligent violations in each growing growing season. action plan to fully restore their license. season as under the IFR, this final rule When USDA determines that a A USDA license shall be immediately provides that producers can only incur negligent violation has occurred, USDA revoked if the USDA licensee: (1) Pleads one negligent violation in each growing will issue a Notice of Violation. This guilty to, or is convicted of, any felony season, which prevents producers from Notice of Violation will include a related to a controlled substance; 9 (2) accumulating multiple negligent corrective action plan. The corrective made any materially false statement violations and losing program eligibility action plan will include a reasonable with regard to this regulation to USDA after a single growing season. date by which the producer will correct or its representatives with a culpable USDA will maintain oversight of the negligent violation or violations and mental state greater than negligence; or USDA-licensed hemp producers by will require the producer to periodically (3) was found to be growing cannabis conducting audits of USDA licensees report to USDA on its compliance with exceeding the acceptable hemp THC and working with licensees with the plan for a period of not less than the level with a culpable mental state negligent violations to establish next two calendar years. A producer greater than negligence or negligently corrective action plans. Negligent who has negligently violated the violated the provisions of this regulation violations by a producer may lead to provisions of this rule three times in a three times in five years. suspension or revocation of a producer’s five-year period is ineligible to produce If the licensed producer wants to license. hemp for a period of five years from the appeal any suspension or revocation While USDA has not yet conducted date of the third violation. Negligent decision made by USDA as described in any random audits, the department may violations are not subject to criminal this section, they can do so using the conduct random audits of licensees to enforcement. appeal process explained in section V of verify hemp is being produced in Hemp found to be produced in this document. accordance with Subtitle G of the AMA violation of this regulation, such as G. Reporting and Recordkeeping no more frequently than every three hemp produced on a property not years, based on available resources. The disclosed by the licensed producer or The 2018 Farm Bill requires USDA to format of the audit will vary and may without a license, would be subject to develop a process to maintain relevant include a ‘‘desk-audit’’ where USDA the same disposal provisions as for information regarding the land where requests records from a licensee, or the cannabis testing above the acceptable hemp is produced. Reporting audit may be a physical visit to a hemp THC level. Further, if it is requirements under this final rule, licensee’s facility. When USDA visits a determined a violation was committed particularly the requirement to report licensee’s facility, the licensee must with a culpable mental state greater than hemp crop acreage to FSA, are provide access to any fields, negligence, USDA will report the discussed extensively in Section B of greenhouses, storage facilities, or other violation to law enforcement. the State and Tribal plan requirements locations where the licensee produces The 2018 Farm Bill limited the and the same requirements are hemp. USDA may also request records participation of certain convicted felons applicable to USDA licensed producers. from the licensee, to include production in hemp production. A person with a In general, changes from the IFR allow and planting data, testing results, and State or Federal felony conviction producers more flexibility in defining other information as determined by relating to a controlled substance is for FSA the areas (instead of ‘‘lots’’) they USDA. subject to a 10-year ineligibility use for hemp production. USDA hemp USDA will issue a summary of the restriction on producing hemp under production licensees can apply for audit to the licensee after the completed the Act. An exception applies to a licenses on a rolling basis under this audit. Licensees who are found to have person who was lawfully growing hemp final rule, in contrast to the limited a negligent violation will be subject to under the 2014 Farm Bill before period provided under the IFR. a corrective action plan. Negligent December 20, 2018, and whose Reporting requirements under this final violations include: (1) Failure to provide conviction also occurred before that rule are revised slightly to allow a legal description of the land on which date. producers to account for on-farm the hemp is produced; (2) not obtaining disposal of non-compliant product. a license before engaging in production; F. Suspension of a USDA License USDA’s FSA is well suited to collect or (3) producing plants exceeding the There are no changes to the IFR this information for the domestic hemp acceptable hemp THC level. Similar to provisions related to suspension of production program. FSA has staff the requirements for State and Tribal USDA licenses in this final rule. throughout the United States who are plans, USDA will not consider hemp A USDA license may be suspended if trained to work with farmers to verify producers as committing a negligent USDA receives credible information that land uses. Many hemp producers are violation if they produce plants a USDA licensee has either: (1) Engaged likely to be familiar with the FSA since exceeding the acceptable hemp THC in conduct violating a provision of this they already operate traditional farms, level if they use reasonable efforts to regulation; or (2) failed to comply with and therefore already provide data to grow hemp and the cannabis plant does a written order from the AMS FSA on acres and crops planted. not have a THC concentration of more Administrator related to a negligent Producers may benefit from information than 1.0 percent on a dry weight basis. violation of this regulation. Examples of to participate in other USDA programs AMS believes that increasing the credible information are information through FSA offices. Licensed negligence threshold from 0.5 percent to from local authorities of harvested producers will be required to report 1.0 percent will increase flexibility to plants without testing or planting of their hemp crop acreage with FSA, and farmers as they learn more about how to hemp in non-licensed locations. to provide FSA with specific grow compliant hemp and as the Any person whose license has been availability of stable hemp genetics suspended shall not produce hemp 9 For a corporation, if a key participant has a disqualifying felony conviction, the corporation improves. Further, producers may only during the period of suspension. A may remove that person from a key participant receive one negligent violation per suspended license may be restored after position. Failure to remove that person will result growing season, as determined by USDA a waiting period of one year. A producer in a license revocation.

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information regarding field acreage, H. Information Sharing With Law The term ‘‘applicant’’ means any State greenhouse, or indoor square footage of Enforcement or Indian Tribe that has applied for hemp planted. This information must USDA is working to develop and USDA approval of a State or Tribal include street address, geospatial maintain a database of all relevant and hemp production plan for the State or location or other comparable required information regarding hemp as Indian Tribe they represent. This term identification method specifying where specified by the 2018 Farm Bill. This also applies to any person or business the hemp will be produced, and the database will be accessible in real time in a State or territory of an Indian Tribe not subject to a State or Tribal plan, who legal description of the land. Geospatial to Federal, State, local, and Tribal law applies for a hemp production license location or other methods of identifying enforcement officers through a Federal under the USDA plan established under the production locations are necessary, government law enforcement system. as not all rural locations have specific this part. USDA AMS will administer and The term ‘‘cannabis’’ is the Latin addresses. This information is required populate this database, which will for each field, greenhouse, building, or name of the plant that, depending on its include information submitted by THC concentration level, is further site where hemp will be grown. USDA States, Tribes, laboratories, and USDA will use this information to assemble defined as either ‘‘hemp’’ or licensed producers and information ‘‘marijuana.’’ Cannabis is a genus of and maintain the data USDA must make submitted to FSA. States and Tribes available in real time to Federal, State, flowering plants in the family must provide information to USDA in a Cannabaceae, of which Cannabis sativa Tribal and local law enforcement as format that is compatible with USDA’s required by the 2018 Farm Bill and as is a species, and Cannabis indica and information sharing system. USDA will Cannabis ruderalis are subspecies described in section G below. work with States and Indian Tribes on thereof. For the purposes of this part, Specific procedures for reporting system format and other information cannabis refers to any form of the plant hemp acreage to FSA will be posted on necessary to share information. where the delta-9 tetrahydrocannabinol the USDA Domestic Hemp Production USDA will use this information to concentration on a dry weight basis has Program website. All information will create a comprehensive list of all not yet been determined. This term is be maintained by USDA for at least domestic hemp producers. USDA will important in describing regulations that three calendar years. FSA will assist also gather the information related to apply to plant production, sampling, or producers in identifying the hemp the land used to produce domestic handling prior to determining its THC growing locations since they have maps hemp. This information will be content. that allow for better identification. This comprehensive and include data from The ‘‘Controlled Substances Act’’ is is a procedure that FSA employees are both State and Tribal plans and will the statute, codified in 21 U.S.C. 801– very familiar with since it is used for include a legal description of the land 971, establishing Federal U.S. drug other USDA programs. This rule also on which hemp is grown by each hemp policy under which the manufacture, revises the definition of ‘‘lot’’ to include producer and the corresponding importation, exportation, possession, other terms used by FSA with the same geospatial location or other identifiable use, and distribution of certain meaning. FSA uses terms like ‘‘farm,’’ location. Finally, USDA will also gather substances are regulated. Because ‘‘tract,’’ ‘‘field,’’ and ‘‘subfield.’’ FSA information regarding the status of all cannabis with THC content staff will not provide a ‘‘lot number’’ to licenses issued under State and Tribal concentration levels of higher than 0.3 producers as described in the IFR. government plans and under the USDA percent is deemed to be marijuana, a Instead, FSA will assist producers to plan. Schedule I controlled substance, its identify the area where hemp is grown. This information will be made regulation falls under the CSA. More details are provided under the available in real time to Federal, State, Therefore, for compliance purposes, the States and Tribal plan Section B earlier local and Tribal law enforcement as requirements of the CSA are relied upon in this final rule. required by the 2018 Farm Bill. for the disposal of cannabis that contains THC concentrations above the Licensed producers are required to IV. Definitions stated limit of this final rule. maintain copies of all records and The following terms are integral to The rule includes a definition of reports necessary to demonstrate implementing Subtitle G of the AMA ‘‘conviction’’ to explain what is compliance with the program. These and establish the scope and considered a conviction and what is not. records include those that support, applicability of the regulations of this Specifically, a plea of guilty or nolo document, or verify the information final rule. contendere or any finding of guilt is a provided in the forms submitted to The term ‘‘Act’’ refers to the conviction. However, if the finding of USDA. Records and reports must be Agricultural Marketing Act of 1946. The guilt is subsequently overturned on kept for a minimum of three years. 2018 Farm Bill amended the appeal, pardoned, or expunged, then it Because the final rule allows producers Agricultural Marketing Act of 1946 by is not considered a conviction for to remediate plants, the final rule also adding Subtitle G, which is a new purposes of part 990. This definition of requires producers to maintain records authority for the Secretary of ‘‘conviction’’ is consistent with how on all remediated cannabis plants. Agriculture to administer a national some other agencies conducting Under the USDA plan, there will be hemp production program. Section criminal history record searches additional reporting requirements for 297D of Subtitle G authorizes and determine disqualifying crimes. licensed producers. These include directs USDA to promulgate regulations A ‘‘corrective action plan’’ is a plan information requested in the application to implement this program. agreed to by a State, Tribal government, for a license and the record and The ‘‘Agricultural Marketing Service’’ or USDA for a licensed hemp producer, reporting requirements needed to or ‘‘AMS’’ is the Agricultural Marketing to correct a negligent violation or non- document disposal or remediation of Service of the U.S. Department of compliance with a hemp production cannabis produced in violation of the Agriculture is the agency the Secretary plan, its terms, the applicable law(s) or provisions of this rule. Specific of Agriculture has been charged with this regulation. Corrective action plans reporting requirements are detailed in the responsibility to oversee the may also be a plan set forth by a State § 990.71. administration of this new program. or Tribal government with an approved

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hemp production plan to correct a non- assist in information collection of land A ‘‘key participant’’ is a person or compliance of their program with their being used for hemp production. persons who have a direct or indirect USDA-approved plan. This term is ‘‘Gas chromatography’’ or GC, is a financial interest in the entity producing defined in accordance with the 2018 scientific method (specifically, a type of hemp, such as an owner or partner in a Farm Bill, which mandates certain non- chromatography technique) used in partnership. A key participant also compliant actions to be addressed analytical chemistry to separate, detect, includes persons in a corporate entity, through corrective action plans. and quantify each component in a including tribally-owned corporation ‘‘Culpable mental state greater than mixture. It relies on the use of heat for individuals, at executive levels, negligence’’ is a term used in the 2018 separating and analyzing compounds including chief executive officer, chief Farm Bill to determine when certain that can be vaporized without operating officer, and chief financial actions would be subject to specific decomposition. Under the terms of this officer. This does not include such consequences. This term means to act part, GC is one of the valid methods by management personnel as farm, field, or intentionally, knowingly, willfully, which laboratories may test for THC shift managers. This definition also does recklessly, or with criminal negligence. concentration levels. not include a member of the leadership The term ‘‘decarboxylated’’ refers to For the purposes of this part, the term of a Tribal government who is acting in the completion of the chemical reaction ‘‘geospatial location’’ means a location their capacity as a Tribal leader except that converts THCA into delta-9 THC, designated through a global system of when that member exercises executive the intoxicating component of cannabis. navigational satellites used to determine managerial control over hemp The decarboxylated value is also the precise ground position of a place or production. calculated using a molecular mass object. ‘‘Law enforcement agency’’ refers to conversion ratio that sums delta-9 THC The term ‘‘handle’’ is commonly all Federal, State, Tribal, or local law and eighty-seven and seven tenths (87.7) understood by AMS and used across enforcement agencies. Under the 2018 percent of THC-acid ((delta-9 THC) + many of its administered programs. For Farm Bill, State and Tribal submissions (0.877*THCA)). the purposes of this part, ‘‘handle’’ of proposed hemp production plans to ‘‘Delta-9 tetrahydrocannabinol,’’ also refers to the actions of cultivating or USDA must be made in consultation referred to as ‘‘Delta-9 THC’’ or ‘‘THC’’ storing hemp plants or hemp plant parts with their respective Governors and is the primary psychoactive component prior to the delivery of such plant or chief law enforcement officers. of cannabis, and its regulation forms the plant part for further processing. In Moreover, the 2018 Farm Bill basis for the regulatory action of this cases where cannabis plants exceed the contemplates the involvement of law part. As mandated by the Act, legal acceptable hemp THC level, handle may enforcement in compliance actions hemp production must be verified as also refer to the disposal of those plants. related to offenses identified as being having THC concentration levels of 0.3 ‘‘Hemp’’ is defined by the 2018 Farm made under a ‘‘culpable mental state percent on a dry weight basis or below. Bill as ‘‘the plant species Cannabis greater than negligence.’’ To assist law For the purposes of this part, delta-9 sativa L. and any part of that plant, enforcement in the fulfillment of these THC and THC are interchangeable. including the seeds thereof and all duties, the 2018 Farm Bill also The term ‘‘disposal’’ means the action derivatives, extracts, cannabinoids, mandates information sharing that or process of getting rid of cannabis that isomers, acids, salts, and salts of provides law enforcement with real- is non-compliant. isomers, whether growing or not, with a time data. ‘‘DEA’’ is an acronym for the ‘‘Drug delta-9 tetrahydrocannabinol The term ‘‘lot’’ refers to a contiguous Enforcement Administration,’’ a United concentration of not more than 0.3 area in a field, greenhouse, or indoor States Federal law enforcement agency percent on a dry weight basis.’’ The growing structure containing the same under the United States Department of statutory definition is self-explanatory, variety or strain of cannabis throughout. Justice. The DEA is the lead agency for and USDA is adopting the same In addition, ‘‘lot’’ is a common term in domestic enforcement of the Controlled definition without change for part 990. agriculture that refers to the batch or Substances Act. The DEA plays an ‘‘Liquid chromatography (LC)’’ is a contiguous, homogeneous whole of a important role in the oversight of the scientific method (specifically, a type of product being sold to a single buyer at disposal of marijuana, a Schedule I chromatography) used in analytical a single time. Under the terms of this controlled substance, under the chemistry used to separate, identify, and part, ‘‘lot’’ is to be defined by the regulations of this part. The DEA is also quantify each component in a mixture. producer in terms of farm location, field instrumental in registering laboratories It relies on pumps to pass a pressurized acreage, and variety (i.e., cultivar) and to legally handle controlled substances, liquid solvent containing the sample to be reported as such to FSA. For FSA including cannabis samples that test mixture through a column filled with a reporting purposes, FSA staff will above the 0.3 THC concentration level. solid adsorbent material to separate and determine the appropriate designation ‘‘Dry weight basis’’ refers to a method analyze compounds. Under the terms of for the specific location(s) where hemp of determining the percentage of a this part, LC is one of the valid methods is being grown using FSA terminology chemical in a substance after removing by which laboratories may test for THC such as ‘‘farm,’’ ‘‘tract,’’ ‘‘field,’’ and the moisture from the substance. concentration levels. Ultra-Performance ‘‘subfield’’ to mean ‘‘lot’’ for the purpose Percentage of THC on a dry weight basis Liquid Chromatography (UPLC) is an of this rule. means the percentage of THC, by additional method that may also be used ‘‘Marijuana,’’ or, as defined in the weight, in a cannabis item (plant, as well as other liquid or gas CSA, ‘‘marihuana,’’ means all parts of extract, or other derivative), after chromatography with detection. the plant Cannabis sativa L., whether excluding moisture from the item. ‘‘Indian Tribe or Tribe’’ is defined in growing or not; the seeds thereof; the The ‘‘Farm Service Agency (FSA)’’ is the 2018 Farm Bill by reference to resin extracted from any part of such an agency of the U.S. Department of section 4 of the Indian Self- plant; and every compound, Agriculture that provides services to Determination and Education manufacture, salt, derivative, mixture, farm operations including loans, Assistance Act (25 U.S.C. 5304). The or preparation of such plant, its seeds, commodity price supports, conservation statutory definition is self-explanatory, or resin. The term ’’marihuana’’ does payments, and disaster assistance. For and USDA is adopting the same not include hemp, as defined in section the purposes of this program, FSA will definition without change for part 990. 297A of the Agricultural Marketing Act

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of 1946, and does not include the the definitions for decarboxylation and explanatory, and USDA is adopting the mature stalks of such plant; fiber total THC. same definition without change for part produced from such stalks; oil or cake The term ‘‘produce,’’ when used as a 990. made from the seeds of such plant; any verb, is a common agricultural term that The term ‘‘store’’ is related to the term other compound, manufacture, salt, is often used synonymously with ‘‘handle’’ under this part and means to derivative, mixture, or preparation of ‘‘grow,’’ and means to propagate plants deposit hemp plants or hemp plant such mature stalks (except the resin for market, or for cultivation for market, product in a storehouse, warehouse, or extracted therefrom), fiber, oil, or cake; in the United States. In the context of other identified location by a producer or the sterilized seed of such plant this part, ‘‘produce’’ refers to the for safekeeping prior to delivery to a which is incapable of germination (7 propagation of cannabis to produce recipient for further processing. U.S.C. 1639o(1)). ‘‘Marihuana’’ also hemp. The term ‘‘Territory of the Indian means all cannabis that tests as having ‘‘Producer’’ means a producer as Tribe’’ means (a) all land within the a THC concentration level on a dry defined in 7 CFR 718.2 specifically of limits of any Indian reservation under weight basis of higher than 0.3 percent. hemp. The 2018 Farm Bill mandates the jurisdiction of the United States ‘‘Negligence’’ is a term used in the that USDA maintain a real-time Government, notwithstanding the 2018 Farm Bill to describe when certain informational database that identifies issuance of any patent, including rights- actions are subject to specific registered hemp production sites, of-way running through the reservation, compliance actions. For the purposes of whether under a State, Tribal, or USDA (b) all dependent Indian communities this rule, the term means failure to plan, for the purposes of compliance within the borders of the United States exercise the level of care that a and tracking with law enforcement. whether within the original or reasonably prudent person would AMS will maintain this system with the subsequently acquired territory thereof, exercise in complying with the information collection assistance of and whether within or without the regulations set forth under this final FSA. In order to maintain consistency limits of a State; (c) all Indian rule. and uniformity of hemp production allotments, the Indian titles to which locations, USDA is using FSA to collect have not been extinguished, including Used in relation to the other terms this information through their crop rights-of-way running through the same; and regulations in this part, acreage reporting system. In this and (d) any lands title to which is either ‘‘phytocannabinoids’’ are cannabinoid context, a common use of the term held in trust by the United States for the chemical compounds found in the ‘‘producer’’ is essential to maintaining a benefit of any Indian Tribe or individual cannabis plant, two of which are Delta- substantive database. For this reason, or held by any Indian Tribe or 9 tetrahydrocannabinol (delta-9 THC) the definition of ‘‘producer’’ individual subject to restriction by the and cannabidiol (CBD). Testing incorporates the FSA definition of United States against alienation and methodologies under this part will refer ‘‘producer’’ with the additional qualifier over which an Indian Tribe exercises to the presence of ‘‘phytocannabinoids’’ that they are a producer specifically of jurisdiction. as either THC or CBD. hemp. All producers are required to be The IFR defined the Territory of the Under the terms of this program, licensed or authorized to produce hemp Indian Tribe as ‘‘Indian Country’’ in 18 ‘‘plan’’ refers to a set of criteria or under the USDA Domestic Hemp U.S.C. 1151 because section 1151 is a regulations under which a State or Production Program. commonly acceptable approach to Tribal government, or USDA, monitors ‘‘Remediation’’ refers to techniques determine a Tribal government’s and regulates the production of hemp. utilized to transform non-compliant jurisdiction. The final rule retains the ‘‘Plan’’ may refer to a State or Tribal cannabis into something useful and language of section 1151, but adds item plan, whether approved by USDA or compliant while disposing of non- (d) to the definition of ‘‘Territory of the not, or the USDA hemp production compliant parts. Remediation can occur Indian Tribe.’’ This addition does not plan. by removing and destroying flower significantly expand the definition The 2018 Farm Bill mandates that all material, while retaining stalk, stems, because many of the lands encompassed cannabis be tested for THC leaf material, and seeds. Remediation by item (d) were already considered as concentration levels using ‘‘post- can also occur by shredding the entire ‘‘Territory of the Indian Tribe’’ under decarboxylation’’ or similar methods. In plant into a bio-mass like material, then the IFR. For example, off-reservation the context of this part, ‘‘post- re-testing the shredded biomass material trust land, if not considered part of a decarboxylation’’ means testing for compliance. reservation under section 1151(a), is methodologies for THC concentration ‘‘Secretary’’ means the Secretary of generally considered within a levels in hemp, where the total potential Agriculture of the United States dependent Indian community under delta-9-tetrahydrocannabinol content, Department of Agriculture. section 1151(b). See Club One Casino, derived from the sum of the THC and Section 297A of the Act defines Inc. v. Bernhardt, 959 F.3d 1142, 1149– THCA content, is determined and ‘‘State’’ as any of one of the fifty States 50 (9th Cir. 2020); Felix Cohen, Cohen’s reported on a dry weight basis. The of the United States of America, the Handbook of Federal Indian Law, post-decarboxylation value of THC can District of Columbia, the section 3.04 (Nell Jessup Newton ed. be calculated by using a chromatograph Commonwealth of Puerto Rico, and any 2012). Also, restricted fee lands outside technique using heat, known as gas other territory or possession of the of a reservation are often considered chromatography, through which THCA United States. The statutory definition part of a dependent Indian community, is converted from its acid form to its is self-explanatory, and USDA is provided the lands satisfy the two neutral form, THC. The result of this test adopting the same definition without requirements of a dependent Indian calculates total potential THC. The post- change for part 990. community—lands that are (1) set aside decarboxylation value of THC, or total The term ‘‘State department of by the Federal Government for the use THC, can also be calculated by using a agriculture’’ is defined by the 2018 Farm of the Indians and (2) under federal liquid chromatograph technique, which Bill as the agency, commission, or superintendence. Citizens Against keeps the THCA intact, and requires a department of a State government Casino Gambling in Erie Cty. v. conversion calculation of that THCA to responsible for agriculture in the State. Chaudhuri, 802 F.3d 267, 281 (2d Cir. calculate total potential THC. See also The statutory definition is self- 2015).

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However, because ‘‘dependent Indian Practice Governing Formal Adjudicatory VII. Outreach communities’’ is an oft-litigated term Proceedings, 7 CFR part 1, subpart H, that is interpreted varyingly amongst the which USDA will amend to add the As part of this rulemaking process, courts, USDA decided to add item (d) to Domestic Hemp Production Program. If AMS held numerous meetings with the definition of ‘‘Territory of the Indian the applicant or USDA licensee does not State and Tribal governments and their Tribe’’ to add clarity and ensure request that the Administrator initiate a representatives, industry organizations, nationwide consistency regarding the formal adjudicatory proceeding within groups and individuals with experience jurisdictional boundaries of regulatory 30 days of the Administrator’s adverse in the hemp industry, and authority over the production of hemp. ruling, such ruling becomes final. representatives of law enforcement, as ‘‘Total THC’’ is the post- well as other Federal agencies. decarboxylation value of THC, either Appeals Under a State or Tribal Hemp In addition, USDA also conducted a after testing with gas chromatography or Production Plan listening session on March 13, 2019, that had more than 2,100 participants, LC after using a conversion factor. LC A State or Tribe can appeal the denial and included comments from 46 does not use decarboxylation as part of of a proposed hemp production plan, or separate speakers representing States, the process and this addition is to the proposed suspension or revocation Tribes, producers, end-users, hemp account for the conversion of THCA into of a plan by USDA. USDA will consult organizations, and others. The recording THC if decarboxylation was part of the with States and Tribes to help ensure of the listening session is available on process. The addition of 87.7 percent of their draft plans meet statutory the USDA website at https:// THCA is applicable if the testing requirements, and that existing plan www.ams.usda.gov/rules-regulations/ laboratory uses LC with detection to requirements are monitored and hemp. On May 1 and 2, 2019, USDA measure the THC. Total THC is the enforced by States and Indian Tribes. If, measured THC plus 87.7 percent of also participated in Tribal consultation however, a proposed State or Tribal THCA. meetings for a total of 52 and 38 plan is not approved, or an existing plan As defined by the 2018 Farm Bill, the participants, respectively. On is suspended or revoked the decision term ‘‘Tribal government’’ means the September 24, 2020, AMS conducted may be appealed. governing body of an Indian Tribe. The another Tribal Consultation with statutory definition is self-explanatory, If the AMS Administrator grants a approximately 90 participants. and USDA is adopting the same State or Indian Tribe’s appeal of a AMS published an interim final rule definition without change for part 990. disapproval of its hemp plan, the on October 31, 2019 (84 FR 58522), that The ‘‘U.S. Attorney General’’ is the proposed State or Tribal hemp established a temporary hemp Attorney General of the United States. production plan shall be approved as production program and invited public ‘‘USDA’’ is an acronym that stands for proposed. If the AMS Administrator comments on the program’s provisions. the ‘‘United States Department of denies an appeal, prospective producers The initial 60-day comment period was Agriculture.’’ located in the State or Tribal Territory extended by 30 days on December 18, can apply directly to USDA for a hemp V. Appeals 2019 (84 FR 69295). The comment license. Similarly, if an appeal of a The following paragraphs explain period was reopened for another 30 denied proposed State or Tribal plan is days on September 8, 2020 (85 FR when and how to appeal a USDA denied, producers located in the decision. State or Tribal plans may 55363). A total of approximately 5,900 impacted State or Tribal territory may comments were submitted by States, include similar appeal procedures. No apply for licenses under the USDA plan. changes were made to this section based Tribes, farmers, industry associations, A State or Tribe appealing the and other interested groups and on comments. suspension or revocation of their hemp An applicant for a USDA hemp individuals during the combined production plan must explain the production program license may appeal comment periods expressing their views reasoning for the appeal and the appeal a license denial to the AMS on the provisions of the IFR and must be filed within the time-period Administrator. USDA licensees can suggesting modifications, many of provided in the letter of notification or appeal denials of license renewals, which have been incorporated into this within 30 business days from receipt of license suspensions, or license final rule. the notification, whichever occurs later. revocations to the AMS Administrator. Finally, in November 2019, AMS This timeframe should be adequate for All appeals must be submitted in posted an informational webinar about the assembly of the information writing and received within 30 days of the domestic hemp production program required to be submitted as part of the the denial. Appeals may be submitted on its website (in English and Spanish) appeal. by mail or electronic form. This at https://www.ams.usda.gov/rules- submission deadline should provide VI. Interstate Commerce regulations/hemp. AMS has also posted adequate time to prepare the necessary additional useful information for information required for the appeal. The Nothing in this rule prohibits the regulated entities and other interested Administrator will take into account the interstate commerce of hemp. No State persons on its website at https:// applicant or USDA licensee’s or Indian Tribe may prohibit the www.ams.usda.gov/rules-regulations/ justification for why the license should transportation or shipment of hemp hemp. not be denied, suspended, or revoked, produced in accordance with this part As required by the Farm Bill, the and then issue a final determination. and with section 7606 of the 2014 Farm Secretary developed this final rule and Determinations made by the Bill (expires January 1, 2022) through related guidelines in consultation with Administrator under the appeals the State or the territory of the Indian the U.S. Attorney General. In addition, 10 process will be final unless the Tribe, as applicable. USDA has submitted information to, applicant or USDA licensee requests a and consulted with, the Committee on formal adjudicatory proceeding to 10 See section 10114 of the 2018 Farm Bill and the Agriculture of the House of USDA General Counsel’s Legal Opinion on the review the decision, which will be Authorities for Hemp Production at https:// Representatives and the Committee on conducted pursuant to the U.S. www.ams.usda.gov/content/legal-opinion- Agriculture, Nutrition, and Forestry of Department of Agriculture’s Rules of authorities-hemp-production. the Senate regarding updates on the

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implementation of the hemp technological collection techniques or comply with Subtitle G of the AMA and requirements in the Farm Bill. other forms of information technology; this final rule. whether there is information or data that VIII. Severability Comments: Numerous comments may inform whether or not the market praised the hemp production regulatory This final rule includes a severability will experience a significant shift, either schemes established by States and provision. This provision helps address positive or negative, in the developing Universities under the 2014 Farm Bill the status of the regulations should a hemp market and on consumers; any authority. Many comments reflected on court vacate a particular provision. This data or information on what impacts the the perceived increase in regulatory section provides that if any provision of regulation may have on current and burden under the IFR, as opposed to the part 990 is found to be invalid, the future innovation in the areas of regulatory scheme that has been applied remainder of the part shall not be industrial hemp usages and how much to domestic hemp production until now. affected. such impacts on innovation may affect Many comments, while making rural communities; the potential for IX. Comment Analysis recommendations with regards to innovation and the uncertainty and its specific aspects of the IFR provisions, AMS accepted comments during an impact on the hemp market vis a vis also encouraged USDA to continue to initial comment period from October 31, steady State; and additional reliable regulate domestic hemp production 2019 through December 31, 2019. On data sources on the annual receipts of under the 2014 Farm Bill until December 18, 2019 (84 FR 69295), this industrial hemp producers. satisfactory resolution of industry initial comment period was extended AMS received approximately 5,900 concerns can be achieved. Further, for an additional 30 days, ending comments. Comments represented the several comments stated that the January 29, 2020. AMS reopened the views of States, Indian Tribes, hemp extension of the pilot programs under comment period for 30 additional days farmers and processors, universities, the 2014 Farm Bill for another two to on September 8, 2020 (85 FR 55363), laboratories, trade associations, carriers, three years would give the industry time ending October 8, 2020. Comments may non-profit associations, other Federal to adjust to the new requirements and 11 be accessed through Regulations.gov. government agencies, consumers, and to develop hemp genetics to more easily Reopening the comment period gave other interested individuals. A summary comply with the regulations. interested persons an additional of the comments and AMS’s analysis A few comments opposed extension opportunity to comment on the IFR. and response follows. of the 2014 Farm Bill pilot program, Comments were solicited from all Extention of Comment Period asserting that States now operating stakeholders, notably those who were under the more restrictive 2018 Farm subject to the regulatory requirements of Several commenters urged AMS to extend the public comment period to Bill provisions are placed at a the IFR during the 2020 production disadvantage. cycle. allow for small businesses to AMS response: The extension of the AMS specifically requested comments meaningfully participate in this 2014 Farm Bill authority is not within on the 15-day sampling and harvest rulemaking process. One reason given the authority of USDA. Congress only timeline; the possibility of establishing was that the comment period fell in the extended this authority under the 2021 a fee-for-service hemp laboratory middle of the harvest season for much Continuing Appropriations Act (Pub. L. approval process for labs that wish to of the mid-Atlantic and southern hemp 116–260), until January 1, 2022. offer THC testing services; the growers, excluding those who grow possibility of requiring all laboratories indoors, and therefore were too busy to THC Limit testing hemp to have ISO 17025 comment. Other reasons given were the The IFR adopts the 2018 Farm Bill accreditation; the number of labs ongoing global pandemic as well as definition of hemp as the plant species already ISO 17025 accredited; many other ongoing natural disasters Cannabis sativa L. and any part of that additional examples of reasonable nation-wide that have presented plant with a delta-9 efforts to illustrate actions hemp additional strains and unique challenges tetrahydrocannabinol concentration of producers can take in order to avoid to agricultural operations. not more than 0.3 percent on a dry committing a negligent violation under AMS Response: AMS provided an weight basis. Further, the IFR requires the program; the sufficiency of the hemp initial 60-day comment period and a 30- that THC levels in representative license application period; whether the day extension and then reopened the samples test at or below the acceptable information collection for the program comment period for 30 additional days hemp THC level. Testing must be is necessary for the proper performance in order to receive feedback from conducted using post-decarboxylation of the functions of the agency, including stakeholders thus giving ample time to or other similarly reliable methods, whether the information will have interested parties to submit comments. where the total THC concentration level practical utility; the accuracy of the In order to finalize the Domestic Hemp measured includes the potential to agency’s estimate of the burden of the Promotion Program before the 2021 convert THCA into THC. Finally, the proposed collection of information, production cycle begins, AMS decided IFR provides that hemp testing higher including the validity of the not to extend the comment period and than the acceptable hemp THC level is methodology and assumptions used; the to finalize this rule. considered a controlled substance and ways to enhance the quality, utility, and Extension of 2014 Pilot Program requires disposal. clarity of the information to be Under the 2014 Farm Bill, State Comments: Some comments collected; the ways to minimize the departments of agriculture and supported the 2018 Farm Bill’s hemp burden of the collection of information institutions of higher education were THC level of 0.3 percent, and some on those who are to respond, including permitted to produce hemp as part of a explained that States had successfully the use of appropriate automated, pilot program for research purposes. incorporated that limit into programs electronic, mechanical, or other Congress extended this authority under authorized under the 2014 Farm Bill. Some comments thanked USDA for 11 https://www.regulations.gov/searchResults? the 2021 Continuing Appropriations Act rpp=25&po=0&s=AMS-SC-19-0042& until January 1, 2022. After January 1, clearly defining the delta-9 THC fp=true&ns=true.. 2022, domestic hemp production must standard in the IFR, which commenters

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said would foster uniformity across a controlled substance. Several conclusionary statement on the use of hemp production in all States. comments recommended that university the 0.3 percent THC threshold. However, a greater number of and other research programs be given Several comments reported that comments from various stakeholder more leeway as they work toward countries determined to compete in the groups, including producers, States, developing more compliant, regionally global marketplace, including Indian Tribes, and hemp organizations, appropriate varieties through breeding. Switzerland, Australia, Thailand, asserted that the 0.3 percent threshold is Some comments noted that hemp Uruguay, and Ecuador, recognize an too low and impractical in a program containing more than 0.3 percent THC acceptable hemp THC limit of 1.0 intended for multiple end uses of hemp. is not eligible for crop loss or replant percent. According to comments, the Comments argued that individuals payments under USDA Risk international market settled on the 1.0 interested in obtaining cannabis for Management Agency regulations. percent THC limit after numerous intoxication purposes are unlikely to be Comments said further that if USDA is countries tested hemp over many years. interested in material containing 1.0 not certifying seed because of the Comments recommended the IFR percent THC—or perhaps higher, and regional effects of growing conditions incorporate the same standard. that setting the threshold at even 1.0 on genetics, farmers are at risk and Comments asserted that the rights of percent THC would give farmers, should be able to obtain comprehensive Indian Tribes and small Tribal farmers breeders, and researchers a lot more insurance coverage for crops with should be protected by allowing greater flexibility and confidence in producing negligible overage above the acceptable flexibility in the hemp production compliant crops. One commenter THC level. regulations overall, consistent with reported that their State recognizes Comments explained that while the Tribal self-government. For example, hemp with THC concentrations of up to genetics of most U.S. crops have been comments said that Indian nations 0.39 percent, with most crops testing developed over many years, hemp has should be recognized to have authority between 0.31 and 0.39 percent THC, and not enjoyed that history, and it will take to grow hemp with up to 1.5 percent no end products testing higher than 0.3 time to develop compliant but THC and should not be restricted to 0.3 percent THC. The comment suggested commercially viable crops with percent. One comment explained that their USDA should raise the THC limit to at marketable CBD content for different company has focused on breeding least 0.39, if not up to 0.5 percent. Other regions. Comments asserted farmers will efforts to develop genetics that produce comments recommended revising the have fewer planting options because of CBD-rich hemp with the lowest possible threshold to a higher level, asserting the lack of a national hemp seed THC concentrations. The commenter that there is no scientific evidence that certification protocol and limited claimed their company has harvested supports use of the 0.3 percent level. agronomic research on hemp varietals millions of pounds of hemp compliant Some comments recommended and production practices. Comments with the 0.3 percent total THC standard increasing the threshold to 0.8 or 1.0 inferred that the 0.3 percent THC since 2017. The comment said they percent, while some suggested 2.0 threshold would effectively demand produced 25 million rooted cuttings this percent and others as much as 5.0 that farmers plant a nationwide percent. Comments explained that a spring—enough, according to the monoculture with little genetic comment, to produce biomass for the THC concentration of 5 percent is not diversity, which they said would leave viable for recreational marijuana entire country, and the commenter U.S. hemp crops vulnerable to pests and assumed they were not the only ones markets and that USDA should consider diseases. the end-use potential when determining who had done so. The comment Many comments questioned the a threshold. One comment asserted further that the global standard selection by Congress of the 0.3 percent recommending a THC threshold of at for THC concentration is 0.2 percent THC threshold to legally distinguish least 2.0 percent included a news story and that to be competitive, U.S. hemp from marijuana.13 Comments reporting that marijuana plants production must adhere to a similarly frequently referenced a 1976 confiscated by law enforcement strict standard. publication, A Practical and Natural routinely have THC concentrations of 12 Although asserting that the IFR hemp Taxonomy for Cannabis, in which percent or higher.12 THC level of 0.3 percent is not Several comments suggested that the horticulturalists Dr. Ernest Small and commercially reasonable, some IFR’s level of 0.3 percent delta-9 THC on Arthur Cronquist used 0.3 percent THC comments acknowledged that only a dry-weight basis is ‘‘more aspirational as a threshold to distinguish hemp from Congress could change the statute to than practical.’’ Comments explained marijuana in their scientific study on allow a higher limit, and some 14 that THC levels vary with plant maturity cannabis. Comments highlighted commenters offered to serve as and other factors. Comments urged statements made by Small and resources in that effort. Other comments USDA to build greater flexibility into Cronquist, saying the researchers openly urged USDA to work with Congress to the rule so producers don’t unwittingly acknowledged that they ‘‘arbitrarily raise the THC threshold. become illegal marijuana farmers as a adopt a concentration of 0.3 percent AMS response: Congress defined result of factors beyond their control. delta-9 THC (dry weight basis) in young, hemp in the 2018 Farm Bill as Cannabis One comment suggested USDA establish vigorous leaves of relatively mature sativa L. with a delta-9 a wider gap between the THC levels that plants as a guide to discriminating two tetrahydrocannabinol concentration of define controlled substances and classes of plants,’’ and that the number not more than 0.3 percent on a dry agricultural commodities such as hemp was never intended to define hemp from weight basis. Any change to the to create an environment where hemp a legal perspective. According to the statutorily established threshold of THC producers are presumed innocent until comment, Small and Cronquist made no concentration requires an amendment to proven guilty of intentionally producing the statute. The CSA defines marijuana 13 Johnson, Renee. ‘‘Hemp as an agricultural as cannabis that is over the 0.3 percent 12 McCullough, Jolie. ‘‘Marijuana Prosecutions in commodity.’’ Congressional Research Service THC level. AMS has no discretion to (2014). Texas Have Dropped by More than Half Since change the THC level or to treat States Lawmakers Legalized Hemp.’’ The Texas Tribune, 14 Small, Ernest, and Arthur Cronquist. ‘‘A 3 January 2020; www.texastribune.org/2020/01/03/ practical and natural taxonomy for Cannabis.’’ and Tribes differently as the 2018 Farm texas-marijuana-prosecution-drop-testinghemp/. Taxon (1976): 405–435. Bill applies to all production of hemp in

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the U.S. Tribes do not have the Agency’s regulations regarding crop loss delta-9 THC element. Thus, for authority to grow hemp with up to 1.5 or repayment payments. Thus, compliance purposes, delta-9 THC is the percent THC as this would violate the comments regarding those regulations standard, and the lab report must at 2018 Farm Bill and the CSA. Tribes’ are outside the scope of this rule. least reflect THCA, delta-9 THC, and the powers of self-government may be Total THC results, but Total THC should Testing for Total THC constrained by acts of Congress in not be determinative in whether a accordance with Congress’ The IFR requires that when hemp farmer has to destroy his crop. constitutional authority to regulate THC levels are measured using post- Industry impacts. Commenters commerce with Indian Tribes. decarboxylation or other similarly asserted that testing for THCA AMS notes that there seems to be reliable methods, the total THC concentration, a component they argued confusion amongst some commenters on concentration level measured must which is not psychoactive, would vastly the THC level stated in the 2018 Farm include the potential to convert THCA undermine the efficient production of Bill and the IFR’s definition of into THC. hemp and the growth of the industry. acceptable hemp THC level. The Comments: Some comments agreed Some comments supported the 0.3 acceptable hemp THC level in this final that the measurement of delta-9 THCA percent THC standard, but said rule includes the 0.3 percent established should be added to the measurement of requiring testing for total THC goes in the Farm Bill plus any measure of delta-9 THC and reported as total THC beyond what is statutorily required, to uncertainty due to laboratory testing. used for determining compliance with the detriment of producers. Commenters Regarding the comment citing the the hemp program requirements, as this argued that the difference between news story, AMS believes the is what many hemp producing States levels of delta-9 THC and total THC in commenter misconstrued the article’s are already doing under State programs. hemp is significant, and that crops that meaning. The article cited by the A comment from an association of would otherwise be compliant commenter explained that following Departments of Agriculture reported measuring only for delta-9 THC would passage of Texas’s law that legalized that many States responding to their not be compliant when measuring for hemp in early 2019, the number of survey supported testing for total THC Total THC. Comments asserted that marijuana prosecutions in the State in this manner. testing for total THC with a threshold of plummeted, due in part to the lack of Other commenters disagreed. 0.3 percent effectively lowers the adequate and affordable criminal According to one comment, only 22 of allowable hemp THC level to an even laboratory resources. According to the 47 States with State-level hemp lower limit. article, prosecutors were less likely to programs test for total THC. The Comments also described the expend resources on low-level comment said that 18 States do not correlation between total CBD and total marijuana charges where the likelihood currently test for total THC, and that 7 THC production and explained that of conviction is low. The article States’ rules are ambiguous on this producers trying to maximize CBD described anticipated release of a new point. Other comments reported that production will not be able to do so lab testing method that only determines State programs currently testing for only successfully if total THC levels are whether THC concentration is above or delta-9 THC are confident that restricted to 0.3 percent. One comment below 2 percent for criminal testing producers are not selling ‘‘hot’’ crops. claimed that a farmer can produce hemp purposes. According to the article, even One comment said it is irrational to plants with up to 25 percent though 2 percent is higher than the subject hemp biomass to cannabinoid content while staying State’s legal hemp limit of 0.3 percent, decarboxylation when most biomass under 0.3 percent delta-9 THC limit, but such testing would nevertheless be harvested for processing into that the farmer would have to plant adequate for Texas law enforcement increasingly popular consumer goods or twice as many acres of a less potent purposes, since nearly all marijuana industrial products will never even be hemp variety to produce the same plant prosecutions in the State involve decarboxylated. amount of CBD end product and stay THC concentrations of 12 percent or Another comment explained how compliant under the IFR’s Total THC more. AMS believes neither the article USDA cannot alter the definition of limit. nor the State are advocating legalization hemp as set forth in the 2018 Farm Bill. Several comments reported that some of hemp THC concentrations of up to 2 The comment said that there should not CBD hemp processors reject product percent, but that Texas law enforcement be a ‘‘total’’ THC mandate and, rather, with CBD amounts of less than 8 is merely using that limit as a the plain reading of the 2018 Farm Bill percent. According to comments, convenient way to determine whether to establishes that delta-9 THC is actually breeders have worked years to develop pursue criminal prosecution. the determinative factor. The comment cultivars that meet the 0.3 percent delta- In response to concerns that went on to explain how other State and 9 THC threshold, but many cultivars producers could unwittingly become Federal agencies also rely only on delta- would not be compliant under the total illegal marijuana farmers without 9 THC when making critical distinctions THC limit. Comments predicted that greater flexibility in the rule, AMS has with respect to hemp, such as the DEA with a standard of 0.3 percent total modified the negligent violation and the FDA, to determine whether a THC, growers will stop growing hemp threshold as explained in the section substance is controlled and subject to for CBD because the risk is too high that responding to comments on the criminal penalties. The comment their hemp crops will exceed the limit negligent violation threshold. AMS also presented an alternative testing and be destroyed, defeating the purpose notes, however, that it does not have methodology where testing methods for growing crops for the potential high any authority over how the DEA must be able to determine the potential returns related to CBD production. chooses to enforce compliance with the for THCA to convert into delta-9 THC, Comments further lamented that the CSA. and the test result must reflect that industry would lose investments they’ve In the final rule, AMS is ability as well as the aggregate already made. implementing a nation-wide domestic computation, but the controlling factor According to comments, many States hemp production program as whether a crop meets the definition of that have only been measuring delta-9 contemplated by the 2018 Farm Bill. It hemp and is within the ‘‘acceptable THC under 2014 Farm Bill pilot is not amending Risk Management hemp THC level’’ relies only upon the programs have developed companion

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marketing programs that have been methodologies report the same Bill language testing methods and the tailored to complement State hemp information. IFR requirements. Commenters urged production programs. Comments AMS acknowledges that some States USDA to reconsider the legislative asserted the total THC limit in the IFR do not currently test for total THC and record and Congress’s intent in passing would significantly impact these new that switching to testing for total THC the 2014 and 2018 Farm Bills. and emerging markets and cripple the may have a negative impact on those According to numerous comments, the industry in those States, preventing State programs. Most laboratories that plain language of the 2018 Farm Bill them from selling their product. use LC obtain THCA results and delta- statute does not support the IFR’s Some comments claimed that 9 THC results in the same analysis, so requirement to test for total THC. common industry practice is to measure the information should be readily Commenters asserted that if Congress THC and THCA independently. available to incorporate a calculation for had intended samples to be tested for Comments recommended USDA treat Total THC. The opposite is also true. If total THC, they would have so specified, THC and THCA as two separate USDA was to ignore the statutory rather than making the specific molecules and only be concerned with requirement of using post- reference to delta-9 THC in the statute. the amount of THC in a sample, rather decarboxylation or other similarly Comments concluded that than total available THC. reliable methods and allow for THC concentrations of THCA in hemp should One comment recommended that if levels that do not account for be irrelevant to its legal status under the USDA wants to test for total THC, the decarboxylation, States and Tribes that regulations. One comment characterized limit should be raised to 0.694 percent, currently require testing for total THC ‘‘decarboxylated value’’ as a new legal could experience a negative impact. with negligence set at 1.094 percent, term and questioned USDA’s authority When States or Tribes use different and that growers whose samples under the 2018 Farm Bill to create such methods to measure THC, it impacts measure between the two limits should a term. One comment went on to say commerce because producers are not all be allowed to retest samples with up to that the term ‘‘potential conversion’’ as on the same playing field. Also, since two certified labs of their choice at a appearing in the IFR is offensive total THC at 0.3 percent is harder to cost of $500 each. Another comment because Federal criminal law does not recommended that samples be tested for obtain, those States and Tribes currently using total THC have been potentially convert a legal substance into an illegal THC and THCA separately, with limits one simply because the substance has of 0.3 and 1.0 percent, respectively. selling less or destroying more hemp. Further, many in the industry have the ‘‘potential’’ to be converted. AMS response: The 2018 Farm Bill already made the switch to total THC Several comments cited a letter from requires that State and Tribal plans since the IFR was published, Senators Merkley and Wyden,16 authors provide a procedure for testing, using diminishing the impact. of the Hemp Farming Act of 2018 that post-decarboxylation or other similarly AMS consulted with the Departments was included in the 2018 Farm Bill, as reliable methods, delta-9 of Justice and Health and Human evidence that the IFR wrongly requires tetrahydrocannabinol concentration Services to develop the IFR. The Drug testing of Total THC. In that letter, levels of hemp. In order to use post- Enforcement Administration’s Analysis Senators Merkley and Wyden asserted decarboxylation, the sample must be of Drugs Manual cites GC methodology, that requiring hemp samples to be tested heated or a conversion made to account initially labeling results as delta-9 THC for the lack of heating process. This using methods by which the reported and then defining total THC and THC concentration accounts for the means that the total THC must account instructing how to determine for THCA and delta-9 THC. conversion of THCA to THC ‘‘is a compliance using total THC. complete reversal of the Congressional Currently, some States and Indian In order to provide flexibility to States intent expressed in that law and Tribes use gas chromatography (GC) to and Indian Tribes administering their requires testing that Congress test hemp. In GC testing, heat is applied own hemp production programs, specifically did not include.’’ Comments to the sample which THCA, producing alternative testing protocols will be also asserted that the Farm Bill delta-9 THC (a psychoactive considered by AMS if they are definition of hemp is clear in that ‘‘all compound), so that the final delta-9 comparable and similarly reliable to the derivatives, extracts, cannabinoids, THC result is actually a total THC result. baseline mandated by section isomers, acids, salts, and salts of GC is the more traditional technique 297B(a)(2)(ii) of the AMA and isomers, whether growing or not’’ of the used for THC testing and GC results are established under the USDA plan and hemp plant are expressly lawful so long typically reported as ‘‘delta-9 THC’’ procedures. Updated USDA procedures as the pant does not contain a delta-9 without distinguishing that the reported for sampling and testing will be issued THC concentration of above 0.3 percent. delta-9 THC is actually total THC. concurrently with this rule and will be Thus, according to these comments, the Liquid chromatography (LC) testing provided on the USDA website. IFR required measurement of a lawful typically does not involve the use of This final rule covers hemp plant-based acid when distinguishing heat, so the THCA in a sample does not production. Hemp products are between hemp and marijuana under the decarboxylate. In LC, results for THCA regulated under the Food and Drug Controlled Substances Act, and such a and delta-9 THC are obtained separately Administration and its various requirement contradicts the plain and can be reported separately. 15 statutes. language of the Farm Bill and the spirit Cannabis naturally contains more THCA Statutory Compliance and of the law. than delta-9 THC; if the THCA Congressional Intent: Several comments concentration is ignored while testing expressed concern about regulatory 16 https://www.merkley.senate.gov/news/press- by LC, it is improbable to correctly inconsistency between the 2018 Farm releases/wyden-merkley-to-dea-interim-rule-on- distinguish hemp varietals from drug hemp-contradicts-congressional-intent-by- varietals. A total THC needs to be 15 The 2018 Farm Bill explicitly preserved the criminalizing-intermediate-steps-in-hemp- calculated post-testing in order to authority of the U.S. Food and Drug Administration processing-2020#:∼:text=Authors%20of%20the (FDA) to regulate hemp products under the Federal %20provision%20in,by%20seriously determine the ‘‘post-decarboxylation’’ Food, Drug, and Cosmetic Act (FD&C Act) and %20misunderstanding%20hemp%20processing. delta-9 THC value as required by the section 351 of the Public Health Service Act (PHS See https://beta.regulations.gov/comment/AMS-SC- 2018 Farm Bill. In this way, all testing Act). 19-0042-0884.

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One comment asserted that requiring Calculating Total THC percent THCA + percent delta-9 THC), test reports of THC concentration to The 2018 Farm Bill and IFR identified assuming a 70 percent THCA account for conversion of THCA into and described the procedure for testing decarboxylation to delta-9 THC rate. THC effectively mandates that only test THC concentration using post- Another comment explained the need methods relying on post- decarboxylation or other similarly to include delta-8 THC into any calculation for the future state delta-9 decarboxylation be used, nullifying reliable methods. The term THC. Congressional intent that other similarly decarboxylated was defined in the IFR reliable methods that don’t require AMS response: Delta-8 THC only as the completion of the chemical exists in a trace amount in marijuana conversion of THCA to THC should be reaction that converts THC-acid (THCA) authorized. The comment recommended which has a high Delta-9 THC into delta-9 THC, the intoxicating concentration. The Delta-9 THC amount revising the rule to comply with the component of cannabis. The Congressional mandate to allow testing is already low in hemp, so the decarboxylated value is also calculated concentration of Delta-8 THC would be through other similarly reliable using a conversion formula that sums methods. basically undetectable in hemp. A quote delta-9 THC and eighty-seven and seven from the ‘‘WHO Expert Committee on AMS response: AMS is not making a tenths (87.7) percent of THC-acid. The Drug Dependence Critical Review— determination of Congressional intent term decarboxylated is also commonly Isomers of THC’’ regarding the relative when passing the 2018 Farm Bill used in science and is the precursor to amount of Delta-8 THC to Delta-9 THC provision for hemp. Instead, AMS is the term ‘‘post-decarboxylation,’’ which that can be found at https:// following the plain statutory language appears in the 2018 Farm Bill’s mandate www.who.int/medicines/access/ that states that a State or Tribal plan on the acceptable cannabis testing controlled-substances/ shall be required to include ‘‘a methodologies for identifying THC IsomersTHC.pdf?ua=1. procedure for testing, using post- concentration levels. AMS adopted this The above range means that Delta-8 decarboxylation or other similarly definition in this final rule. THC occurs at a level that is roughly reliable methods, delta-9 Conversion Efficiency: Many 1000 times less than Delta-9 THC. So, if tetrahydrocannabinol concentration stakeholders opposed USDA’s Delta-9 THC was observed at 0.3 percent levels of hemp produced in the State or conversion formula described in the in hemp, then the Delta-8 THC territory of the Indian Tribe’’. IFR. Comments claimed the IFR was concentration would be roughly around based on 100 percent conversion International Impact: Some comments 0.0003 percent. This contribution is efficiency, which is only achievable completely negligible and contributes asserted that the average global delta-9 under controlled laboratory testing THC limit is 1.0 percent. Others claimed nothing significant to the total THC conditions and is not possible outside of content. The trace amount of Delta-8 that Europe has adopted a 0.3 percent a laboratory environment. One comment THC limit, but that it applies only to THC is about 100 times less than the stated the IFR failed to account for the uncertainty (MU) of the test method, delta-9 THC and not total THC. inefficiency of the decarboxylation Comments contend that American hemp further demonstrating that it is process. Numerous other comments insignificant and not worthy of production required to comply with at characterized the USDA formula as consideration in the final assessment of 0.3 percent total THC limit will be theoretical and explained that the THC for hemp compliance. disadvantaged in the international realistic conversion efficiency is AMS is adopting the calculation marketplace. Comments proposed that between 30 and 75 percent. For provided in the IFR for determining matching a global standard by example, several commenters cited a total THC. However, the calculation has establishing a higher delta-9 THC peer reviewed study which found 72 been clarified to explain the use of the threshold or total THC limit would percent to be a viable efficiency factor molar conversion ratio to strengthen U.S. producers’ market and provided the calculation formula: mathematically convert THCA to delta- competitiveness. Other comments Total Potential THC = (0.72) × [(0.877 × 9 THC. As written in the IFR, the warned that reducing the domestic THCA) × delta-9THC)]. Additionally, a calculation may have been hemp supply by imposing the IFR’s 0.3 commenter suggested USDA utilize misunderstood as containing a percent total THC limit will incentivize three different conversion factor tiers (0, conversion efficiency factor, which is importation of hemp biomass and hemp 30, or 70 percent) depending on the not the case. THCA cannot be added to derivatives produced in countries with end-use varietal because the THC delta-9 THC without accounting for the lower labor costs and less restrictive concentration varies by varietal. The difference in molecular mass. Using regulatory regimes, and that domestic commenter argued that the conversion stoichiometry, a molar conversion ratio hemp and hemp derivatives will be factors should reflect the different end- (0.877) is used to mathematically priced out of the market. uses. convert THCA in terms of delta-9 THC. AMS response: The 2018 Farm Bill One comment said the calculation for The molar mass of THCA is 358.47 g/ authorizes USDA to issue regulations to ‘‘Total Potential THC’’ should be mol and the molar mass of delta-9 THC regulate the production of hemp and defined and incorporated into the final is 314.45 g/mol. In other words, the defines hemp in terms of the rule because the decarboxylation mass of THCA has to be adjusted or concentration of THC in a Cannabis percentage definition is critical for multiplied by 0.877 to be comparable to sativa L. plant. A Cannabis sativa L. standardization and uniformity in the the mass of delta-9 THC. plant is considered hemp, and therefore industry. Otherwise, according to the The 2018 Farm Bill requires that the not a controlled substance, if the THC comment, States could adopt different THC content be expressed post- concentration is not more than 0.3 decarboxylation percentages in their decarboxylation, which means that the percent on a dry weight basis. AMS equations, causing confusion for conversion of THCA into delta-9 THC to does not have the discretion to change growers. The comment gave the account for the potential total THC in a this threshold in the definition of hemp following formulas as examples: (Total sample must be taken into account. The even if this threshold could impact the potential THC = 0.877 × percent THCA term ‘‘potential’’ is used because it is global competitiveness of U.S.-produced + percent delta-9 THC) as compared to not possible to readily, consistently, and hemp. (Total Potential THC = 0.877 × 0.70 × reliably calculate the precise extent of

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the conversion of THCA to THC under rather than an exact value’’. Therefore, conversion of THCA to THC. Comments any and all circumstances. Therefore, the author proposes that labs using GC suggested liquid chromatography is the calculation for total THC assumes should calculate their own method’s more accurate and representative than 100 percent conversion efficiency and is conversion efficiency and then apply gas chromatography. USDA received a hereby retained in this regulation. The their efficiency to their result to increase comment that because Tribes often do calculation for total THC [total THC = their total THC value to make it not have ready access to gas (0.877 × THCA) + (delta-9 THC)] comparable to LC. This is the opposite chromatography and may only be able assumes that 100 percent of the THCA of what many commenters are to access liquid chromatography, the is decarboxylated, producing to delta-9 proposing in that they wanted LC rules need to allow for a more lenient THC, meaning that it gives the methods to incorporate conversion formula. maximum (or potential, or theoretical) efficiency into their LC results to make Many more comments opposed the total THC. The final rule includes a total THC lower. The further IFR requirement to use post- definition for total THC to provide more complication of this ‘‘opposite’’ decarboxylation testing methods on the specificity on this issue. This is approach is that it is impossible without grounds that the IFR too strictly standard procedure for how theoretical having a single conversion efficiency interpreted or unnecessarily developed yield is calculated in chemistry. The which, as stated previously, cannot be regulatory requirements that are not issue is that theoretical yield does not agreed upon and can vary widely. consistent with the statutory language of always equal actual yield. Just because Furthermore, no matter how the the 2018 Farm Bill. Comments stated a maximum total THC can be calculated conversion efficiency was to be applied, that USDA should be flexible and allow does not mean that the maximum is requiring each lab to determine their for measuring THC levels with always obtained; however, there is own method’s efficiency would require ‘‘similarly reliable methods,’’ as potential for this maximum to be significant effort. provided in the statute. Comments obtained. The amount of THCA that Delta-8 THC is a cannabinoid that can claimed that the IFR’s exclusive actually decarboxylates, producing be formed from delta-9 THC. It is endorsement of gas or liquid delta-9 THC, is dependent on multiple typically only found in very small chromatography methods ignores this variables; primarily, the amount of heat quantities in plants, if it is found at all, statutory flexibility. Comments further it is exposed to and the amount of time and is more often obtained by growing asserted that these two methods may it is exposed to that heat. These a plant with high delta-9 THC and then overstate THC levels in hemp samples variables, in turn, depend on what is converting the delta-9 THC into delta-8 and that USDA should approve being done to a cannabis sample (tested THC through an extraction and alternative reliable methods that may via LC, tested via GC, used for smoking, conversion process in a lab to make a produce more accurate results. used for extraction, etc.). distillate product. It is rarely included According to some comments, reliable Incorporating the use of a conversion in total THC calculations and many labs testing methods have emerged that do efficiency factor into the calculation is do not test for it. Delta-8 THC is not necessitate decarboxylation to problematic due to these variables. unrelated to the 0.3 percent delta-9 THC accurately measure THC concentrations. Designating different conversion limit or the ‘‘post-decarboxylation delta- For example, comments claimed that efficiency factors based on intended end 9 THC’’ that are defined and required in some States recognize genetic testing use is not practical as the factors can this final rule. that measures the ratio of cannabidiol to still vary. For example, if an end-use of THC in a sample or that confirms a Similarly Reliable Testing Methods extraction is intended, there are many stable cultivar’s taxonomic different types of extraction processes The 2018 Farm Bill states that State, determination in lieu of post- and even within one specific process Tribal, or USDA plans shall include ‘‘a decarboxylation testing to verify there are still many different variables procedure for testing, using post- compliance with THC limits. Comments that will affect the conversion decarboxylation or other similarly explained that genetic testing could efficiency. Ultimately, there is no way to reliable methods, delta-9 include testing seed or testing during standardize a conversion efficiency tetrahydrocannabinol concentration early plant growth stages, instead of factor based on end-use, methodology, levels of hemp.’’ depending on chemical analyses to or processing. The infrastructure does The IFR included two examples of measure THC levels in mature plants, not currently exist to measure and standard industry post-decarboxylation which may be inconsistent under monitor conversion efficiency. testing methods that meet 2018 Farm unpredictable growing conditions or In terms of conversion during Bill requirements: Gas and liquid dependent upon the time of sampling or instrumental analysis, many chromatography with detection. AMS the specific part of the plant that is commenters referenced a study selected these standard methods of sampled. conducted by Dussy 17 that determined chromatography as the best options for Comments advocated removing the a conversion efficiency factor for a testing but also provided flexibility for Total THC testing requirement and specific GC setup. The author of the alternative sampling and testing recommended USDA work with study recommends determining THCA protocols if they are comparable and scientific and agricultural communities and delta-9 THC separately and similarly reliable to the baseline to ensure testing standards are calculating total THC (using the mandated by the 2018 Farm Bill and established and similarly reliable equation the IFR stated to use). The established under the USDA plan and methods are developed that will author says that ‘‘every total D9 THC procedures. accurately identify and measure THC value determined after decarboxylation Comments: Some comments without the forced conversion of other [by using GC] gives a minimal content expressed support for the use of post- cannabinoids, isomers, and/or acids. decarboxylation. One comment States Operating under 2014 Farm 17 Dussy F.E.; Hamberg, C.; Luginbu¨ hl, M.; described liquid chromatography as a Bill Authority: Comments said that Schwerzmann, T.; Briellmann, T.A. Isolation of D9 preferable testing method over gas USDA should recognize that States have THCA–A from hemp and analytical aspects concerning the determination of D9 THC in chromatography because there are no been effectively regulating hemp cannabis products. Forensic Science International, published methods for gas production using approved testing 149, 3–10, 2005. chromatography that show 100 percent methods under 2014 Farm Bill pilot

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programs. Comments argued that by illegal under the IFR. The comment in September and October and that applying the IFR’s new testing standard, recognized that the pilot program will farmers are busy with harvest activities certain hemp plants that are legally not be authorized after 2021 but said related to other crops as well during that grown under one or more of the existing current disparate treatment under the time of year. Comments noted that pilot programs are converted into plants two laws is problematic. farmers typically finalize decisions that violate the 2018 Farm Bill. AMS response: The 2014 Farm Bill about the coming crop year during the Comments contended that while USDA included a 0.3 percent THC level but winter, after having time to attend will argue that States and Tribes can did not include the requirement for this industry and trade conferences, enter propose a testing method other than measurement to account for into production contracts, and obtain post decarboxylation, the alternative decarboxylation. Thus States have the crop loans and insurance. Thus, method still has to measure potential flexibility to determine testing according to comments, a longer conversion of THCA into THC. methodologies. The 2018 Farm Bill application window or a later Comments said further that the IFR states that procedures for testing use application window would give farmers must consider that hemp testing is an post-decarboxylation or other similarly time to plan for the coming year and evolving science and that THC testing reliable methods to determine delta-9 submit hemp production license methods are likely to change over time. tetrahydrocannabinol concentration applications as appropriate. Comments They stated that imposing new testing levels in hemp. AMS stated in the IFR also noted that a longer application requirements is adding costs for and further adopts the language in this period would give producers time to growers, marketers, and regulators, and final rule that at this time two methods complete the mandatory background is limiting the number of labs that can meet this requirement for check. Some comments recommended perform these tests, for unnecessary and decarboxylation. The current acceptable the application period be extended to possibly impermissible reasons. Finally, testing methods include gas and liquid December 31. Others recommended a comments questioned whether USDA chromatography, including LC with UV winter application period of January 1 has the authority to impose new testing detection. As other testing methods and to March 15. requirements when the statute spells out alternatives are developed by industry, Other comments recommended even the testing standards to be applied in AMS will review and evaluate their greater flexibility in application periods. granting approval to State and Tribal compliance with the 2018 Farm Bill. At Comments explained that harvest cycles plans. this time, genetic testing has not been for hemp growers may vary regionally A comment cited case law that held determined to be a similarly reliable and by operation type. They said a that under the Administrative Procedure testing methodology. significant number of hemp operations Act (APA), agency decisions must be This final rule provides States and involve year-round cultivation, reasonable and based on factors and Indian Tribes the option to develop maintenance of mother clones, clone evidence that support the decision, different sampling methodologies based propagation, indoor cultivation, and/or divergent views notwithstanding. It on end use, including grain and fiber, to tissue culture. Time and resources to suggested the IFR is arbitrary and better account for differences in these gather and submit paperwork would not capricious under the APA because plants. Biomass only needs to be tested coincide with the down-cycles in USDA (1) ‘‘has relied on factors which after remediation to ensure that the productivity and would strain these Congress has not intended it to sample that represented the plant that types of operations. Some recommended consider, ’’ (2) ‘‘entirely failed to once tested above the acceptable THC USDA adopt a year-round, rolling consider an important aspect of the level did not result in the plant being a application period with different problem,’’ (3) ‘‘offered an explanation controlled substance. This final rule deadlines for different operation types for its decision that runs counter to the does not set requirements for testing or sizes. One comment said it was evidence before the agency,’’ and (4) has final products—but hemp plants, unclear in the IFR whether State and made a decision that ‘‘is so implausible regardless of their end use, must still Tribal plans were required to adhere to that it could not be ascribed to a use the same testing procedures. the same window provided for under difference in view or the product of Although the USDA plan does not USDA’s plan. Several comments urged agency expertise.’’ It further claimed allow for sampling based on end use, USDA to provide greater regulatory that a court must sustain an agency’s AMS will study the experience of States flexibility at the State and Tribal levels action unless it determines that the and Tribes that adopt methodologies to determine the appropriate application agency committed a ‘‘clear error in based on end use. If it appears that the and renewal timeframes for their judgment.’’ The commenter asked that data and experience of those States and jurisdictions. An example was given of their comment be considered within the Tribe suggest that their methodologies a State’s agriculture department context of these legal standards, and may be adaptable to the USDA plan, transitioned enrollment from a argued that THCA is not psychoactive; AMS may explore a sampling scheme restricted to an unrestricted timeframe but can be converted into delta-9 THC based on end use for producers under to better manage the logistical through a chemical reaction, and that the USDA plan in the future through challenges related to the enrollment such a reaction may cause otherwise notice and comment rulemaking. period. lawful hemp plants to test ‘‘hot.’’ The AMS response: AMS agrees with the comment projected further that such License Application Period commenters opposed to a limited USDA ‘‘hot’’ plants will require disposal, AMS received comments on the license application window and will causing a significant and unnecessary timeframe established in the IFR for allow for applications to be submitted loss of hemp production, which will in submitting applications for a USDA for a USDA license year-round. This turn reduce economic development and license. The application period extends will provide greater flexibility to hemp job growth in many rural communities. between August 1 and October 31. producers to determine when to apply The comment said post- Comments: Several comments for a license or renew their license. This decarboxylation testing was not opposed the August-through-October decision recognizes the different required under the 2014 Farm Bill pilot window for USDA license applications regional harvest timetables and program and the same plants that are and renewals. They explained that production types used by hemp legal under 2014 Farm Bill could be many outdoor hemp crops are harvested producers, and how flexible timetables

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may allow producers to prepare acreage to both FSA and the plan easy access to information needed for applications during lower level periods authorities under which they operate. law enforcement and for other of production activity thereby reducing Several comments took exception agricultural programs. This information some of producers’ burden on time and with the IFR’s assumption that most is compiled in one system, using an resources when the producer is hemp farmers are already registered and information sharing mechanisms planning the next planting cycle(s). familiar with FSA and its programs. currently used by law enforcement and States and Tribes can determine their Comments from some State agriculture which they are familiar with, and license application window as it best departments asserted that within their transmitted to law enforcement in a safe meets their programs. jurisdictions most farmers in general do manner, which otherwise would not be not already work with FSA. as readily available through State and FSA Reporting and Information One comment asserted that Tribal reporting. States and Tribes must Sharing participation in FSA programs is provide information to USDA in a AMS received comments on the IFR voluntary and that hemp growers format that is compatible with USDA’s requirement that hemp producers report should not be precluded from information sharing system. USDA will acreage and provide licensing participating in the commenter’s State work with States and Tribes on system information to USDA’s Farm Service program because they forego FSA format and other information necessary Agency (FSA). Hemp producers must registration. Other comments suggested to share information. provide FSA information about their that farmers growing hemp for personal Secondly, FSA’s county network is hemp crop acreage, such as its location use and hemp farmers also growing expansive with over 2,000 field office and size, and must provide the producer medical marijuana may be hesitant to locations. FSA offices provide services license or authorization number issued register crop acreage with Federal both in person and virtually to under the hemp production plan under agencies. accommodate the needs of producers. which they operate. States, Indian One comment expressed concern Its mission runs parallel to other Tribes, and USDA must collect the same about FSA staffing in rural areas and USDA agencies including Risk asked USDA to increase funding to information, as well as other producer Management Agency, Natural Resources support additional reporting obligations. information, under their respective and Conservation Service, and Rural Another comment suggested USDA plans. USDA then assembles and Development, each of which provide a develop and fund one standardized maintains FSA and plan information wide range of benefits and services to reporting program for all plans and and makes it available to law local communities. AMS noted that in growers that would decrease program enforcement agencies, as required under many cases, FSA is co-located with reporting burdens for all entities. Some the 2018 Farm Bill. other Federal, State and county-level comments encouraged streamlining government offices which means a Comments: Several comments collection of crop acreage information variety of services are provided through expressed strong support for FSA by allowing the use of open-source GIS one central location. These services programs generally, acknowledging that mapping instead of FSA data and frequently include information on FSA programs provide farmers valuable reporting tools. Comments also insurance and risk management access to Federal programs and funding, suggested USDA could rely on States programs, conservation and irrigation and that registering crop acreage with and Tribes to provide grower crop technical expertise, agricultural credit FSA would help mainstream hemp acreage and registration information for operating or marketing, and rural production within agricultural since they already collect it. Several housing loans. As such, the requirement communities. Comments noted that comments recommended eliminating is considered by AMS to be particularly requiring hemp growers to register with the FSA registration requirement important to new and beginning farmers FSA is similar to registration altogether. who traditionally are not familiar with requirements for growers of other AMS response: AMS acknowledges the wide range of programs and services commodities and that FSA already the FSA reporting requirement may offered by Farm Service Agency and the compiles reports about other crops. present a hurdle for certain hemp other USDA agencies. However, many commenters opposed producers, particularly new and the requirement to register with FSA beginning farmers, farmers in rural Definition of ‘‘Lot’’ when they are already required to locations, and farmers located in Tribal AMS received comments on the provide the same information to their territories. However, AMS determined definition of ‘‘lot’’ for providing licensing authority. Comments argued that the FSA reporting requirement is geographical determination of hemp that the duplicative reporting essential for two key reasons: Real-time production and for sampling purposes. requirement is unnecessarily data collection and field-based One comment explained that nursery burdensome to farmers, could be resources. operators and their field operating confusing, and could discourage farmers First, USDA is required under the counterparts may need to file hundreds from seeking hemp production licenses 2018 Farm Bill to provide law of permits for a single greenhouse under or from growing hemp. One comment enforcement with certain ‘‘real-time’’ the IFR. The comment described as an speculated that confusion about the information about who is growing example one greenhouse at a nursery, duplicative requirement could lead to hemp, whether their license is in good which may have upwards of 36 benches, unintended violations by growers who standing with the regulatory body in which each bench could have 20 don’t comply. Other comments issuing the license, and the location(s) different hemp varieties growing at any speculated that lower program of where hemp is being grown. The one time. The comment said that the participation would inhibit industry daily collection of this information IFR would require that single growth and deprive States and Indian through FSA county offices enables greenhouse to have 720 ‘‘lots,’’ and Tribes of licensing fees that enable them USDA to easily transmit the required based on most States’ current rules, 720 to fund their respective production information to law enforcement. FSA containment plans, destruction plans, plans. maintains the technology necessary for and transportation notices when any Comments noted that the statute does data collection and geographical land plants are moved—all possibly requiring not specify dual reporting of crop identification. These tools will provide agency approval prior to any action

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being taken. It further explained that the recognized the difficulty of developing Association of Official Seed Certifying growing cycle for nursery stock could be a hemp seed certification program but Agencies (AOSCA) has already as short as five to six weeks, and nonetheless urged USDA to pursue what established national standards for hemp different varieties could take their place. they characterized as an important effort field crop cultivars and is reviewing The comment said a nursery with five to allow for consistency among hemp issues related to the development of or six greenhouses on a relatively small producers when resources permit. certification standards for feminized acreage may have to register thousands One comment asserted that seed seed and clones of CBD hemp. Other of lots and submit thousands of certification is key to a regulated hemp comments recommended USDA adopt associated plans. It recommended that industry and explained that certification AOSCA standards in the development such a nursery should only be required is a common practice in the of a Federal seed certification system, to designate the actual greenhouse or international seed industry. Several and several comments said that some indoor growing structure itself as used comments contended that USDA must States have already adopted AOSCA for the cultivation of hemp generally, develop a seed certification program to protocols for production of certified and the term ‘‘lot’’ should not be prevent hemp growers from purchasing seed for commercial sale to farmers. For defined to include any restriction or and planting seed of unproven quality— example, a comment stated that a state limitation to the same hemp varietal. or of the wrong varieties for their currently recognizes 17 hemp seed The comment proposed revising the purposes—and risking unnecessary varieties that have been certified for use definition of ‘‘lot’’ to mean a contiguous financial loss and regulatory violations. in that state in accordance with AOSCA area in a field, greenhouse, or indoor Comments claimed that hemp farmers standards. The comment said the state growing structure used for the already have difficulty verifying the encourages farmers to use certified seed cultivation of hemp. origin, genetics, and reliability of hemp when possible and the state intends to AMS response: In this final rule, AMS varieties currently on the market, and rely on certified seed to streamline the is clarifying that the term ‘‘lot’’ has the that a seed certification program would hemp testing program in the future. same meaning as other terms used by help farmers know whether seed they A comment clarified that there is a FSA, as found in 7 CFR 718.2, to mean purchase is appropriate for their difference between seed that has been the same production area, such as growing conditions or intended hemp certified according to AOSCA standards ‘‘farm,’’ ‘‘tract,’’ ‘‘field,’’ and ‘‘subfield.’’ product end-use. Numerous comments (or an international equivalent standard) AMS uses the term ‘‘lot’’ to help inferred that a seed certification for varietal purity, and seed that has growers and oversight officials identify program would identify hemp varieties been tested for THC or other farm locations, field acreage, and variety that had been tested and proven to compounds. It asserted that some State (i.e., cultivar). Although a hemp reliably produce compliant hemp plants programs have confused the producer must report their ‘‘lot’’ in specific geographic areas. terminology and urged USDA to clarify information to FSA, when a producer Some comments argued USDA should the difference and promote use of visits the FSA office to report hemp not engage in hemp seed certification certified seed for varietal purity. The crop acreage, FSA staff will determine because plant genetic expression is comment said the hemp industry has the appropriate designation for the influenced by environmental conditions access to numerous proven varieties and specific location(s) where hemp is being and seed certifiers cannot guarantee that plant breeders are making strides to grown. FSA staff will not provide a ‘‘lot plants will have THC concentrations develop more varieties with specific number’’ to producers as described in within the acceptable range. Other characteristics. the IFR, but instead designate either a comments countered that assertion and Numerous other comments reinforced ‘‘field’’ or ‘‘subfield’’ as the unique referenced a comment that reported on the need for seed certification programs identifying number. This number is the analysis of cannabis genome trials that ensure hemp seed meets high considered equivalent to a ‘‘lot and concluded that cannabinoid standards for proper labeling, reliable number.’’ concentration is 80 percent or more germination rates, purity, and the ability A lot must always contain the same controlled by genetics rather than to produce healthy plants. Some variety or strain of cannabis throughout environmental conditions. comments supported seed certification the area because the final rule requires Comments claimed that hemp under State or Tribal programs, claiming lot-based testing. varieties developed under proper such localized programs have proven breeding programs and certified in the successful in areas where they’ve been Certified Seed European Union and Canada had been developed and used, and saying that The IFR explains that under the 2014 proven to have stable cannabinoid such programs promote crop Farm Bill, various States developed seed profiles across multiple regions. They predictability and reduce uncertainty certification programs to help producers suggest that comparable results could be for farmers. One comment asserted that identify hemp seed that would work achieved under a USDA seed not only seed, but clone certification is well in their specific geographic areas. certification program. a must, to ensure that growers are Comments: Some comments A comment claimed that the lists of getting what they think they are when concurred with USDA’s decision not to acceptable/approved varieties provided they purchase clones from nurseries. introduce a hemp seed certification by the processor and/or the governing Some comments asserted confidence in program with the IFR. Numerous authority in the State in which the certified seed could be extended to crop commenters said that such a program hemp is grown needs to be updated insurers, who could provide coverage at would not be appropriate, that it would soon and regularly. The policy language prices that reflect reduced risk. Some be too difficult to regulate, or that it may be acceptable, but these lists need comments suggested growers using seed would be premature now. Other attention quickly so that ill-suited certified under a Federal certification comments said a federal hemp seed varieties are not planted and insured program should be indemnified against certification program is not necessary when planted outside of the area and legal liability or financial losses related because some States and Indian Tribes not likely to perform as well. to production of hemp that tests higher had already developed such programs Some comments asserted it is not than the acceptable THC level. Some for their jurisdictions or are capable of necessary for USDA to develop a seed comments suggested States and Tribes doing so. Numerous comments said they certification program now because the that adopt seed certification programs

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for cultivars reliably producing agent collect samples from floral and drought tolerance or pest resistance compliant plants should be authorized material for THC concentration testing must be identified and preserved, while to exempt such cultivars from hemp in order to determine compliance with plants with unwanted genetic traits or sampling and testing requirements or to the Federally established THC diseases must be separated and employ random, risk-based sampling threshold. Some operations growing destroyed in order to stabilize the schemes supported by data about those hemp do not grow to the stage where genetics for THC expression and other cultivars. flower material is present and as such desirable traits and understand how AMS Responses: AMS is not cannot test the floral material. environmental factors, disease, and establishing a seed certification program Clones and Cloning: Comments noted insect pressure affect the expression of for hemp. The IFR explained USDA’s there are a significant number of grower those traits. According to comments, the decision to not establish a seed operations that cultivate and produce THC concentration in such plants could certification program was due to a lack hemp plants year-round. Some of these exceed the acceptable THC level in the of accurate data and the advanced operations grow hemp varietals and IFR and plant breeders could find technology necessary to develop such a maintain mother clones and/or grow themselves in violation of the law. As program. The term ‘‘certification,’’ as plants for clonal propagation or tissue well, they explained that the IFR’s used here, means tested or verified and culture propagation purposes. disposal requirement could force does not necessarily mean certified for Comments explained that hemp breeders to destroy valuable plant seed varietal purity or genetics. AMS varietals grown in these types of material and waste years of work, as understands that some seed production systems do not usually reach well as funding. certification-related studies are already full maturity. According to comments, Other comments asked USDA to under way in different locations and before achieving the floral stage of support research into hemp pollination that results of these studies are helpful development, many of these hemp and drift. Comments reported industry in production risk mitigation. AMS varietals are sold and enter the stream concern that cross pollination could recommends the use of hemp seed from of commerce as starter plants that other reduce the value of neighboring CBD varieties that have undergone a variety licensed hemp growers may transplant flower crops. They asked USDA to focus review, following the process outlined to a field or greenhouse to be raised to on grain producing geographic areas and in the Federal Seed Act and associated full maturity and harvest. Comments varieties to provide the science to regulations, (7 U.S.C. 1551–1611 and 7 questioned how immature or juvenile support large acreage growers. CFR part 201), and produced according hemp plants with no floral material to Comments explained that the IFR’s to AOSCA standards. These types of test can demonstrate regulatory THC threshold of 0.3 percent reduces seed have been screened and tested for compliance under the IFR. the incentive to conduct hemp variety purity and are properly labeled. This Microgreens: Comments raised similar research because of the likelihood that final rule maintains flexibility for concerns about hemp raised and many plants will exceed that threshold. stakeholders to continue with trials of marketed as microgreens or other types For example, comments suggested the seed varietals and does not prohibit the of immature plants intended for human THC limit for hemp plants in licensed use of any hemp varietals by industry. consumption, noting that these plants breeding programs could be raised to 0.6 Updating the varieties list is a State and cannot be tested for regulatory percent or 1.0 percent or higher. They Tribal issue, as they developed them. compliance because they have no floral suggested breeders be allowed to raise This final rule does not address seed material to test. Comments encouraged plants to maturity, collect data and save certification. However, USDA will USDA to develop a regulatory process in seed for further research, and be consider such a program in the future if which THC concentration testing may required to destroy noncompliant plant enough information is available. If there occur for immature, non-flowering material at the end of the growing is sufficient data to support a program, hemp varietals so that operations like season. Other comments suggested that USDA will explore adopting one those producing clones or microgreens breeders and researchers should not through rulemaking under the APA. can support the development of the have to wait for hemp plants to flower Separately from this hemp production hemp industry. and undergo testing before they can regulation, AMS administers the Plant One comment representing a hemp remove and destroy those plants with Variety Protection Office (PVPO). This cultivation and distribution corporation undesirable traits. office actively accepts applications of in several states provided a pre harvest Comments asserted that hemp strains seed-propagated hemp for plant variety test on a microgreen variety grown in used in genetic studies authorized by protection. Under the U.S. Plant Variety two different States. One State test the 2014 Farm Bill and compliant with Protection Act, PVPO examines new reported 0.17 percent total cannabinoids other program regulations may now be applications and grants certificates that and the other test reported 0.0193 in jeopardy due to the uniform protect varieties for 20 years (25 years percent total cannabinoids. Based on application of the IFR’s 0.3 percent THC for vines and trees). PVPO provides these tests, commenter indicated that threshold and plant disposal intellectual property protection to hemp leaf greens/microgreens and requirements. They noted how a breeders of new varieties of seeds and related crops are not in danger of excess regulation that requires the disposal of tubers. Certificate owners have rights to THC. what was previously compliant hemp exclude others from marketing and Hemp Research: Numerous comments will undermine the efforts and millions selling their varieties, manage the use of stated the need for a separate regulatory of dollars invested by farmers and their varieties by other breeders, and scheme to support hemp research. researchers. Other comments indicated enjoy legal protection of their work. Comments explained that the plant that not having the ability to replicate breeding process by its nature requires certain genetic traits from a plant that is Regulations for Different Operations breeders to bring multiple varieties of noncompliant can slow the The 2018 Farm Bill requires any plants to maturity in order to evaluate development of industry. producer growing hemp to be licensed their characteristics and potential use in Comments from and about university either by their applicable State or Tribal ongoing hybridization projects. They research programs suggested that USDA authority or USDA. The IFR further said, for example, that plants with make land grant universities eligible for required that an authorized sampling desirable characteristics such as frost special research carve-outs or regulatory

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exemptions to allow them to continue research must obtain a USDA license or sampling activities and that these States research efforts. Other comments a State or Tribal license. However, the did not use or require third-party suggested USDA define criteria under hemp that is produced for research is sampling agents during piloting. which researchers and other plant not subject to the same sampling One comment reported use of third- breeders could be eligible for special requirements or the requirements party certified samplers for the 2020 research program exemptions. They pertaining to non-compliant plants, season, and as of the date of their suggested USDA develop criteria for provided that the producer adopts and comment, had employed 74 certified certification or qualification of hemp carries out an alternative sampling sampling agents. The commenter said researches and breeders, and some method that has the potential to ensure, the State recommends producers make suggested those meeting specified at a confidence level of 95 percent, that appointments with sampling agents 30 criteria could be exempt from the IFR’s the cannabis plant species Cannabis days in advance prior to intended crop destruction and reporting sativa L. that will be subject to this harvests, and that they had not received requirements, provided they adhere to alternative method will not test above any feedback regarding unavailability of other restrictions, such as prohibiting the acceptable hemp THC level. USDA sampling agents based on the 15-day research material from entering the licensees will need to submit an window. The comment went on to chain of commerce, disposing of non- alternative sampling method to USDA report that the State had received compliant plant material, and limiting for approval and shall ensure the numerous anecdotes of next-day plot size. Some commenters noted that disposal of all non-compliant plants. availability for sampling, which the without such allowances their USDA licensees shall also comply with comment suggested would not be university administrators would not the reporting requirements including possible without the use of third-party allow them to continue research with reporting disposal of non-compliant sampling agents. any form of cannabis, including hemp, plants. Resources: Several commenters due to concerns about Federal grant AMS views this flexibility as worried that there would be insufficient disqualification. necessary to help support research and numbers of appropriately trained, One commenter requested an development as it relates to hemp USDA-approved sampling agents exemption for Tribal research facilities production by industry, particularly in available during harvest periods to so that they will not have to destroy all its infancy. This decision allows these ensure that all crops could be sampled, non-compliant plants. types of research facilities and tested, and harvested within the 15-day Comments noted that USDA’s institutions to oversee the study of window specified in the IFR. They National Institute of Food and hemp plants through trialing and asserted that sampling backlogs and Agriculture had not issued requests for genetics research. Over time, the delayed testing and harvesting would applications on hemp research and that flexibility provided by this final rule cause crops to mature beyond the hemp was not listed for funding under will help to stabilize industry by acceptable hemp THC content the Specialty Crop Research Initiative. providing greater understanding of concentration, resulting in crop Comments suggested more agronomic hemp genetics and how certain varietals disposals and financial losses for research is needed to address current respond differently to growing farmers. Several comments said gaps in knowledge related to hemp conditions in various geographic producers in rural and remote production and management and to locations. All producers are expected to mountainous areas would be standardize seed. benefit from such knowledge as particularly impacted, since sampling AMS response: Due to the variability information about more stable and agent travel into those areas would in immature plants across producers, consistently reliable hemp varietals States, and Tribes, and the lack of becomes available. Any non-compliant require extra time and expense. consistency across varietals, USDA is plants produced by research institutions Comments described how some States unable to establish or standardize an as a result of research and development developed sustainable hemp oversight approach to dealing with immature will still need to be disposed and programs using risk-based sampling plants for USDA licensees. However, disposal will need to be verified with methodology to support regulatory AMS acknowledges operations that documentation. Research institutions monitoring of hemp growers. They grow hemp for certain purposes that do that handle ‘‘hot’’ hemp must follow asserted these same States would find it not bring plants to their flowering stage CSA requirements for handling difficult to meet the IFR’s sampling like clones and microgreens, may not marijuana. requirement because of a limited budget need to meet the same sampling and to hire and train additional personnel testing requirements as operations that Sampling Agents for sampling all hemp production. grow flowering hemp. The final rule This final rule reiterates that samples Comments reported having to make provides States and Tribes the flexibility of hemp collected for purposes of appointments for sample collection a to consider performance-based sampling testing THC must be collected by week in advance under risk-based protocols to address these concerns. As sampling agents, or by Federal, State, sampling plans and predicted it would allowed under the AMA, States and Tribal or local law enforcement agents be even harder to arrange for sample Indian Tribes can be more restrictive authorized by USDA to collect samples. collection on a timely basis under the and may impose sampling and testing Requirements and training materials for IFR’s requirement that all hemp lots be requirements on these producers. sampling agents are provided on sampled and tested. USDA also acknowledges that USDA’s website. Commenters presented two proposals research institutions face special Third-party Sampling Agents: Some to alleviate this strain—allowing circumstances when conducting hemp comments supported the use of third- producers to collect their own samples research. Accordingly, this rule party sampling agents to help offset the and reducing the volume of farms and provides sampling and testing flexibility cyclical demand for hemp sample plants from which samples are to these institutions and producers collection and to ensure integrity in the collected. working with them to conduct hemp sampling process. Comments noted that Some commenters requested that research under the USDA plan. some State agriculture departments have USDA compile a publicly available Producers that produce hemp for relied on in-house personnel to perform national list of sampling agents.

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Sampling Agent Training: Comments the USDA training, or they may develop Comments generally discouraged highlighted the importance of providing their own custom training. This requiring sampling and testing every lot robust training for sampling agents and decision does not change the for THC since THC concentration is recommended subsequent annual, requirement that designated agents significantly lower in male plants and documented refresher training be collect samples. We are retaining the grain/fiber varietals. Comments from required. Some comments requirement from the IFR that the use of State agriculture departments that recommended USDA develop and third-party agents is acceptable. administer pilot programs under the implement a sampling agent Requiring sample collection by trained 2014 Farm Bill also explained how risk- certification scheme, while others agents ensures that samples are based sampling requirements under suggested States and Tribes retain the collected consistently throughout the their programs function. Comments authority to develop sampling agent industry and no conflict of interest emphasized that a ‘‘one-size-fits-all’’ training. Other comments suggested exists between the sampler and grower. regulation is inappropriate and including a sampling agent training Further, AMS has addressed discourages innovation as there are application on the USDA website. commenters’ concerns about adequate different risk-profiles for hemp based on Other Comments on Sampling Agents: resources by allowing for States and its end-use. Other comments objected to the IFR’s Indian Tribes to design a sampling plan Comments maintained that grain and provision that sampling agents be given in accordance with the AMA and this fiber varietals are less likely than unlimited access to all areas listed in final rule that suits their needs and cannabinoid crops to exceed the THC the producer’s license. Comments resources. Additional discussion of threshold and argued that assessing all claimed that this provision, in addition sampling methodologies and hemp by the same standard may result to the fact that default sampling agents flexibilities is included elsewhere in in strained oversight resources and may also be law enforcement this final rule. inefficiencies. One comment asserted representatives, seems to associate the AMS agrees with the concerns that that THC concentration in varietals now legal hemp industry with potential sampling agents be given unlimited grown for grain is reduced dramatically illegal activity. Comments stated further access to all areas listed in the by the production of seeds in the flower that while State, Tribal, and USDA producer’s license and is clarifying that and, therefore, hemp grown for grain is personnel may require such access for sampling agents need access only to at lower risk of exceeding the THC limit. audits or other purposes, broad access is areas where the hemp is grown and Comments also noted that the flower not necessary for sampling hemp, and stored so they can perform their parts, where a majority of the THC is that sampling access should be limited sampling work. concentrated, do not fairly represent the to cannabis plant material being AMS agrees with comments that THC content of the entire plant, which cultivated as hemp. allowing third-party individuals to is used in biomass and fiber production. Other commenters suggested that become certified hemp sampling agents One State agriculture department sampling agents should be agricultural creates jobs, gives producers greater noted that many of the seed and fiber specialists rather than law enforcement flexibility during the harvest season, varietals being grown in their State were specialists in order to alleviate possible and allows the States and Tribes to originally bred in Canada and have been tension between Indian Tribes and law reallocate resources. The final rule does selected for low THC content as part of enforcement, and would ensure that the not limit sampling agents to law Canada’s hemp program for many years. sampling agents have an understanding enforcement officers and does not Several trade association comments of the agricultural product they are prevent agricultural specialists noted that hemp grain/seed is not a working with. operating as sampling agents. Because source of cannabinoids, and that grain AMS response: AMS agrees with the States and Indian Tribes with approved and fiber varietals are largely developed many commenters that sampling agent plans may approve their own sampling from certified, pedigreed seed that training should be enhanced. agents, USDA encourages States and meets all THC testing standards. Standardized training for sampling Tribes to maintain their own lists of Commenters contrasted that with hemp agents will help achieve regulatory sampling agents. crops grown for cannabinoids, and that consistency. As such, AMS will provide the latter show higher phenotypic training documents for sampling Sampling Methodology variability and lack of uniformity in the concurrently with publication of this AMS posted supplemental Sampling field because they have received less final rule. The revised sampling agent Guidelines for Hemp Growing Facilities focus in breeding programs. One training will establish uniform and on its website. The guidelines describe comment stated that hemp varietals standardized criteria, including sampling procedures, including the grown for cannabinoid production often sampling processes and procedures, to number of cuttings to take for sampling have questionable origins and are at a ensure the sampling agents understand each lot and how to pace a hemp field greater risk of producing higher THC regulatory provisions of this final rule when sampling. A few comments than varieties grown for grain or fiber. and the appropriate processes addressed the Sampling Guidelines and Another comment claimed there are associated with sampling activities. This recommended alternative sample currently no certified varieties of hemp will help ensure that sampling done by volumes and field sampling patterns. for CBD production. different agents will be conducted End-use/risk-based sampling: Many comments agreed that hemp similarly. AMS anticipates this will Comments asserted that hemp sampling grown for cannabinoid production is minimize variances in sampling requirements should differ based on the more likely to exceed acceptable THC practices that may affect the samples crop’s end-use, primarily whether the limits. Data from 2019 submitted with a and ultimately the test results. crop is used for grain and fiber comment showed that 13 percent of Training documents will explain how production or for cannabinoid hemp samples tested exceeded 0.3 sampling agents can meet the sampling extraction. They contended that the IFR percent THC, and all were CBD requirements of this final rule. States requirement to sample every hemp lot, varietals. The comment further and Indian Tribes with an approved regardless of the crop’s end-use, is recommends that certified seed varieties plan may require the sampling agents expensive and burdensome for States, should be sampled and tested from a used by their licensed producers to take Indian Tribes, and individual growers. random selection of hemp grain and

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fiber fields 30 days prior to harvest. For account for producers using certified smaller, with the option for producers to uncertified varieties, it recommends seed, producing hemp for industrial use increase the quantity of cuttings requiring a post-harvest test, as well as purposes, fiber, grain, seed, extraction of collected as they see fit (up to 150 a pre-harvest test of a random selection biomass, and indoor producers growing cuttings per lot). Another comment of fields within 30 days of harvest. plants only in vegetative state for described how contracted labs for their According to comments, those hemp research or resale that pose a low risk state have requested at least 40 grams of crops being grown for cannabinoids for detectable THC content. wet material and up to 60 grams if the should be subject to higher scrutiny and Several other comments suggested licensee is also needing additional more frequent testing. ways USDA could incorporate risk- testing such as heavy metals, pesticides Another commenter cited data from based sampling into the domestic hemp and mycotoxins. the Midwestern Hemp Database 18 production program. Comments One comment reported the results of showing that many publicly available recommended USDA evaluate and a 2019 controlled study where the top varieties are exhibiting a linear (or consider allowing greater regulatory 12 inches of the plant and the top 2 curvilinear) relationship between Total flexibility for States and Tribes to inches of flowering material were CBD (%) and Total THC (%). Given this develop and use risk-based modeling to collected from each of 83 plants, for a presumed relationship, Total CBD guide their sampling and testing total of 166 samples. The samples were percentages are often not able to exceed activities. According to comments, this tested using gas chromatography with 8 percent without exceeding the approach would help offset the flame ionization detection. Test results regulatory threshold of 0.3 percent THC. anticipated strain on resources during showing total delta-9 THC of the 2-inch The commenter said these moderate peak sampling that would otherwise cuttings were, on average, 0.0273 levels of CBD production can have result under the IFR requirements. percent higher than results for the 12- significant impacts on profitability as Two State agriculture departments inch cuttings. The comment interpreted growers and therefore a whole plant recommended that crops produced from the results to suggest that including testing methodology would help to AOSCA-certified seed, which they said vegetation from the entire plant yields mitigate this linear relationship. currently only include grain and fiber lower THC results, and that all parts of Comments identified States and other varietals, be considered low-risk for hemp plants should be sampled because institutions where they think risk-based testing and compliance purposes. producers generally harvest the entire oversight modeling works to ensure Comments said that as more CBD hemp plant. hemp is at 0.3% acceptable hemp THC varietals are developed and certified, One comment reported that their State level. For example, the Kentucky they could also be subject to less requires samples for any size lot to Department of Agriculture publishes a stringent testing protocols. include 30 buds (subsamples) to insure ‘‘Varieties List’’ to track THC content A few comments suggested the there is large enough volume of material across hemp varieties. Comments adoption of a random risk-based to provide for adequate sample testing. characterized this as a useful tool for sampling and testing scheme to reduce Another comment reported that State hemp farmers when planning grower costs and relieve pressure on staff are directed to look at a cultivar production cycles and selecting hemp approved labs by reducing the number and evaluate it for uniformity with varietals. Several comments also and volume of required tests. One respect to maturation, height, color, and described how, at the State level, other comment indicated State hemp basic plant architecture. According to measures support risk-based oversight, regulators have successfully developed the comment, uniformity within a like randomized sampling crops of a sampling requirements for end-use that cultivar results in fewer plants sampled percentage of the total grower ensure adherence to State and Federal than a cultivar exhibiting greater population or the use of risk criteria to regulations, while allowing for phenotypic diversity for the same identify ‘‘high risk’’ growers. flexibilities around State resources. acreage. The comment supported Other comments sought requirements Commenters credited these types of providing States with authority to establishing a minimum number of practices and activities with allowing establish sampling protocols, given the cuttings per lot (e.g., ‘‘5’’ cuttings per lot states to efficiently oversee hemp significant variation in plant counts regardless of size.) For example, one production under pilot programs. Other between fields (on a per acre basis) and comment suggested that when sampling comments described how financial phenotypic diversity within and lots of less than 1 acre, taking cuttings institutions routinely incorporate risk- between cultivars. The comment also of one plant will not allow for a based modeling into the risk assessment recommended that AMS provide representative sample, so a minimum of guidance on a recommended number of of lending decisions, and that similar 5 plants be identified for cuttings. plants to be sampled per unit area, modeling should be adopted by USDA Another comment said that the including the plant density for each for sampling and testing. sampling requirements in the IFR, as Comments argued that subjecting all sample number recommendation. applied to a 170-acre field, could One comment advocated revisions to varietals to the same regulatory require the sampling of as many as 110 USDA’s sampling guidelines. The requirements under the final rule will plants from that field which would be commenter said the State has had to compound logistical challenges to impossible for a state department of deviate from USDA’s sampling table, oversight bodies, strain resources, and agriculture to meet. As an alternative, specifically for smaller lots. According increase costs for low-risk farmers. They USDA might provide a fixed sliding to the comment, taking a sample from said testing based on hemp’s end-use scale (for example, a lot of less than 10 one plant does not provide enough created a more flexible approach to acres requires 5 plants; a lot between 10 material for lab testing, and the State oversight while benefiting the farmer. acres and 20 acres requires 6 plants; and has had to bear the cost of taking a Two state department of agriculture so on) rather than leaving those second sample. The comment comments supported end use or risk- calculations to each state. Alternatively, mentioned that some of the State- based sampling methods in order to another comment explained how their contracted labs have requested at least 18 https://farmdoc.illinois.edu/field-crop- state sampling protocol currently 40 grams of wet material and up to 60 production/hemp/midwestern-hemp-database-a- utilizes the parameters of a minimum of grams, if the licensee is also requesting new-tool-for-hemp-growers.html. 6 cuttings per lot or acre, whichever is additional testing, such as for heavy

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metals, pesticides, and mycotoxins. The USDA finds the data submitted by sampling requirements are not included comment also explained that to keep commenters to be reliable because these in a State or Tribal plan, every lot, and from delivering excess material from States have been growing hemp since thereby every producer must be large lots to labs, inspectors take the the 2014 pilot program started and they sampled and tested. required number of cuttings, then have sufficient data to develop their When evaluating sampling protocols homogenize the sample, keep the sampling plans. AMS agrees with submitted by States and Indian Tribes, required 40 to 60 grams, and leave the commenters that the performance-based USDA will take into consideration remaining sample material in the field. concept is the same method that whether the performance-based factors The comment supported a sampling financial institutions use. Further, the State or Indian Tribe used have the protocol that would provide adequate performance-based programs are also potential to ensure compliance at a 95 testing material without unnecessarily used by other scientific and Federal percent confidence level. USDA overcutting plants material. agencies such as USDA’s Food Safety licensed producers are required to One comment reported results of a and Inspection Service and FDA. comply with the sampling requirements poll they conducted among States after AMS finds that it makes sense to in this final rule. Additional guidance the end of the 2018 growing season. encourage States and Indian Tribes to on sampling for USDA licensees or According to the comment, three consider performance-based alternatives States and Indian Tribes that decide to States—New York, Pennsylvania, and when developing sampling plans. The use these guidelines is available on the Minnesota—reported they had analyzed final rule provides the standard; USDA website at https:// the THC content in microgreens, and however, States and Indian Tribes have www.ams.usda.gov/rules-regulations/ none were found to be above 0.3 percent the flexibility to determine how to hemp/information-sampling. USDA total THC. achieve that standard tailored to their may develop a performance-based One comment reported that their State specific needs. sampling in the future if data is has tested every hemp lot produced in The sampling requirements for State available and if it deems appropriate. Minnesota in the past five years, and and Tribal plans allow for States and Separate rulemaking and comment that hemp grown for grain and fiber has Indian Tribes to develop unique process will be necessary to establish a never tested above the 0.3 percent total sampling protocols for hemp licensees performance-based sampling plan by THC limit. According to the comment, under their jurisdiction. State and Tribal USDA. varieties grown in Minnesota are plans must include a procedure for USDA plans to audit State and Tribal certified varieties found either on the accurate and effective sampling of hemp activities to assess program compliance Health Canada List of Approved that meets the requirements of the final with all Federal requirements, which Cultivars or the European Union’s rule. The method used for sampling includes review of the performance- Organization for Economic Co-operation must be sufficient at a confidence level based sampling implemented by States and Development List of Varieties of 95 percent that no more than one and Indian Tribes. Eligible for Seed Certification. percent of the plants in each lot would One comment reported their State has exceed the acceptable hemp THC level. Sampling Guidance: A comment implemented a risk-based sampling Alternatively, States and Indian Tribes noted that although the sampling frequency schedule, under authorities may design a sampling method that is protocol was issued as a guideline, it provided for in the 2014 Farm Bill, performance-based that ensures, at a appears to be binding with regard to using end-use and certified seed as confidence level of 95 percent, that how hemp must be sampled. The guidance. According to the comment, plants will not test above the acceptable comment said AMS should clarify that official total THC results collected from hemp THC level. This plan must be part there may be other acceptable sampling regulatory samples and formal research of the State or Tribal plan. A procedures that would meet the IFR’s samples showed that hemp grown from performance-based method may sampling requirement. The comment certified seed have a low risk of testing consider: (1) A seed certification process explained further that some States above 0.3 percent. Additionally, the or process that identifies varieties that operating hemp programs under the grain or stalk components of hemp have have consistently demonstrated to result 2014 Farm Bill have established zero to negligible levels of total THC. in compliant hemp plants in that State detailed hemp sampling protocols that The comment recognizes that more or territory of the Indian Tribe; (2) producers are used to and should be research is needed in this area but is whether a producer is conducting allowed to continue. confident that the utilization of hemp research at an institution of higher Another comment appreciated the variety categories to determine the learning or that is funded by a Federal, IFR’s provision that the AMS Sampling department’s sampling frequency has State, or Tribal government; (3) whether Guidelines may need continual been successful to date. a producer has consistently produced updating and refinement as industry, AMS response: AMS agrees that States compliant hemp plants over several academia, and government discover and Indian Tribes need more flexibility years or several seasons; and other new evidence, science, products, and in developing sampling methodologies. similar factors. USDA believes this will innovations. For States and Indian Tribes with provide needed flexibility to States and A comment described the hemp field primary regulatory authority, USDA is Indian Tribes to develop logical and sampling plan they adopted from altering the sampling requirements in enforceable sampling requirements that Florida’s nematode sampling plan. The this final rule to allow performance- take into consideration their unique plan recognizes that nematodes are based sampling methodologies. circumstances. AMS will still require unlikely to be evenly distributed Information submitted by States that States and Indian Tribes to submit their throughout an orchard or field, which participated in the 2014 pilot program individual sampling requirements for would also allow for accurate detection show various ways these States are review as a component of the plan of THC fluctuation within a hemp field. already using performance-based approval process. Sampling protocols The comment said Florida’s sampling sampling. Some States are using a list of submitted by States and Indian Tribes plan is accepted by every State and varieties that work in their geographical must comply with the thresholds country to whom they send citrus plant area while others rely on evaluation on established by the 2018 Farm Bill and material that has been screened for what they consider high risk producers. this final rule. If performance-based nematodes and recommended AMS

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revise the hemp Sampling Guidelines to the comment, since cannabinoids tend stem’’ (that includes the leaves and incorporate Florida’s sampling plan. to increase along the height of the plant, flowers), ‘‘terminal bud’’ (that occurs at A comment said Kentucky requires floral material should be sampled at the end of a stem), or ‘‘central cola’’ (cut cuttings from five plants per lot, random heights from plants rather than stem that could develop into a bud) of believing this standard provides a all from the tops of plants to be the flowering top of the plant. reasonably representative sampling of representative. This is considered appropriate and the plants in each lot. It opposed the Another comment recommended fair to balance the collection of sliding scale in AMS’s Sampling revisions to the Sampling Guidelines to sufficient plant material necessary for Guidelines, saying the sliding-scale provide that sampling agents should compliance laboratory testing while calculation relies upon a decades-old sample fields in a zig-zag pattern. The avoiding the need to cut excessive and pesticide residue sampling regime that comment further recommended that unreasonable amounts of plant material. may or may not be appropriate for AMS revise the Sampling Guidelines to Further, AMS determined this final calculating confidence levels in a hemp provide that three cuttings should be rule must provide some additional plant’s THC levels. The comment taken from every plant sampled, and degree of flexibility for States and asserted the sliding scale formula, that the three cuttings should be taken Indian Tribes in the development of which depends on a variable factor of floral, stem, leaf and stalk material at their sampling plans, which is why as based on historical data, is likely to three different points on the plant. It an alternative, this final rule allows for create state-to-state variations in the argued that floral material makes up performance-based sampling number of samples that must be only 25 to 30 percent of hemp plants methodologies in State and Tribal plans. collected, and would require States with and that, to be truly representative of Flexibilities afforded to States and historically lower rates of non- the sampled plant, the sample should Indian Tribes developing their own compliant THC test results to take more consist of cuttings of all plant materials hemp production plans will allow them samples per lot than those States with from throughout the plant. to incorporate best practices, as those historically higher rates of non- One comment recommended change and develop over time. For compliance, which the comment found requiring that samples consist of a example, States and Indian Tribes can to be illogical. The comment explained minimum of 4 ounces of material to adapt field-walking patterns to various that applying the Sampling Guidelines’ provide an adequate amount for testing. sized and shaped hemp grower sliding scale calculation to a 170-acre Another comment suggested USDA operations. AMS believes that a national field could require the sampling of as research and review multiple sampling standard would be difficult to many as 110 plants from that field. It protocols and select the best among consistently apply given the various went on to say that sampling a single them. grower operations and that standard field under that scenario would AMS response: AMS agrees that ‘‘zig-zag,’’ or letters ‘‘M’’ or ‘‘Z’’ walk overburden available sampling and establishing clear and standardized patterns may not be feasible for sample laboratory staff, make transporting Sampling Guidelines is important for all collection of micro-acreage producers, sample material difficult, and make hemp producers and States and Indian very large scale producers or those with grinding sample material an impossible Tribes with primary regulatory authority polygonal hemp lots. workload. The comment recommended over hemp. AMS issued Sampling As an alternative option, AMS has AMS specify a single number of plants Guidelines and is updating that updated the Sampling Guidelines and to be sampled from every lot, regardless guidance to reflect the changes from the Protocols in conjunction with the of the lot’s size, or publish a fixed IFR to this final rule. States and Indian publication of this final rule. This sliding scale for industry-wide use, Tribes with USDA-approved hemp resource document is available online rather than leaving those calculations to production plans may develop their and offers guidance States or Indian each State. This comment was own sampling procedures that take into Tribes can adopt and incorporate into supported by several state departments account regional and other differences their own USDA-approved sampling of agriculture. and are performance-based, so long as procedures. A comment noted the importance of those procedures meet the requirements moisture content consistency in in the regulations at § 990.3. The Flower Versus Whole Plant Sampling compliance sampling and recommends entirety of the State or Tribal sampling The IFR requires the collection of 8–12 percent moisture content plan, including any guidelines, must be samples from the flower material of standardization. They also noted the included in the State or Tribal plan hemp plants for laboratory testing. need for best practices to be identified submitted to USDA for approval. When Comments: Several comments for drying sample material. developing such plans the State or expressed support for sampling only Several comments said USDA’s Indian Tribe must follow the hemp flowers, as provided in the IFR, sliding scale sampling protocol results requirements of this final rule that relate although many recommended changes in too little a sample for small acreages to where the cutting takes place to the overall flower material sampling and too large a sample for large including only flower material, and the requirements. Those recommendations acreages. Comments asserted, for number of inches necessary for and commenters’ explanations for them example, that one cutting for four acres sampling. Specific to sample size or are addressed in another section of the or less would not be suitable to collect weight of a cutting, AMS does not agree comment analysis. Numerous comments a representative sample and could put that establishing a specific volume is opposed the IFR’s floral material small acreage farmers at a higher risk of prudent given the variances in flower sampling requirement, preferring being violative or not might be sufficient size and densities, and different scales instead composite sampling of the to capture uncertainty related to of hemp production. It would be flowers, stems, stalks, and seeds, and population variability in a newly difficult to consistently sample at an asserting such samples would be more established crop. Another comment said exact weight of plant material across the truly representative of the entire plant that a true representative sample needs spectrum of producers and therefore is and lot. Numerous comments agreed to entail multiple subsamples collected not included in this final rule. Rather, that cannabinoid concentrations are spatially across a field and pooled into AMS specifies a length (approximately higher in the flower than in other parts an average sample. Further, according to five to eight inches) from the ‘‘main of the plant, and many comments

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argued that sampling only floral locations on the plant, not just the top accurate representation of each lot’s material would cause more samples to third as indicated by the Sampling composite marketable hemp product. inappropriately and unfairly test ‘‘hot’’ Guidelines. They explained that Sampling technique: Some comments and lead to unwarranted and costly crop marketable hemp product comes from a cautioned that inconsistent potency disposals. composite of the entire plant, not just measurements may be the result of Several comments said that sampling the top, and asserted that flower divergent sampling approaches and only the flowering material of the hemp material samples should likewise come recommended that USDA provide plant is inconsistent with the definition from the entire plant to ensure the regulatory clarity as to the proper of industrial hemp, as amended by the sample accurately reflects the lot from sampling process. 2018 Farm Bill, which refers to the which it is taken. Comments also voiced A comment encouraged USDA to whole hemp plant. Comments asserted the need for greater regulatory clarity on establish clear numeric designations of that the statute did not limit sampling the size of the floral cuttings due to how much floral material is taken from to floral material and challenged concerns that no regulatory each plant. Comments varied in their USDA’s interpretation of the statutory requirements address floral collection suggestions on sample cut including: 12 sampling requirement. As well, by authorized sampling agents, and inches per plant; cuts from the top and comments argued that requiring variances in types of materials collected bottom 18 inches of a terminal branch sampling of only flowering material may affect test results. of the plant to achieve a more could lead to legal challenges from representative sample; cutting from the producers who would be forced to Cannabinoid Concentrations: top twenty centimeters from the main destroy hemp that may be statutorily Comments described phytochemical stem of the female plant; eight to ten compliant, but not compliant with the characteristics of Cannabis sativa L and inches of the plant’s primary stem; IFR. They recommended that the argued that samples taken from only one whole plant sampling whereby the top regulations provide for sampling the part of the plant are not representative 1/3rd, middle 1/3rd and bottom 1/3rd whole plant and that USDA define the of the whole plant. Some comments are each sampled; and to ground the term ‘‘whole plant’’ to include the contended that flowers at the top of the whole plant—not only the top 1/3rd— flower, stalk, and leaves. plant have higher concentrations of THC as that is not representative of the delta- Some comments stated that sampling and other cannabinoids—by as much as 9 THC level of the plant. only flower material ignores the hemp 30 percent, according to some—than AMS response: The IFR required the grown for seed and stalk end-uses, and flowers elsewhere on the plant. One collection of samples from the flower not for cannabinoids. Comments comment cited a study 19 that found that material of hemp plants for laboratory claimed that sampling and testing only top-only sampling, as prescribed in testing. Following the publication of the flowering material would limit industry many State testing programs, leads to an IFR, AMS made available at diversification in terms of producing overestimation of THC content by nearly www.ams.usda.gov/rules-regulations/ hemp for biomass intended for uses 37 percent. The study stated that to hemp a supplemental document other than THC production. To address better represent total crop THC levels, addressing Sample Guidelines as a this, several recommendations for samples should be taken from the top, reference resource to industry. This revisions to the IFR’s sampling middle, and bottom of plants in equal resource document indicates that hemp requirements were offered. Some quantities. Commenters asserted that samples are comprised of cuttings from comments recommended taking larger sampling flowers from only the top of just underneath a flower material samples from prescribed parts of hemp the plant could lead to incorrect located at the top one-third of the plant. plants that would include other than conclusions about the lot’s compliance Following review of public comment flowering material. For example, both and lead to inappropriate and costly lot from various stakeholders, AMS State departments of agriculture and disposals. determined this final rule will allow for Indian Tribes recommended taking Other comments contended that THC additional sampling methodologies for branch samples from two or more concentrations are not necessarily determining the sample size from the lot specified parts of plants that would higher at the top of the hemp plant. One as described previously under the include flowers, stems, stalks, and comment used data to show that the ‘‘Sample Size’’ discussion. However, seeds, and proposed a range of sample distribution of THC concentrations since THC is concentrated in the flower lengths they considered appropriate, throughout hemp plants is not material of the plant, the flower material from 4 to 18 inches. Some consistent between varieties. It cited a is more appropriate to test than the recommended taking samples of the 2019 comparison study in which 4-inch entire plant. The final rule specified lower part of branches as well as cuttings of floral material from two pre-harvest samples shall be flowering tips from the same plant. hemp varieties were taken from the top, approximately five to eight inches from Several comments urged USDA to adopt middle, and bottom sections of plants. the ‘‘main stem’’ (that includes the leaves and flowers), ‘‘terminal bud’’ risk-based sampling requirements that In one variety, total THC was highest in (that occurs at the end of a stem), or would better align with the intended samples taken at the top, and lowest in ‘‘central cola’’ (cut stem that could end-use of hemp crops, like grain and samples taken from the bottom of develop into a bud) of the flowering top fiber. Other comments recommended plants. In the other variety, total THC of the plant. This aligns provisions of revising the IFR to allow States and varied little between samples from plant this final rule with the common Indian Tribes to design sampling top, middle, and bottom positions. The practices of several States that requirements to meet the particular comment said the data refutes the belief significantly participated in the 2014 needs of producers in their that THC levels are highest at the top of Farm Bill hemp pilot programs. This jurisdictions, like producers who are the plant and supports sampling from decision further balances the need to well experienced with growing hemp all parts of the plant to obtain an and understand the potential to grow a collect a sufficiently large portion of the non-compliant crop. plant’s flower, where THC and other 19 ‘‘THC Distribution in Field Grown Hemp Prior Commenters expressed the widely to Harvest,’’ J. Scott Lowman, Jack He, Mike Clark, cannabinoids are at their most shared view that cuttings for hemp and Mark Gignac; The Institute for Advanced concentrated, and the need to avoid samples must come from various Learning and Research (IALR), Danville, Virginia. cutting a portion of the hemp plant that

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poses logistical challenges to shipment, performing laboratory tests for and post-laboratory activities, or, (a) drying and preparing for laboratory regulatory compliance. squared plus (b) squared = (c) squared, tests. AMS believes this provision will Comments: Several comments noted where (a) is field sampling activities and help standardize sampling across the that not accounting for MU in sampling (b) is laboratory MU. The comment nation. is a potential oversight that should be offered this example: If the in-laboratory AMS considered the differences of addressed in the final rule. Several measurement of uncertainty (b) is pre-harvest vs. post-harvest sampling comments note that field sampling is calculated as 0.0300 percent, and the and determined the most practicable the largest source of variability in any field sampling measurement of way to identify THC concentrations of testing process, due to the choices uncertainty (a) is estimated to be 0.0400 the plant is through pre-harvest individual sampling agents make and percent, then the total measurement of sampling since the floral material is still field condition variability. Comments uncertainty (c) would be 0.0500 percent. intact. Floral material must be intact to argued that there is a wide degree of An institute that commented assure the material submitted for testing variability among individual plants in a discussed research which found that is in fact the flower part of a hemp plant hemp crop and that this contributes to sampling from the whole plant more and it has not been compromised or further uncertainty in field sampling. accurately reflected what was observed mixed with other plant parts. AMS also Due to this uncertainty in the field in a field. The comment explained how considered the many commenters who during sample collection, commenters the current USDA method, which 1 endorsed ‘‘whole plant’’ sampling. AMS suggested that an MU for field sampling analyzes only the top ⁄3 of the plant, concluded that measuring THC be included in the final rule. generates data that is error-prone and concentration through floral material Several State agriculture departments results that likely do not represent the testing is more appropriate and argued that the MU value should actual THC levels that are present in the practicable than testing the entire plant account for variability in the steps that hemp plants in the field as a whole. It because testing the entire plant will occur before a sample reaches the said, for example, in one research field, laboratory. Comments noted the various dilute the THC concentration in the THC levels ranged from 0.06 percent to steps in the field sampling process, such 1 3 sample, except as allowable under 2.46 percent in the top ⁄ plant samples as cutting, bagging, sealing, remediation, as discussed elsewhere in when individual plants were evaluated transporting, and handling, and this final rule. Further, the study cited separately. explained that each increases The research also found significant by a commenter that shows THC uncertainty in the THC testing results variation in THC concentration across concentrations throughout hemp plants before the sample even arrives at the plants, which the commenter attributed are not consistent between varieties laboratory for compliance testing. to the lack of ability of the sampling does not support the use of whole plant Commenters asserted that uncertainty procedure to generate a consistent, sampling because it compares different related to each step in the field reproducible sample from any given plant varieties, not the THC level on sampling collection process should be hemp field. The research found if the different parts of the same plant variety accounted for in the MU. field contains plants that are not where the sample is taken. Accordingly, Several comments argued that, completely uniform in their THC levels sampling the top part of the plant will without a standardized MU for field relative to each other, it is possible that provide the most accurate results. sampling, some hemp crops with this small subsample in any given Since THC is concentrated in the specific end-uses would be analysis could over-represent plants that flower material of the plant, the flower disproportionately impacted. According have higher levels of THC, thereby material is more appropriate to test than to comments, hemp crops grown for leading to failure of the field. On the the entire plant. AMS will modify the cannabinoids show the most phenotypic other hand, equally possible, that sampling requirement to state that the variability and lack of uniformity in the analysis could over-represent plants that sample shall be approximately five to field. Comments said this variability have lower levels of THC, leading to eight inches from the ‘‘main stem’’ that should be accounted for before the passing the field. The research stated includes the leaves and flowers, sample reaches the laboratory. that the most likely result of a sampling ‘‘terminal bud’’ that occurs at the end of One comment suggested following the test is an inaccurate assessment of the a stem, ’’or ‘‘central cola’’ (cut stem that ISO 15189 standards that take into total THC levels based on the method could develop into a bud) of the account uncertainty sources during the used to sample the plants in the field flowering top of the plant. AMS believes analytical phase where the and then prepare them for extraction. this consistency will help establish a measurement actually occurs. Several A comment from a private laboratory level playing field for all U.S. hemp comments requested that USDA noted that when field sampling and pre- producers. The Sampling Guidelines establish a standardized method of analysis handling and processing is issued concurrently with this rule calculating uncertainty resulting from done properly and uniformly, the pre- includes additional details. sample collection procedures and for analysis measurement uncertainty can AMS also includes additional uncertainty in laboratory testing be reduced to 5–10 percent. The flexibilities for disposal and methods. One comment noted that comment suggested that test results remediation of ‘‘hot’’ hemp that would USDA’s Sampling Guidelines do not might be more consistent and uniform reduce the costs to producers. These are require the USDA-approved sampling when collecting samples in a ‘‘W’’ discussed later in this final rule and in agent to communicate to the laboratory pattern with a minimum of 10–15 separate guidelines published anything related to crop variations or individual cuttings taken from the top concurrently. the agent’s sampling methodologies that and middle third of the plant. may contribute to uncertainty in testing Measurement of Uncertainty (MU)— Some comments recommended USDA the hemp crop for compliance. Field Sampling conduct or fund a study to determine A comment suggested a method for appropriate requirements for calculating The IFR did not address the subject of calculating MU that would include pre- sampling uncertainty. uncertainty when conducting field and post-laboratory activities: MU AMS response: AMS appreciates the samples and only speaks to the would be calculated as the square root different suggestions submitted by measurement of uncertainty in of the sum of squared values for pre- commenters on ways to handle potential

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variability and uncertainty associated Federal, State, local, or Tribal law would strain existing resources and with sampling. AMS recognizes that a enforcement agency or their designee. make it difficult to return results to variability in sampling may contribute Comments: Numerous comments farmers in time to complete harvesting to the overall uncertainty of the final expressed opposition to the 15-day post- within the 15-day window. One result. For reasons explained below, sample harvest window. Comments commenter from a private laboratory AMS in unable to adopt a national argued that a 15-day window is too also noted the strain on human standard for calculating the MU for short and urged AMS to make it longer, resources this would create to oversight sampling. However, States and Indian providing several examples of activities because laboratory employees Tribes, may include one in their State or anticipated difficulties with the 15-day are required to accompany sampling Tribal plan as part of their performance- window. agents through the sampling process based alternative method for sampling According to comments, the 15-day within the window. Other comments under § 990.3(a)(2)(iii). sampling window in the IFR did not noted a possible shortage of available In order to develop a standardized allow enough flexibility to reckon with farm workers during a tight harvest approach to sampling MU, a sampling adverse weather conditions that could window. plan must first be well-established, delay or preempt field sampling and Comments from Indian Tribes stated standardized, and studied to accurately harvest activities. Comments said that that the requirement to test within 15 account for uncertainty differences in isolated producers and others with days prior to harvest by DEA registered sampling methodologies. To measure limited access to harvest machinery laboratories is not practical for Indian uncertainty of the complete process, might not be able to complete harvests Tribes, explaining that many Indian from primary sampling through within 15 days of sampling if weather Tribes were moved to desolate lands analytical determination, all steps in the prevents them from getting into the where growing crops is hampered by process must be included. There are fields. Comments also noted that in location, quality of the land, available many intermediary steps that must be some hemp production areas, climate water and infrastructure, and access to measured, such as sampling conditions, changes are trending toward wetter ready transportation. Further, Indian harvest seasons, with frequent and sample preparation, sample Tribes said growers are hampered by the catastrophic flooding in recent years. preservation, and transportation, all of economies of size. Comments suggested Other comments provided examples of which are not always present and/or that in much of the Indian Tribe climate variations across the U.S. and completed the same each time sampling territories, Tribes will not be able to explained that the 15-day window is not occurs. States producing hemp under develop large farms that reduce risk. the 2014 Farm Bill have developed uniformly suitable for all regions, some Many comments recommended sampling plans that vary widely; of which may be more prone to early increasing the sampling window to 30 sampling MU is not something that can freezes and other conditions that could days. Some suggested that producers be be easily studied, calculated, or broadly forestall a timely harvest or force standardized. Due to the variability in producers to harvest before receiving allowed to harvest before the return of sampling across producers, States, and test results in order to save their crops. laboratory results, but not be allowed to Indian Tribes, and the lack of available Comments also pointed out that a 15- release product until test results are data, USDA is unable to establish or day window does not adequately obtained. One comment added that standardize a specific MU value or accommodate a commonly employed allowing post-harvest testing would boundaries (upper or lower) for general two-phase harvest technique, wherein incentivize farmers to monitor their use. farmers first harvest the seeds and crops prior to harvest in order to In the future, standards organizations, flowers and then the plant’s stalks. minimize the need to destroy crops. such as ASTM International through Comments additionally stated Another comment recommended that all their Committee (D37) on Cannabis, will logistical challenges related to sampling hemp testing labs be required to return be establishing sampling standards that on larger hemp farms or farms with results to growers within 15 days of States, Indian Tribes, and producers several varietals. They asserted that the receiving samples. Other comments could use to improve or help control number of required samples greatly proposed revising the regulations to sampling uncertainty. USDA also increased under the IFR from what was require only that harvest commence, recognizes that States and Indian Tribes required under most State administered rather than be completed, within the may have or will conduct their own pilot programs, and that collecting, specified period following sampling. study of the sampling uncertainty drying, and submitting samples for Data on compliance testing from within their States or territories taking those additional lots will be very North Carolina 20 cited a recent study into account the conditions that may difficult within the 15-day window. A showed an average of 12.65 days taken affect sampling. Those States and Indian commenter stated that, in 2019, to receive test results, with a range of Tribes may be able to calculate or Colorado sampled only 23 percent of all between 2 days and 41 days. It estimates standardize the MU for sampling within registered hemp lots within a 30-day that 50 percent of growers would begin their States and territories. For those sampling window under the pilot to harvest before receiving the results of reasons, States and Indian Tribes may program, while under the IFR their THC compliance test and 22.5 incorporate a sampling MU as part of an requirements, they would need to percent would complete their harvest alternative method for sampling under collect more than four times as many without receiving their results. § 990.3(a)(2)(iii). samples in half the time. Another State department of Many commenters—from producers, agriculture said it has been operating Post-Sample Harvest Window state departments of agriculture, and their pilot program utilizing a 25-day The IFR required testing for total Tribal governments—anticipated harvest window but noted that 25 days delta-9 tetrahydrocannabinol bottlenecking delays at laboratory has proved an insufficient amount of concentration levels and sampling for testing facilities due to the limited time in their experience managing their such testing was required to occur number of DEA-registered laboratories pilot program. They recommend the within 15 days prior to the anticipated available to provide testing. Comments harvest of cannabis plants. The IFR from laboratories agreed that the 20 https://beta.regulations.gov/comment/AMS-SC- required sampling to be conducted by a increased demand for hemp testing 19-0042-5294.

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final rule utilize, at minimum, a 30-day claims that the State does not have the university that showed different sampling window. financial capability or staff resources to cultivars of hemp accumulate A State extension service cited data ensure sampling can be achieved at cannabinoids at different rates and at from the Midwestern Hemp Database every field within the optimal and different times in plant maturity. Study and reports from Rock River Laboratory correct time. data showed that some cultivars can which shows that 68 percent of the Data analysis provided by North rapidly accumulate THC and CBD, with requests for THC compliance testing Carolina State University 21 evaluated weekly changes of as much as 0.1 were submitted during the period of the 2018–2020 turnaround times for labs percent THC and 1.5 percent CBD in September 8th–October 1st and note reporting THC test results to growers on some cases. The study found that the this will create a tight peak window 3,317 lots. The analysis found that in rates of THC and CBD accumulation during which samples will be 22.5 percent of cases, growers would were parallel in the four cultivars submitted. Due to this peak timeframe have had to commence harvest with no studied, with the CBD:THC ratio staying of compliance testing needs, several knowledge of their test results to meet consistent around 24:1. The study State departments of agriculture note the 15-day harvest window requirement concluded that given the rapid rate of that during these peak times there will in the IFR. The comment asserted that change in cannabinoid levels, samples be staffing shortages, delays in in reality, growers would need lab taken 2, 3, or 4 weeks prior to harvest sampling, delays in analyzing material, results in 10 days or less in order to may not accurately reflect the delays in the reporting of results and make informed harvest decisions, in cannabinoid profile of the harvested delays due to unsuitable harvest which case they assumed approximately material. The study further concluded conditions. 50 percent of the state growers would that a larger harvest window increases Another State department of have had to start harvesting without the likelihood that non-compliant plant agriculture recommends that certified knowing their test results. The comment material will be harvested and seed varieties should be sampled and referenced NCSU farm cost studies that potentially rejected at market, costing tested from a random selection of hemp showed farmers with some equipment at the grower the additional expense of grain and fiber fields 30 days prior to their disposal will spend approximately harvesting. harvest. For uncertified varieties, it $14,000 per acre on hemp cultivation. AMS response: AMS recognizes recommends requiring a post-harvest Noting that of those costs, seed/plant weather and climate-related factors test, as well as a pre-harvest test of a acquisition and labor are the greatest affect all cycles of agricultural random selection of fields within 30 expenses, the comment asserted that production including pre-planting, days of harvest. harvest is the most labor-intensive planting, management, and harvest. One commenter discussed data activity, and that requiring farmers to AMS also understands these factors may showing that different cultivars harvest without knowing whether their vary by region from year to year, and accumulate cannabinoids at different hemp crop is compliant or marketable that certain conditions might cause rates and at different times. Given the puts them at great financial risk. The some farmers to alter their normal rapid changes in cannabinoid levels, the comment recommended extending the harvest timeframe as a result of factors comment said its data highlights the post sampling harvest window to 30 beyond their control as mentioned in challenges of scheduling pre-harvest days to reduce financial risk for farmers. several comments. It is common regulatory samples and harvest dates. A comment from another state noted agricultural practice to harvest crops Finally, a few comments asked for that given the State’s size and taking into consideration weather clarification about the 15-day window. geography, distances between hemp patterns such as rain, wind or freezes. Some said it was unclear whether production sites could be greater than Producers also harvest crops based on harvest must commence or be 2000 miles, making the 15-day sample- the availability of labor and completed within the window. Others to-harvest window impractical for them. transportation, crop rotation and market asked whether a producer is prohibited The comment recommended allowing demand among many factors. A 15-day from harvesting before testing is States and Tribes, who are better aware harvest window may not allow completed. One comment stated that the of their geographies and resources, to producers the flexibility needed to take 2018 Farm Bill does not contain a determine their own windows, up to 30 all these factors into consideration. timing requirement. days. AMS considered the impact of the 15- One comment reported that their One comment reported the State has day window on resources needed for current sample-to-harvest window is 25 three inspectors geographically sampling and testing activities. We days, and that it does not appear to be dispersed throughout the State, acknowledge that sample collection may long enough to sample all the State’s servicing approximately 200 farms require an authorized sampling agent to outdoor hemp crops maturing harvesting within the same 8-week time visit multiple farms of varying sizes concurrently. period. The comment advocated over a very short period of time. AMS One comment reported that the IFR’s extending the harvest window to 30 further understands that in some places, 15-day harvest window is not feasible to days to cope with unforeseen weather the sampling agent may visit a farm on implement and puts incredible stress on events, extended travel, lab turnaround, multiple occasions due to the size and the developing State’s hemp industry. resampling and testing, and other harvest cycle of the farm. AMS also According to the comment, the State delays. considered the turnround time for applied a 30-day sample-to-harvest One comment contained preliminary producers to receive results from window during the four years it findings from an ongoing 2020 study 22 laboratory testing. participated under the 2014 pilot conducted by a state and a state This final rule allows farmers to program. During the 2020 growing commence harvests before receiving test season, the State reported it has 21 Ibid. results, as did the IFR. However, crops struggled to sample and test the 5,809 22 Pearce, Bob et al. Sequential Sampling of Four may not be released in commerce or acres and 1.46 million indoor square Hemp Cultivars for Cannabinoids—2020; University further processed until tests confirm of Kentucky, College of Agriculture, Food, and feet that comprise the fields and Environment and Kentucky Department of that the lots in question are compliant facilities of the State’s 700 licensed Agriculture. https://beta.regulations.gov/comment/ with the regulations. Harvests must be growers within 20 days. The comment AMS-SC-19-0042-5762. completed within the 30-day timeframe

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provided by the final rule. AMS does accreditation should also be required for added that incorporating ISO standards not believe harvests should occur after hemp testing labs. Specifically, AMS into LAP accreditation lends confidence that time because, generally, total THC asked about accreditation through in testing procedures and results, which levels continue to increase with time AMS’s LAP, through the ISO standards in turn creates a fair marketplace for and there is too great a risk that the (ISO 17025), or through both, and if so, hemp. They asserted that the benefits of levels would increase after 30 days and which would be preferable. LAP accreditation outweigh the costs thus the sample that was tested would Comment: Comments reflected a because they emphasize quality controls not be an accurate reflection of the total range of views across the industry, both and accurate analytical performance by THC of the harvested crop. in support of and opposition to knowledgeable and trained staff. One Regarding comments on laboratory additional laboratory certification comment suggested that using LAP- resources, AMS considered input from requirements. In general, commenters approved labs would facilitate USDA’s our Science and Technology Program, preferred more regulatory flexibility to hemp program oversight and the which conducts laboratory testing for address the widespread concern of development of an evidence-based data numerous agricultural commodities and insufficient laboratory capacity as a tracking system. Another comment oversees our third-party laboratory result of laboratory certification/ pointed out that LAP offers growers a approval program. AMS assessed testing registration/accreditation requirements complete online listing of qualified labs activities, which include the receiving, imposed by USDA regulation. from which to choose. selection, drying, processing (through Supportive of LAP and ISO: Some Some comments argued against liquid or gas chromatography), analysis, comments supported requiring adopting LAP accreditation, saying the storage, and reporting of hemp test additional accreditation through both accreditation process is expensive and results. AMS considered the time LAP and ISO. Comments explained that burdensome for laboratories, and that necessary to ship samples to the LAP accreditation imposes analytical the user-fee program benefits only laboratory and to issue test results back standards and limits that ensure reliable USDA. One comment said that it is to the grower, recognizing that not all and consistent results across hemp labs, unclear from the IFR how LAP differs farms have readily available internet to while ISO 17025 accreditation ensures from ISO and whether LAP expedite receipt of electronic laboratory that labs adhere to their own established accreditation offers more confidence in notifications. Standard mail may be the protocols. Comments asserted that test results than ISO accreditation. primary means of communication for additional accreditation is essential to Another comment said that LAP rural populations in certain regions and ensure that laboratories, government accreditation would be redundant to Tribal lands. AMS also considered the entities, and farmers comply with ISO accreditation and is not necessary. level of routine work at testing facilities regulations. One comment that Some comments favored the use of across the nation and their capacity to supported requiring both accreditations laboratories with ISO 17025 efficiently process hemp samples while said the scope of the ISO 17025 accreditation in addition to or instead of continuing unrelated, non-hemp standards should include hemp testing DEA-registration. Comments noted that laboratory activities. AMS agrees that it methods. hemp laboratories in many States may be difficult at the peak of the One comment said requiring LAP already have ISO accreditation, season for high-volume laboratories to and/or ISO accreditation in conjunction although some are not DEA-registered. consistently issue timely results to with DEA registration is a step in the They suggested use of those labs should growers, as producers experienced and right direction because current be grandfathered into approved hemp DEA acknowledged, impacting growers’ standards are subpar and do the production plans. Some comments ability to make harvest decisions. industry a disservice, while adding LAP asserted that between LAP- and ISO- Based on comments received and and/or ISO accreditation would provide accreditation, ISO is the best alternative knowledge of agricultural practices, a baseline standard that benefits all for the hemp industry because it meets AMS determined that the post-sampling stakeholders, including consumers. the needs of the hemp industry, and at harvest window should be extended to Either LAP or ISO: Other comments a reported cost of $25,000, it reduces allow hemp harvests to be completed advocated requiring additional unnecessary expense and regulatory within 30 days after sampling. AMS accreditation through either LAP or ISO, burden for labs and growers. One believes allowing the additional time but not both. Comments said that comment recommended that USDA will provide flexibility for dealing with requiring one or the other would be specify that the most current ISO 17025 unforeseen weather events and other adequate to provide testing integrity, but standard be required for accreditation— agricultural factors, and better that requiring both would unnecessarily the 2017 version. accommodate complicated harvest overburden labs and create a testing Neither LAP nor ISO: Several processes. AMS also believes this will bottleneck as labs worked toward comments opposed requiring additional reduce strain on testing resources and accreditation. One comment said that laboratory accreditation on top of DEA- ensure test results can be returned to since hemp products are consumable, registration. Some comments called it growers on a timely basis. public health and safety should be of ‘‘overkill,’’ and said requiring additional paramount concern when choosing a lab accreditation would put an undue strain Laboratory Accreditation—Laboratory accreditation program. on laboratories and delay testing and Approval Program (LAP) and Comments supporting LAP reporting results for growers. International Standards Organization accreditation specifically said such None of the Above: Several comments (ISO) accreditation would improve grower opposed specifying any particular The IFR required hemp growers to access to qualified labs and would laboratory registration or accreditation obtain testing from DEA-registered improve the efficiencies and protect the and recommended instead that States laboratories to ensure proper handling, competitive interests of non-DEA labs. and Indian Tribes be authorized to disposal, and reporting of samples that Comments favoring LAP accreditation determine appropriate standards for exceed allowable THC limits for hemp pointed out that LAP already hemp testing laboratories under their and may therefore be controlled incorporates ISO 17025 standards and respective production plans. Comments substances. As part of the IFR, AMS includes regular audits and records said that allowing States and Indian asked stakeholders whether laboratory management requirements. Comments Tribes to determine their own lab

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certification schemes would allow them Recognition Agreement (ILAC MRA) Another comment agreed with DEA to maintain appropriate testing signatory accreditation body), because it lab registration, saying that otherwise, capability while finding the best fit for will help ensure lab results are more any lab could be handling controlled the economic profile of their regulated accurate, ISO 17025 accreditation substances without observing stringent jurisdictions. One comment suggested requires significant time and financial DEA requirements. The comment USDA encourage laboratories to commitment to pursue and maintain. argued that allowing any lab to test participate in the Hemp Proficiency This it is most challenging for smaller hemp creates an unfair business Testing Program established by the and start-up labs. The initial advantage for non-DEA labs that do not University of Kentucky, rather than accreditation can cost $5,000–$10,000 have to pay high costs of maintaining building an accreditation program from (and in some case more) and yearly DEA registrations. Further, those non- scratch through LAP. ongoing costs are $3,000–$8,000. DEA labs would be handling controlled Other Alternatives: One comment Smaller labs may not have the resources substances inconsistent with Federal asked USDA to clarify why any to pursue accreditation in a timely law. additional accreditation should be manner or they may have to spend more More commonly, comments opposed required. Another comment suggested time and money for consultants to assist the DEA-registration requirement for that if laboratory accreditation is them in setting up a quality hemp testing laboratories. Commenter necessary, AMS should explore the management system and to navigate the concerns were as follows: most cost-effective choice from among application and audit processes. Logistics: Numerous comments stated LAP, ISO, or other commercial Based on this input, AMS will not there are not enough DEA-registered accreditations to minimize costs for require USDA administered lab labs to handle the volume of samples growers. A comment suggested that approval program or require ISO 17025 required under the IFR’s sampling and DEA-registered labs not be required by accreditation because doing so would testing regulations. Comments predicted the rule but be allowed as backups for increase the financial burden on that such limited capacity would labs with other accreditations. Another producers and reduce the availability of exacerbate existing bottlenecks, greatly comment speculated that if only LAP or laboratories that can test for THC level increasing the likelihood that THC ISO accreditation were required, and in hemp. AMS is committed to continue levels in sampled crops would continue DEA registration was not, growers looking into this option. to rise while farmers wait for test would test their crops more frequently. results. Several comments noted that the DEA Laboratory Registration Some comments recommended that no IFR allowed farmers to harvest sampled Requirement specific accreditation be required crops before receiving test results, because the process is too costly and The IFR required that laboratory however many prefer not to expend time consuming and would discourage testing of hemp for the purpose of time and money harvesting a crop that labs from participating in the program. determining compliance under the might not be marketable. Comments also One comment suggested that USDA program be conducted by laboratories anticipated growers’ testing fees would encourage labs to adhere to ISO 17025 appropriately registered with DEA. increase to cover the addition of testing standards, but not require accreditation. However, on February 27, 2020, USDA resources at existing DEA-registered Some comments suggested that LAP announced guidance delaying the labs. accreditation would be beneficial to the requirement to use laboratories Some comments noted that not all industry, but that such a program registered with DEA for testing. Under States or Tribal lands have DEA- should be developed incorporating the this guidance, testing can be conducted registered labs within or near their expertise of former DEA or other by labs that are not yet DEA-registered boundaries. According to comments, chemists with experience testing until the final rule is published, or Oct. where DEA labs do exist, they are cannabis. Other comments supported 31, 2021, whichever comes first. This generally located in urban areas at some using ISO-accredited labs until LAP deadline was later extended to distance from rural farms. They accreditation can be fully developed December 31, 2022. This change was explained that the scarcity of DEA- and used on a trial basis to gather intended to allow additional time to registered labs in reasonable proximity adequate experience and data. One increase DEA-registered analytical lab to farms will increase costs for comment suggested allowing States, capacity. transporting samples and increase the Tribes, and USDA to contract with Comments: A few comments turnaround time for obtaining test commercial labs or use private labs that supported the DEA-registration results. Some comments submitted by adhere to ISO standards. requirement. Some comments favored Indian Tribes also asserted that the DEA AMS response: AMS noted that dual laboratory accreditation (e.g., DEA had failed to consult with Tribes about commenters generally preferred more and ISO 17025 accreditation or DEA and its accreditation process and that it regulatory flexibility to address the AMS LAP accreditation) saying that failed to timely respond to Tribes’ widespread concern of insufficient such combinations would assure requests for lab results. laboratory capacity as a result of technically competent, unbiased testing Accreditation: Comments said that laboratory registration requirements and results reporting. One comment DEA-registration is costly and time outlined in DEA regulations. Adding agreed with DEA lab registration but consuming for laboratories and that ISO 17025 or other accreditation said that labs that have applied for DEA such expenses would discourage requirement to laboratories would registration by Nov 1, 2020, should be existing labs from seeking DEA decrease the number of laboratories allowed to continue testing (as under registration. One comment said that available to perform hemp tests. AMS pilot programs) as the certification DEA accreditation is too expensive to be also noted some commenters opposed process takes so long. It further observed required for ‘‘low-level THC testing.’’ accreditation requirements due to cost that while the IFR seemed settled on Comments suggested alternatives, implications and additional burden. HPCL as the testing method, the rule including: While we strongly encourage does not specify the detection method • Allow testing by labs accredited laboratories to be accredited to ISO/IEC as it should. The comment under ISO 17025 17025 (by an International Laboratory recommended mass spectrometry as the • Allow testing by labs approved under Accreditation Cooperation Mutual most accurate. AMS’s LAP

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• Allow testing by labs accredited by about an IFR published by DEA and that such accreditation or have the financial States or Tribes the rule by DEA could inadvertently backing of large, vertically integrated • Allow testing by labs accredited criminalize hemp at various stages of its companies to enable them to do so. under other accreditation programs production process. They encouraged Comments recommended that existing • Allow testing by labs with dual USDA to eliminate DEA’s involvement. State, Indian Tribe, university, or other accreditation (e.g. DEA and ISO, or Comments also said DEA involvement Federal labs with demonstrated ability DEA and LAP) in USDA’s program discourages to perform testing according to USDA • Allow continued testing by labs participation by laboratories and by standards be allowed to do so, thus approved to do so under the 2014 growers, neither of whom may care to providing opportunities for more Farm Bill risk prosecution for inadvertent interested participants and keeping • Allow for a transition period to allow criminal acts if a test result indicates testing costs down for growers. Some labs time to work toward registration they raised or possess a controlled comments suggested USDA contract One comment suggested that allowing substance. Some comments said private with State, Tribe, or Federal labs to for alternative laboratory accreditation labs with ISO or other accreditation provide required testing. Other would increase competition between don’t want to obtain DEA accreditation, comments recommended capping costs labs, reduce costs for growers, and fearing the tension it will cause between for DEA-registered lab testing at $25– reduce the potential bottleneck created themselves and their grower customers $50 per test. by allowing for only DEA-registered lab because of the requirement to report Alternatives: One comment asked potential criminal activity. Other USDA to clarify whether all testing. comments said growers fear independent labs must be DEA- Another comment argued that repercussions related to possible felony registered to test hemp or whether only although accreditation is costly, relying prosecution for growing crops State labs needed to obtain that on it could help enforce strict standards considered illegal, including loss of accreditation. and ensure less variability between chemical application permits that allow AMS response: In consultation with testing labs. Some comments suggested them to manage other crops. One the Department of Justice, AMS USDA fund accreditation of private labs comment argued that it isn’t necessary determined it must retain the to help offset the cost of expensive to involve DEA in hemp testing, that it provisional requirement that accreditations and encourage more labs distracts that agency from other vital laboratories testing hemp for the to seek necessary accreditation. Federal work. purposes of regulatory compliance be Other comments suggested DEA According to some comments, most registered with DEA. This requirement expedite its lab approval process and DEA-registered laboratories are crime further extends to any laboratory testing make it easier for existing labs to obtain labs that do not offer commercial testing hemp throughout the growing season to DEA registration. services. As reported by a State, the informally monitor THC concentration. Other commenters stated that the DEA DEA may be reluctant to even visit—let The basis for this determination is lab accreditation process requires State alone approve—certain laboratories rooted to the statutory requirements of approval and not Tribe approval and because of the handling and testing of the Controlled Substances Act (CSA), that this is unworkable because of marijuana, although considered legal by which requires any laboratory that occasionally difficult relationships the State. Other States with legal might potentially handle a controlled between some Tribes and States and medical and/or recreational marijuana substance to undergo the DEA because hemp is prohibited in a couple provisions commented that their labs registration process. The CSA states that of States. may not want to seek DEA registration it is unlawful to possess a controlled Finally, several comments because they choose to focus on substance (21 U.S.C 844) and requires recommended AMS provide a phase-in marijuana testing. Some comments said any laboratory that might potentially period of as much as two years to allow labs that handle marijuana may not in handle a controlled substance to existing labs to continue hemp testing fact obtain DEA registration, thus undergo the DEA registration process while they work toward DEA laboratory capacity to process hemp (21 U.S.C. 822) with a few specific registration so the industry will have samples at the volume and speed exemptions. Further, 21 CFR 1301.13 access to adequate testing options required by the IFR may not materialize. includes categories that require during its development. One comment assumed DEA- registration with DEA, including DEA and Controlled Substances: registered labs might test only for chemical analysis where laboratories Comments expressed concern about cannabinoids, while other commercial fall. many aspects of DEA’s involvement labs would be able to perform additional AMS is aware through stakeholder with the hemp program. Comments testing, for instance for microbes, heavy comment that many stakeholders argued that hemp is a legal agricultural metals, and pesticide residues, saving oppose the DEA registration commodity under the 2018 Farm Bill growers the additional expense of requirement. AMS is also aware of and requiring testing by DEA labs multiple tests. widely held concern among insinuates hemp is a controlled Some comments recommended USDA stakeholders, especially Indian Tribes, substance regulated under the waive the requirement to use DEA- that an insufficient number of DEA- Controlled Substance Act. Commenters registered labs in States where registered laboratories exist and have asserted that treating hemp as a recreational marijuana is legal, thus limited accessibility to those in rural or controlled substance exceeds the intent increasing the number of labs available regional locations away from of the 2018 Farm Bill. Comments also for hemp testing. Other comments metropolitan areas. AMS understands suggested USDA’s IFR impeded recommended DEA change its standards how this combination of variables leads Congressional intent to foster the to allow labs that handle legal marijuana to delays in sample processing by DEA- development of a new agricultural to also handle hemp. registered laboratories and how this sector. Cost Management: A few comments affects producers’ harvest timetables. One commenter representing a suggested that restricting hemp testing AMS also knows that since the IFR was processor of hemp, specifically for CBD to DEA-registered labs creates a published, numerous laboratories have products, said they were concerned monopoly among labs that already have applied for registration and DEA is

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working diligently to process these Measurement of Uncertainty (MU)— Comments from States that requests. For this reason, DEA is Laboratory Testing administered pilot programs under the delaying enforcement of this The IFR required that laboratories 2014 Farm Bill offered several requirement until December 31, 2022. calculate and include the measurement suggestions on approaches to MU AMS anticipates this delay will provide of uncertainty (MU) when they report calculations. A comment recommended adequate time for testing facilities to THC test results. using laboratories participating in the obtain DEA registration. Comments: Several comments University of Kentucky—Division of While we understand the expressed support for requiring that the Regulatory Services’ Hemp Proficiency commenters’ concern about DEA MU be accounted for when testing the Testing Program to establish an MU involvement, the 2018 Farm Bill THC concentration of hemp due to the through a set of guidelines rather than distinguishes hemp from marijuana, a variability in laboratory testing in the rule. The commenter concluded controlled substance under DEA’s equipment and complex mathematical that the Hemp Proficiency Testing regulatory authority, based on the THC principles involved. Comments Program could be tasked with concentration level in the cannabis generally emphasized that the inclusion calculating and announcing an MU that plant. Although a producer may have of a standardized MU was needed for would be used for compliance testing intended to cultivate hemp, it is the industry to develop, as hemp purposes on a nationwide basis. The possible that the plant is marijuana farmers should not be exposed to risks comment added that including the MU because of the THC concentration level. of economic loss that are created by in the guidelines rather in the rule If that is the case, the producer would mathematical inconsistencies within an would allow it to be refined over time then be subject to DEA regulations and individual laboratory’s computations. as instrumentation and calculations jurisdiction. USDA coordinated with Several comments emphasized the develop, rather than having to modify the hemp regulation. DEA so that producers that importance of USDA clarifying the Some comments advocated having inadvertently produce marijuana may be method for MU calculation in the rule because it is part of what determines multiple testing methodologies to able to take remediation steps consistent choose from and including requirements with DEA’s regulations to avoid whether hemp must be disposed. One commenter cited a study 23 that for calculating MU for each method. potential criminal liability. Other comments recommended that Additionally, the 2018 Farm Bill makes found that test results on samples from each field sent to five different labs instead of requiring a specific MU, clear that negligent production of hemp USDA should determine a maximum will not subject the producer to criminal deviated significantly, ranging from a low of 22 percent deviation to a high of threshold for allowable MU value. enforcement activity. See 7 U.S.C. Comments argued that a maximum 1639p(e)(2)(C). 41 percent depending on the field. Some comments expressed the need threshold would prevent forum AMS also acknowledges that some for a standard, specific MU in the final shopping by consumers looking for laboratories believe the DEA-registered rule to prevent licensees from laboratories with the most lenient MU laboratories are crime labs that do not ‘‘shopping around’’ for laboratories with ranges, but still allow laboratories to use offer commercial testing services and the most lenient testing. Comments their own calculations. One comment DEA may be reluctant to approve noted there is no universally accepted recommended revising the MU laboratories because of the handling and way to calculate MU, so differences in provision of the IFR to include a testing of marijuana, although MU values used by various laboratories maximum uncertainty level that considered legal by the State. However, are just as likely to result from laboratories cannot exceed and AMS does not have any information that differences in calculation method as suggested the maximum uncertainty would support this belief. AMS is aware they are from differences in instrument value should be one-third or less of the that DEA continues to add laboratories quality or use. Several comments target uncertainty. Another comment to their approved list. explained that the lack of a standardized suggested USDA use guidelines from the Accordingly, any laboratory testing MU in the rule incentivizes inaccuracy United States Pharmacopeia for determining THC concentration, which hemp for purposes of regulatory by potentially driving customers to include calculations for significant compliance must be registered by DEA laboratories willing to use MUs with to conduct chemical analysis of figures such as MU. greater ranges. A comment asked USDA to clarify the controlled substances (in accordance Many comments advocated specifying role of significant figures in using MU with 21 CFR 1301.13). Registration is an MU to create uniformity in testing to determine total THC concentration necessary because laboratories could across the nation. One comment noted because, they argued, in both of the potentially handle cannabis that tests that variation in MU values could be IFR’s examples for determining above the 0.3 percent concentration of problematic for interstate commerce and compliance, the lower end of the range THC on a dry weight basis, which is, by result in a hemp crop that is compliant can be written as 0.3 percent, if definition, marijuana and a Schedule 1 in one state being shipped to another rounding to match significant figures. It controlled substance. Instructions for state where it would be considered laboratories to obtain DEA registration, suggested requiring the lower value of noncompliant. Other comments argued the THC calculation distribution range, along with a list of approved that it may be too soon in the scientific laboratories, are available on the USDA which accounts for uncertainty, to be process for USDA to include a standard less than or equal to 0.30 percent rather Domestic Hemp Production Program MU because laboratories, particularly in website. than 0.3 percent. States that didn’t previously have One commenter stated that for the Laboratory accreditation options are cannabis programs, haven’t had time to cannabis plants exceeding the discussed earlier in this rule. USDA do the research necessary to determine acceptable THC levels, USDA should does not have any authority over the an appropriate MU. incorporate a MU for laboratory DEA’s laboratory accreditation process. deviation of .0500 percent for the many 23 Evaluation of methods used to sample hemp for DEA’s IFR published August 21, 2020, regulatory compliance testing;’’ Gang, David R. and different variable ways that a sample (85 FR 51639) is out of the scope of this Anna Berim; Washington State University, Pullman, arriving at a laboratory could result in final rule. WA; 2020. an inaccurate test. This includes cutting,

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bagging, sealings, transporting, This may encourage labs to adopt the compliant plant material. Further, a handling, and other pre-laboratory maximum MU as their MU, rather than comment from an Indian Tribe noted activities. drive for a smaller uncertainty. USDA that requiring crop destruction is One comment cited guidance from the may allow for establishing limits in the culturally offensive to indigenous National Institute of Standards and future, if needed, once methods are people that traditionally use every part Technology providing that assigned established and USDA has access to of every animal and plant that can be uncertainty should be small relative to Proficiency Testing results and the utilized. the total uncertainty targeted for test reported MUs. Disposal Methods: Several comments samples. The comment asserted that, as Additionally, this rule retains the asserted that the only disposal methods a rule of thumb, assigned uncertainties flexibility for State and Tribal available under DEA regulations are should be about one-third or less of the Departments of Agriculture to include incineration or chemical digestion and target uncertainty to ensure that specific requirements regarding MU for argued that the current rules under the uncertainty in the certified value will laboratories conducting hemp regulatory CSA are designed for disposal of have negligible influence on the results testing under their specific state or pharmaceuticals and chemical-based of measurements. According to the Tribal hemp programs if they meet the illegal drugs, not for the disposal of comment, laboratories with well- minimum standard set in this final rule. agricultural crops. Comments asserted developed processes will provide the AMS encourages State and Tribal that incineration by DEA is not efficient most accurate and precise results and regulatory agencies to coordinate in or environmentally sound, and in some their uncertainty will be very small. The developing proficiency and testing places may not be allowed. They noted comment advocated that USDA provide methods, similar to the program that burning crops releases harmful an uncertainty range that cannot be administered by the University of carbon dioxide and other pollutants into exceeded by participating laboratories, Kentucky, but participation in these the air, contributes to the risk of thereby reducing the risk that producers types of programs is not required by this wildfires, and wastes valuable plant will shop for laboratories with the regulation. nutrients that could be used elsewhere. widest uncertainty. The comment Numerous comments stated that the Disposal asserted that such a provision would rule should provide alternative methods also improve data comparability across The IFR stipulated that cannabis of disposal for non-complaint hemp the hemp industry. exceeding an acceptable THC level must plants to protect growers against total AMS response: AMS appreciates the be disposed of in accordance with the crop loss and preserve valuable different suggestions submitted by CSA and DEA regulations because such resources. Several comments commenters on ways to improve the material constitutes marijuana, a recommended USDA adopt disposal calculation of MU and also Schedule I controlled substance under rules established under their various acknowledges the variability in the CSA, rather than hemp. State and Tribal regulations. Comments laboratory testing equipment that may Destruction vs. Disposal: Several suggested growers be allowed to mulch exist. However, based on the input comments noted that the 2018 Farm Bill or disc the non-compliant crop into the received and limited data available at specifies only ‘‘disposal,’’ of hemp soil at the farm, which would build up the time of its review, AMS will only testing above the acceptable THC level, soil nutrients, improve soil water require that hemp testing laboratories yet the IFR required ‘‘destruction’’ of holding capacity, and improve soil tilth. complete a MU calculation as part of the such material. Comments argued that Other comments suggested growers mathematical test result for THC the IFR’s destruction requirement is an could recuperate some of their concentration. This final rule does not overreach. Comments asked USDA to investment by marketing non-compliant establish or standardize an upper or revise the regulations to require only crops for other non-ingestible or non- lower boundary for general use by disposal of non-compliant plants or consumable products like fiber, building laboratories to calculate a measurement plant parts, and to provide either materials, biofuel, biochar, bioplastics, of uncertainty. MU is typically not general parameters or specific and animal bedding. A few comments standardized, but rather is controlled provisions regarding acceptable suggested growers should be permitted using test methods controlled by methods of disposal. Several comments to export or ship non-compliant hemp performance standards (e.g., AOAC asked AMS to provide or expand the to countries or States that have legalized Standard Method Performance requirements for disposal of non- recreational or medical marijuana. Requirements 2019.003 that can be compliant material. Numerous comments recommended a found at https://www.aoac.org/ Although a few comments supported surgical approach to disposing of non- resources/smpr-2019003/). destroying non-compliant hemp crops, compliant plants by allowing for the USDA does not recommend most comments that addressed the topic removal and disposal of only the plant establishing a MU upper limit argued against total crop destruction if parts testing over the acceptable THC (maximum) because (1) MU is typically alternative disposal methods are level, while allowing growers to market not standardized, but is controlled using available and practical. Comments the remaining parts. One comment standard test methods, and (2) USDA explained that crop loss is financially suggested the Federal Government does not have the data to set an upper devastating to growers—and doubly could buy non-compliant crops for no limit, so setting it would be arbitrary, punitive if the grower must pay to less than 50 percent of the market value not scientific. The hemp and scientific destroy the crop—as well as a waste of and use them to manufacture paper, industries are just beginning to discuss valuable resources that could be plastics, and fuel for government and standard test methods, and the final rule repurposed and provide at least some military uses. Other comments proposed does not establish an explicit test return to growers. Comments explained remediation as an alternative to crop method. Setting an upper limit or that crop destruction can be a drain on destruction; comments on remediation maximum MU does not resolve the core limited official resources, depending on are discussed in another section of this issue and would not encourage or drive the availability of law enforcement comment analysis. One comment labs to improve accuracy and precision. personnel and equipment for the suggested further research be conducted Setting an upper limit would in effect potential need to collect, transport, and to identify appropriate alternatives for be setting a maximum or absolute MU. oversee the destruction of non- crop disposal, and one comment

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suggested that industry stakeholders, would consider providing crop These activities align with normal and governments, regulators, and law insurance for losses due to disposal of routine production actions by farmers. enforcement officials work together to ‘‘hot’’ crops. One comment asked AMS believes specifying these activities develop disposal options under the whether stored hemp product produced help hemp growers determine which program. under previous programs that allowed activity best supports their operation to Disposal Oversight: Several comments for higher THC levels would be transition non-compliant crop into a recommended that States, Indian Tribes, disposed under the new program, or non-retrievable or non-ingestible form. or local authorities be allowed to could be ‘‘grandfathered’’ in. These methods also allow recycling determine appropriate crop disposal One comment contended that certain non-compliant plant materials back into methods for their jurisdictions. language in the IFR was inconsistent, the earth, a viewpoint AMS learned Comments further recommended that and as a result, the IFR could be through public comment to be State, Tribal, or local regulatory officials interpreted to require disposal of hemp especially relevant for producers be authorized to oversee disposal of that does not meet the IFR’s definition practicing cultural conservation non-compliant hemp, as several have of hemp, rather than the disposal of practices. AMS recognized that done prior to the establishment of the hemp that does not meet the acceptable controlled burning is the closest farm Domestic Hemp Production Program. hemp THC level. practice to incineration but controlled One comment recommended further AMS response: AMS received burns may not be a viable option for that hemp disposals handled by the significant comments on this producers in some places due to State should not imply criminal intent requirement from State and Tribal wildfire risk or state prohibition against on the part of growers. Comments said regulatory agencies, producers, and using controlled burns. that allowing for local oversight would other hemp industry stakeholders and reduce strain on DEA and other law based on this input, AMS determined it Remediation enforcement resources and ensure necessary to include specific on-farm The IFR stipulated that cannabis disposals can be handled on a timely hemp disposal activities and to provide exceeding the acceptable THC level basis. One comment from a State oversight flexibilities. must be disposed of in accordance with agriculture department said that when As explained in the IFR, State and the CSA and DEA regulations because law enforcement officers have been Tribal plans are required to include such material constitutes marijuana, a invited to attend crop disposals in their procedures for ensuring effective Schedule I controlled substance under jurisdiction, officers are typically disposal of plants produced in violation CSA, rather than hemp. In addition, the unavailable. Other comments argued of this Part. As part of its review, AMS IFR stated that noncompliant plants that growers should automatically noted the cultural implication of the use may not be further handled, processed, become DEA-registered reverse of the term ‘destruction’ and or enter the stream of commerce, and distributors if their test results exceed accordingly amended the regulatory that the licensee shall ensure the lot is acceptable hemp THC levels so they can provision to clarify the disposal disposed. The IFR did not stipulate any dispose of the non-compliant crops activities required of growers in cases provisions to allow for remediation themselves and provide acceptable when a sample tests above the activities that reduce the THC evidence (e.g., photo or video) that they acceptable total THC level. concentration to levels within the have done so, or so they can do so in AMS also determined that producers acceptable limit. the presence of regulatory officials. benefit from greater regulatory Remediation of non-compliant crops Some said USDA should pay for official flexibility to control on-farm disposal into compliant plant biomass: oversight of crop disposal or there activities according to production Numerous comments expressed support should be no charge for that service. schedules that are not dictated by the for remediation of non-compliant plants Comments noted that AMS had not availability of reverse distributors to to help farmers mitigate against yet posted disposal guidelines on its physically witness disposal activity. financial loss. Comments claimed that website at the time those comments State and Tribal plans must still include not having remediation options would were submitted, although the IFR had procedures to verify disposal. This may be a barrier to industry growth because committed AMS to doing so. Some come in the form of in-person farmers would be unable to bear the comments said interested entities were verification by State or Tribal financial risk of losing crops. One unable to complete applications for representatives, or alternative commenter used 2019 production and program participation because AMS had requirements the direct growers to economic data to project that applying not yet provided disposal requirements. provide pictures, videos, or other proof the IFR to 2019 statewide non- Several comments asserted that DEA that disposal occurred successfully. compliant test rates (17 percent), regulations do not mandate specific State and Tribal plans must also include farmgate losses due to crop destruction disposal methods, so long as the requirements to submit to AMS the could have totaled $842.6 million in ‘‘desired result’’ is achieved. Comments monthly disposal report documenting Colorado.24 According to the comment, asked for more specifics on DEA any on-farm disposals that occurred adding losses related to lost processing disposal procedures, including what during the prior month. Additional and manufacturing due to the same crop disposal methods or processes were information on specific disposal destruction could have brought the allowed under the IFR, what the methods is available to producers, State, economic cost to approximately $1.2 timeline is for disposal, and what and Tribal oversight agencies is billion. It suggested that allowing for results are desired. available on the AMS website. remediation of non-compliant crops One comment asked whether all of a Disposal through the agricultural testing between 0.3 and 1.0 percent THC grower’s crops would be disposed if one practices appearing in this final rule in the same scenario would preserve of the lots tested above the acceptable reflected those allowable under the IFR, hemp THC level. Others asked whether and previously published to the AMS 24 Polis, Jared; Phillip J. Weiser; and Kate marketing non-compliant crops for non- web page in February 2020. These Greenwood: State of Colorado Comments in Response to USDA Establishment of a Domestic ingestible and non-consumable products included plowing under, mulching/ Hemp Production Program; https:// would be considered a form of disposal. composting, disking, bush mower/ beta.regulations.gov/comment/AMS-SC-19-0042- One comment asked whether USDA chopper, deep burial, and burning. 3358.

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about $798 million in direct farmgate comment reported that the average grinding and retesting offers a viable value, or $1.1 billion of total economic amount of THC was reduced by 31.61 economic solution for farmers seeking to value for the State. percent, and suggested that while this recuperate their investment on crops Numerous comments explained that remediation process might not be that initially test non-compliant. Other non-compliant plants can be remediated successful for crops that are comments urged USDA to provide for by chemical processes that either significantly over the legal threshold, retesting provisions, including remove and destroy THC or dilute THC and while the market value of the remediation activities, that more concentrations, thereby transitioning the resulting biomass may be reduced, the favorably support farmers who seek to remaining material into biomass blends process may allow growers to recover salvage crop value. Some of these which then test at or below the some of their losses. comments requested that USDA clarify Federally allowable THC threshold of One comment 26 reported on a survey retesting procedures if a harvest has 0.3 percent. Thus, according to of all Minnesota hemp growers who had already occurred. comments, crop remediation through experienced lot failures since the Statutory implications: Comments one of these processes is a viable beginning of their pilot program in from Tribes and other stakeholders alternative to total crop loss. Some 2016. According to the comment, expressed concern that the 2018 Farm comments suggested processors could reported losses varied greatly, ranging Bill only requires ‘‘procedure for be registered with DEA to handle such between $22,000 and $70,000 per year. effective disposal,’’ and urged USDA to remediation processes to ensure THC is The comment further described the allow producers greater regulatory extracted, handled, and disposed or State’s analysis of 1,492 hemp lot leniency as they become familiar with marketed legally. Other comments samples from 2016 through September growing a new crop by permitting suggested that USDA could issue 2020, which showed that 10.3 percent alternative remediation methods that do processor permits to allow them to tested at or above 4.0 percent total delta- not require crop destruction. handle hot crops to bridge the perceived 9 THC, although there was no indication AMS Response: This final rule covers legal gap between farmer and consumer. of non-compliance with program rules testing of the hemp plant to determine Some comments further suggested or of illegal drug activity on the part of acceptable THC levels as required by the growers could bear processing costs growers. The comment recommended 2018 Farm Bill. This final rule does not then retake possession of the remaining that States and Tribes be allowed to cover testing for seeds and stalks biomass for use or sale elsewhere. develop remediation plans to salvage individually nor does it cover Several comments suggested growers non-compliant crops. processing or the licensing of themselves could be allowed to merge Post-harvest sampling and retesting: processors. ‘‘hot’’ lots with lots testing below Several comments suggested retesting As described in the IFR, hemp allowable hemp THC limits to create a post-harvest samples to confirm THC exceeding the acceptable THC level may compliant, homogenized blend. levels. Comments provided examples of not be further handled, processed, or Some comments suggested non- some State agriculture departments that enter the stream of commerce. The compliant crops could be remediated by implemented post-harvest sampling and licensee shall ensure the disposal of the removing the only flowers and retaining testing processes under the 2014 Pilot noncompliant crop. Before such the seeds and stalks for other use. Other Programs. For instance, one comment disposal occurs, AMS believes it comments argued that the IFR testing cited results from the 2018 season in important and necessary that hemp provisions conflict with CSA provisions which they allowed post-harvest growers be provided the opportunity to that exempt seeds and stalks of plant retesting of hemp plots that originally remediate THC from non-compliant material from the definition of tested between 0.4 and 1.0 percent THC. crops in order to stave off financial risk marijuana, and several comments urged The comment said under Kentucky associated with the loss of investment in USDA to modify the IFR to require only rules, farmers were allowed to choose their hemp crop. that the parts of the plant exceeding the between immediate destruction of the AMS agrees with comments that THC limit be destroyed. leaf and floral material of the crop, consider remediation as a viable activity One comment advocated that States without additional testing, or paying the for farmers to minimize crop loss and to be allowed to remediate non-compliant $250 fee for a post-harvest retest of salvage the value of remaining crops through milling and blending the harvested and ground up hemp compliant plant material. For this harvest lot to include the entire plant to material, in which the THC reason, the final rule provides a homogenized state, then retesting the concentration was diluted. It stated that regulatory flexibility that allows lot. The comment included the results of 29 growers whose lots tested between remediation activities—either disposing of a comparative analysis based on 0.4 and 1.0 percent THC, 22 chose of flower materials and salvaging the crops that initially tested over the legal retesting and none of those returned a remainder of the plant or blending the threshold of 0.3 percent total THC second measurement above 0.3999 entire plant into biomass plant material. during Arizona’s 2019–2020 growing percent THC. Thus, those growers were Through both forms of remediation, the season.25 According to the comment, able to realize a return on their farmer may be able to minimize losses producers opted to attempt remediation investment. The remaining seven cases and, in some case, produce a return on as described for a total of 25 lots did not elect to retest—five elected to investment. A guidance document will representing 568.6 acres of hemp. Of the destroy the entire plant and 2 destroyed be published with this rule to illustrate 25, 19 lots representing 507 acres only floral and leaf materials, salvaging approved remediation techniques. successfully reduced the total THC the stalks. The data showed the acreage USDA will also finalize the guidance amount to be compliant, for an 89.71 destroyed represented approximately document on disposal techniques. percent recovery of acres that would one percent of total acreage. The Additionally, AMS determined that otherwise have required disposal. The comment concluded that post-harvest pre-harvest sampling and testing yield the truest measurement of THC 25 Caravetta, John: Arizona Department of 26 Petersen, Thom: Minnesota Department of concentration at the point of harvest. Agriculture Additional Comments on USDA Interim Agriculture Comments on USDA Interim Rule: AMS further maintains this position in Final Rules on Domestic Hemp Production; https:// Establishment of a Domestic Hemp Production beta.regulations.gov/comment/AMS-SC-19-0042- Program; https://beta.regulations.gov/comment/ this final rule. AMS notes that if the test 5645. AMS-SC-19-0042-5548. results show the original THC

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concentration exceeded the Federally distributors if their hemp samples test through comment concerns about the allowable limit, the licensee may above acceptable THC levels so growers collection of non-compliant plants by request the laboratory retest the pre- could legally manage crop destruction DEA-registered reverse distributors, or harvest sample. This retest would not on their own. Another comment asked duly authorized Federal, State, or local entail the use of post-harvest plant whether DEA would allow for a waiver law enforcement. AMS notes that law material. However, if the farmer elects from the current limitation on reverse enforcement policies and priorities are to perform remediation activities under distributors to allow reverse distributors not set by USDA and the 2018 Farm Bill a USDA, State or Tribal plan, an to accept cannabis material for disposal does not provide this authority. To additional sampling and testing of the from individuals or entities who address public comment, this final rule remediated crop must occur to cultivate hemp in accordance with their will retain disposal requirements stated determine THC concentration levels. state’s approved plan, but who do not in the IFR but will further clarify what Only those crops testing below the hold a Schedule I DEA registration. ‘‘disposal’’ means relative to the role of acceptable hemp THC level limit will be Numerous other comments expressed reverse distributors. considered successfully remediated and concern that alternative law AMS relaxed the disposal thus allowed to enter the stream of enforcement agencies (non-DEA) will requirements enacted under the IFR in commerce. All other remaining non- face the same resource constraints as the February 2020. This decision followed compliant crops must then be properly DEA. Comments described how State consultation with DEA. This provided disposed. law enforcement officials are typically growers the added flexibility to conduct AMS believes the inclusion in the unwilling or unavailable to participate on-farm disposal activities themselves, final rule of remediation and post- in the disposal of noncompliant crops without required onsite law- harvest sampling after remediation and suggested this is due to the lower enforcement supervision. Based on provides the additional flexibility prioritization of hemp compliance positive feedback received from State requested by commenters that expressed oversight in light of more pressing and Tribal oversight agencies and the need for farmers to have greater public safety and crime intervention producers following the relaxation of opportunity of success entering the responsibilities. For example, a disposal requirements, AMS is hemp production industry. comment representing rural counties permanently allowing for on-farm said this conflict in priorities is disposal flexibility in the final rule. Reverse Distributors particularly acute in rural areas where Under this final rule producers do not The IFR requires the collection and resources are already stretched too thin. need to use a DEA-registered reverse destruction of noncompliant material by The comment asserted that while distributor or law enforcement to a person authorized under the CSA to preventing serious violations of dispose of non-compliant plants (7 CFR handle marijuana, such as a DEA- controlled substances laws is a priority 990.3(a)(3)(iii)(E) and 990.27) if the registered reverse distributor, or a duly for law enforcement agencies, hemp producer disposes of the plants using authorized Federal, State, or local law with slightly elevated THC levels is one or more of the means described by enforcement officer or their designee. unlikely to be sold as marijuana. The USDA at https://www.ams.usda.gov/ Comments: Comments largely comment advocated formulating hemp rules-regulations/hemp/disposal- opposed the use of DEA-registered disposal procedures entirely outside the activities. It is the agency’s intent that reverse distributors to dispose of scope of law enforcement. One these methods allow producers to apply noncompliant material. Comments comment worried about the stress and common on-farm practices as a means of asserted that many States and producers stigma on growers having law disposal while rendering the controlled operating under the 2014 Farm Bill have enforcement personnel descend upon substance non-retrievable or non- implemented policies related to their farms in connection with hemp ingestible. Producers must document disposal of non-compliant material that disposals. Other comments supported the disposal of all non-compliant plants do not require DEA involvement. allowing State regulatory authorities to in accordance with § 990.27. Reporting Comments argued there are relatively oversee or authorize disposal of non- can be accomplished by providing few registered reverse distributors on compliant material, asserting that States USDA with a completed: ‘‘USDA Hemp DEA’s 2019 list and pointed out that can safely and efficiently complete the Plan Producer Disposal Form.’’ some of the major hemp production process at a much lower cost to Cannabis with a THC level of over 0.3 States have very few or no registered producers and States. percent on a dry weight basis is a reverse distributors. Comments claimed Some comments supported disposal controlled substance, that must be existing DEA-registered reverse of non-compliant material by law disposed of onsite according to the distributors haven’t the resources or enforcement. Some suggested that disposal methods approved by USDA. training to oversee destruction of large States, rather than Federal agencies, The State, Indian Tribe or the state’s plots of agricultural crops in remote work with State and local law department of agriculture wishing to areas, and that such limitations would enforcement to handle disposals. One have primary regulatory responsibility create a compliance bottleneck. comment suggested that the definition have the responsibility for establishing Comments asked USDA to clarify who of ‘‘duly authorized Federal, State, or protocols and procedures to ensure non- would be responsible for paying DEA local law enforcement officer’’ be compliant plants are appropriately reverse distributors for crop disposal modified to include disposal under the disposed of in compliance with services. authority of State or local law applicable State, Tribal, and Federal One comment asserted that DEA enforcement in order to address the law. States and Indian Tribes operating regulations prohibit reverse distributors anticipated increase in required under approved hemp production plans from accepting controlled substances disposals. Finally, comments from must notify USDA of any occurrence of from other than DEA registrants, making Indian Tribes urged USDA to expand non-conforming plants or plant material it impossible for hemp farmers to the definition of law enforcement in the and provide the disposal record of those release non-compliant hemp directly to final rule to include Tribal law plants and materials monthly. There is DEA reverse distributors. One comment enforcement. a similar requirement for producers suggested that hemp growers could AMS response: AMS acknowledges operating under the USDA plan. automatically become reverse the many stakeholders who expressed Additionally, USDA will conduct

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random audits of licensees to verify A state department of agriculture fixing a uniform standard until the hemp is being produced in accordance estimates that 42 licenses would need to industry has more experience and better with the provisions of the rule. be revoked at 0.5 percent stated in the understanding of the relationship State and Tribal plans must still IFR. They further estimate that this between all the hemp production include procedures to verify disposal number would shrink to only about 12 factors. Still other comments asserted but would have the additional flexibility licenses were the threshold increased to that negligence should not be to use in-person verification where 1.0 percent under the final rule. determined numerically at all, but by a deemed necessary or, when practicable, A state hemp steering committee determination about the farmer’s intent. require producers provide pictures, commented that a 0.5 percent threshold Several comments said that ‘‘negligence videos, or other proof of disposal. AMS will deter the experimentation of is a state of mind, not a number.’’ believes this decision will further different varietals and that this research General comments on 0.5 percent alleviate the strain to oversight is essential to discovering which threshold: Several comments argued resources and allow State and Tribal varietals work best in different climate USDA arbitrarily determined the 0.5 authorities to more efficiently and zones and soil types as well as for the percent negligence threshold. One autonomously monitor hemp development of better genetics. comment asked USDA to provide the production in their jurisdictions. Another state department of research reports used to inform the Additionally, the final rule expands agriculture explained that 13 percent of selection of the 0.5 percent negligence the definition of ‘‘law enforcement’’ to the hemp samples taken in 2019 tested threshold. Another questioned whether include Tribal law enforcement. over the THC limit. The average THC USDA used test results based on the level in those failures was 1.07 percent total THC standard established in the Negligent Violation Threshold Delta-9 THC post-decarboxylation. A IFR to set the negligence threshold, The IFR specified that a producer hemp association within the state since it was the commenter’s experience commits a negligent violation when a agreed with the commenter’s that producers routinely report recommendation that the level defined reasonable effort to grow hemp is made difficulty meeting that standard. One for negligence should be increased to 1 and the total THC dry weight comment reported anecdotally that its percent THC. concentration exceeds 0.5 percent. farm sends three samples from the same One comment reported that more than composite lot sample to three testing Supporting an increase of negligent 5.5 percent of the pre-harvest samples laboratories and gets three different violation threshold: Most comments that collected under the State’s plan in 2019 results, which the comment ascribes to addressed negligent violations opposed were found to have a THC concentration the variation in lab procedures. Another the 0.5 percent total THC threshold in of greater than 0.5 percent. Another comment said that there are no the IFR, and many advocated raising the comment reported that 13 percent of established uniform standards for threshold to 1.0 percent or higher, hemp samples taken in 2019 tested over cannabinoid testing, such that even offering suggestions ranging between the THC limit. According to the from reputable labs it will not be 0.99 and 5.0 percent total THC. comment, data for all years through entirely clear what the results mean. Comments said the 0.5 percent September 2020 show that most hemp The impact of the 0.5 percent threshold can be too easily breached by lot failures occur between 0.4 percent threshold on production: Several prudent farmers for any number of and 1.0 percent THC. comments said the 0.5 percent environmental or genetic factors that are Data submitted with a comment from negligence threshold in the IFR beyond grower control. One comment a State University researcher showed provided very little buffer (at 0.2 supported the 0.5 percent negligence that 8.5 percent of 3,508 samples tested percent) between the 0.3 percent THC threshold, and others noted it but during 2018–2020 exceeded the IFR’s allowed under the program and the 0.5 signaled neither support for nor negligent violation threshold of 0.5 percent threshold for determining a opposition to the threshold particularly. percent THC. The comment said that 65 negligible violation. What several Some comments suggested that a 1.0 percent of those would not be comments called a ‘‘safe harbor’’ for percent threshold would provide a safe considered negligent violations if the growers was nevertheless considered environment in which both new and threshold were raised to 1.0 percent. too narrow by many, saying that it left veteran farmers can operate Framing study results another way, the virtually no room for error. Comments comfortably. Comments in favor of a 1.0 comment explained that at a negligence argued that requiring growers to both percent negligence threshold noted that threshold of 0.5 percent, the State exercise reasonable care and produce several States and other countries have would have revoked 42 producer crops with only 0.5 percent THC or less established a 1.0 percent threshold for licenses, whereas at a 1.0 percent is too stringent a standard and does not their jurisdictions that seems reasonable threshold, the State would have revoked really offer the ‘‘safe harbor’’ intended. and achievable in most situations. A few only 12 licenses, given three negligent One comment argued that USDA cannot comments pointed out that a 1.0 percent violations in a five-year period, a provide a ‘‘safe harbor’’ for violations of threshold is relatively low compared to reduction of 72 percent in revocations the 0.3 percent THC cap because that the THC levels in marijuana, which by changing the threshold to 1.0 cap is enforced by other Federal and commenters said typically range from percent. State agencies. A few comments said 10 to 15 percent. Other comments One comment reported that based on that the THC levels in 2014 DEA advocated higher thresholds that they test results they’d seen this year, 1.0 or confiscations averaged 11.84 percent claim would give farmers the peace of 1.5 percent would be a more appropriate THC and argued that the negligence mind to continue building an industry threshold for negligence, due to the level under USDA hemp program rules that is just taking off. Finally, one heterogeneity of the plant and the should be closer to the average DEA comment asked whether an MU was awareness of the industry. culpability level. figured into the IFR’s negligent violation Implementation timeframe: Some A comment from a state department of threshold and advocated setting the comments suggested that it is too early agriculture used 2019 production and threshold at 1.5 percent THC and in the industry’s development to testing data to demonstrate that raising specifying that that threshold includes determine a realistic numeric threshold, the IFR’s threshold from 0.5 percent to the MU. and they recommended USDA delay 1.0 percent could theoretically reduce

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the number of its farmers exceeding the would account for the fact that a AMS response: Congress established negligent violation threshold by more reasonable reliance on certified or the definition of hemp and defined the than 75 percent. Several comments eligible varieties may still yield a plant threshold of THC concentration at 0.3 advocated a 2.0 percent threshold, while that tests above the acceptable hemp percent dry weight. The statute did not others suggested the elimination of the THC level. define negligent violation. USDA negligence threshold altogether. The impact of the 0.5 percent derived the definition of negligence Comments highlighted uncertainty in threshold on crop research: Comments from the definition of negligence in the genetic variation of hemp varietals described the IFR’s 0.5 percent negligent Black’s Law Dictionary (10th ed. 2014). and other factors like weather violation threshold as a rate limiting USDA set the level of total THC conditions, soil type, plant disease, and factor to industry innovation and hemp concentration at 0.5 percent for a pest pressures that may further research. One comment said that hemp negligent violation to establish a clear exacerbate the risk of exceeding the 0.5 farmers, growing under pilot buffer so that any crop testing out of percent threshold. As well, comments authorization of the 2014 Farm Bill, compliance would not automatically explained that hemp plants mature routinely planted multiple varieties of trigger a violation. The 0.5 percent was rapidly just before harvest. One hemp to see which performed best. based on data from three states commenter described seeing plants go According to the comment, the low participating in the 2014 Farm Bill pilot from 0.18 to 0.62 percent total THC in negligence threshold in the IFR program. AMS believes raising the one week. Comments suggested that discourages such hemp trialing and negligent violation threshold from 0.5 enforcing the 0.5 percent negligence innovation because farmers face greater percent to 1.0 percent in the final rule threshold on growers who truly do not risk of receiving three negligent provides a greater buffer and reduces intend to grow marijuana is excessive violations in one or two seasons and farmers’ exposure to risk of violation penalization when THC levels can losing eligibility to grow hemp for accrual and license suspension. change that rapidly. Comments argued another five years. Comments from Oversight Authority: Several that it is not appropriate to add further research universities found the IFR’s comments suggested the government penalties to hot crop destruction. Other negligent violation provisions should have the ability to determine comments suggested that administrative unworkable for institutions testing negligence and culpability based on and logistical factors beyond the numerous varieties and production facts and circumstances surrounding grower’s control, such as bottlenecks in variables each season for the same violations and not solely on a numeric sampling and testing, can likewise reason. Comments suggested a higher threshold. Other comments asserted that create compliance risks for growers threshold for negligent violation would the 2018 Farm Bill’s language leaves under the 0.5 percent threshold. give industry the regulatory flexibility to room for an Indian Tribe to apply its AMS response: Based on these conduct research with reduced risk of own negligence standard. Similarly, comments, AMS is increasing the violating regulatory requirements. other comments from the industry said negligent violation to a 1.0 percent AMS response: AMS recognizes the that States should be allowed to threshold. AMS acknowledges that a violation threshold may incentivize (or evaluate potentially negligent violations lower total THC threshold will result in disincentivize) innovation by research of State plans. a higher number of negligent violations. institutions and producers. AMS AMS response: With regard to AMS also understands that factors acknowledges more innovation and violations and culpability beyond the control of farmers may cause research across industry will bring more determination, AMS seeks to establish a an increase in total THC-levels, such as stability to stakeholders. The 1.0 percent regulatory framework that ensures seed genetic, weather and climate, and negligent violation threshold provides consistency in oversight activities of may contribute to crops exceeding the new and existing producers across hemp production. Variations of criteria negligent violation threshold. AMS States and Indian Tribes additional or the use of subjectivity in oversight believes that the data provided in the flexibility to innovate and research with could result in bias against or leniency comments clearly showed that reduced risk for noncompliance. AMS to some hemp farmers simply based on increasing the negligent violation believes the 1.0 percent threshold location. Leaving the decision of what threshold to 1.0 percent would diminish incentivizes innovation across industry constitutes a negligent violation to the risk that producers would incur more so than a 0.5 percent violation abstract factors rather than objective negligent violations without adding a threshold. metrics may result in differences greater risk of non-compliant material Statutory implications: Some between States and Indian Tribes. reaching channels of commerce. comments argued that establishment of Because farmers may grow hemp in AMS also reviewed the test results of the 0.5 percent negligence threshold in different locations, and in some cases certified hemp varieties planted in the IFR was arbitrary and capricious are subject to multiple oversight Kentucky in 2017 and 2018 under its under the APA and asked USDA to authorities, it is important the 2014 Farm Bill program. Kentucky has provide more information about how thresholds for violations are consistent a certified seed program that it believes the threshold for negligence was across oversight authority jurisdictions will yield hemp. The plants from the determined. Some comments asserted to which the grower is responsible. certified varieties tested below 0.8 that negligence is a well-established Having a threshold that is well percent THC concentration level. legal doctrine, and they argued that established and transparent provides a Additionally, AMS reviewed the test USDA cannot artificially and arbitrarily minimum framework to producers. results of varieties that were eligible to declare a threshold for negligence. A In developing the compliance be cultivated under the Nevada 2014 couple of comments suggested that requirements for State and Tribal plans, Farm Bill program in 2018. The plants putting farmers on probation, USDA recognizes that there may be from those varieties tested below 0.9 suspending them from program significant differences across States and percent THC concentration level. Given participation, and requiring them to Indian Tribes in how they will those test results based on varieties that destroy their crops based on an arbitrary administer their respective hemp those two states believed would yield number rather than on court findings is programs. Accordingly, if, at a hemp, AMS determined that a 1 percent a violation of due process under the minimum, the requirements of the 2018 THC concentration level for negligence U.S. Constitution’s Fifth Amendment. Farm Bill and applicable parts of this

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regulation are met, States and Indian negligent violation every time he or she benefits producers, including small and Tribes are free to determine whether or grows hemp with a concentration of new farmers, that intended to grow not a licensee under their applicable hemp above the 0.3 percent level, this hemp but whose crops tested ‘‘hot’’ plan has taken reasonable steps to will assist producers when requesting even though they made reasonable comply with plan requirements. As loans or other financial assistance. AMS efforts to grow hemp. previously stated, this final rule will provide risk mitigation activities Resources and enforcement: One State provides that a producer shall not be such as remediation and disposal commented that it currently enforces a subject to more than one negligent provisions as well as increasing the 1.0 percent negligence threshold. violation per calendar year. State and negligent violation threshold to 1.0 According to the comment, lowering the Tribal plans may tailor the timing percent to diminish the number of threshold to 0.5 percent would around this requirement to align with violations that are considered negligent. significantly increase the rate of their growing season or other applicable Some producers have more than one negligent violations in that State, dates. field or farm in a state or across state require more State and Federal Financial and business risk: Several boundaries. Assigning more than one resources to enforce the regulation, and comments linked the 0.5 percent THC negligent violation might be detrimental be financially burdensome to novice threshold with a greater likelihood of to these producers. For example, if a farmers. It stated that the 0.5 percent producers committing negligent producer uses the same seed in multiple negligence threshold is lower than the violations, receiving corrective action locations, and that seed results in a THC threshold DEA designates as the upper plans, and even committing culpable level over 0.3 percent, all of that THC limit for ‘‘inconclusive marijuana/ negligent violations. Comments stressed production must be disposed or hemp.’’ The comment found the IFR’s that a low negligence threshold puts remediated. All of these locations could 0.5 percent threshold inconsistent with farmers at higher risk of accumulating be determined a separate violation. some laboratories’ testing capabilities negligent violations, even when growers However, AMS wants to clarify that a and suggests raising the rule’s threshold take reasonably prudent steps to producer may not be found to have to 1.0 percent. mitigate against the production of committed more than one negligent AMS response: AMS anticipates that noncompliant plants. According to violation per year. the closer the negligent violation comments, this, in addition to the loss Barriers to entry: Several comments threshold is to 0.3 percent total THC, of the crop, jeopardizes farmers’ access suggested that a 0.5 percent negligence the greater the likelihood that oversight to crop insurance and business loans. threshold threatens the survival of authorities issue more negligent Comments addressed the negative farmers in an emerging industry. violations. Moreover, whenever a impact of the accrual of negligent Comments suggested that the low producer commits a negligent violation, violations on the financial stability of threshold is a barrier to entry for new the oversight authorities must also the individual business. They described farmers or farmers with no experience establish a corrective action plan as how a hemp grower’s access to credit growing hemp, who risk high initial required by regulation. AMS believes and insurance is jeopardized when capital investments to establish that increasing the negligent violation negligent violations accumulate and operations. Comments argued that the threshold to 1.0 percent would therefore lead to a determination of culpable low threshold favors larger farms using reduce some burden to oversight negligence. Comments explained that industrialized hemp varieties and authorities by reducing the number of lending institutions and insurance production practices, and that the low negligent violations and corrective providers look for risk factors. They also negligence threshold in the IFR would action plans that oversight authorities raised questions about how the accrual unnecessarily criminalize farmers must issue and administer. AMS notes of negligent violations may be working with a legal agricultural that regardless of the negligent violation interpreted by lender or providers. commodity. threshold, any crop exceeding the Comments said that many insurers will AMS response: All persons interested Federal allowable total THC not cover crop losses if losses are due in growing hemp must meet the concentration must be disposed of to the growers’ negligence. Commenters eligibility criteria established in the according to regulatory requirements. implored USDA to explain how 2018 Farm Bill and this final rule. AMS disagrees that the DEA’s violations can lead to determinations of Negligent violations document instances enforcement program for marijuana culpable negligence and to provide when the statue or rule are violated should affect how AMS manages its guidance about how a reasonable farmer such as when a grower fails to report a compliance program for hemp. can avoid growing noncompliant hemp. legal description of land on which hemp AMS response: AMS acknowledges is grown or fails to dispose of a State and Tribal Resources institutional lenders view violations as noncompliant crop. All farmers, The IFR required States and Tribal risk factors in decision making. AMS regardless of the size of their operations, governments to certify they have the also notes that not all culpable face the same set of requirements. Even resources and personnel to carry out the violations are derived from the accrual though the 2018 Farm Bill sets the THC practices and procedures of their of negligent violations. Culpable concentration level at 0.3 percent, it respective plans. Further, the IFR violations may be the result of does not define what THC level in provided for audits of State and Tribal producers violating other parts of the cannabis will give rise to a negligent plans to include review of the resources 2018 Farm Bill. However, the 2018 Farm violation. Left undefined, this lack of and personnel employed to administer Bill explicitly considers certain actions definition is troublesome as it could and oversee its approved plan. Finally, as constituting negligent violations. make enforcement uneven among States the IFR specified audit reporting AMS’s intention is to provide a and Indian Tribes. The IFR provided requirements and remediation steps for threshold between 0.3 percent THC that hemp producers do not commit a States and Tribal governments found to level and what would be considered a negligent violation if they make be non-compliant with USDA negligent violation so not all hemp that reasonable efforts to grow hemp and the requirements. tests over the 0.3 percent be considered marijuana does not have a THC Comments: Comments from many a negligent violation. Because a concentration of more than 0.5 percent. States expressed enthusiasm for producer will not have committed a Increasing this threshold to 1.0 percent partnering with USDA in the regulation

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of domestic hemp production. The increased regulatory burden on States Additionally, USDA has decreased the comments were supportive of and Tribal governments. Many risk of the regulatory burden on States establishing a national regulatory recommended changing the 15-day post- and Indian Tribes being borne by hemp framework that would bring clarity and sample harvest period to 30 days to producers by addressing various issues consistency to the regulation of hemp allow more time for States and Tribal commenters identified that could cause production across the U.S. They governments to collect and process States and Indian Tribes to be unable to emphasized that many States have samples, balance workloads, and timely fulfill their responsibilities such enacted legislation to facilitate the alleviate potential backlogs. In addition, as by modifying the sampling protocol regulation of hemp production. No several comments contended that the and changing the 15-day post-sample comments received from the States increased sampling requirements in the harvest period to 30 days. Other demonstrated a reluctance to work with proposal (i.e. requiring sampling of burdens associated with this final rule USDA in establishing regulations. every lot) would burden the process and that the producer must cover should be The requirement for States and Indian contribute to delays in growers considered by producers, as in any Tribes to certify to USDA that they have receiving results. Those comments agricultural business, before a decision the capacity to administer a domestic recommended revising the sampling to grow hemp is made. hemp program was not addressed protocol (reducing number of samples Appeals—Denial of Application and explicitly in any of States’ comments. required per producer) to help relieve Appeal of Test Results However, many of the comments from the strain on government resources. the States and Indian Tribes registered Lastly, comments suggested that The IFR addressed the denial of concerns with some aspects of the IFR. allowing labs that are ISO 17025 applications to grow hemp in Part V. Most of the comments from States and accredited to process samples, as APPEALS. The IFR also provided an Indian Tribes delineated areas where opposed to only allowing labs with DEA option to appeal test results in which the burden of regulatory oversight might registration, would enhance the State’s producers can request that a second test be reduced, or efficiencies realized, by ability to provide validated, accurate, be performed if they disagree with the revisions to the regulations. and timely testing. first test results. Several comments expressed concern One commenter said they had talked Comments: A comment recommended that State and Tribal governments with a number of States that expressed that USDA establish a clear deadline for would not be able to perform their strong concerns over the additional applicants who wish to appeal the responsibilities under the program as burdens as a result of the IFR. The denial of their grower applications. The currently established. One comment commenter further stated that some comment noted that the IFR already said the lack of appropriate personnel, states they are considering whether to required a State or Indian Tribe training, and protocol would lead to an ‘‘opt-out’’ of administering a hemp appealing the suspension or revocation untenable backlog in the collection and production plan themselves in favor of of a hemp production plan to file an testing of samples. Many comments USDA administering a plan. appeal ‘‘within the time-period focused on the sheer number of samples Lastly, one comment stated that if provided in the letter of notification or that must be collected, processed, and there was a bureaucratic slow down or within 30 business days from receipt of tested under the program. The shortage insufficient resources on the part of the notification, whichever occurs of DEA-registered labs in the States and USDA, a farm should be allowed to have later.’’ The commenter noted that no the new sample collection protocols some recourse to be able to harvest. That such similar deadline is identified for were also areas of concern, although comment, and others that were similar applicants who have been denied USDA that was addressed shortly after the IFR in spirit, effectively questioned what hemp grower licenses. went into effect with the announcement mitigation efforts would be undertaken One comment asserted that denials of of enforcement discretion.27 Points of for producers in the short run if a State ‘‘licensure’’ may occur for ‘‘whatever potential weakness in the States’ and or Indian Tribe ultimately lacks the reason.’’ Two other commenters Tribal governments’ implementation of necessary resources and personnel to submitted examples of State regulatory the IFR were raised by many administer its plan and fails to perform language from California and Ohio, each commenters, both explicitly and in the obligations it certified it could of which include provisions for the implied remarks. Many of the comments undertake. denial of applications for license. referenced State and Tribal government AMS Response: The issues raised in Several comments suggested USDA infrastructures being strained under the these comments are mostly addressed establish an appeals process through new regulatory requirements, especially under other sections in this rule (e.g., which someone with a felony during peak harvest intervals, and that 15-day harvest window, laboratory conviction may demonstrate completion those factors could contribute to the accreditation). AMS agrees that there are of appropriate steps to become eligible failure of the States and Indian Tribes to regulatory burdens of this program, hemp producers. fulfill their oversight obligations. A which are discussed in this rule. States AMS response: This rule retains the number of comments alluded to the and Indian Tribes have multiple options IFR provision that an applicant for a burden of any breakdown in the that would allow producers in their USDA hemp production program regulatory scheme being borne by hemp States or territories to grow hemp. States license may appeal a license denial to producers directly, as with samples that and Indian Tribes can develop their the AMS Administrator. USDA are not timely collected by State own plan, send their producers to grow licensees may appeal denials of a inspectors and the samples then testing under the USDA plan, or States can license, renewals, license suspensions, ‘‘hot’’ without any remediation options, continue under the 2014 Farm Bill pilot or license revocations to the AMS or labs that are not able to process program. Many States and Indian Tribes Administrator must be submitted in samples due to capacity issues. assess fees on producers to cover their writing and received within 30 days of Numerous comments made expenses for sampling, oversight and the receipt of notification of the denial recommendations to address the other costs of this program. These or within the time-period provided in options provide producers different the letter of notification, whichever 27 https://www.ams.usda.gov/rules-regulations/ alternatives to grow hemp under occurs later. State and Tribal plans hemp/enforcement. different regulatory schemes. reviewed and approved by USDA are

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required to include an appeal process purposes of interstate commerce approved by USDA and the plan may for producers to appeal licensure transport and commerce. provide for more stringent requirements. decisions. In response to the comment Commenters stated they had already A State has the responsibility for that USDA should establish an appeals encountered situations where States enforcing the requirements of its plan. process through which someone with a passed temporary regulations Thus, hemp that is produced under a relevant felony conviction may conflicting with the 2018 Farm Bill and State’s plan should meet the demonstrate completion of appropriate impeding interstate commerce. For requirements of the final rule. steps to become eligible hemp example, comments noted an Idaho Shipping Documentation: Several producers, it is important to note that Executive Order—Transportation of comments encouraged USDA to limitations as a result of relevant Hemp—issued in 2019, that they facilitate the unimpeded flow of hemp felonies are set in the 2018 Farm Bill. claimed would ‘‘excessively frustrate in interstate commerce by implementing interstate hemp transportation and identity preservation or tracking Appeals—Technical growth of the hemp industry.’’ One systems or requiring the use of The IFR stated that producers can airline carrier comment explained that standardized shipping labels, packaging, request a second test be performed if under this Order, ‘‘transporters may or other documentation to certify to they disagree or have doubts about the have to stop, get inspected, and be stakeholders and law enforcement original test results. subject to detention each time they cross authorities that the cargo in transport is Comments: One comment indicated jurisdictional boundaries’’ and that Federally legal hemp. Comments that if there is a discrepancy between airlines would avoid carrying hemp if suggested the use of USDA-issued compliance testing for THC this issue is not remedied. stamps or forms that are recognizable, concentration, there needs to be a Comments from Indian Tribes understood, and accepted by all law process for farmers to appeal. Another expressed concern that despite the 2018 enforcement authorities. Several Indian comment noted that no administrative Farm Bill, Tribes transporting hemp Tribes made this suggestion because appeal process exists for producers who through States have a bias against Tribal they are concerned about law wish to challenge a decision they hemp production. There were enforcement transportation issues, believe adversely affects them, such as suggestions of the use of a USDA form particularly in Idaho, South Dakota, test result. Another commenter cited or stamp authorizing transportation to Maine, New York and Wisconsin. personal experience with one State address these obstacles. One commenter According to comments, such forms agriculture department and described as also requested that USDA provide for could verify that cargo hemp is ‘‘unfair’’ a regulatory system that does recourse for Indian Tribes that are compliant with USDA-approved not allow for an appeal process through prohibited from moving hemp through production plans. Other comments which a farmer may contest test results. neighboring States. suggested the use of a standardized bill AMS response: USDA is maintaining AMS Response: At this time, USDA of lading across the industry that sets its position that producers under a recommends that transporters carry a out essential information about the USDA plan are able to request a second copy of the producer’s license or shipment for easy reference by test be conducted when they do not authorization, as well as any other transporters, regulators, processors, and agree or have questions about a test information the governing State or law enforcement officials to ensure all result. This rule provides flexibility to Indian Tribe recommends or requires loads have been lawfully produced in allow States and Indian Tribes to that will validate that the transporter is accordance with Federal, State, or Tribal provide for retesting if the State or transporting legally-grown hemp. As law. A comment from an association of Indian Tribe chooses to do so. allowed under the 2018 Farm Bill, county agriculture commissioners and States and Indian Tribes can be more Transportation and Shipping sealers suggested USDA require the restrictive, which includes possible officially certified lab report to Documents transportation paperwork requirements accompany shipments of hemp product Under the 2018 Farm Bill and the IFR, by States or Indian Tribes. USDA is not during interstate shipment. neither States nor Indian Tribes may adding transportation paperwork Comments suggested various interfere with the transportation of requirements to this rule because it does commercial systems for recognizing lawfully produced hemp through States not have jurisdiction over common legally produced hemp in transport. or Tribal territories, even if hemp carriers or other types of transporters. Other comments asked USDA to devise production is prohibited within a Comment: A comment asserted that a standard documentation system for particular State or Tribal territory. intrastate commerce of hemp that does hemp carriers that would more easily Public comments related to transporting not meet all the requirements of the IFR absolve them of legal liability related to hemp focused primarily on facilitating should remain under the State’s transporting hemp. Comments the interstate transportation of hemp. authority, and farmers producing hemp recommended that USDA coordinate Interstate commerce: Many comments compliant with the 2018 Farm Bill but with the hemp industry; Federal applauded the IFR’s reiteration of the not the IFR should be allowed to do so, agencies such as DEA, the Department statutory provision that allows for as long as that hemp is not transported of Transportation, and the Department interstate shipments of lawfully across State lines. The comment of Justice; and State agencies, including produced hemp and hemp products advocated for no Federal preemption, law enforcement and transportation without interference by State or Tribal citing to section 297B(a) of the 2018 departments, to develop such law enforcement. Some asked USDA to Farm Bill, which provides that ‘‘nothing documentation. clarify that prohibited interference in this subsection preempts or limits Some comments additionally includes that from State, Tribal, or any law of a State or Indian Tribe that recommended adopting specific hemp Federal law enforcement, including (i) regulates the production of hemp; packaging and labeling requirements on DEA. Other comments wanted and (ii) is more stringent than this the basis that they would support confirmation that interstate commerce subtitle.’’ compliance and enforcement tasks. includes entry into and egress from AMS Response: The 2018 Farm Bill Some comments advised USDA to Tribal territories and that Tribal hemp does not preempt State law provided provide specific regulations for testing production licenses be honored for that the State adopts a plan that is hemp in transit so that such testing, if

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necessary, be conducted in a standard on which hemp is produced, and status product to ensure compliance with the manner, consistent with the of the producer’s license or other threshold. requirement that all pre-harvest Total required authorization from the State or AMS response: The 2018 Farm Bill THC testing be conducted by DEA- Indian Tribe. directed USDA to establish a national registered laboratories. Other comments regulatory framework for hemp ‘‘In-Process’’ Material recommended that hemp loads be production in the U.S., and the final sealed to ensure their integrity and Comments: Several comments rule outlines provisions for this mitigate the interference of illicit mentioned ‘‘in-process material,’’ mandate. The IFR and this final rule do products. described as material made from not cover hemp or its products beyond Comments advocated that USDA host otherwise qualifying hemp plant production. Further, DEA has issued a central hemp database for reporting material, such as crude CBD oil and regulations covering some of these data applicable to all phases of hemp distillate, or as any hemp material that products or ‘‘in-process materials’’.29 production that would be ‘‘read only’’ to is compounded, blended, ground, Accordingly, this final rule does not law enforcement, saying such a system extracted, sifted, sterilized, derived by address ‘‘in-process materials,’’ would be particularly beneficial in chemical reaction, or processed in any processors, end-products, processing of resolving questions related to interstate way for use in the manufacture of hemp CBD or other cannabinoids or anything commerce. One comment advocated for products. Commenters asked USDA to that may contain hemp or hemp the use of a centralized hemp clarify that once hemp has been tested byproducts. clearinghouse to capture hemp flower and allowed to enter commerce, it transfer to processors or manufacturers should be considered legal material Equal Treatment for Tribes for CBD extraction, including thereafter. One comment suggested the Comments: Some commenters said information on the licensed producers establishment of specifications or that final rule should provide Indian and receivers of raw materials, the total guidance for any part in the ‘‘in-process Tribes at least as many opportunities weight of materials being transferred, material’’ manufacturing record where regarding hemp production and testing certificates indicating THC levels control is necessary to help ensure that regulation as those granted to States and of the materials being transferred, and specifications are met for the identity, that the final rule should allow Indian other State-mandated criteria, as well as purity, strength, and composition of the Tribes to catch up quickly with States information on the vehicles being used hemp products and, as necessary, for that have been allowed to develop to transport the materials. It further limits on those types of contamination production methods and markets under recommended USDA evaluate methods that may adulterate or may lead to the 2014 Farm Bill provisions. to physically identify and segregate adulteration of the finished batch of the AMS Response: This final rule does products containing hemp-derived CBD hemp product. not distinguish between States and to differentiate legitimate from One comment explained the Indian Tribes. USDA recognizes that potentially illicit products. perception that in-process materials are both State and Tribal governments have AMS response: AMS understands the not allowed to transfer freely between the ability to authorize and to regulate importance of ensuring safe passage of processors, causing bottlenecks in the production of hemp within their hemp across states and Tribal product processing. According to the States or territories consistent with the jurisdictions. Section 10114 of the 2018 comment, some hemp processors may 2018 Farm Bill and the final rule. Farm Bill specifically states that be limited to performing only one step ‘‘Nothing in this title or an amendment of a multi-step process to derive hemp Psychoactive Effects of Cannabinoids made by this title prohibits the products, such as distilling CBD oil and Delta 9 THC or THC is the primary interstate commerce of hemp.’’ USDA isolating the CBD molecule. It said psychoactive component of cannabis. issued a memorandum addressing this processor-to-processor transfers of in- As mandated by the 2018 Farm Bill, issue.28 Several States already identified process hemp materials should be hemp must be verified as having THC documents to facilitate transportation of authorized between U.S. States with concentration levels of 0.3 percent or hemp across states. AMS strongly valid hemp programs, which would below on a dry weight basis. encourages producers of hemp and open a processing bottleneck and allow Comments: Several comments carriers providing transportation both hemp materials and cash to flow referenced different studies to support services to provide the following more freely. The comment asserted such conflicting positions regarding the documentation accompanying the hemp authorization would improve prices for psychoactive effects of THC and used cargo: Copies of the laboratory testing CBD end-products, which would trickle study findings to argue that the IFR’s report(s), hemp grower license, invoice/ down to hemp growers. THC limit should be revised. Many bill of lading, and contact information of Some commenters stated that it is comments cited the ‘‘Defining Hemp: A buyer and seller. The 2018 Farm Bill commonly known that THC levels in Fact Sheet’’ from the Congressional does not provide specific authority to initially compliant hemp may rise above Research Service, updated March 22, USDA to This final rule does not adopt the 0.3 percent delta-9 THC limit during 2019, that said a level of about 1 percent any requirement for interstate subsequent processing. Commenters THC is considered the threshold for transportation of hemp. As required by expressed concern that some cannabis to have a psychotropic effect the 2018 Farm Bill, USDA is developing jurisdictions believe the ‘‘in-process or an intoxicating potential. Other a database that will share information material’’ should be diluted to always commenters argued THC levels of 5 about hemp production with law maintain the level below 0.3 percent percent or more are necessary for enforcement. The database will identify delta-9 THC, even during transportation marijuana to have a psychoactive the contact information for the to another processor. However, several impact or commercial value. Comments producer, a legal description of the land comments argued that ‘‘in-process noted that hemp is generally material’’ is neither consumer ready nor characterized as plants that are low in 28 Memorandum from Stephen Vaden, Office of a ‘‘finished’’ product and that dry- delta-9 THC and high in levels of CBD, General Counsel to Sonny Perdue, Secretary of weight measurements related to hemp Agriculture, Legal Opinion on Certain Provisions of the Agriculture Improvement Act of 2018 Relating THC levels are calculated on the initial 29 https://www.govinfo.gov/content/pkg/FR-2020- to Hemp (May 29, 2019). plant material and not the finished 08-21/pdf/2020-17356.pdf.

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the primary non-psychotropic delta-9 THCA into delta-9 THC when One comment asked USDA to support compound. Many comments stated that the plant material is dried. Finally, the the hemp industry by adding hemp seed research shows that CBD affects the comment recommended that in all cases foods to those offered through school ability of THC to bind to CB1 receptor where ‘‘THC’’ is referenced throughout lunch and other government feeding in cells, thus blocking the psychoactive the final rule document with no further programs. effects of THC. clarification, ‘‘THC’’ should be changed One comment said that hemp extracts Other comments representing health to ‘‘delta-9 THC.’’ The comment said and concentrates and byproducts from organizations stated that research is these clarifications will be helpful in hemp should be afforded the same legal challenging the widely accepted administration of the rule. status and protections as the hemp from premise that CBD is not intoxicating. AMS Response: AMS is adding a which they originated. They further stated that the THC found definition of ‘‘Total THC’’ to clarify the One comment suggested that the IFR in CBD products can be intoxicating and use of the term in this rule. Total THC did not consider compliant hemp has caused significant and serious accounts for the conversion of THCA topical products that make up a large consequences in terms of job loss, into THC. We believe using THC and portion of the market or other health, and exposure to pediatric delta-9 THC interchangeably is applications that cannot be inhaled or populations. Some comments provided appropriate. ingested. personal testimony that while using Comment: One comment claimed that One comment advocated that hemp CBD for health benefits they had not making the IFR effective immediately and CBD should be covered and experienced psychoactive or gave farmers preparing for imminent protected under the Perishable intoxicating effects. harvest no time to comply with the new Agricultural Commodities Act (7 U.S.C. Other comments reported that the testing and threshold requirements, 499 et seq.). Some comments said farmers should United Nations standard STR/NAR/40 increasing their risk of producing plants uses a ratio of ([THC] + [CBN])/[CBD] to only be allowed to sell hemp to licensed that were legal under the 2014 and 2018 determine whether a plant is likely to brokers, handlers, and processors, and Farm Bill statutes but potentially illegal have a psychoactive effect. not directly to the public. They further under the IFR. AMS response: AMS appreciates advocated requiring license information AMS response: USDA’s decision to understanding different views on the to be part of the documentation that make the IFR effective immediately was psychoactive effects of THC. However, accompanies hemp shipments. this topic is outside the scope of the to provide a framework for the 2020 A couple of comments urged USDA to final rule, and AMS made no revisions growing season. However, States had establish good manufacturing practices to the program based on these the option to continue operating under for CBD manufacture. comments. The 2018 Farm Bill defined the 2014 Farm Bill. States and Indian One comment claimed that chemical hemp as having a THC concentration of Tribes were provided time to develop and seed providers have developed 0.3 percent or less. Medicinal use of plans on time for their planting and aggressive tactics which may be used to hemp or CBD is covered under the harvest season. hamper hemp producers. Federal Food, Drug, and Cosmetic Act, Comment: USDA should work with One comment requested updating 21 U.S.C. ch. 9, sec. 301, et seq. and other agencies, including DEA and DOJ, banking regulations to allow banks to do under the FDA’s jurisdiction. to develop cohesive information and business with entities whose income is guidance regarding enforcement related derived from hemp and/or legal Miscellaneous Comments to hemp. cannabis. Another comment requested Comments: One comment pointed out AMS response: AMS has worked with an examination on how bonding could that the IFR’s hemp definition did not DEA and other agencies in developing protect hemp farmers against companies include the application of an MU, but these regulations to assure that the and contracts that have not been that the definition of acceptable hemp intent of the 2018 Farm Bill provisions honored, causing financial harm to the THC level does. The comment said for hemp are met. USDA is responsible grower. references to the definition of hemp for the regulatory oversight of hemp One commenter suggested to should be changed to refer to acceptable production and DEA and other law discontinue the program totally or at hemp THC level so there is uniformity enforcement agencies are responsible for least discontinue the CBD portion across the final rule. enforcing the law regarding marijuana. because there is too much potential for AMS Response: USDA has made Miscellaneous Comments—Out of abuse and waste of taxpayer dollars. The references to acceptable hemp levels Scope commenter stated that it could be okay when appropriate. The acceptable hemp to continue the coverage for the seed levels include the MU to account for In addition to addressing specific and fiber. They also stated that USDA differences in laboratory conditions or provisions of the IFR, comments also should not be in the marijuana business. environments. There is no intention to addressed other topics related to the AMS received comments on the change the definition of hemp that is hemp industry. impact of the current statutory and stated by the 2018 Farm Bill. Comments: One comment advocated regulatory structure on banking and Comments: Another comment the creation of a USDA commodity insurance related to hemp production. recommended improving the clarity of checkoff program for one or more Commenters expressed concern that the the final rule by deleting the words ‘‘or categories of hemp (e.g. grain, fiber, 0.3 percent THC ceiling and the THC’’ from the definition of delta-9 CBD) and recommended that USDA required disposal of cannabis testing THC, as well as deleting the sentence work with hemp industry trade above 0.3 percent THC would hinder ‘‘For the purposes of this part, delta-9 organizations and stakeholders to the ability of hemp producers to obtain THC and THC are interchangeable.’’ The administer checkoff funds to support insurance, loans, or other financial comment further recommended that the hemp agronomic and market services. One commenter also urged definition of Total delta-9 THC be development. Another comment AMS to clarify if the preemption expanded to clarify that it includes included a newsletter item quoting language in section 10114(a) of the 2018 delta-9 THC combined with delta-9 USDA as saying that such a program Farm Bill encompasses interstate THCA to account for the conversion of could be developed. banking, financial services, and

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insurance transactions and if USDA activity’’ that would be a barrier to Comments on the IFR’s Regulatory intends to supersede, coordinate, or naturalization. Analyses adopt guidance issued by other Federal Several commenters expressed Civil Rights Review agencies related to hemp production. concern regarding hemp production in A comment suggested banks could The IFR included a Civil Rights close proximity to other agricultural offer insurance for crop losses if the review that found the rule would not crops. Commenters also expressed hemp had a THC concentration that was have adverse effects on protected greater than 0.3 percent but less than or concern regarding drying and persons or groups, deny them program equal to 0.5 percent, similar to offering processing of hemp near other crops and benefits, or subject them to coverage for losses due to factors residential areas. One commenter discrimination. beyond the grower’s control, depending suggested that AMS support research on Comments: One comment indicated on various USDA culpability findings. pollination and drift related to hemp that small farmers face challenges Another comment advocated that crop production. related to costs of seed. Another insurance be available for hot hemp. One comment asked USDA to clarify commenter associated the destruction of A comment stated that Non-Irrigated whether section 10114(a) of the 2018 non-compliant hemp as posing a great (NI) acreage should be uninsurable Farm Bill extends to interstate banking, risk of economic hardship on hemp because good producers who are serious insurance, or financial services farmers, especially the small minority about growing the crop would not involving hemp and hemp products. farmers. bother with NI acreage. Another Several comments from Indian Tribes comment discussed establishment of According to the comment, it is not clear whether interstate commerce in explained that certain provisions of the ‘‘Earliest Plant Dates’’ (EPD), Late Plant IFR, for example laboratory DEA- Period (LPP), and Final Plant Date hemp and hemp products necessarily includes the payment for any hemp and registration requirements, the definition (FPD), and references sections of what of key participants, and Tribal law may be a State or Tribe plan and the hemp products through various enforcement availability, did not difficulty of finding farmers growing methods, such as wires, checks, sufficiently account for the specific hemp in comparable environments for automated clearinghouse transactions, circumstances and challenges facing determining such dates and insurance credit card or other financial Indian Tribes across the nation such as coverage. It also recommended transactions, including loan proceeds. the remote location of many Indian developing a Replant Endorsement One comment advocated the use of Tribes, the limited economic resources (with premium associated) to insure 50 their company’s blockchain technology of Indian Tribes, and Tribal decision- to 75 percent of seed costs for replant. to address industry and law making structures. Comments pointed Finally, a commenter stated that enforcement concerns about chain-of- out that this final rule must ensure germination tests should be required custody in sampling, transporting, and Tribal civil regulatory authority to help before the crop is planted and set a testing hemp. minimum standard of 85 percent Tribal nations build and implement germination—and those under that One comment requested that a clear successful plans. Other Tribal standard would be uninsurable. Several statement be included in the final rule comments identified the requirements commenters argued that USDA should that USDA concurs that the exportation for the complete destruction of the plant (1) ban hemp and hemp related of hemp and hemp products is legal. It as, ‘‘disproportionately economically disastrous for our small Native products imported into the United noted that the 2018 Farm Bill does not American farmers,’’ explaining that States; (2) establish import limits on the prohibit exports, and stated, without number of clone material; (3) eliminate Native American farmers tend to be providing any empirical evidence, that significantly smaller and operate on all imported hemp and concentrates there is sufficient interest in exporting into the U.S. for the next 2 years, except very small margins. hemp and hemp products from the U.S. One commenter suggested that AMS for trades to the Canadian marketplace, It also suggested that a dedicated tariff but exportation must still be open for reconsider the potential civil rights code for hemp and hemp-derived implications of this rule on the our country and product markets products be established to facilitate outside the United States; and (4) convicted felons because the IFR, if export trade. establish clear rules on how imported unchanged, will have a disproportionate hemp and hemp products will be AMS Response: These comments all negative impact on both Black and regulated. address issues that are beyond the scope Latino Americans, who according to One commenter expressed concern of the rule. This rule only covers the DOJ data, represent 38.8 percent and about the current regulation of CBD as production of hemp. Issues such as 37.2 percent (respectively) of the total a prescription drug arguing that the promotion of hemp under a research population of Federally sentenced drug prescription-only status for CBD is and promotion program; adding this offenders. The commenter compares unwarranted and will facilitate the product to other programs including this data to the data from U.S. illegal market that continues to exist for feeding programs or PACA; importing or Department of Health and Human these products. One commenter noted exporting of hemp; who can produce Services’ rates of illicit drug use among that the regulatory ambiguity resulting hemp in the U.S.; processing the White Americans (9.5%), Black Americans (10.5%,) and Latino from the FDA’s lack of guidance on CBD commodity; insurance and banking; American (8.8%). negatively impacts hemp producers and research or setting production Another commenter claimed that requires greater clarity. boundaries; requirements on further One commenter raised concerns about using ‘‘flawed/inaccurate science with products such as CBD; or other subjects the ability of farm workers seeing U.S. lower standards is a direct example of naturalization to be able to participate mentioned above, are not the subject of failing to preserve the protection of the in hemp production based on a fear that this rulemaking or within other USDA public at large,’’ and ‘‘USDA cannot U.S. Immigration and Customs or federal, State, Tribal, or private legally implement their proposed rules Enforcement will view work in hemp industry responsibilities and without violating the mission statement production as an ‘‘exclusionary authorities. of the agency.’’

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AMS response: AMS considered the hemp, testing burdens, lab registration sales of the product. It cited sales data potential civil rights implications of this burdens. AMS addressed these reporting a 50 percent decline in the rule on minorities, women, and persons comments in the general comment price of CBD extracts and concentrates with disabilities to ensure that no section and took into consideration from April 2019, stating that the person or group shall be discriminated information provided for the RIA. oversupply of hemp has affected the against on the basis of race, color, One comment acknowledged that entire commercial supply chain. national origin, gender, religion, age, USDA’s economic analysis was based The commenter disagreed with the disability, sexual orientation, marital or on sound and reasonable methodology methodology used to project the net family status, political beliefs, parental but said that its expectations were not social benefit of hemp per acre in the status, or protected genetic information. confirmed by actual market events in IFR, saying that methodology assumed Additionally, this rule would not deny 2019. The commenter compiled social benefit is a static figure. The any persons or groups the benefits of the production data provided in other commenter asserted instead that social program or subject any persons or comments in an effort to present a more benefit is ‘‘a fluid figure that is heavily groups to discrimination. This rule is current analysis of the hemp market. influenced by time and supply and neutral and of general applicability. The comment pointed out that the RIA demand economics’’ and that it will We also note that some of the burdens underestimated the number of hemp likely fall over time.31 or hardship described in the comments production licenses that would be Further, it argued that the estimated are required by the 2018 Farm Bill. issued and hemp acres that would be 2019 societal willingness to pay of First, the 10-year ineligibility restriction planted in the 2019 growing season. $2,650 per acre, which was calculated applicable to persons convicted of a According to the comment, while the in the RIA using Kentucky grower sales State or Federal felony is a requirement RIA called only for a doubling of and planted acreage, is not of the 2018 Farm Bill. Also, as stated licenses beyond the 2018 benchmark, representative of the rest of the United previously the basis for the DEA lab the actual rate of licenses increased by States. Based on the hemp product sales registration is rooted to the statutory 476 percent in 2019. Similarly, the in Chart 1 of the RIA, the estimated requirements of the Controlled comment reported actual planted hemp return to producers of processor sales of Substances Act, that requires any acreage in 2019 to be close to 230,000 31 percent, which was calculated in the laboratory that might potentially handle acres, well over the 155,000 acres RIA by comparing Kentucky grower and a controlled substance to undergo the assumed by the RIA. The comment went processor sales, and total U.S. planted DEA registration process and thus on to say that the rate of growth for new acres estimated in Table 3 of the RIA, cannot be eliminated. Additionally, the licenses outpaced the rate of growth for the comment calculates a 2019 national 2018 Farm requires effective disposal of consumer sales by 3:1, while the RIA societal willingness to pay of $2,325 per non-compliant plants. had assumed a 1:1 rate over the next acre. This result indicates that the Moreover, AMS conducted a Civil four years. The comment explained that societal willingness to pay based on Rights Impact Analysis in accordance supply growth has outstripped demand Kentucky data is 14 percent higher than with USDA’s Departmental Regulation and created significant market the estimate for the United States as a 4300–004: Civil Rights Impact imbalance and, as a result, market prices whole. The comment also calculates a Analysis.30 AMS’s analysis did not find have dropped and driven down national societal willingness to pay for any evidence that the final rule would revenues to hemp producers. 2018 of $4,047, which illustrates that a adversely or disproportionality impact The comment cited the gross revenue decline in societal willingness to pay of hemp producers in protected groups, for floral material estimated in Table 1 42.5 percent occurred in 2019. regions or Tribes as compared to the of the RIA, which ranges from $2,333 to The comment cautioned that the net general population of hemp producers $24,000 per acre under the assumption social benefit calculated in the IFR was or State Departments of Agriculture. that two-thirds of an acre is planted for over inflated because it represents a floral material. Based on market data point in time during the industry’s Regulatory Impact Analysis published in November 2019, after the infancy. The comment argued that the Executive Orders 12866 and 13563 IFR’s publication, the comment industry faces a market depression and direct agencies to assess all costs and suggested that the actual range of gross recommended a quota system for benefits of available regulatory revenue for floral material per two- licensing classified by intended use. In alternatives when an action is deemed thirds of an acre was $2,728 to $17,261. this recommendation, the comment to have significant impacts. If regulation The comment then applied the variable offered a detailed approach to is necessary, then agencies must select cost of planting one full acre of floral estimating acreage required to meet the action that maximizes net benefits, material estimated in the RIA, $28,638 demand for hemp grown for use in the including potential economic, per acre, to this range of gross revenue. CBD market. The analysis resulted in an environmental, public health and safety This calculation resulted in a loss of estimated 44,509 acres required to meet effects, and equity. Executive Order $11,377 to $25,910 per acre, which the demand in 2020, 83,336 acres for 2021, 13771 mandates that agencies provide comment said is incorrect given that the 188,558 acres for 2022, 255,899 acres for the best approximation of total costs variable cost per acre of floral material 2023, and 309,773 acres for 2024. The associated with a new or repealed was deducted from the gross revenue comment expanded upon its regulation. AMS prepared a Regulatory per two-thirds of an acre. For an recommendation of a quota licensing Impact Analysis (RIA) with the purpose accurate estimate of net revenue, it system, suggesting that a number of of accomplishing these objectives. stated that gross revenue and costs must licenses be granted by range of acreage, Comments: Very few comments be represented in terms of the same unit thereby ensuring that a share of licenses addressed the RIA specifically, but we of measurement. is reserved for small farmers. received many comments with The comment suggested that the Another comment asserted that unless information related to assumptions that downstream effects of an unbalanced the IFR definition of hemp is revised to fed into the RIA such as percent of hot economic supply equation would include cannabis with a total THC level further disrupt the profitability of 30 https://www.ocio.usda.gov/sites/default/files/ sectors that are intended to support the 31 https://beta.regulations.gov/comment/AMS-SC- docs/2012/CRIA%20DR%204300-004-final.pdf. transportation, processing, and retail 19-0042-1490.

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of not more than 1.0 percent on a dry Two comments asserted that USDA for future crops until USDA finalizes its weight basis, it will not be economically grossly underestimated the sampling rule. viable to grow hemp for flower in the time and cost in the IFR. Comments AMS response: AMS is aware that the U.S. According to the comment, if the were concerned that readers might number of licenses and amount of THC limits of the IFR are maintained in assume hemp sampling and testing costs acreage that were estimated in the RIA the final rule, the RIA should be revised fees are preset. The comments suggested of the IFR were underestimated. to reflect the impact of the rule on total that hemp sampling is a more complex Entrance of producers into the market yield and CBD concentration of logistical problem than contemplated in spiked at an unexpected rate in 2019, harvestable flowers, reduced value of the IFR because of the geography and driving up acreage along with licenses. CBD hemp seed, and the unknowable scope of sampling on farms. The AMS utilized the most current data market value of CBD. The comment comments encouraged USDA to available to it in its analysis of the hemp predicted that although the value of calculate anticipated sampling costs to market in the IFR and the final rule. hemp seed for flower might be reduced include a minimum number of hours for Regarding the estimate in one marginally, other input costs would each step in the sampling process, and comment of net loss ranging from remain very high. to consider factors such as travel time and coordination of supplies and $11,377 to $25,910 per acre, it is One comment recommended personnel for the sampling effort. important for gross revenue and costs to differentiation between hemp biomass One comment disagreed with the IFR be represented in the same unit of and hemp flowers in the IFR’s analysis statement that the new hemp measure for an accurate net revenue of market prices for floral material. The production program would expand calculation, which, in this case, they are comment said that hemp biomass refers production and sales of domestic hemp, not. The variable cost per one acre of to full plant material, including stems, benefitting U.S. growers and consumers. floral material was deducted from the leaves, and flowers, while hemp flower The commenter said that production gross revenue per two-thirds of one acre refers to the part of the plant that costs for his CBD hemp farm were of floral material, resulting in a larger contains trichomes which houses richly approximately $16,000 per acre, but loss than if calculated using the same and densely populated cannabinoid because of the IFR’s restrictiveness and unit of measurement. AMS has adjusted content. The comment said the prices in his resulting inability to bring the crop the calculation of net revenue in the the RIA are consistent with prices for to full maturity, the crop would likely table below using the market price data hemp biomass, and suggested prices for only return $9,000 per acre. The cited by the comment. AMS appreciates hemp flowers ranging from $25 to $800 commenter said they were unwilling to the comment’s citation of its sources per pound, depending on the percentage make that kind of risky investment and and utilized similar sources in the RIA of CBD present. was unwilling to decide whether to plan of this final rule.

Gross Variable Net Planted acres Yield Price revenue cost revenue

Low estimate

2/3 ...... 1,000 $4.09 $2,727 $19,092 $(16,365) 1 ...... 1,000 4.09 4,090 28,638 (24,548)

High estimate

2/3 ...... 1,200 21.58 17,264 19,092 (1,828) 1 ...... 1,200 21.58 25,896 28,638 (2,742)

Furthermore, AMS understands and licenses based on intended use and to Comments: One organization that appreciates the commenter’s argument revise the definition of hemp such that represents the views of small entities that net social benefit andsocietal it includes cannabis with up to 1.0 stated that small hemp producers have willingness to pay are over inflated in percent total THC on a dry weight basis significant startup costs that affect their the IFR. Due to the relative scarcity of are outside of the authority of USDA. ability to be competitive in the hemp industry data, AMS made many The 2018 Farm Bill provided USDA no industry. The comment notes that hemp assumptions in its analysis in the IFR, authority to regulate production production is labor-intensive and has some of which were not realized. In volume. Additionally, USDA cannot licensing and regulatory costs that are order to caution industry stakeholders adjust the statutory definition of hemp. not typically incurred by producers of of the volatility of the hemp market, other agricultural crops. Small entities AMS has also reviewed the sampling however, AMS used variable cost indicated that only those businesses procedures and costs characterized in estimates to calculate net returns to with adequate capital and large-scale approved state and Tribal plans to better producers, which ranged from a loss of operations would be able to survive and nearly $17,000 to a gain of $6,240. In the estimate the time and resultant fees that comply with the requirements of this single year since publication of the IFR, will be charged to producers for rule. Further, comments conveyed that a greater amount of data has become sampling in the hemp program. this rule will raise real barriers to entry available to AMS, which allows the Small Business Impacts for small and disadvantaged producers analysis in the final rule to rely less on and could prevent these critically assumptions that may not be actualized. AMS performed a Regulatory important producer groups from even AMS only has the authority regarding Flexibility Analysis (RFA) in entering the hemp industry. hemp regulation granted to it by the conjunction with the IFR that Other comments stated that the 2018 Farm Bill. The recommendations considered the effects of the rule on negative effects of the regulatory to establish a quota system for issuing small businesses particularly. incongruence in the IFR

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disproportionately affect farmers, in practical regulatory scheme to Tribal Matters particular new and small farmers—and encourage industry growth. The IFR provided that States and small or already disadvantaged hemp AMS response: AMS understands that Indian Tribes may submit hemp farmers will face additional risks if the there is a great deal of uncertainty in the production plans to USDA for approval. IFR is not changed. hemp industry currently and has made Individual producers from States or One comment claimed the 2014 and efforts to minimize any burden which Tribal territories that do not have 2018 Farm Bills presented an innate may befall producers as a result of this USDA-approved plans may file separate prejudice for institutional research, rule. To that end, USDA is not charging applications for hemp production including State departments of producers any fees for licensing or licenses under the general USDA hemp agriculture and institutions of higher collecting any fees from producers to production plan. Below are several education and this prejudice continued support AMS’ administration of the comments and AMS’s responses in the IFR. The commenter says this is hemp program. The fee structure regarding matters of particular concern similar to the bias of California’s draft developed by States and Indian Tribes to Indian Tribes and Tribal members. State plan, where individuals permitted to administer their hemp programs lies Comments: Comments said the to be grower or breeders, but the outside of the purview of USDA. On regulations fail to treat Indian Tribes on program’s compliance burdens are average, AMS anticipates total fees paid an equal basis with States by repeatedly effectively beyond the reach of most by producers under a State or Tribal failing to include the term ‘‘Tribe’’ when individuals. Plan to amount to $800 per grower. This referring to the State and local Commenters stated that this rule will amount includes licensing and other disrupt small producers who were jurisdictions. According to comments, fees intended to generally fund the by doing so, the regulations fail to successfully producing hemp under operations of States or Tribal Programs. prior pilot programs. One organization respect Tribal sovereignty and self- Fees for sampling and testing, on government. reported that hemp producers have average, amount to about $300 per lot. stopped growing hemp altogether until AMS response: USDA agrees that The cost for an annual background Indian Tribes must be treated the same they can be certain about what the check for three key participants is $54. requirements for producing hemp. as States under the regulations. There AMS estimates an annual reporting and Comments also reported that some were a few occasions where USDA recordkeeping burden of $129 per hemp buyers have not renewed their mistakenly left out ‘‘Tribe’’ from the grower. Altogether, these costs total contracts. Comments stated that several language in the regulation. USDA is $1,283 per grower, assuming one lot of the provisions of this rule impose correcting these mistakes in the IFR by requires sampling and testing. This total unnecessary burdens on small entities. revising the language of the final rule to cost is 0.1 percent of $1 million, which Comments suggested that many of the insert ‘‘Tribe’’ after ‘‘State’’ in the is the largest amount in annual receipts sampling and testing requirements definition of Law Enforcement Agency that a grower may receive to be should be revisited and alternatives in § 990.1; insert ‘‘Tribe’’ after ‘‘State’’ in considered to be a ‘‘small business’’ should be considered and analyzed to § 990.24(a); and revise § 990.40(d), minimize the burden to small under the Small Business Size which incorrectly referred to ‘‘States producers. In addition, comments said Standards of the U.S. Small Business and territories of Indian Tribes,’’ to refer that small business are very concerned Administration (SBA). to ‘‘States and Indian Tribes’’. about the risk of losing their economic In response to comments, AMS has Comments: Several comments investment due to mandatory disposal, revised its sampling and testing asserted that USDA should not define the lack of control over growing methodology to allow for performance- ‘‘territory of an Indian Tribe’’ and conditions, genetics of neighboring based sampling, which should reduce claimed that by doing so, USDA violates crops, and timing and precision of the the burden on all producers, large and Tribal treaty rights to farm on Tribal testing. small. Section 990.3 details this revised territories. Comments argued that such Comments from State departments of methodology. In addition, AMS has a definition should be left up to each agriculture expressed strong concern as modified its disposal requirements, and Indian Tribe. Further, comments to the additional burdens they would allows for remediation of noncompliant contended that the definition of incur as a result of the rule. These crops. These remediation options are ‘‘territory of an Indian Tribe’’ at § 990.1 burdens may be directly passed to small described in § 990.27. inappropriately refers to a criminal producers in the form of delayed AMS understands the concerns raised statute, 18 U.S.C. 1151, to define an responses to license applications, by state departments of agriculture Indian Tribe’s territory and regulatory renewals, and appeals; testing backlogs; regarding the requirements of jurisdiction. Other comments supported duplicative reporting requirements; new administering a commercial hemp the use of the Indian country definition, license fees; and other programmatic program. For this reason, AMS has but asked for the removal of the issues. made every effort to provide States and requirement that the lands must be One comment claimed that, based on Indian Tribes flexibility to administer within the Indian Tribe’s jurisdiction, six years of administering their hemp their hemp programs, including whether primarily because it causes uncertainty program, many of the most rigid they charge for fees or other costs or as to whether Indian Tribes may requirements of the IFR are not only cover those expenses from other State or regulate hemp production on non- unnecessary, but also likely to have a Tribal resources. If the burden for a Indian owned fee lands within a Tribe’s disproportionately adverse impact on State or Indian Tribe to administer its territorial boundaries. Comments also new farmers and farmers with smaller own hemp program remains too great, asked that AMS clarify that States operations. According to the comment, however, the State or Indian Tribe may cannot interfere with hemp production these farmers already face great risk in elect to participate in the Federal plan within the territory of an Indian Tribe. the current marketplace, and need and allow AMS to administer the AMS Response: If an Indian Tribe regulatory help, rather than program. By providing this flexibility, does not assume primary jurisdiction impediments, in order to grow and USDA believes it is less likely that the over the Tribe’s Indian territory, USDA thrive. The comment urged AMS to burdens on State and Tribal resources has jurisdiction over the hemp provide a more sensible, flexible, and will be passed on to small businesses. production on an Indian Tribe’s

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territory pursuant to the 2018 Farm Bill. benefit. . . .’’ Montana v. Blackfeet hemp production within their USDA, therefore, must know the limits Tribe of Indians, 471 U.S. 759, 766 territories, including on nontribal fee of its jurisdiction over such Indian (1985) (citations omitted). In addition, lands within reservations. This territory, just as it must know its USDA may address ambiguities in a authority applies without regard to the jurisdiction over lands ordinarily within statute that it administers, with any Indian Tribe’s ability to demonstrate State jurisdiction. reasonable interpretation of the inherent regulatory authority over non- The IFR defined ‘‘territory of the ambiguous term entitled to judicial Indians under the factors set forth in Indian Tribe’’ at 7 CFR 990.1 as having deference. Chevron U.S.A. Inc. v. Nat. Montana v. United States, 450 U.S. 544 the same meaning as ‘‘Indian Country’’ Res. Defense Council, Inc., 467 U.S. 837, (1981). Additionally, this definition will in 18 U.S.C. 1151. Upon consideration 842–43 (1984). In this case, Congress make clear the area over which USDA of comments submitted by Indian provided no indication that the term will have regulatory authority including Tribes, USDA concurs that reference to ‘‘territory of the Indian Tribe’’ should licensing if the Indian Tribe does not the criminal law definition of Indian apply more narrowly than similar terms have an approved plan or a plan country could be confusing. that have been defined and interpreted submitted to USDA for approval. Therefore, in the final rule USDA in other Federal statutes and programs. Comment: Some comments said revised the definition of ‘‘territory of the Moreover, a narrow interpretation that Indian Tribes did not have the benefit Indian Tribe’’ to incorporate language excluded nontribal fee lands within of operating under the 2014 Farm Bill from other Federal statutes, but without reservations would perpetuate the and, consequently, have not developed explicitly cross-referencing such problem of checkerboard jurisdiction the farming techniques and regulatory statutes. Specifically, the final rule over lands within Indian reservations, systems that States have. Therefore, defines ‘‘territory of the Indian Tribe’’ to adding unnecessary confusion and according to comments, Indian Tribes mean (a) all land within the limits of uncertainty to the challenges of should be given a grace period while any Indian reservation under the implementing the hemp program in they develop best practices. jurisdiction of the United States Indian country. Therefore, the USDA AMS response: Not all States operated Government, notwithstanding the includes a regulatory definition of the under the 2014 Farm Bill, and some issuance of any patent, including rights- term ‘‘territory of the Indian Tribe’’ that Indian Tribes did enter into Tribal— of-way running through the reservation; is based on the definition of Indian State agreements under the 2014 Farm (b) all dependent Indian communities country in 18 U.S.C. 1151 and the Bill. Therefore, establishing a regulatory within the borders of the United States definition of Indian lands in the Indian grace period for Indian Tribes only is whether within the original or Gaming Regulatory Act, 25 U.S.C. not workable. Indian Tribes may take subsequently acquired territory thereof, 2703(4). advantage of training and technical and whether within or without the The definition includes all lands assistance offered by the USDA and limits of a state; (c) all Indian within the limits of any Indian other entities to ensure that they allotments, the Indian titles to which reservation under the jurisdiction of the implement the best systems possible. have not been extinguished, including United States Government, Comments: Some comments claimed rights-of-way running through the same; notwithstanding the issuance of any that negligent violations by Indian and (d) any lands title to which is either patent, which encompasses on- Tribes under § 990.6 may cause Indian held in trust by the United States for the reservation parcels held in fee simple by Tribes to be ineligible for other benefit of any Indian Tribe or individual non-members of the Indian Tribe. programs. or held by any Indian Tribe or Similar provisions are found in the AMS response: The 2018 Farm Bill individual subject to restriction by the criminal jurisdiction definition of describes three types of negligent United States against alienation and Indian country, 18 U.S.C. 1151; in the violations under State and Tribal plans. over which an Indian Tribe exercises Clean Water Act, 33 U.S.C. 1377(h); the The negligent violations detailed in jurisdiction. Clean Air Act, 42 U.S.C. 7601(d)(2)(B). § 990.6 are required to be included in In the 2018 Farm Bill, Congress The U.S. Environmental Protection State and Tribal plans pursuant to the provided authority for any Indian Tribe Agency (‘‘EPA’’) interpreted the statutes 2018 Farm Bill. to seek USDA approval to become the that it administers as providing Comment: A comment contended that primary regulator of hemp production authority to Indian Tribes over non- the requirement for a geospatial site within the ‘‘territory of the Indian Tribal fee lands within Indian identification at § 990.3(a)(1)(ii) is too Tribe.’’ The 2018 Farm Bill did not reservations. EPA Final Rule: Indian expensive for Indian Tribes, provide a definition of the term territory Tribes—Air Quality Planning and unnecessary, and not readily available. of the Indian Tribe, and there is no Management, 63 FR 7254 (Feb. 12, Comments said the Department of the universally accepted definition of that 1998); EPA Interpretive Rule: Revised Interior has land records that could be term, or similar terms, within the field Interpretation of Clean Water Act Tribal used to obtain necessary information. of Federal Indian law. In describing Provision, 81 FR 30,183 (May 16, 2016). AMS response: A legal description of jurisdictional boundaries associated EPA found that the Clean Water Act and the land where hemp is grown is with Indian Tribes, various Federal Clean Air Act provided a delegation of required by the 2018 Farm Bill. statutes use several terms, including authority to Indian Tribes over non- Geospatial location is one form of Indian country, Indian lands, Federal Tribal fee land within reservations. See meeting such requirement. Producers Indian reservations, and areas within Arizona Public Serv. Co. v. EPA, 211 are required to provide information to the Indian Tribe’s jurisdiction, among F.3d 1280 (D.C. Cir. 2000). The agency FSA on the geographical location of others. found legislative intent and a common- hemp production. FSA offices will Thus, by its very nature and history, sense reasoning to treat Indian provide assistance in identifying such the statutory term ‘‘territory of the reservations holistically for purposes of location at no cost to producers. Indian Tribe’’ is ambiguous. According environmental regulation. Comments: Some comments said to the Indian canon of construction, Similarly, USDA interprets the 2018 USDA should conduct more Tribal ‘‘statutes are to be construed liberally in Farm Bill as authorizing Indian Tribes consultations and provide USDA and favor of the Indians, with ambiguous to become—with USDA’s approval of a DEA training for hemp producers. One provisions interpreted to their hemp plan—the primary regulators of Indian Tribe requested more time to

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allow Indian Tribes to organize a Tribal leasing trust or restricted Indian lands. production. USDA also believes that Advisory Council of Tribal Leaders to USDA conferred with the Department of this focus should be consistent across continue with the development and the Interior, the agency regulating the USDA plan regardless of the person implementation of federal hemp policy. Indian land, and did not identify any who is applying for a license. For the AMS Response: In addition to conflicts between the two sets of foregoing reasons, USDA has clarified previous Tribal consultations and regulations. the definition of key participants in the extending and reopening the IFR’s Comment: A comment suggested final rule to provide that the definition comment period, USDA added a USDA hire an Indian law expert to ‘‘does not include a member of the September 2020 Tribal consultation to assist with development of the final leadership of a Tribal government who receive additional information, rule. is acting in their capacity as a Tribal particularly from 2020 growing season AMS response: USDA agreed and leader except when that member producers. See the section on E.O. hired a consultant with 40 years- exercises executive managerial control 13175 Consultation and Coordination experience as an Indian law attorney to over hemp production.’’ AMS notes that with Indian Tribal Governments in this assist with the development of the final an Indian Tribe may adopt its own document for further discussion about regulations and the review of Tribal hemp plans subject to USDA approval. the consultations. If Indian Tribes plans. When adopting a hemp plan, the Indian organize a Tribal Advisory Council of Comment: Comments said the Tribe can determine who participates in Tribal Leaders, USDA would appreciate criminal history checks required by the its plan and will be subject to a criminal any future feedback. Additionally, IFR should be expanded to include the history check. USDA is available to provide technical Department of Justice Tribal Access Comment: USDA received a comment assistance when requested, including Program (TAP). According to comments, that it should affirm Tribal sovereignty training. USDA is adding training for those using TAP would then be able to by not allowing other federal agencies, sampling to its website. directly access criminal history checks. such as the DEA, to interfere with Tribal Comments: Comments said that Comments also said the regulations hemp remediation. Indian Tribes and individuals within need to clarify whether the criminal AMS Response: USDA does not have the territory of the Indian Tribe should history check can be a name check or a the authority to control the actions of not have to be regulated by States, but finger-print check. other federal agencies acting properly should be able to go directly to USDA AMS Response: USDA conferred with within their authority. for licensing if the Indian Tribe opts out the DOJ Office of Tribal Justice and was Comment: USDA received comments of developing its own Tribal plan and informed that Indian Tribes can use the that USDA owes a trust responsibility to the Indian Tribe does not otherwise TAP program to access the FBI Identity Indian Tribes. According to prohibit hemp production. History Summaries. The FBI Identity commenters, that trust responsibility AMS Response: Subpart C, the USDA History Summaries may be based on requires acknowledging the unique Hemp Production Plan, governs hemp name check or a finger-print check. challenges that Indian Tribes face producers in the absence of a Tribal Comment: Comments noted that the including that (1) most tillable land was plan. Therefore, any Indian Tribes or term ‘‘key participant’’ is defined at taken from Indian Tribes during individuals wishing to produce hemp § 990.1 in a manner that is not homesteading; (2) Tribes’ participation must comply with those regulations if necessarily consistent with an Indian in the farm program results in only a 60 not covered under a State or Tribal plan. Tribe’s unique organization and percent yield of their non-Indian If an Indian Tribe decides not to methods of doing business. Comments counterparts; (3) the finance system is develop its own hemp plan, a producer explained, for example, that an Indian usurious as financiers discount the may directly apply for a USDA license. Tribe may be the owner of a hemp farm. value of Tribal assets or refuse to States were not delegated authority Comments asserted that although the consider them at all; and (4) American under the 2018 Farm Bill to regulate Indian Tribe’s governing council may be Indian producers will be hemp production within the territory of the ultimate decision-maker as the disproportionately disadvantaged an Indian Tribe. owner, it would not be appropriate to because their farms are significantly Comment: Indian Tribes should be include them in the felony and smaller and are generally run with only allowed to implement their Tribal background investigations. Therefore, one crop by families with small preference laws. comments said Indian Tribes should be margins. AMS Response: Nothing in the IFR or permitted to identify their own ‘‘key AMS Response: USDA acknowledges the final rule prevents Indian Tribes participants’’ if they are operating under that it has a special government-to- from implementing their Tribal a USDA plan and the requirements of government relationship with Indian preference laws. § 990.22. Tribes, and believes that, in preparing Comment: A comment said that Tribal AMS Response: USDA understands and issuing this final rule it has acted ordinances and interstate commerce the concerns raised by Indian Tribes in accordance with that relationship. In regulations need to address price regarding the application of the criminal response to concerns regarding the gouging in seeds and input. history report requirement and the unique challenges Indian Tribes face, as AMS Response: This comment is felony conviction restriction on Tribal explained in the Civil Rights Review of outside the scope of this rule. leaders. However, USDA must ensure this final rule, AMS conducted a ‘‘Civil Comment: A comment said the that entities operating under a USDA Rights Impact Analysis’’ and did not Bureau of Indian Affairs and USDA plan comply with the felony conviction find any evidence that the final rule should review 25 CFR part 162 restriction in the AMA. For reasons would adversely or disproportionality governing agriculture and business explained in the IFR, USDA believes impact Indian Tribes or Tribal members leases to ensure that the hemp that the appropriate approach in producing hemp as compared to the regulations here do not conflict with determining who participates in the general population of hemp producers that part or cause additional regulatory program, and therefore subject to the or State Departments of Agriculture. hurdles. felony conviction restriction, is to focus Indian Tribes may take advantage of AMS response: 25 CFR part 162 on those who exercise executive training and technical assistance offered establishes certain requirements for managerial control over hemp by the USDA to ensure that they

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implement the best systems possible. by the 2018 Farm Bill. These baseline drug, USDA can only make the Additionally, USDA is available to regulations require all State and Tribal determination of whether the crop is provide technical assistance when plans to include certain minimum legal hemp (which it regulates) or illegal requested. requirements for licensing, sampling, marihuana (which it does not regulate) testing, disposal, and information through the mechanisms Congress has State and Tribal vs. Federal Regulation collection. These requirements could authorized. Recordkeeping requirements The preamble of the IFR stated that certainly be considered ‘‘more are paramount to that determination, ‘‘[n]othing preempts or limits any law of burdensome’’ than certain State hemp which is required by Congress. AMS is a State or Indian Tribe that regulates the production plans operated under 2014 retaining the recordkeeping production of hemp and is more Farm Bill pilot program provisions, but requirements of the IFR. stringent than the provisions in the 2018 they are intended to provide APA Notice and Comment Concerns Farm Bill.’’ Further, Section 297B of the consistency and transparency among the AMA expressly states that it does not U.S. hemp industry as it matures. Prior Comment: Some commenters claimed preempt a State or Indian Tribe’s ability to the passage of the 2018 Farm Bill, that in issuing an IFR, AMS acted to adopt more stringent requirements or States operating hemp pilot programs arbitrarily and capriciously in violation to prohibit the production of hemp. This could administer these programs with of the APA. Commenters argued that the was codified in the IFR in § 990.3(b)(1), minimal Federal oversight, and without good cause statement included in the which provides that nothing in the part baseline requirements around sampling, IFR was not adequate to support its preempts or limits any law of a State or testing, and other program requirements issuance rather than going through Indian Tribe that regulates the because the 2014 Farm Bill programs are notice and comment rulemaking. production of hemp and is more for research. The 2018 Farm Bill AMS Response: AMS does not agree stringent than this part or Subtitle G of established baseline requirements for with these comments and believes that the Act. hemp production for hemp production there was good cause to issue the IFR. Comments: Many of the comments across the U.S. regardless of the purpose AMS has encouraged public input on received stated that the provisions of the of the production. the IFR since its issuance and has IFR were more stringent than the provided many opportunities for public regulations of pilot programs Preemption comment. established by States under the Comment: AMS received comments authority of the 2014 Farm Bill. In fact, asserting that the IFR did not abide by Criminal Background Checks and the majority of all comments received the mandate of the 2018 Farm Bill that Definition of Key Participants either took exception to the perceived there be no preemption of state or Tribal Comment: Several commenters argued increase in regulatory requirements for laws that regulate the production of that the restrictions on participation in hemp production under the IFR, or hemp and are more stringent than the hemp production for people with presented recommendations for hemp provisions in the federal statute. criminal convictions related to a alternative requirements under the final AMS response: Section 297B(a)(3) of violation of a state or Federal controlled rule that would not be as restrictive or the AMA provides that for States and substance law are not necessary and that burdensome as the provisions in the Indian Tribes with primary regulatory hemp should be treated the same as all IFR. jurisdiction over the production of other commodities, which do not have No comments were received that hemp, there is no preemption if that similar restrictions. Commenters argued either affirmed or opposed the rights of State or Indian Tribe both regulates the that there should be an exception for States and Indian Tribes to promulgate production of hemp and that regulation people with disqualifying criminal more stringent regulations for their is more stringent than the 2018 Farm convictions who could demonstrate jurisdictions. However, one comment Bill or the implementing regulations. rehabilitation and that this restriction said rather than using the flexibility Thus, the no preemption provision of conflicts with state statutory allowed in the law to let states develop the 2018 Farm Bill is to make clear that requirements in some states. One sensitive state plans, the IFR had rigid more stringent requirements are not commenter argued that USDA should controls not required by law or preempted. AMS finds that the 2018 conduct all criminal background checks correlated to the relatively low-level risk Farm Bill requires the implementation rather than States or Indian Tribes. of non-compliant hemp. The comment of federally mandated minimum AMS Response: AMS acknowledges further said USDA should establish standards, which all jurisdictions must various stakeholders’ advocacy for baseline requirements but provide follow, allowing for certain further reduced restrictions to entry in hemp States flexibility to consider the restrictions by States and Indian Tribes. production. However, the restriction on dynamics of agricultural production that participation-based on a criminal depend on farm and field conditions, Recordkeeping Requirement conviction for violation of a state or weather, and the timing appropriate for Comment: One commenter argued Federal law related to controlled planting, harvesting, the varieties being that the recordkeeping requirements of substances is a requirement established cultivated and the marketing of crops. the IFR violated the 4th Amendment’s by statute and AMS does not have the Other comments agreed with prohibition against unreasonable search authority to change to waive this recommendations to allow States and and seizure and was ‘‘arbitrary and restriction. Indian Tribes to determine certain capricious’’ and a violation of the APA. provisions that are not central to the AMS Response: The 2018 Farm Bill Definition of Key Participants minimum regulatory requirements of established a hemp production program Comment: Some commenters the IFR, such as application windows in the U.S. subject to oversight from the requested that AMS change the and reporting. Secretary of Agriculture. Part of that definition of key participants to more AMS response: The 2018 Farm Bill congressional mandate is for the clearly state which individuals within a expressly preserved the ability for State Department of Agriculture to establish a business entity would be required to and Tribal hemp production plans to plan by which it collects information submit a criminal history report. One establish additional provisions stricter from producers to ensure compliance. commenter requested that AMS align than the baseline regulations required While hemp is no longer a Schedule 1 the definition of key participant with

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the definitions of ‘‘legal entities’’ and on the number of producers, disposal of 2020, USDA has already approved 65 ‘‘beneficial owners’’ in Department of rates, and time burdens for completing individual State and Tribal programs, Treasury regulations. Another the forms. Because of this new with more to come. The amount of State commenter suggested that AMS define information, AMS is updating the approved programs will also increase who must submit a criminal history burden calculations currently approved once the 2014 Farm Bill pilot authority report in States and Indian Tribes that by OMB. AMS will submit an updated expires and those additional States have an approved plan for primary Information Collection to align the new submit plans. States and Indian Tribes regulatory authority over hemp in their calculations in the FR with the 0581– with approved plans are required to jurisdiction. 0318 package. report certain information to USDA AMS Response: AMS acknowledges AMS received over 4,600 comments through three Forms: The ‘‘State and various stakeholders’ advocacy for a in the first public comment period and Tribal Hemp Producer Report’’, the single definition of ‘‘key participants’’ 1,100 during the second comment ‘‘State and Tribal Hemp Disposal for all hemp producers. However, AMS period on the overall regulation. A Report’’, and the ‘‘State and Tribal will not require that States or Indian specific analysis of each topic area in Hemp Annual Report’’. USDA collects Tribes with an approved plan for the comment analysis section of the information from all hemp producers primary regulatory authority over the final rule. AMS did not receive public under a State, Tribal or USDA program production of hemp in their jurisdiction comments specifically on the PRA nor through the FSA report form ‘‘Report of adopt the USDA definition of ‘‘key on the time burden hour calculations to Acreage’’. USDA collects information participants.’’ States and Indian Tribes complete any of the forms. One from USDA producers through the are free to incorporate the AMS comment from the Alabama Department ‘‘USDA Producer Application’’, the definition of key participants into their of Agriculture wrote that 10 minutes for ‘‘USDA Annual Report’’ and the ‘‘USDA plan but they are not required to do so. a State or Tribal producer license Disposal Report’’. Laboratories provide They must, however, define who application was too low, so that has information on the ‘‘Laboratory Test participates in their plan and, for each been increased to 20 minutes. Report’’. license or authorization they issue, must AMS used an initial estimate of 9,000 AMS has updated PRA calculations identify at least one individual who will total producers for the IFR. This was using the Occupational Employment be subject to a criminal history check. based on the limited data from State Statistics Survey of the Bureau of Labor 32 The Department of Treasury definitions Departments of Agriculture and the and Statistics using the 2019 data. of ‘‘legal entities’’ and ‘‘beneficial hemp advocacy group, Vote Hemp. The mean hourly wage of a compliance owners,’’ while similar to the definition Based on a review of hemp production officer, as reported in May 2019, was of ‘‘key participants’’ adopted herein data from State Departments of $35 per hour. This is the same apply broadly to the corporate structure Agriculture, and the data reporting numerical value as the May 2018 report. of a business entity. USDA finds the services from Hemp Benchmarks and Assuming 39 percent of total ‘‘key participant’’ definition to best Vote Hemp, AMS now estimates 20,000 compensation accounts for benefits, the describe those individuals responsible producers as a yearly average to use for total compensation of a compliance the purposes of reporting calculations. for compliance with this program or officer is $57 per hour. This $57 per These numbers will be updated every ‘‘leadership structure of a business hour will be used throughout the PRA three years. While the current percent of entity.’’ section. hemp growers licensed under USDA is X. Regulatory Analyses drastically smaller than this, AMS Respondents: States or Tribes With Approved Plans Paperwork Reduction Act assumes approximately 20 percent or 4,000 producers will be licensed under AMS initially estimated that the time In accordance with section 3507(d) of the USDA plan, and the other 80 required for States and Indian Tribes to the Paperwork Reduction Act of 1995 percent or 16,000 producers licensed fill in the information for each of these (44 U.S.C. 3501 et seq.), the Domestic under State and Tribal USDA-approved forms will be 20 minutes or 0.33 hours Hemp Production Program’s programs. with a 5 minute or 0.08 hours record information collection requirements The description and function of the keeping burden. This estimate has been have been previously approved by seven reporting forms remains the same updated from 20 minutes to 60 minutes Office of Management and Budget from the IFR and initial OMB approval. or one hour. The ‘‘State and Tribal (OMB) and assigned OMB No. 0581– These forms require specific Hemp Producer Report’’ and the ‘‘State 0318. The 60-day public comment information be submitted by States and and Tribal Hemp Disposal Report’’ are period was imbedded in the interim Tribes operating their own domestic due to USDA every month. The ‘‘State final rule (IFR) which was published on hemp plans, from producers and Tribal Hemp Annual Report’’ form October 31, 2019, and ended on participating in the USDA Plan, and must be submitted to USDA once per December 30, 2019. Because of the very from laboratories testing for THC year. Similar to the other two State and tight timeline for publishing the IFR, content. Reporting and recordkeeping Tribal forms, the annual time burden OMB granted conditional emergency burdens reflecting revised reporting was initially 20 minutes but has been approval of these seven forms on hours and the projected additional updated to 60 minutes. The time burden December 3, 2019. The USDA Office of producers are described in the following for each State and Indian Tribe to Chief Information Officer (OCIO) sections. All time and cost figures have complete and maintain these three published the 30-day Notice for the been approximated to the nearest whole forms is now 12 hours for each monthly three-year renewal at 85 FR 36828 on number. The table below explains these form and 1 hour for the annual report, Thursday, June 18, 2020. changes numerically. for a total of 25 hours per State and While writing the IFR there was very Tribe with an approved plan. Given the limited data available to make the initial Costs of Reporting and Recordkeeping estimated number of approved State and burden calculations under the The initial estimate of 100 State and Tribal plans is 100, the total cost is 250 Paperwork Reduction Act (PRA). Since Tribal plans remains accurate since the hours and $14,250. the IFR was published, USDA has been majority of States and Indian Tribes will able to gather much more accurate data have their own programs. As of the Fall 32 https://www.bls.gov/oes/home.htm.

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Respondents: Producers Under State or from the Alabama Department of convictions that would disqualify them Tribal Plans (Information Only, Not Agriculture. from participation in the program. Completing the Forms) In the IFR, AMS originally estimated States have some flexibility in what they that the majority of States and Indian require of applicants to make this The time required of producers to Tribes would have three-year producer demonstration. However, for purposes supply the information for the ‘‘State licenses, and producers would only of this analysis, AMS will use the cost and Tribal Hemp Disposal Report’’ and submit this information once every of the FBI Identify Summary, $18, as a the ‘‘State and Tribal Hemp Annual three years. Since approving 60 State proxy cost for all background reports, and Tribal plans, the majority of State Report’’ will stay the same at 10 minutes and 3 key participants for each license and Tribal licenses are issued on a for reporting and 5 minutes for each year, although if we were to take yearly basis instead. AMS estimates that recordkeeping burden for each producer into account comments, it is likely there for these two forms. The ‘‘State and the 16,000 State and Tribal producers will submit license information each will be more than 3 key participants Tribal Hemp Producer Report’’ time each year. In the chart below is a cost estimate is now increased to 20 minutes year for State and Tribal programs. In addition to obtaining a license, all hemp breakdown of the application and with a 5 minute record keeping burden background check for producers under a for each producer, per the suggestion producers are required to prove that they do not have prior drug related State or Tribal program.

Cost of Number of Number of Total annual * 3 Key background Plus burden FBI Identity Summary respondents responses resposes participants check cost of Total cost ($18) application

Cost for State and Trib- al producers (3 key participants every year) ...... 16,000 1.0000 16,000.00 48,000.00 $864,000.00 $379,666.00 $1,243,666.00

In the IFR, AMS estimated that 20 hold records for three forms. The total hemp producers, or 4,000 producers percent of lots will need to be disposed time burden for these producers each year. Because the USDA license is even though the current rate of disposal providing and maintaining this valid for three years, approximately is closer to 12%. This assumption is information is estimated at 11,061 total 1,332 producers will complete this form based on the increased number of new hours and $630,466. each year. The total annual burden for entrants to the market who may not be Respondents: Producers Participating this form is 544 hours and $31,603. successful in their first year or two. in the USDA Plan In addition to the ‘‘USDA Hemp Plan AMS is introducing a new performance- Producer Licensing Application’’ based method to sampling, which will To produce hemp under the USDA submitted once every three years, decrease the amount of testing and Plan, a producer, which may be an noncompliant tests. Therefore, AMS individual producer or a business, producers must submit criminal history estimates that 1,600 lots will be completes the ‘‘USDA Hemp Plan reports for each of their key disposed under State and Tribal Producer Licensing Application’’ and an participants. AMS estimates each programs. The producers under a State FBI Identity Summary. If all parts of the producer to have three key participants or Tribal program will provide their application and summary are valid, submit criminal history reports to disposal information to their individual AMS issues a license. The total burden USDA. The cost of a criminal history regulatory body. The States and Indian per respondent of this form will report is $18 apiece, so three key Tribes will then use that information to maintain the same as in the IFR; 10 participates would cost $54 per complete the monthly ‘‘State and Tribal minutes for the time and 5 minutes for participant. As stated previously, AMS Hemp Disposal Report’’. record keeping for a total of 15 minutes, estimates that it will receive 1,332 These are just the costs and burden of or .25 hours. Licenses under the USDA license renewals in each year. Each of collecting and maintain the information Plan must be renewed every three years, these 1,332 renewals will include a associated with the disposal, not the so each producer only submits this background summary for three key actual disposal. The actual cost of information once every three years. In participates. Adding the cost of 1,332 disposing of the non-compliant ‘‘hot’’ the IFR, AMS initially estimated that renewals at $71,928 with the cost of the hemp is discussed in the RIA. there will be 1,000 participants in the background check is $31,603 for the In total, producers under a State or USDA Plan. AMS has now updated this renewals and means there is an annual Tribal program provide information and estimate to be 20 percent of the total cost of $103,531.

Cost of Number of Number of Total annual * 3 Key background Plus burden FBI Identity Summary respondents responses per resposes participants check cost of Total cost respondents ($18) application

Cost for USDA pro- ducers (3 key partici- pants every three years) ...... 4,000 0.3330 1,332.00 3,996.00 $71,928.00 $31,603.00 $103,531.00

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Similar to the required annual report maintain the three USDA forms ‘‘USDA Respondents: All Producers submitted by States and Indian Tribes to Hemp Plan Producer Licensing USDA, producers operating under the Application’’, the ‘‘USDA Hemp Plan The FSA collects information on crop USDA Plan must submit the ‘‘USDA Producer Disposal Form’’, and the acreage through the ‘‘Report of Acreage’’ Hemp Plan Producer Annual Report’’ to ‘‘USDA Hemp Plan Producer Annual form. Hemp producers under all plans USDA each year. AMS estimates the Report’’ amounts to an annual total of are required to fill in the information for time burden of submitting this form will 2,386 hours and a cost of $136,011. this form once they receive their license maintain the same, at 25 minutes, or or authorization from USDA, a State, or Respondents: Laboratories 0.42 hours, per respondent. AMS has Indian Tribe and have planted the crop. updated the initial estimate of 1,000 The 2018 Farm Bill requires that all AMS will keep the initial reporting participants in the USDA Plan, to 4,000 domestically produced hemp be tested burden and record keeping burden at 35 producers. Therefore, the total burden of for total THC content on a dry-weight minutes, or 0.58 hours. AMS has added this form has increased from 416 hours basis, whether produced under a State 60 minutes or one hour for the travel to 1,665 hours, costing $94,916 or Tribal Plan or the USDA Plan. Using time to and from the FSA office, for a annually. data from FSA the initial estimate of total of 90 minutes. With the increased When a hemp sample tests above the two lots of hemp per producer remains number of producers and the addition of acceptable hemp THC level, the material accurate. However, the new travel time, AMS estimates the burden from the specific lot must be disposed. performance-based sampling process The producer and disposal agent must for the 20,000 producers will be 31,660 will decrease the number of total hours and cost $1,804,620. complete the ‘‘USDA Hemp Plan samples that are collected and tested. Producer Disposal Form’’. The burden Total Reporting and Recordkeeping AMS requires all laboratories testing for this form will stay at 25 minutes, or Costs for All Respondents 0.42 hours, per respondent. hemp for THC to submit all test results, Using the same assumptions regarding whether passing or failing, via the Altogether, the annual burden for the prevalence of non-compliant crops ‘‘Laboratory Test Results Report’’. AMS reporting and recordkeeping for all and the costs of disposal that were used maintains the estimated reporting and respondents is 52,296 hours, costing a in generating the estimates of hemp recordkeeping burden for this form at 35 total of $2,980,864 per year. This is the disposal reporting (and disposal) for minutes, or .58 hours. AMS originally sum of the annual burden of reporting estimated that 7,700 total hemp State and Tribal programs, the 4,000 and recordkeeping to States and Indian producers would submit 15,400 samples producers that will participate in the Tribes operating their own plans, to to test. AMS has updated this estimate USDA Plan will generate 400 samples producers participating in the State and that test high for THC content. The total to 8,000 total tests annually. Therefore, Tribal Plans, to producers participating reporting burden of this form will the total annual burden of these tests in the USDA Plan, including the cost of amount to 167 hours and cost $9,492 and the accompanying ‘‘Laboratory Test annually. Results Report’’ form decreased from a criminal history report for three key Altogether, the annual burden for the 8,399 hours to 4,664 hours, and costs participants, and to laboratories testing USDA producers completing and $265,848. samples for THC content.

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ABLE T response Hours per State and tribal forms USDA Producer Forms responses Total annual Number of respondent responses per Number of respondents AMS–23 ...... onlyAMS–23 ...... 37,962.00 1,200.00 100 12.0000 2,664.00 information 0.3333 0.083 221.11 666.00 399.96 2,664.00 0.1670 444.89 8,000 0.3330 100 1,200.00 100 12.0000 1,200.00 information only 1.0000 0.083 $23,270.82 100 8.30 408.26 0.083 68,873.10 AMS–24 ...... 1,208.30 8.30 16,000 onlyAMS–24 ...... 1.0000 1,200.00 100 12.0000 information 0.3333 38,190.00 399.96 2,680.00 0.1670 447.56 2,680 only 2,680 1.0000 0.083 222.44 670.00 16,000.00 100 1,200.00 100 12.0000 1,200.00 1.0000 0.083 23,270.82 100 8.30 information 408.26 22,800.00 0.083 1,600.00 0.1670 267.20 0.3333 68,873.10 1,600 1,600 1.0000 0.083 132.80 400.00 1,208.30 8.30 5,332.80 AMS–25 ...... onlyAMS–25 ...... 16,000 95,475.00 1,118.90 information 1,675.00 6,700 6,700.00 0.1670 100 1.0000 100.00 0.3333 0.083 556.10 33.33 6,700 1.0000 0.083 100 100 1.0000 100.00 information only 0.083 2,372.91 100 8.30 0.083 41.63 6,173.10 8.30 108.30 1,328.00 16,000 6,660.80 AMS–26 ...... 379,665.60 1.0000 4,745.25 AMS–26 ...... 0.1670 55.61 333.00 333 0.083 27.64 83.25 0.3330 1,000 16,000.00 AMS–27 ...... 4,000 0.3330 1,332.00 0.1670 0.1670 AMS–27 222.44 4,000.00 ...... 0.083 400 1.0000 400.00 0.3333 133.32 332.00 2,672.00 31,603.31 554.44 400 9,491.64 0.083 33.20 166.52 400 1.0000 400.00 0.3333 133.32 16,000 400 9,491.64 0.083 166.52 33.20 0.083 1,328.00 4,000.00 228,000.00 Name Form Producer Report (Old). Producer Report (Update). ducer Responses (Old). ducer Responses (Update). Disposal Report (Old). Disposal Report (Up- date). ducer Disposal Re- sponses (20% then x 2 for lots/producer) (Old). ducer Disposal Re- sponses (25% of lot from 80% of pro- ducers) (Update). Annual Report (Old). Annual Report (Up- date). Annual Report Re- sponse (Old). Annual Report Re- sponse (Update). ducer Licensing Ap- plication (Old). ducer Licensing Ap- plication (Update). ducer Disposal Form (20% x 2 lots for lots/producer) (Old). ducer Disposal Form (25% x lots from 20% of all pro- ducers) (Update). State and Tribal Hemp State and Tribal Hemp State and Tribal Pro- State and Tribal Pro- State and Tribal Hemp State and Tribal Hemp State and Tribal Pro- State and Tribal Pro- State and Tribal Hemp State and Tribal Hemp State and Tribal Hemp State and Tribal Hemp USDA Hemp Plan Pro- USDA Hemp Plan Pro- USDA Hemp Plan Pro- USDA Hemp Plan Pro-

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E-Government Act responsibilities among the various expressly contemplates preemption AMS is committed to complying with levels of government. The federalism when there is a conflict between the E-Government Act, to promote the implications of the rule, however, flow exercising State and Federal authority use of the internet and other from and are consistent with the under Federal statute. Section 297B of information technologies to provide underlying statute. Section 297B of the the AMA requires State plans to include AMA, 7 U.S.C. 1639p, directs USDA to six practice and procedures and a increased opportunities for citizen review and approve State plans that certification. It also expressly states that access to Government information and meet statutory requirements and to it does not preempt a State’s ability to services, and for other purposes. We audit a State’s compliance with its State adopt more stringent requirements or to recognize using an electronic system plans. Overall, the final rule attempts to prohibit the production of hemp. will promote efficiencies in developing balance both the autonomy of the States Section 297D of the AMA requires and implementing the new USDA with the necessity to create a Federal USDA to promulgate regulations to Domestic Hemp Production Program. framework for the regulation of hemp implement subtitle G of the AMA, Since this is a new program, AMS is production. which includes section 297B. Subpart B working to make this process as Section 3(b) of E.O. 13132 recognizes of the final rule repeats those effective and user-friendly as possible. that national action limiting the requirements, providing more detail Civil Rights Review policymaking discretion of States will where necessary. States have wide be imposed ‘‘. . . only where there is latitude to develop the required practice AMS has considered the potential constitutional and statutory authority and procedures. Subpart B includes civil rights implications of this rule on for the action and the national activity more details on the testing and sampling minorities, women, and persons with is appropriate in light of the presence of of hemp plants to establish a national disabilities to ensure that no person or a problem of national significance.’’ standard to determine whether the group shall be discriminated against on Section 297B of the AMA is the plants meet the statutory definition of the basis of race, color, national origin, statutory authority underlying the rules hemp. Likewise, the final rule requires gender, religion, age, disability, sexual for USDA to review, approve, States to follow DEA requirements for orientation, marital or family status, disapprove, or revoke State plans for disposal of marijuana for cannabis political beliefs, parental status, or hemp production. Until the passage of plants exceeding the acceptable hemp protected genetic information. This the 2018 Farm Bill, hemp was a THC level. Finally, the final rule also review included persons that are Schedule I controlled substance as it fell reaffirms that States may adopt more employees of the entities who are within the CSA definition of marijuana. stringent standards and prohibit hemp subject to these regulations. This final When hemp was exempted from the production within their jurisdiction. rule does not require affected entities to definition of marijuana as part of the Section 6 of E.O. 13132 requires relocate or alter their operations in ways 2018 Farm Bill, in connection with consultation with State officials in that could adversely affect such persons removing it from that list, Congress development of the regulations. AMS or groups. Further, this rule does not established a national regulatory conducted significant outreach with deny any persons or groups the benefits framework for the production of hemp. State officials including individual of the program or subject any persons or Because cannabis plants with a THC meetings, participation in conferences groups to discrimination. level higher than 0.3 are marijuana and with State officials, and listening This final rule reflects AMS’s on the Federal controlled substances sessions where State officials from all response to public comment and input list, ensuring that hemp produced under States were invited. During our provided by stakeholders. The final rule this program is not marijuana is of consultation with the States, provides States and Indian Tribes the national significance. representatives from various State regulatory authority over hemp In addition to establishing a national agencies and offices expressed the production in their jurisdictions. It also regulatory framework for hemp following concerns about sampling and establishes a Federal plan for hemp production, Congress expressly testing procedures. Most requested that producers located in States or territories preempted State law with regard to the USDA adopt uniform, national of Indian Tribes that do not have their interstate transportation of hemp. requirements to facilitate the marketing own USDA-approved hemp oversight Section 10114 of the 2018 Farm Bill of hemp. Some States advocated that plan. There is no evidence that the final States that ‘‘[n]o State or Indian Tribe USDA defer to each State to determine rule will potentially adversely or shall prohibit the transportation or the appropriate procedures for its plan. disproportionality impact hemp shipment of hemp or hemp products USDA recognizes the value of a national producers in protected groups, regions produced in accordance with subtitle G standard to promote consistency while or Indian Tribes differently than the of the Agricultural Marketing Act of allowing States the flexibility to adopt general population of hemp producers 1946 (as added by section 10113) procedures that fit their circumstances. or State Departments of Agriculture. through the State or the territory of the As explained above, USDA is adopting Indian Tribe, as applicable.’’ Thus, Executive Order 13132—Federalism performance standards for sampling and States and Indian Tribes may not testing. As long as the procedures in the AMS has examined the effects of prevent the movement of hemp through State plans meet those standards, AMS provisions in this final rule on the their States or territories even if they will find those procedures acceptable. relationship between the Federal prohibit its production. Congress also As AMS implements this new Government and the States, as required expressly preempted a State’s ability to program, we will continue to consult by Executive Order 13132 on prosecute negligent violations of its plan with State officials to obtain their ‘‘Federalism.’’ Our conclusion is that as a criminal act in section feedback on implementation. this rule does have federalism 297B(e)(2)(c). That preemption is Finally, we have considered the cost implications because the rule has incorporated into this rule. burden that this rule would impose on substantial and direct effects on States, Section 3(d)(2) of the E.O. 13132 States as discussed in the Regulatory on the relationship between the requires the Federal Government to Impact Analysis of this document. National Government and States, and on defer to the States to establish standards AMS has assessed this final rule in the distribution of power and where possible. Section 4(a), however, light of the principles, criteria, and

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requirements in Executive Order 13132. 2019, roughly 41 days after the expressed how some provisions of the We conclude that this final rule: Is not publication of the domestic hemp interim final rule are too rigid and that inconsistent with that E.O.; will not production program interim final rule, USDA did not consider practical impose significant additional costs and USDA held a second formal Tribal problems and potential economic harm burdens on the States; and will not consultation. This consultation faced by Indian Tribes under the affect the ability of the States to provided information on the interim program. discharge traditional State governmental final rule. This consultation occurred in Indian Tribes requested more functions. Las Vegas, Nevada, and attendees included USDA officials, Tribal leaders, extensive Tribal consultation and the Executive Order 13175 Consultation Tribal proxies, non-consulting Tribal inclusion of other agencies involved in and Coordination With Indian Tribal members, non-profit representatives, hemp production and enforcement. In Governments businesses, law firms, private response, USDA extended the public AMS examined the effects of individuals, and other government comment date by thirty additional days provisions in the final rule on the employees. On September 24, 2020, to January 29, 2020 and agreed to relationship between the Federal USDA held a third formal Tribal conduct an additional consultation after Government and Tribal governments, as consultation and provided information the first growing season. AMS also required by E.O. 13175 on on the interim final rule. This reopened the public comment period for ‘‘Consultation and Coordination with consultation occurred virtually and thirty days in the Fall of 2020. Indian Tribal Governments.’’ We attendees included USDA officials, Tribal Consultation September 2020: concluded that the final rule does have Tribal leaders, Tribal proxies, non- Consultation also occurred on substantial direct effects on Tribal consulting Tribal members, non-profits September 24, 2020. governments, on the relationship representatives, Businesses, law firms, between the National Government and private individuals, and other Based on the comments and Tribal governments, and on the government employees. consultations received, we made distribution of power and During the May 2019 consultation, changes to the final regulations. responsibilities among the various Tribal representatives from several Although Indian Tribes will still incur levels of government. The effects of the Tribal Governments expressed their costs in complying with final rule, those rule, however, flow from and are opinions that the 2018 Farm Bill costs should be outweighed by the consistent with the underlying statute. permitted the USDA Secretary to allow benefits that the Indian Tribes realize in Section 297B of the AMA, 7 U.S.C. AMS to approve Tribal plans ahead of commercial hemp production occurring 1639p, directs USDA to review and issuing regulations of the USDA plan. within their territories. approve Tribal plans that meet statutory Indian Tribes stated that approving requirements and to audit a Tribal hemp plans immediately would allow Executive Order 13175 government’s compliance with its Tribal those Indian Tribes (and States) with a This rule has been reviewed in plans. Overall, the final rule attempts to plan to begin planting for the accordance with the requirements of balance both the autonomy of the Tribal commercial production of hemp in Executive Order 13175, Consultation governments with the necessity to create 2019. The USDA Secretary released a and Coordination with Indian Tribal a Federal framework for the regulation Notice to Trade (NTT) on February 27, of hemp production. 2019, to explain that Tribal and State Governments. Executive Order 13175 As with States, Tribal governments plans would not be reviewed or requires Federal agencies to consult and will have wide latitude in adopting approved until AMS finalized coordinate with tribes on a government- procedures including adopting regulations ahead of the 2020 planting to-government basis on policies that requirements that are more stringent season. Additionally, the NTT stated have tribal implications, including than the statutory ones. For reasons that until regulations were in place, regulations, legislative comments or stated in the federalism analysis, AMS States, Indian Tribes, and institutions of proposed legislation, and other policy is adopting national standards for higher education could continue statements or actions that have sampling, testing, and disposal of non- operating under authorities of the 2014 substantial direct effects on one or more compliant plants that Tribal plans must Farm Bill. The 2018 Farm Bill extension Indian tribes, on the relationship also incorporate. of the 2014 authority expired 12 months between the Federal Government and AMS conducted extensive outreach to after USDA had established the plan Indian tribes or on the distribution of Tribal governments through individual and regulations required under the 2018 power and responsibilities between the discussions with Tribal representatives, Farm Bill. Congress extended this Federal Government and Indian tribes. by extending the regulatory comment expiration until January 1, 2022. After The USDA’s Office of Tribal Relations periods and through the following more the May Tribal consultation, USDA (OTR) has assessed the impact of this formal consultations. issued a second NTT on May 27, 2019, rule on Indian tribes and determined, in Tribal Consultation May 2019: On to clarify that Tribal governments agreement with AMS, that this rule has May 1 and 2, 2019, USDA held a formal through the authorities in the 2014 Farm Tribal consultation on the 2018 Farm Bill are permitted to grow industrial substantial direct tribal implications Bill including a session on hemp hemp for research purposes during the that require continued outreach efforts production. This consultation occurred 2019 growing season. USDA appreciates to determine if tribal consultation under at the National Museum of the the urgency in which the Indian Tribes E.O. 13175 is required. Based on AMS American Indian located in Washington wish to engage in this new economic outreach efforts to date, OTR does not DC. In addition to listening sessions for opportunity. We worked expeditiously believe that tribal consultation is the general public, USDA hosted a to develop and promulgate the IFR so necessary at this time. If a tribe requests listening session for Tribal governments that States and Indian Tribes could consultation AMS will work with the following the formal Tribal consultation submit their plans in time for the 2020 OTR to ensure meaningful consultation on May 2, 2019. USDA officials season. is provided where changes, additions, attended meetings with representatives Tribal Consultation December 2019: and modifications identified herein are of Tribal governments. On December 11, During this consultation Indian Tribes not expressly mandated by Congress.

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Executive Orders 12866, 13563, and in States and Indian Tribes not The estimates of net benefits resulting 13771 regulated by State or Tribal plans. This from this final rule differ from those in Executive Orders 12866 and 13563 program is intended to provide the IFR due to a variety of factors. First direct agencies to assess all costs and consistency in production, sampling of these is the large increase in planted benefits of available regulatory and testing of hemp product to ensure acreage and market entrants in 2019, the alternatives when an action is deemed compliance with the acceptable hemp scale of which was unexpected. (There to have significant impacts. If regulation THC level. may be other unexpected changes due to is necessary, then agencies must select This rule has been reviewed under the pandemic, but we cannot estimate the action that maximizes net benefits, Executive Order 12988, Civil Justice those at this time.) Changes in other including potential economic, Reform, and is not intended to have variables, as well, contributed to the environmental, public health and safety retroactive effect. The discussions on increase in net benefits in the final rule effects, and equity. This rule meets the Executive Orders 13132 (Federalism) over the IFR. A comparison of the definition of an economically significant and 13179 (Consultation and variables that are assumed constant regulatory action under Executive Order Coordination with Tribal Governments), (across years 2020 through 2025) in the 12866, as it is likely to result in an above, address the extent to which the IFR and the final rule is shown in Table annual effect on the economy of $100 rule preempts State law, and the 1 below. In the year between million or more. USDA considers this to impacts of the rule to Tribal publication of the IFR and this final be a deregulatory action as it allows the governments. The discussion above rule, additional information regarding development of a niche market that regarding appeals under new part 990, the hemp industry has emerged to the cannot exist under the state pilot subpart D, describes the administrative benefit of this analysis. AMS believes programs authorized under the procedures that must be exhausted prior that the modifications to the analysis Agricultural Act of 2014 (2014 Farm to a judicial challenge. from the IFR to the final rule represent the state of the hemp industry to the Bill). This action finalizes the interim Introduction final rule published on October 31, greatest extent practicable. The 2019, that expanded production options On October 31, 2019, USDA modifications in this final rule are and enabled interested farmers to grow promulgated an interim final rule intended to further support the hemp hemp. establishing a national program for the marketplace and provide the greatest Executive Order 13771 mandates that production of industrial hemp. A flexibility possible while still ensuring agencies provide the best approximation regulatory analysis was performed in the program complies with the 2018 of total costs associated with a new or support of that regulation and published Farm Bill. repealed regulation. AMS has prepared as part of the preamble to that rule. This AMS suspects that this rule, this Regulatory Impact Analysis with analysis is intended to update the compared to the IFR, will incentivize the purpose of accomplishing these previous analysis to reflect additional participation in the market and allow objectives. USDA considers this to be a information gained through the first for more farmers to be successful. In deregulatory action under Executive year of operation of that program and to particular, AMS attributes this to two Order 13771 as it allows for the assess whether any of the modifications policies. First, AMS anticipates that the development of a niche market that to the program made in response to flexibilities in disposal and remediation cannot exist under current regulation. public comment have significant of non-compliant hemp will help This rule removes barriers to entry and impacts on the estimated costs or minimize the risk to farmers, therefore enables domestic farmers to grow hemp. benefits of the final program. increasing participation in the industry. In the IFR, AMS estimated lower and Second, AMS anticipates that the Regulatory Impact Analysis upper bounds to calculate the total net increased threshold for negligent hemp Regulations must be designed in the benefits of the rule to society at large. (from 0.5 percent to 1.0 percent) will most cost-effective manner possible to These net benefits were calculated for also reduce risk to farmers and allow for obtain the regulatory objective while 2020 through 2022 only due to lack of more innovation. imposing the least burden on society. data for future years. In the IFR, 2020 AMS received numerous comments This rule finalizes and updates the estimated net benefits ranged from a providing data on the different aspects interim final rule that established a loss of nearly $4 million to a gain of of the hemp industry, that while national regulatory oversight program $17.6 million; for 2021, a net benefit of informative, could not be incorporated for the production of hemp. This $23 million to $46 million; and, for in the RIA due to such factors as they program is necessary to effectuate the 2022, a net benefit of nearly $49 million were too regionally focused, small in mandate in the Agriculture to $74 million. In this final rule, the sample size, or lacked the depth of data Improvement Act of 2018, known as the estimated net benefits, as shown in points to be representative of the 2018 Farm Bill, to coordinate State and Table 12, are $46 million in 2020; $87 national hemp market. An example of Tribal government hemp production million in 2021; $135 million in 2022; this is the portion of retests performed regulations with the newly established $190 million in 2023; $226 million in on hemp samples that initially tested federal regulations for hemp production 2024; and, $351 million in 2025. higher than 0.3 percent THC.

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The 2014 Farm Bill defined hemp as resumed. In 1970, Congress passed the commodities, have fueled producer the plant Cannabis sativa L. and any Controlled Substances Act, granting the interest in hemp production since 2014. part of that plant with concentrations of Attorney General the authority to 2018 Farm Bill THC no greater than 0.3 percent on a regulate production of cannabis, dry weight basis. While belonging to the including hemp. The 2018 Farm Bill allowed the same species as the plant that produces The 2014 Farm Bill authorized pilot production and sale of industrial hemp marijuana, hemp is distinctive from programs, as permitted by State law, for either under a State or Tribal program marijuana in its chemical makeup. The hemp cultivation for research purposes approved by the USDA or under a marijuana plant contains high levels of to be administered by academic Federal license for producers in areas the cannabinoid delta-9 institutions and State departments of with no approved plan and no explicit tetrahydrocannabinol (THC), which is agriculture. By 2019 approximately half State or Tribal statute prohibiting the the chemical that produces of the states had developed such a pilot production of hemp. The 2018 Farm Bill psychoactive effects. Hemp may contain program. The research under these pilot explicitly preserved the authority of the no greater than 0.3 percent THC on a programs included market research, U.S. Food and Drug Administration dry weight basis. which allowed cultivated hemp to enter (FDA) to regulate hemp products under Prior to the 2014 Farm Bill, hemp had the stream of commerce as inputs into the Federal Food, Drug, and Cosmetic never been designated in a Federal law various consumer products. For Act (FD&C Act) and section 351 of the as different from cannabis generally. example, in Kentucky, one of the first Public Health Service Act (PHS Act). The first regulation of hemp occurred in states to enact a pilot program, producer Accordingly, products containing 1937 with the Marihuana Tax Act, sales to processors totaled $1.6 million cannabis and cannabis-derived which required all producers of the in 2016, $7.5 million in 2017, $17.7 compounds are subject to the same species Cannabis sativa to register with million in 2018, and $51.3 million in authorities and requirements as FDA- and apply for a license from the Federal 2019.33 Hemp biomass contains regulated products containing any other government. The ‘‘Hemp for Victory’’ concentrations of the cannabinoid substance. The 2018 Farm Bill removed Campaign during World War II cannabidiol, known as CBD. High prices hemp from the list of controlled promoted production of hemp for rope for hemp harvested for cannabinoids, substances, decontrolling hemp to be used by U.S. military forces. At the relative to those of other agricultural production in all U.S. States, territories, end of the war, however, the and lands belonging to Indian Tribes, requirements in the Marihuana Tax Act 33 Kentucky Department of Agriculture. unless prohibited by State or Tribal

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Law. This action eliminates the States or Indian Tribes where no State enrolling in the new hemp programs, uncertain legal status at the Federal or Tribal Plan has been approved and these 17 states expressed a preference level of hemp production and allows the that do not prohibit the cultivation of for the hemp programs authorized by U.S. Department of Agriculture (USDA) hemp. These actions will promote the 2018 Farm Bill over the 2014 Farm to provide hemp producers with crop consistency in regulations governing the Bill pilot programs. The remaining 80 insurance programs, potentially legal production of hemp across the percent of planted acreage estimated reducing risk to producers and country. from 2020 through 2025 will be treated providing easier access to capital. The Baseline Definition as attributable to the 2014 pilot statute also prohibits interference in the programs under the assumption that interstate transport of hemp by States, The 2014 Farm Bill authorized hemp they would have continued in the including those States that prohibit research pilot programs to be absence of the 2018 Farm Bill which hemp production and sales. As a result, administered by states and universities. terminated them. The 2018 Farm Bill repealed these pilot hemp producers will have access to In the interim final rule (IFR), AMS nationwide markets. programs beginning one year from the publication of a USDA rule; however, attributed 50 percent of the growth in Need for Regulation the 2021 Continuing Appropriations Act producer sales from 2020 through 2022 to the 2018 Farm Bill and this enabling The rule is necessary to facilitate the extended the authorization of the 2014 rule. In deriving this assumption, AMS domestic cultivation of hemp for sale pilot programs until January 1, 2022. considered the rate at which hemp into the market for hemp products by From 2014 to 2018, planted acreage acreage had increased in recent years, creating a set of minimum standards to tripled in every year, reaching nearly the number of States whose hemp pilot ensure that hemp being produced under 63,500 acres in 2018. In the year programs produced a crop in recent this program meets all statutory following the signing of the 2018 Farm years, and the number of States that requirements. The rule establishes Bill, planted acreage increased by more passed legislation following the signing minimum requirements for States and than 400 percent to 327,600 acres in of the 2018 Farm Bill in anticipation of Indian Tribes to obtain program 2019.34 The surge of entrants into the this rule’s enactment in time for the approval and, for producers operating hemp market in 2019 left many 2020 growing season. In the time under the Federal program to obtain a producers with unsold inventory. In between publication of the IFR on license and meet operating requirements Kentucky alone, more than $100 million October 31, 2019, and the beginning of under that license. Without these of hemp material went unsold due to the 2020 growing season, 17 states provisions, it would not be possible to lack of buyers in 2019. The large representing 20 percent of planted grow hemp legally. number of entrants into the market in acreage opted to participate in the hemp Both the declassification of hemp, and 2019 caused a surplus of hemp programs mandated by the 2018 Farm the prohibition on interference with production, which in turn caused prices Bill. This portion of enrollment is less interstate transportation apply to hemp to fall and revenue losses to producers. than AMS anticipated in the IFR. that is grown under an approved State Despite the producer excitement that or Tribal plan, or under a Federal ensued in 2019 following the signing of Affected Entities license. As a result, this regulation the 2018 Farm Bill, only 17 states opted facilitates provisions of the 2018 Farm to participate in the new hemp As of July 2020, States, Indian Tribes, Bill that would otherwise be self- programs in time for the 2020 growing and USDA had issued 19,121 producer implementing. season. These 17 states accounted for licenses. This figure represents licenses about 20 percent of the total estimated issued in 44 States and one Tribe. About Overview of the Action planted acreage in 2020. Given the 70 percent of states reported at the time The 2018 Farm Bill granted regulatory apparent affinity by states for the 2014 that they were still accepting authority of domestic hemp production pilot programs, AMS assumes that in applications, which indicates that the to the State departments of agriculture, the absence of the 2018 Farm Bill, the number of 2020 producer licenses Tribal governments, and USDA. States 2014 Farm Bill pilot programs would issued is likely to grow. For this reason, and Indian Tribes wishing to operate have continued indefinitely. Indeed, the AMS estimates that up to 20,000 their own programs must submit to 2014 Farm Bill offered no sunset date producer licenses will be issued in USDA plans that include provisions for for these programs. In order to capture 2020. Based on the slowed pace in maintaining information regarding the the impacts of this rule on affected growth of producer licenses from 2019 land on which hemp is produced, for entities, AMS attributes 20 percent of to 2020, AMS assumes an annual testing the levels of THC, for disposal of the estimated planted acreage from 2020 growth rate in producer licenses of 10 plants that do not meet necessary through 2025 to the 2018 Farm Bill and percent from 2020 through 2025, for the requirements, and for procedures to this rule which enables its purposes of this analysis. The result is ensure compliance with the prescriptions. This 20 percent reflects shown in Table 2. AMS is unaware of requirements of the new part, including the amount of planted acreage in the 17 any estimates that exist regarding the background checks of all key states that opted to participate in the number of producer licenses that will be participants. State and Tribal Plans 2018 Farm Bill hemp programs for the issued in the coming years; however, must be approved by USDA. This rule 2020 growing season. The 2020 growing the novelty of hemp as a commercial outlines requirements by which the season was the final opportunity for agricultural commodity, the resolutions USDA would approve plans submitted producers to cultivate hemp under the of uncertainty surrounding regulations, by States and Tribal governments for 2014 pilot programs until the 2021 the expected growth in demand for oversight of hemp production. The 2018 Continuing Appropriations Act existing and new hemp products, and Farm Bill also directs USDA to develop extended the authorization of the 2014 the effective establishments of State, a plan for use by hemp producers in pilot programs to January 1, 2022. By Tribal, and Federal hemp programs may

34 Sources include the following: State David Olson, William Snell, Susan Proper, and A Review of State Pilot Programs, EIB–217, U.S. Departments of Agriculture; Vote Hemp. 2016–2019 Suzanne Thornsbury. February 2020. Economic Department of Agriculture, Economic Research Crop Reports; and, Mark, Tyler, Jonathan Shepherd, Viability of Industrial Hemp in the United States: Service.

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continue to draw producers into the market.

TABLE 2—ESTIMATED PROJECTION OF NUMBER OF PRODUCER LICENSES ISSUED

Year 2020 2021 2022 2023 2024 2025

Growers ...... 20,000 22,000 24,200 26,620 29,282 32,210 Sources and notes: 2020 figure based on July 2020 National Industrial Hemp Regulators conference call. 2021–2025 figures based on assumed annual growth rate of 10% in producer licenses.

As of the writing of this analysis, in the process of submitting plans for rule enables states, Indian Tribes, and three states had opted to participate in USDA approval. At least three states USDA to regulate this authorization. the USDA Federal Plan authorizing have opted to participate in the USDA This rule is expected to generate producers to cultivate hemp. These plan, and one state and one territory benefits and costs to hemp producers, states are Hawaii, Mississippi, and New await legislation authorizing hemp state departments of agriculture, Tribal Hampshire. Together, they represent production. AMS anticipates receiving governments, USDA, and laboratories. more than 300 producers in 2020. The further interest in both the Federal Plan The benefits of this rule are expected to number of licensed producers and the plans administered by states, outweigh the costs, however, and the participating in the Federal Plan is Indian Tribes, and territories in the burden on the impacted entities is likely to grow over time due to both coming months when the provisions of anticipated to be minimal. greater entrance of producers into the the 2014 Farm Bill expire and States market in these three states and and Tribes start implementing their Producers programs. For the purposes of this additional states, Indian Tribes, and Using figures from Hemp Industry analysis, AMS assumes that 100 states, territories opting to participate in the Daily and the Brightfield Group, AMS Indian Tribes, and territories will USDA Plan. At the end of 2020, less estimates retailer sales of hemp administer their own plans in every year than 2 percent of the total number of products to range from $2.5 billion in producers were licensed by USDA. The from 2020 through 2025. AMS acknowledges that this number is likely 2020 to nearly $17 billion in 2025. extension of the 2014 pilot programs to Based on price spreads from farm to 2022, which was included in the 2021 to change from year to year, depending on market conditions, which affect the consumer, published by the Economic Continuing Appropriations Act Research Service (ERS), AMS assumes a published October 1, 2020, resulted in ability of a state, tribe, or territory to manage its own hemp program. Because pass-through rate of 20 percent from fewer producers participating in the 35 AMS has no way to predict future retailer to producer. AMS also USDA Plan. Prior to the extension of the assumes that import values account for 2014 pilot programs, the portion of market or state political conditions, for simplicity, it assumes a constant of 100 15 percent of the producer share of participants under the USDA Plan was retail sales. This estimate was derived about 10 percent of the total number of states, Indian Tribes, and territories administering their own plans from using 2019 and 2020 import data from 2020 producers, with the expectation for the Foreign Agricultural Service (FAS) further enrollment. For the purposes of 2020 through 2025. Finally, this rule will impact of USDA. At the time of this analysis, this analysis, therefore, AMS assumes import data for 2020 was only available that 20 percent of the total number of laboratories that will provide testing services to producers and program for the months of January through licensed producers will be participants administrators. As of the writing of this August. In order to gauge what total of the USDA Plan, and the remaining 80 analysis, there were 67 laboratories that 2020 imports might be, AMS applied to percent will be participants of a State or test hemp that are registered with the the figure of total imports for January Tribal Plan. DEA. USDA is requiring that all samples through August 2020 ($55 million) the In addition to hemp producers, this tested for THC concentration levels be average percentage change that occurred rule will impact state departments of conducted in DEA-registered in the four months from August through agriculture, Tribal governments, and laboratories; however, enforcement of December of recent years (40 percent). USDA as these entities will bear the this requirement has been delayed until Applying the assumptions of 20 percent responsibility to ensure that hemp December 31, 2022. price pass-through from retailer to producers abide by the State and Tribal producer and import values of 15 Plans and the USDA Plan for regulating Expected Costs and Benefits of the Rule percent of the producer share of retail hemp. At the time this document was The 2018 Farm Bill grants sales to the estimates of retailer sales written, more than 40 Indian Tribes, at authorization for production of hemp to results in estimated total producer sales least 40 states, and two U.S. territories all states and Indian Tribes, unless of $432 million in 2020 to $2.9 billion had plans approved by USDA or were prohibited by State or Tribal Law. This in 2025, shown in Table 3.

TABLE 3—ESTIMATED RETAILER AND PRODUCER HEMP PRODUCT SALES [Millions]

Year 2020 2021 2022 2023 2024 2025

Total retailer sales 1 ...... $2,540 $4,485 $6,740 $9,310 $10,995 $16,800

35 ERS. Price Spreads from Farm to Consumer. September 2020.

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TABLE 3—ESTIMATED RETAILER AND PRODUCER HEMP PRODUCT SALES—Continued [Millions]

Year 2020 2021 2022 2023 2024 2025

Producer share of retail sales 2 ...... 508 897 1,348 1,862 2,199 3,360 Imports 3 ...... 76 135 202 279 330 504 Total producer sales 4 ...... 432 762 1,146 1,583 1,869 2,856 1 Retailer sales estimates based on the following stores: 2020–2024 estimates from Hemp & CBD Industry Facebook 2019, Hemp Industry Daily, ‘‘Annual U.S. Hemp-Derived CBD Retail Sales Estimates.’’ Published October 16, 2019. 2025 estimate from Brightfield Group. ‘‘US CBD Market Forecast Reduced Due to Health Consolidation.’’ Published July 31, 2020. 2 Product of total retailer sales and 20% share of retail sales passed to producers; estimate of 20% share of retailer prices based on Economic Research Service publications of ‘‘Price Spreads from Farm to Consumer’’. 3 Assumes imports account for 15% sales at the producer level; source for assumption is FAS 2015–2019 import data, HTS codes 1207990320 and 5302100000. 4 Difference of producer share of retail sales and imports.

The estimates in Table 3 reflect total this, AMS understands that the programs. By enrolling in the new hemp producer sales in aggregate. AMS is estimated producer sales for a given programs, these 17 states expressed a unaware of any data that currently year in Table 3 may not represent actual preference for the hemp programs exists that would indicate sales by producer sales for that year, but rather, authorized by the 2018 Farm Bill over individual producer. Given the varied sales from prior years. AMS is unaware the 2014 Farm Bill pilot programs. The nature of the hemp industry, producer of any data that exists that would remaining 80 percent of producer sizes are anything but uniform; identify when a harvested hemp crop is planted acreage estimated from 2020 therefore, AMS has not attempted to sold into the retail market. For the through 2025 will be treated as project sales by individual producer as purposes of this analysis, therefore, and attributable to the 2014 pilot programs it would likely result in false for simplicity, AMS assumes that the under the assumption that they would conclusions and misleading producer sales estimated in Table 2 have continued in the absence of the information. Similarly, data comparing represent sales at the producer level for 2018 Farm Bill which terminated them. sales by producers under the 2018 Farm the same year as the retail sales from In Table 4, AMS has calculated total Bill and what sales under the 2014 Farm which they are derived. planted acreage inclusive of all Bill may have been in the absence of the As discussed in the ‘‘Baseline domestic producers, using the estimates 2018 Farm Bill does not currently exist. Definition’’ section of this analysis, Further, AMS believes that this estimate AMS estimates that 20 percent of the of total producer sales in Table 3 and would not differ greatly given the producer planted acreage from 2020 assumptions that are stated and cited in greater access to nationwide markets through 2025 will be attributable to the the table. From the estimates of total and flexibilities provided to producers 2018 Farm Bill and this rule which planted acreage in Table 4, AMS under the 2018 Farm Bill. enables its prescriptions. This 20 calculated the planted acreage due to In addition, AMS acknowledges that percent reflects the amount of planted the rule in Table 5, along with the raw harvested hemp product may take acreage in the 17 states that opted to estimate of sales attributable to the rule. years to enter the retail market after it participate in the 2018 Farm Bill hemp These estimates of sales due to the rule passes through the supply chain. For programs in time for the 2020 growing will be referenced as the benefits of the instance, product sold at the retail level season. The 2020 growing season was rule to producers in the calculation of in 2021 may include hemp that was the final opportunity for producers to net benefits in Table 10. harvested in 2019. In acknowledging cultivate hemp under the 2014 pilot BILLING CODE P

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BILLING CODE C typically harvested. Using 2019 sold, and 95 percent of hemp harvested To calculate total planted acreage producer data from the Kentucky for grain is sold.36 This assumption is nationwide in Table 4, from which Department of Agriculture, AMS also referenced in Table 5. AMS planted acreage due to this rule will be estimates that of total sales of hemp compared the hemp enterprise budgets estimated in Table 5, AMS assumed the products, cannabinoids accounts for 99 published by seven different academic following to remain constant in each percent, and fiber and grain each institutions for yield estimates which year from 2020 through 2025: Portion of account for 0.5 percent. Also based on total sales by intended use; yields by data from the Kentucky Department of 36 The Kentucky Department of Agriculture is intended use; prices per pound by Agriculture, AMS estimates that 65 widely recognized as a reliable source for hemp intended use; portions of harvested percent of the harvested volume of market data as it has collected data from its producers since the inception of its hemp program volume sold by intended use; and the hemp for cannabinoids is sold, 90 in 2014. Much of this data is publicly available and portion of planted acreage that is percent of hemp harvested for fiber is was cited by many commenters.

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represent the growing conditions across remain constant from year to year, acreage is harvested was estimated the country. Aside from these seven, particularly for cannabinoids; however, using data from multiple state AMS is unaware of any other hemp AMS has considered 68 weeks of departments of agriculture. The enterprise budgets published by an cannabinoids prices in determining its assumed constants of the portion of academic institution. estimate of $3.90 per pound. This price planted acreage that is harvested, yield Based on 2019 and 2020 prices assumes 6 percent CBD at $0.65 per by intended use, portion of harvested published by the Jacobsen, AMS CBD percentage per pound. Using these volume that is sold, and prices by assumes constant per-pound prices for prices and yield estimates, AMS intended use are also utilized in Table cannabinoids, fiber, and grain of $3.90, calculated a price per acre for each 5. $0.09, and $0.53, respectively.37 AMS intended use of hemp. Finally, the acknowledges that prices are unlikely to assumption that 75 percent of planted

37 The Jacobsen Publishing Company. Weekly hemp prices from July 2019 through August 2020.

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In addition to the assumptions intended use is likely to change from the relationship between price and sales already identified in reference to Table year to year as a result of market is, of course, positive. 4, AMS assumes constant the portion of conditions. The portion of acreage Many states reported to AMS that the planted acreage due to the rule and intended for cannabinoids has, indeed, land on which hemp is currently grown portions of planted acreage by intended decreased from its levels in 2019, with was previously utilized for cultivation use. As described in the ‘‘Baseline grain and fiber gaining greater consumer of corn. Using data from the National Definition’’ section, AMS assumes that attention. AMS is unaware of any data Agricultural Statistics Service (NASS) 20 percent of total planted acreage can that forecasts planted acreage by on the production value of corn for be considered as attributable to the rule. intended use in years beyond 2020. For grain and acres harvested, AMS This proportion represents the amount the purposes of this analysis, and for determines a value per harvested acre of of planted acreage of the states that had simplicity, therefore, AMS assumes corn of $630. This value is a national plans approved by USDA for a hemp constant the portions of planted acreage average of the three-year period of 2017 production program, as authorized by by intended use as reported for 2020. through 2019, which are the most recent the 2018 Farm Bill, in time for the 2020 years for which data is available.38 For growing season. The 2020 growing To reiterate, AMS is aware that raw the purposes of this analysis, this value season was the final opportunity for hemp product at the producer level may of $630 per acre will serve as the producers to cultivate hemp under the take years to enter the retail market. The opportunity cost to hemp producers. 2014 pilot programs. By enrolling in the analysis in Tables 4 and 5 is meant to The opportunity cost is the potential new hemp programs, these states show potential consumer demand for returns that are foregone in pursuit of an expressed a preference for the hemp hemp products at the producer level in alternative. The potential foregone programs authorized by the 2018 Farm years 2020 through 2025, and not returns, in this case, are $630 per acre Bill over the 2014 Farm Bill pilot necessarily the producer sales of hemp for corn cultivation; and, the alternative programs. cultivated in these specific years. These is hemp cultivation. Applying this value The Jacobsen estimated that of total estimates are sensitive to changes in to the estimates of acreage required to planted acreage in 2020, 80 percent was price. Because planted acreage is meet estimated producer sales as for cannabinoids, 3 percent was for derived from total sales, a change in calculated in Table 5 results in the total fiber, and 17 percent was for grain. AMS price causes an inverse change in the opportunity cost to producers in years acknowledges that planted acreage by estimate of planted acreage; however, 2020 through 2025 as shown in Table 6.

TABLE 6—CALCULATION OF OPPORTUNITY COST OF HEMP CULTIVATION UNDER RULE

2017–2019 average returns per acre of corn for grain 1 ...... $630 Year 2020 2021 2022 2023 2024 2025

Planted acres due to rule 2 ...... 31,820 56,187 84,437 116,633 137,742 210,465 Opportunity cost (millions) 3 ...... $20 $35 $53 $73 $87 $133 Sources and notes: 1 National Agriculural Statistics Service (NASS). 2 See Table 5 estimate calculation. 3 Product of 2017–2019 average retunns per acre of corn for grain and acres worth of hemp sold.

In the IFR, AMS calculated an allow for ‘‘performance-based To estimate the number of lots to be opportunity cost of $591 per acre, using sampling’’. A performance-based sampled in each year, AMS employs the an average of returns per acre for all protocol must have the potential to Cochran Formula: cropland, weighted by area planted or ensure at a confidence level of 95 bearing. This estimate utilized NASS percent that no more than one percent crop totals for fruits, vegetables, and of the plants in each lot would exceed traditional field crops. At the time of the the acceptable hemp THC level. where n is the sample size, Z is the z- writing of the IFR, AMS had little Performance-based sampling achieves 0 value associated with a confidence information as to the prior uses of land defined objectives and focuses on currently being cultivated for hemp. To results. It differs significantly from a interval, p is the estimated proportion of address this in the final rule, AMS prescriptive action in which licensees the population that has the attribute in sought input from state departments of are provided detailed direction on how question, and e is the margin of error or agriculture, most of which reported that those results are to be obtained. A the desired level of precision. the land on which hemp is currently performance-based approach would Inserting the z-value that corresponds grown was previously utilized for simply set a performance objective (e.g., to a 95 percent confidence interval, cultivation of corn. reliability of 95 percent) and allow the assuming maximum variability for p at AMS has modified its sampling and States and Indian Tribes considerable 50 percent, and applying the margin of testing requirements, which are freedom in how to achieve that error of one percent results in the described in the section in this rule reliability objective with their sampling following sample size: titled ‘‘Sampling for total THC’’, to methodology.

38 NASS. Quick Stats. Variable ‘‘Corn, grain— production, measured in $’’ divided by variable ‘‘Corn, grain—acres harvested’’.

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The Cochran Formula assumes an Table 7 shows the number of sampled sampling, driving, and testing; 120 unlimited population size; however, the lots, n, required for a 95 percent miles driven; and, $0.58 per mile formula can be modified to return a confidence interval and one percent compensation. In its calculation of total smaller sample size for a finite margin of error for each year’s total number of lots from total planted population: number of lots, N. The total annual cost acreage, AMS utilized the portions of of sampling and testing borne by planted acreage by intended use, producers is calculated using a cost per introduced in Table 5, and data from the lot of $565, which was estimated using Farm Service Agency (FSA) from which where n is the modified sample size, n0 hourly rates for inspectors and for average lot sizes for hemp by intended is the Cochran Formula sample size, and laboratory services of $75 and $98, use were derived. N is the population size. respectively; two hours, apiece, spent

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Some portion of tested lots are likely of THC concentrations greater than 0.3 November 2020, States and Tribes to return results with THC percent, weighted by the number of tests operating under the 2018 Farm Bill concentrations greater than 0.3 percent. administered in each state, was 25 reported 4,192 licensed producers To estimate this percentage, AMS percent. In Table 8, AMS applies this representing 6,166 acres planted. Of utilized data, specific to this very percentage to estimate total these acres planted, approximately 12 question, collected by the National noncompliant lots in each year and the percent were destroyed due to THC Industrial Hemp Regulators during a cost to dispose of noncompliant acreage. levels exceeding 0.3 percent. This data, November 2019 meeting. The average AMS is aware of other estimates of THC however, is limited because many portion of tests that would return results concentration failure rates. As of approved plans have not all been fully

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implemented. USDA expects more data begins and States and Tribes implement will be available as the 2021 season their programs.

AMS has issued guidance on Discussion with state departments of Survey of the Bureau of Labor and approved methods for disposal of agriculture and producers led AMS to Statistics, the mean hourly wage of a noncompliant hemp material, including estimate an average of 15 minutes per compliance officer is $35. Assuming 39 plowing under, mulching or acre required to dispose of percent of total compensation accounts composting, disking, bush mowing or noncompliant material. This 15-minute for benefits, then total compensation of chopping, deep burial, and burning. estimate is an average across all disposal a compliance officer is $57 per hour. AMS requires disposal of noncompliant methods. According to the May 2019 This is described in the Paperwork hemp using one of these methods. Occupational Employment Statistics Reduction Act (PRA) section of this

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rule. Applying the total hourly salary of The PRA section details the burdens will be imposed by this rule. All a compliance officer to the disposal time of reporting and recordkeeping and their assumptions in this table have been per acre of hemp results in a per acre associated costs. Table 9 shows the previously introduced. The PRA section cost of $14.25 for disposal of calculations of the reporting and describes how each estimate of time was noncompliant hemp acreage. recordkeeping costs to producers that calculated per required form.

In order to obtain a producer license, cost of a criminal history report Subtracted from producer sales due to AMS requires that each producer, or key conducted by the Federal Bureau of the rule are the opportunity costs of the participant of a business entity, submit Investigation (FBI) is $18 per record. For land on which hemp is currently grown; to a background check, or criminal the purposes of this analysis, AMS sampling and testing costs; disposal of history report, at least every three years. assumes each producer license to noncompliant acreage; reporting and A key participant is a person with a represent three key participants. The recordkeeping burdens; and, annual direct or indirect financial interest in total annual cost of a background check background checks. The producer net the hemp-producing entity, including a for three key participants every three benefits of this rule to society range chief executive officer, a chief operating years at minimum is $18 per producer. from $49 million in 2020 to $357 The producer net benefits of this rule officer, and a chief financial officer. The million in 2025. to society are shown in Table 10.

TABLE 10—PRODUCER NET BENEFITS TO SOCIETY [Millions]

2020 2021 2022 2023 2024 2025

Grower sales due to rule ...... $75.51 $133.34 $200.38 $276.78 $326.88 $499.46 Opportunity cost...... (20.05) (35.40) (53.20) (73.48) (86.78) (132.59) Sampling & testing...... (3.20) (3.89) (4.30) (4.56) (4.67) (4.91) Disposal of noncompliant material ...... (0.30) (0.36) (0.40) (0.42) (0.43) (0.46) Reporting & recordkeeping...... (2.56) (2.82) (3.10) (3.41) (3.75) (4.12) Background checks...... (0.36) (0.40) (0.44) (0.48) (0.53) (0.58)

Net benefits...... 49.05 90.47 138.95 194.43 230.72 356.80

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States, Indian Tribes, and USDA program administration. AMS believes, Indian Tribes as detailed in the PRA States and Indian Tribes have the therefore, that this figure is a suitable section of this rule. The total time authority to establish fee structures to proxy for the cost of program required per state or tribe for reporting fund their hemp programs. As of the administration to states, Indian Tribes, and recordkeeping is 25.25 hours writing of this analysis, about half of the and USDA per producer who cultivates annually. AMS assumes constant the states with plans approved by USDA hemp as a result of this rule. number of states and Indian Tribes that reported their programs as being full As discussed in the ‘‘Baseline will operate their own hemp programs funded through user-fees. To estimate Definition’’ section, 17 states opted to at 100 in total from 2020 through 2025. the cost of administering a hemp participate in the new hemp programs In total, the time required of 100 states program, AMS calculated an average of authorized by the 2018 Farm Bill in and Indian Tribes for 25.25 hours of the total fees charged to producers by time for the 2020 growing season. These reporting and recordkeeping is 2,525 these states, which reported as fully states represented 20 percent of both hours. Applying the hourly salary of a user-fee funded, to use as a proxy for the planted acreage nationwide and the compliance officer of $57 to this total per producer cost of hemp program number of producers nationwide. By results in an annual cost to all states and administration. The fees used to applying this percentage to the total Indian Tribes of reporting and calculate this average included those number of producers in each year, as recordkeeping of $143,919, or $1,439 with such designations as application shown in Table 2, AMS estimates the per state or tribe. fee, site registration fee, licensing fee, number of producers that will cultivate The total administration costs to and others. The average did not include hemp due to this rule. The product of states, Indian Tribes, and USDA are fees associated with sampling and the number of producers due to this rule calculated in Table 11. They include the testing as these were calculated and the $800 per grower proxy for costs to all three entities of program separately in Table 7. AMS estimates an administration costs results in program administration, and the costs of average cost per producer of hemp administration costs to States, Indian reporting and recordkeeping to states program administration of $800 Tribes, and USDA of $3 million in 2020 and Indian Tribes. Total administration annually. AMS has no reason to believe to $5 million in 2025. costs to states, Indian Tribes, and USDA that Indian Tribes or USDA will be any This rule places a reporting and range from $3 million in 2020 to $5 more or any less efficient than states in recordkeeping burden on states and million in 2025.

TABLE 11—TOTAL COSTS TO STATES, INDIAN TRIBES, AND USDA [Millions]

2020 2021 2022 2023 2024 2025

Program administration...... $(3.20) $(3.52) $(3.87) $(4.26) $(4.69) $(5.15) Reporting & recordkeeping...... (0.14) (0.14) (0.14) (0.14) (0.14) (0.14)

Total costs...... (3.34) (3.66) (4.02) (4.40) (4.83) (5.30)

Laboratories rule estimates an annual reporting and Multiplying the total number of lots to recordkeeping requirement for be sampled and tested in each year by This rule also places a reporting and laboratories of 0.58 hours per sampled the annual reporting and recordkeeping recordkeeping burden on laboratories as and tested lot. As calculated in Table 7, requirement of 0.58 hours per sampled they will be required to report on the the total number of lots to be sampled and tested lot and by the hourly salary results of samples tested for THC and tested in each year is 5,659 in 2020; of a compliance officer of $57 results in content to the entities administering the 6,886 in 2021; 7,606 in 2022; 8,069 in the total annual costs to laboratories as hemp programs. The PRA section of this 2023; 8,272 in 2024; and, 8,688 in 2025. shown in Table 12.

TABLE 12—TOTAL COSTS TO LABORATORIES [Millions]

2020 2021 2022 2023 2024 2025

Reporting & recordkeeping ...... $(0.19) $(0.23) $(0.25) $(0.27) $0.27) $(0.29)

Total Net Benefit For this reason, the net benefits or costs present values by year are shown in Producers, states, Indian Tribes, and of this rule to these entities have been Table 13. The rule has a positive net USDA, and laboratories are the entities evaluated in this analysis. The total net benefit in every year, ranging from $46 most likely to be impacted by this rule. benefits to society as a whole and their million in 2020 to $351 million in 2025.

TABLE 13—TOTAL NET BENEFITS TO SOCIETY [Millions]

Entity 2020 2021 2022 2023 2024 2025

Producers ...... $49.05 $90.47 $138.95 $194.43 $230.72 $356.80 States, Tribes & USDA ...... (3.34) (3.66) (4.02) (4.40) (4.83) (5.30)

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TABLE 13—TOTAL NET BENEFITS TO SOCIETY—Continued [Millions]

Entity 2020 2021 2022 2023 2024 2025

Laboratories ...... (0.19) (0.23) (0.25) (0.27) (0.27) (0.29)

Total ...... 45.52 86.58 134.68 189.76 225.61 351.21

Present values of net benefits annualized at the given discount rates

Discount rates 2020 2021 2022 2023 2024 2024

3% ...... $45.52 $84.06 $126.95 $173.66 $200.45 $302.96 7% ...... 45.52 80.92 117.63 154.90 172.12 250.41

Alternatives Performance-based sampling also grants by intended use. The portions of lots to In developing this final rule, AMS flexibility to States and Indian Tribes in be sampled by intended use that were considered several alternatives to the the development of sampling considered were 50 percent of lots for policies that were adopted. The first of methodologies. In the IFR, AMS cannabinoids, 10 percent of lots for these was related to methodologies for required sampling of every hemp lot, fiber, and 10 percent of lots for grain. sampling. The methodologies regardless of intended use; however, AMS currently lacks sufficient data to considered include sampling and testing AMS has determined that compliance to successfully carry out a risk-based of all lots, as mandated in the IFR, this method would too greatly burden sampling methodology that would be sampling and testing based on risk, and producers as well as program applicable to the varying growing sampling and testing based on administrators, whose responsibility it regions nationwide; therefore, the risk- performance. The latter of these was the would be to enforce it. AMS also based sampling methodology was not sampling methodology that was chosen considered requiring risk-based chosen for this final rule. An analysis of for the final rule as it results in the sampling, which would mandate these sampling methodologies is lowest total cost to producers. minimum portions of sampling of lots illustrated in Table 14.

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Secondly, AMS considered retaining Indian Tribes to obtain program equivalent of $1 million per intended at 0.5 percent the limit for total THC approval and, for producers operating use. AMS encountered data limitations content that would result in a negligent under the Federal program to obtain a due to the lack of reporting by States violation, as required in the IFR. Based license and meet operating requirements and Tribes that have not started on comments, however, AMS has under that license. Without these implementing the 2018 Farm Bill determined this requirement to too provisions, it would not be possible to provisions and the extension of the 2014 greatly burden producers as factors grow hemp legally. Farm Bill provisions which do not beyond the control of the producer, Both the declassification of hemp, and require reporting from States. such as seed genetics, weather and the prohibition on interference with To this end, AMS utilized data on climate, may cause an increase in total interstate transportation apply to hemp acreage by intended use from the THC-levels. By increasing the negligent that is grown under an approved State Kentucky Department of Agriculture violation threshold to 1.0 percent, AMS or Tribal plan, or under a Federal and the Montana Department of diminishes the risk to producers of license. As a result, this regulation incurring a negligent violation, which facilitates provisions of the 2018 Farm Agriculture. Together, Kentucky and results in time and cost savings to Bill that would otherwise be self- Montana make up a large amount of producers and to program-administering implementing. domestic acreage and represent diversity in hemp planted by intended entities. Overview of the Action Finally, AMS considered mandating a use. For the purpose of this analysis, post-sample harvest window of 15 days, The 2018 Farm Bill granted regulatory therefore, AMS assumes that the as required in the IFR. Based on authority of domestic hemp production combined planted acreage by intended comments and in consideration of the to the State departments of agriculture, use in Kentucky and Montana time required to complete sampling and Tribal governments, and USDA. States adequately represent the planted testing activities, AMS has determined and Indian Tribes wishing to operate acreage by intended use across the that requiring a 15-day post-sample their own programs must submit to United States. harvest window would place undue USDA plans that include provisions for For yield estimates, AMS compared strain on resources. AMS believes that maintaining information regarding the the hemp enterprise budgets published the extension of the post-sample harvest land on which hemp is produced, for by seven different academic institutions window to 30 days will provide testing the levels of THC, for disposal of that represent the growing conditions producers with a beneficial flexibility to plants that do not meet necessary across the country. Aside from these adjust to unforeseen weather events and requirements, and for procedures to seven, AMS is unaware of any other will accommodate complicated harvest ensure compliance with the hemp enterprise budgets published by processes. requirements of the new part, including an academic institution. AMS sourced background checks of all key Regulatory Flexibility Analysis 2019 and 2020 prices from the Jacobsen participants. State and Tribal Plans to estimate per-pound prices for Pursuant to the requirements set forth must be approved by USDA. This rule cannabinoids, fiber, and grain of $3.90, in the Regulatory Flexibility Act (5 outlines requirements by which the $0.09, and $0.53, respectively. The price U.S.C. 601–612), AMS has considered USDA would approve plans submitted for cannabinoids assumes 6 percent the economic impact of this action on by States and Tribal governments for CBD content at $0.65 per CBD small entities. AMS prepared an initial oversight of hemp production. The 2018 percentage per pound. regulatory flexibility act analysis Farm Bill also directs USDA to develop presented with the interim final rule, a plan for use by hemp producers in Using these prices and yield and has now prepared this Final States or Indian Tribes where no State estimates, AMS calculated a price per Regulatory Flexibility Act Analysis. or Tribal Plan has been approved and acre for each intended use of hemp, as AMS has determined that this rule will that do not prohibit the cultivation of shown in Table 15. From the estimates have a significant economic impact on hemp. These actions will promote of price per acre by intended use, AMS a substantial number of small consistency in regulations governing the calculated the equivalent of $1 million businesses because many small legal production of hemp across the in acres of hemp product per intended businesses will not be able to participate country. use. Of the 922 unique producers in the in the hemp market without this rule. combined data from the Kentucky and Potentially Affected Small Entities Montana Departments of Agriculture, 97 Need for Regulation The Small Business Administration percent reported acreage no greater than The rule is necessary to facilitate the (SBA) defines, in 13 CFR part 121, small the amounts necessary to reach $1 domestic cultivation of hemp for sale agricultural producers as those having million, based on the estimated prices into the market for hemp products by annual receipts of no more than $1 per acre. Assuming that these data are creating a set of minimum standards to million. Unfortunately, very little data representative of the U.S. as a whole, ensure that hemp being produced under exists on hemp grower sales receipts. To then 97 percent of domestic producers this program meets all statutory conduct this analysis, however, AMS of hemp would meet the SBA size requirements. The rule establishes estimated prices per acre by intended standard of a small business of annual minimum requirements for States and use of hemp to find the acreage receipts of no greater than $1 million.

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Alternatives Considered To Minimize administrators, whose responsibility it Finally, AMS considered mandating a Impacts of the Rule would be to enforce it. AMS also post-sample harvest window of 15 days, In developing this final rule, due to considered requiring risk-based as required in the IFR. Based on comments received and experiences sampling, which would mandate comments and in consideration of the from the 2020 season, AMS considered minimum portions of sampling of lots time required to complete sampling and several alternatives to the policies that by intended use. The portions of lots to testing activities, AMS has determined were adopted. The first of these was be sampled by intended use that were that requiring a 15-day post-sample related to methodologies for sampling. considered were 50 percent of lots for harvest window would place undue The methodologies considered include cannabinoids, 10 percent of lots for strain on resources. AMS believes that sampling and testing of all lots, as fiber, and 10 percent of lots for grain. the extension of the post-sample harvest mandated in the IFR, sampling and AMS currently lacks sufficient data to window to 30 days will provide testing based on risk, and sampling and successfully carry out a risk-based producers with a beneficial flexibility to testing based on performance. The latter sampling methodology that would be adjust to unforeseen weather events and of these was the sampling methodology applicable to the varying growing will accommodate complicated harvest that was chosen for the final rule as it regions nationwide; therefore, the risk- processes. results in the lowest total cost to based sampling methodology was not producers. Performance-based sampling chosen for this final rule. Pursuant to the Congressional Review also grants flexibility to States and Secondly, AMS considered retaining Act (5 U.S.C. 801 et seq.), the Office of Indian Tribes in the development of at 0.5 percent the limit for total THC Information and Regulatory Affairs sampling methodologies. Some States content that would result in a negligent designated this rule as ‘‘major,’’ as currently have considered performance- violation, as required in the IFR. Based defined by 5 U.S.C. 804(2). based sampling under the 2014 Farm on comments, however, AMS has List of Subjects in 7 CFR Part 990 Bill. However, this information is not determined this requirement to too available and will need to be evaluated greatly burden producers as factors Acceptable hemp THC level, and approved by USDA as part of State beyond the control of the producer, Agricultural commodities, Cannabis, and Tribal plans before it can be such as seed genetics, weather and Corrective action plan, Delta-9 implemented under the 2018 Farm Bill climate, may cause an increase in total tetrahydrocannabinol, Drugs, Dry program if States and Tribes decide to THC-levels. By increasing the negligent weight basis, Hemp, Liquid utilize this option. In the IFR, AMS violation threshold to 1.0 percent, AMS chromatography, Laboratories, required sampling of every hemp lot, diminishes the risk to producers of Marijuana. regardless of intended use; however, incurring a negligent violation, which AMS has determined that compliance to results in time and cost savings to ■ For the reasons stated in the preamble, this method would too greatly burden producers and to program-administering AMS revises 7 CFR part 990 to read as producers as well as program entities. follows:

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PART 990—DOMESTIC HEMP unless the context otherwise requires, Cannabis sativa is a species, and PRODUCTION PROGRAM the following terms shall be construed, Cannabis indica and Cannabis ruderalis respectively, to mean: are subspecies thereof. Cannabis refers Subpart A—Definitions Acceptable hemp THC level. When a to any form of the plant in which the laboratory tests a sample, it must report total delta-9 tetrahydrocannabinol Sec. the total delta-9 tetrahydrocannabinol 990.1 Meaning of terms. concentration on a dry weight basis has content concentration level on a dry not yet been determined. Subpart B—State and Tribal Hemp weight basis and the measurement of Controlled Substances Act (CSA). The Production Plans uncertainty. The acceptable hemp THC Controlled Substances Act as codified in 990.2 State and Tribal plans; General level for the purpose of compliance with 21 U.S.C. 801 et seq. authority. the requirements of State or Tribal hemp Conviction. Means any plea of guilty 990.3 State and Tribal plans; Plan plans or the USDA hemp plan is when or nolo contendere, or any finding of requirements. the application of the measurement of guilt, except when the finding of guilt 990.4 USDA approval of State and Tribal uncertainty to the reported total delta-9 is subsequently overturned on appeal, plans. pardoned, or expunged. For purposes of 990.5 Audit of State or Tribal plan tetrahydrocannabinol content compliance. concentration level on a dry weight this part, a conviction is expunged 990.6 Violations of State and Tribal plans. basis produces a distribution or range when the conviction is removed from 990.7 Establishing records with USDA Farm that includes 0.3 percent or less. For the individual’s criminal history record Service Agency. example, if the reported total delta-9 and there are no legal disabilities or 990.8 Production under Federal law. tetrahydrocannabinol content restrictions associated with the Subpart C—USDA Hemp Production Plan concentration level on a dry weight expunged conviction, other than the fact basis is 0.35 percent and the that the conviction may be used for 990.20 USDA requirements for the ± production of hemp. measurement of uncertainty is 0.06 sentencing purposes for subsequent 990.21 USDA hemp producer license. percent, the measured total delta-9 convictions. In addition, where an 990.22 USDA hemp producer license tetrahydrocannabinol content individual is allowed to withdraw an approval. concentration level on a dry weight original plea of guilty or nolo 990.23 Reporting hemp crop acreage with basis for this sample ranges from 0.29 contendere and enter a plea of not guilty USDA Farm Service Agency. percent to 0.41 percent. Because 0.3 and the case is subsequently dismissed, 990.24 Responsibility of a USDA licensee percent is within the distribution or the individual is no longer considered prior to harvest. range, the sample is within the to have a conviction for purposes of this 990.25 Standards of performance for detecting total delta-9 acceptable hemp THC level for the part. tetrahydrocannabinol (THC) purpose of plan compliance. This Corrective action plan. A plan concentration levels. definition of ‘‘acceptable hemp THC proposed by a licensed hemp producer 990.26 Responsibility of a USDA producer level’’ affects neither the statutory and approved by the governing entity after laboratory testing is performed. definition of hemp, 7 U.S.C. 1639o(1), in for correcting a negligent violation or 990.27 Non-compliant cannabis plants. the 2018 Farm Bill nor the definition of non-compliance with the applicable 990.28 Compliance. ‘‘marihuana,’’ 21 U.S.C. 802(16), in the State, Tribal, or USDA hemp production 990.29 Violations. CSA. plan, its terms, the applicable law(s), 990.30 USDA producers; License Act. Agricultural Marketing Act of and/or this part. Also, a plan proposed suspension. 990.31 USDA licensees; Revocation. 1946. by a State or Tribal government for 990.32 Recordkeeping requirements. Agricultural Marketing Service or correcting violations or non- AMS. The Agricultural Marketing compliances with USDA-approved State Subpart D—Appeals Service of the U.S. Department of or Tribal hemp programs. 990.40 General adverse action appeal Agriculture. Criminal history report. The Federal process. Applicant. (1) A State or Indian Tribe Bureau of Investigation’s Identity 990.41 Appeals under the USDA hemp that has submitted a State or Tribal History Summary. production plan. hemp production plan to USDA for Culpable mental state greater than 990.42 Appeals under a State or Tribal approval under this part; or negligence. To act intentionally, hemp production plan. (2) A producer in a State or territory knowingly, willfully, or recklessly. Subpart E—Administrative Provisions of an Indian Tribe that is not subject to Decarboxylated. The completion of 990.60 Agents. a State or Tribal hemp production plan the chemical reaction that converts 990.61 Severability. and who has submitted an application THC-acid (THCA) into delta-9 THC, the 990.62 [Reserved] to USDA for a license under the USDA intoxicating component of cannabis. 990.63 Interstate transportation of hemp. hemp production plan under this part. The decarboxylated value is also Subpart F—Reporting Requirements Audit. An official inspection of an calculated using a molecular mass individual’s or organization’s accounts 990.70 State and Tribal hemp reporting conversion ratio that sums delta-9 THC requirements. and paperwork or documentation by an and eighty-seven and seven tenths (87.7) 990.71 USDA plan reporting requirements. independent body. An audit also refers percent of THC-acid ((delta-9 THC) + to a compliance audit of States and (0.877 * THCA)). Authority: 7 U.S.C. 1639o note, 1639p, 1639q, 1639r. Indian Tribes with approved hemp Decarboxylation. The removal or production plans by USDA to determine elimination of carboxyl group from a Subpart A—Definitions compliance with their approved plan, molecule or organic compound. the regulations in this part, and the Act. Disposal. An activity that transitions § 990.1 Meaning of terms. For this part, audit relates to the non-compliant product into a non- Words used in this subpart in the documentation related to authorities retrievable or non-ingestible form. Such singular form shall be deemed to impart under the 2018 Farm Bill to produce activities include plowing, tilling, or the plural, and vice versa, as the case hemp. disking plant material into the soil; may demand. For the purposes of Cannabis. A genus of flowering plants mulching, composting, chopping, or provisions and regulations of this part, in the family Cannabaceae of which bush mowing plant material into green

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manure; burning plant material; burying Indian Tribe or Tribe. As defined in concentration level of higher than 0.3 plant material into the earth and section 4 of the Indian Self- percent on a dry weight basis. covering with soil. Determination and Education Measurement of Uncertainty (MU). Delta-9 tetrahydrocannabinol or THC. Assistance Act (25 U.S.C. 5304). The parameter, associated with the Delta-9 THC is the primary psychoactive Information sharing system. The result of a measurement, that component of cannabis. For the database that allows USDA to share characterizes the dispersion of the purposes of this part, delta-9 THC and information collected under State, values that could reasonably be THC are interchangeable. Tribal, and USDA plans with Federal, attributed to the particular quantity Drug Enforcement Administration or State, Tribal, and local law enforcement. subject to measurement. DEA. The United States Drug Key participants. A sole proprietor, a Negligence. Failure to exercise the Enforcement Administration. partner in partnership, or a person with level of care that a reasonably prudent Dry weight basis. The ratio of the executive managerial control in a person would exercise in complying amount of moisture in a sample to the corporation. A person with executive with the regulations set forth under this amount of dry solid in a sample. A basis managerial control includes persons part. for expressing the percentage of a such as a chief executive officer, chief Phytocannabinoid. Cannabinoid chemical in a substance after removing operating officer, and chief financial chemical compounds found in the the moisture from the substance. officer. This definition does not include cannabis plant, two of which are delta- Percentage of THC on a dry weight basis non-executive managers such as farm, 9 tetrahydrocannabinol (delta-9 THC) means the percentage of THC, by field, or shift managers. This definition and cannabidiol (CBD). weight, in a cannabis item (plant, also does not include a member of the Plan. A set of criteria or regulations extract, or other derivative), after leadership of a Tribal government who under which a State or Tribal excluding moisture from the item. is acting in their capacity as a Tribal government, or USDA, monitors and Entity. A corporation, joint stock leader except when that member regulates the production of hemp. company, association, limited exercises executive managerial control Post-decarboxylation. In the context partnership, limited liability over hemp production. of testing methodologies for THC partnership, limited liability company, Law enforcement agency. Any concentration levels in hemp, means a irrevocable trust, estate, charitable Federal, State, Tribal, or local law value determined after the process of organization, or other similar enforcement agency. decarboxylation that determines the organization, including any such Liquid chromatography or LC. A type potential total delta-9 organization participating in the hemp of chromatography technique in tetrahydrocannabinol content derived production as a partner in a general analytical chemistry used to separate, from the sum of the THC and THCA partnership, a participant in a joint identify, and quantify each component content and reported on a dry weight venture, or a participant in a similar in a mixture. LC relies on pumps to pass basis. The post-decarboxylation value of organization. a pressurized liquid solvent containing THC can be calculated by using a Farm Service Agency or FSA. An the sample mixture through a column chromatograph technique using heat, agency of the United States Department filled with a solid absorbent material to gas chromatography, through which of Agriculture. separate and analyze compounds. THCA is converted from its acid form to Gas chromatography or GC. A type of Lot. A contiguous area in a field, its neutral form, THC. Thus, this test chromatography in analytical chemistry greenhouse, or indoor growing structure calculates the total potential THC in a used to separate, identify, and quantify containing the same variety or strain of given sample. The post-decarboxylation each component in a mixture. GC relies cannabis throughout the area. The term value of THC can also be calculated by on heat for separating and analyzing lot also means the terms ‘‘farm,’’ ‘‘tract,’’ using a liquid chromatograph technique, compounds that can be vaporized ‘‘field,’’ and ‘‘subfield’’ as these are which keeps the THCA intact. This without decomposition. terms used by FSA in 7 CFR 718.2 to technique requires the use of the Geospatial location. A location define lot. following conversion: [Total THC = designated through a global system of Marijuana. Or ‘‘marihuana’’, as (0.877 x THCA) + THC] which navigational satellites used to determine defined in the CSA, means all parts of calculates the potential total THC in a the precise ground position of a place or the plant Cannabis sativa L., whether given sample. See the definition for object. growing or not; the seeds thereof; the decarboxylation. Handle. To harvest or store hemp resin extracted from any part of such Produce. To grow hemp plants for plants or hemp plant parts prior to the plant; and every compound, market, or for cultivation for market, in delivery of such plants or plant parts for manufacture, salt, derivative, mixture, the United States. further processing. ‘‘Handle’’ also or preparation of such plant, its seeds or Producer. A producer as defined in 7 includes the disposal of cannabis plants resin. The term ‘‘marihuana’’ does not CFR 718.2 specifically of hemp. that are not hemp for purposes of include hemp, as defined in section Remediation. Remediation refers to chemical analysis and disposal of such 297A of the Agricultural Marketing Act the process of rendering non-compliant plants. of 1946, and does not include the cannabis, compliant. Remediation can Hemp. The plant species Cannabis mature stalks of such plant, fiber occur by removing and destroying sativa L. and any part of that plant, produced from such stalks, oil or cake flower material, while retaining stalk, including the seeds thereof and all made from the seeds of such plant, any stems, leaf material, and seeds. derivatives, extracts, cannabinoids, other compound, manufacture, salt, Remediation can also occur by isomers, acids, salts, and salts of derivative, mixture, or preparation of shredding the entire plant into a isomers, whether growing or not, with a such mature stalks (except the resin biomass like material, then re-testing the total delta-9 tetrahydrocannabinol extracted therefrom), fiber, oil, or cake, shredded biomass material for concentration of not more than 0.3 or the sterilized seed of such plant compliance. percent on a dry weight basis. which is incapable of germination (7 Reverse distributor. A person who is Immature plants. A cannabis plant U.S.C. 1639o). ‘‘Marihuana’’ means all registered with the DEA in accordance that is not flowering. cannabis that tests as having a THC with 21 CFR 1317.15 to dispose of

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marijuana under the Controlled under the USDA planto grow hemp of 95 percent that no more than one Substances Act. under the terms established in this part percent of the plants in each lot would Secretary. The Secretary of and who produces hemp. exceed the acceptable hemp THC level Agriculture of the United States and ensure that a representative sample Department of Agriculture. Subpart B—State and Tribal Hemp is collected that represents a State. Any one of the fifty States of Production Plans homogeneous composition of the lot. the United States of America, the § 990.2 State and Tribal plans; General Alternatively, States and Tribes may District of Columbia, the authority. adopt a performance-based method that Commonwealth of Puerto Rico, and any States or Indian Tribes desiring to meets the requirements in paragraphs other territory or possession of the have primary regulatory authority over (a)(2)(iii)(A) and (B) of this section. United States. the production of hemp in the State or (A) The alternative method must be State department of agriculture. The part of the State or Tribe’s hemp plan agency, commission, or department of a territory of the Indian Tribe shall submit to the Secretary for approval, through and is subject to USDA approval. State government responsible for (B) The alternative method must have the State department of agriculture (in agriculture in the State. the potential to ensure, at a confidence Territory of the Indian Tribe. (1) All consultation with the Governor and chief law enforcement officer of the level of 95 percent, that the land within the limits of any Indian cannabisplant species Cannabis sativa reservation under the jurisdiction of the State) or the Tribal government, as applicable, a plan under which the State L. that will be subject to the alternative United States Government, method will not test above the notwithstanding the issuance of any or Indian Tribe monitors and regulates that production. acceptable hemp THC level. The patent, including rights-of-way running alternative method may consider one or through the reservation; § 990.3 State and Tribal plans; Plan more of the following factors: (2) All dependent Indian communities requirements. (1) Seed certification process or within the borders of the United States (a) General requirements. A State or process that identifies varieties that whether within the original or Tribal plan submitted to the Secretary have consistently demonstrated to result subsequently acquired territory thereof, for approval must include the practice in compliant hemp plants in that State and whether within or without the and procedures described in this or territory of the Indian Tribe; limits of a State; paragraph (a). (2) Whether the producer is (3) All Indian allotments, the Indian (1) A State or Tribal plan must conducting research on hemp; titles to which have not been include a practice to collect, maintain, (3) Whether a producer has extinguished, including rights-of-way and report to the Secretary relevant, consistently produced compliant hemp running through the same; and real-time information for each producer plants over an extended period of time; (4) Any lands title to which is either licensed or authorized to produce hemp and held in trust by the United States for the under the State or Tribal plan regarding: (4) Factors similar to those in this benefit of any Indian Tribe or individual (i) Contact information as described in paragraph (a)(2)(iii)(B). or held by any Indian Tribe or § 990.70(a)(1); (iv) During a scheduled sample individual subject to restriction by the (ii) A legal description of the land on collection, the producer or an United States against alienation and which the producer will produce hemp authorized representative of the over which an Indian Tribe exercises in the State or territory of the Indian producer shall be present at the growing jurisdiction. Tribe including, to the extent site if possible. Total THC. Total THC is the value practicable, its geospatial location; and (v) Sampling agents shall be provided determined after the process of (iii) The status and number of the with complete and unrestricted access decarboxylation, or the application of a producer’s license or authorization in a during business hours to all hemp and conversion factor if the testing format prescribed by USDA. other cannabis plants (whether growing methodology does not include (2) A State or Tribal plan must or harvested), to areas where hemp is decarboxylation, that expresses the include a procedure for accurate and grown and stored, and to all land, potential total delta-9 effective sampling of hemp that buildings, and other structures used for tetrahydrocannabinol content derived includes the requirements in this the cultivation, handling, and storage of from the sum of the THC and THCA paragraph (a)(2). all hemp and other cannabis plants, and content and reported on a dry weight (i) Samples from cannabis plants must all locations listed in the producer basis. This post-decarboxylation value be collected within 30 days prior to the license. of THC can be calculated by using a anticipated harvest, for total delta-9 (vi) A producer shall not harvest the chromatograph technique using heat, tetrahydrocannabinol concentration cannabis crop prior to samples being such as gas chromatography, through level testing. Samples must be collected taken. which THCA is converted from its acid by a sampling agent. Producers may not (vii) Sampling agents must be trained form to its neutral form, THC. Thus, this collect samples from their own growing using USDA, State, or Tribal training test calculates the total potential THC in facilities. procedures. States and Indian Tribes a given sample. The total THC can also (ii) Samples shall be obtained from must maintain information, available to be calculated by using a liquid the flowering tops of plants when producers, about trained sampling chromatograph technique, which keeps flowering tops are present, and shall be agents. the THCA intact. This technique approximately five to eight inches in (3) A State or Tribal plan must requires the use of the following length from the ‘‘main stem’’ (that include a procedure for testing that is conversion: [Total THC = (0.877 x includes the leaves and flowers), able to accurately identify whether the THCA) + THC] which calculates the ‘‘terminal bud’’ (that occurs at the end sample contains a total delta-9 potential total THC in a given sample. of a stem), or ‘‘central cola’’ (cut stem tetrahydrocannabinol content Tribal government. The governing that could develop into a bud) of the concentration level that exceeds the body of an Indian Tribe. flowering top of the plant. acceptable hemp THC level. The USDA licensee. A person, (iii) The method used for sampling procedure must include a validated partnership, or corporation licensed must be sufficient at a confidence level testing methodology that uses post-

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decarboxylation or other similarly subpart F of this part. Laboratories shall (i) A requirement that producers reliable methods. The testing only submit test results used to report their hemp crop acreage to the methodology must consider the determine compliance with this part. FSA, consistent with the requirement in potential conversion of THCA in hemp Test results from informal testing § 990.7. into THC and the test result must report conducted throughout the growing (ii) Assignment of a license or the total available THC derived from the season shall not be reported to USDA. authorization identifier for each sum of the THC and THCA content. (5) A State or Tribal plan must producer in a format prescribed by Testing methodologies meeting the include a procedure to comply with the USDA. requirements of this paragraph (a)(3) enforcement procedures in § 990.6. (iii) A requirement that producers include, but are not limited to, gas or (6) A State or Tribal plan must report the total acreage of hemp planted, liquid chromatography with detection. include a procedure for the disposal or harvested, and, if applicable, disposed The total THC concentration level shall remediation of cannabis plants if the or remediated. The State or Tribal be determined and reported on a dry sample representing that plant tests government shall collect this weight basis. above the acceptable hemp THC level. information and report it to AMS. (i) Any test of a representative sample (i) The disposal must be conducted (b) Relation to State and Tribal law. resulting in higher than the acceptable either by using a DEA-registered reverse A State or Tribal plan may include any hemp THC level shall be conclusive distributor or law enforcement; or on other practice or procedure established evidence that the lot represented by the site at the farm or hemp production by a State or Indian Tribe, as applicable; sample is not in compliance with this facility. Provided, That the practice or procedure part and shall be disposed of or (ii) The State or Tribal plan must is consistent with this part and Subtitle remediated in accordance with § 990.27. include procedures to verify the G of the Act. (ii) Samples of hemp plant material disposal or remediation of the cannabis (1) No preemption. Nothing in this from one lot shall not be commingled plant. This may come in the form of in- part preempts or limits any law of a with hemp plant material from other person verification by State or Tribal State or Indian Tribe that: lots. representatives, or alternative (i) Regulates the production of hemp; (iii) Laboratories conducting requirements that direct growers to and analytical testing for purposes of provide pictures, videos, or other proof (ii) Is more stringent than this part or detecting the concentration levels of that disposal or remediation occurred Subtitle G of the Act. Total THC shall meet the following successfully. Disposal and remediation (2) References in plans. A State or requirements: means are described at AMS’s website. Tribal plan may include a reference to (A) Laboratory quality assurance must (iii) If a producer elects to perform a law of the State or Indian Tribe ensure the validity and reliability of test remediation activities, an additional regulating the production of hemp, to results; sampling and testing of the post- the extent that the law is consistent with (B) Analytical method selection, remediated crop must occur to this part. validation, and verification must ensure determine THC concentration levels. that the testing method used is (7) A State or Tribal plan must § 990.4 USDA approval of State and Tribal appropriate (fit for purpose), and that include a procedure for conducting plans. the laboratory can successfully perform annual inspections of, at a minimum, a (a) General authority. No later than 60 the testing; random group of producers to verify calendar days after the receipt of a State (C) The demonstration of testing that hemp is not produced in violation or Tribal plan for a State or Tribal validity must ensure consistent, of this part. territory in which production of hemp accurate analytical performance; (8) A State or Tribal plan must is legal, the Secretary shall: (D) Method performance include a procedure for submitting the (1) Approve the State or Tribal plan specifications must ensure analytical report described in § 990.70 to the only if the State or Tribal plan complies tests are sufficiently sensitive for the Secretary by the first of each month. If with this part; or purposes of the detectability the first of the month falls on a weekend (2) Disapprove the State or Tribal plan requirements of this part; and or holiday, the report is due by the first if the plan does not comply with this (E) Effective disposal procedures for business day following the due date. All part. USDA shall provide the State or non-compliant samples that do not meet such information must be submitted to Tribe with written notification of the the requirements of this part. the USDA in a format that is compatible disapproval and the cause for the (F) Measurement of uncertainty (MU) with USDA’s information sharing disapproval. must be estimated and reported with system. (b) Amended plans. A State or Tribal test results. Laboratories shall use (9) The State or Tribal government government, as applicable, must submit appropriate, validated methods and must certify that the State or Indian to the Secretary an amended plan if: procedures for all testing activities and Tribe has the resources and personnel to (1) The Secretary disapproves a State evaluate measurement of uncertainty. carry out the practices and procedures or Tribal plan and the State or Indian (G) Sample preparation of pre- or described in paragraphs (a)(1) through Tribe wishes to have primary regulatory post-harvest samples shall require (9) of this section. authority over hemp production within grinding of sample to ensure (10) The State or Tribal plan must its State or territory of the Indian Tribe; homogeneity of plant material prior to include a procedure to collect and share or testing. Sample preparation may follow information with USDA to support the (2) The State or Indian Tribe makes a procedure described by USDA. information sharing requirements in 7 substantive revisions to its plan or its (H) After December 31, 2022, States U.S.C. 1639q(d). The State or Tribal laws which alter the way the plan meets and Indian Tribes shall require that only government is responsible for reporting the requirements of this part. If this laboratories registered with the DEA the information identified in paragraphs occurs, the State or Tribal government may conduct testing under this section. (a)(10)(i) through (iii) of this section must re-submit the revised plan for (4) A State or Indian Tribe shall with AMS. The State or Tribal hemp USDA approval. Such re-submissions require testing laboratories to comply production plan must include the should be provided to USDA within 60 with USDA reporting requirements in following: days from the date that the State or

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Tribal laws and regulations are effective. with a revoked plan would have to the corrective action plan and has Producers shall continue to comply apply to USDA for a license to continue corrected the non-compliances. with the requirements of the existing producing. (2) If the USDA determines that the plan while such modifications are under State or Indian Tribe is not in consideration by USDA. If State or § 990.5 Audit of State or Tribal plan compliance after the second audit, the compliance. Tribal government laws or regulations USDA may revoke its approval of the in effect under the USDA-approved plan The Secretary may conduct an audit State or Tribal plan for one year or until change but the State or Tribal to determine a State or Indian Tribe’s the State or Indian Tribe becomes government does not submit a revised compliance with their approved plan. compliant whichever occurs later. plan within 60 days from the effective (a) Frequency of audits. Compliance USDA will not approve a State or Indian date of the new law or regulation, the audits may be scheduled, no more Tribe’s plan until the State or Indian existing plan is revoked. frequently than every three years, based Tribe demonstrates upon inspection that (3) USDA approval of State or Tribal on available resources. Audits may it is in compliance with all regulations government plan shall remain in effect include an onsite-visit, a desk-audit, or in this part. unless an amended plan must be both. The USDA may adjust the submitted to USDA because of a frequency of audits if deemed § 990.6 Violations of State and Tribal plans. substantive revision to a State’s or appropriate based on program Tribe’s plan, a relevant change in State performance, compliance issues, or (a) Producer violations. Producer or Tribal laws or regulations, or other relevant factors identified and violations of USDA-approved State and approval of the plan is revoked by provided to the State or Tribal Tribal hemp production plans shall be USDA. governments by USDA. subject to enforcement in accordance (4) Upon USDA approval of a Tribal (b) Scope of audit review. The audit with the terms of this section. plan, an Indian Tribe may exercise may include, but is not limited to, a (b) Negligent violations. Each USDA- jurisdiction and therefore primary review of the following: approved State or Tribal plan shall regulatory authority over all production (1) The resources and personnel contain provisions relating to negligent of hemp in its Territory regardless of the employed to administer and oversee its producer violations as defined under extent of its inherent regulatory approved plan; this part. Producers shall not receive authority. (2) The process for licensing and more than one negligent violation per (c) Technical assistance. The systematic compliance review of hemp growing season. Negligent violations Secretary may provide technical producers; shall include: (1) Failure to provide a legal assistance to help a State or Indian Tribe (3) Sampling methods and laboratory description of land on which the develop or amend a plan. This may testing requirements and components; producer produces hemp; include the review of draft plans or (4) Disposal and/or remediation of other informal consultation as (2) Failure to obtain a license or other non-compliant hemp plants or hemp required authorization from the State necessary. plant material practices, to ensure that (d) Approved State or Tribal plans. If department of agriculture or Tribal correct reporting to the USDA has government, as applicable; or the Secretary approves a State or Tribal occurred; plan, the Secretary shall notify the State (3) Production of cannabis with a total (5) Results of and methodology used delta-9 tetrahydrocannabinol or Indian Tribe by letter or email. for the annual inspections of producers; (1) In addition to the approval letter, concentration exceeding the acceptable and the State or Indian Tribe shall receive hemp THC level. Hemp producers do their plan approval certificate either as (6) Information collection procedures not commit a negligent violation under an attachment or via website link. and information accuracy (i.e., this paragraph (b)(3) if they make (2) The USDA shall post information geospatial location, contact information reasonable efforts to grow hemp and the regarding approved plans on its website. reported to the USDA, legal description cannabis (marijuana) does not have a (3) USDA approval of State or Tribal of land). total delta-9 tetrahydrocannabinol government plans shall remain in effect (c) Audit reports. (1) Audit reports concentration of more than 1.0 percent unless: will be issued to the State or Tribal on a dry weight basis. (i) The State or Tribal government’s government no later than 60 days after (c) Corrective action for negligent laws and regulations in effect under the the audit concludes. If the audit reveals violations. Each USDA-approved State USDA-approved plan change, thus that the State or Tribal government is or Tribal plan shall provide for the requiring such plan to be revised and re- not in compliance with its USDA correction of negligent violations. Each submitted for USDA approval. approved plan, USDA will advise the corrective action plan shall include, at (ii) A State or Tribal plan must be State or Indian Tribe of non- a minimum, the following terms: amended in order to comply with future compliances and the corrective (1) A reasonable date by which the amendments to Subtitle G the Act and measures that must be completed to producer shall correct the negligent this part. come into compliance with the Act and violation. (e) Producer rights upon revocation of regulations in this part. The USDA will (2) A requirement that the producer State or Tribal plan. If USDA revokes require the State or Indian Tribe to periodically report to the State approval of a State or Tribal plan due develop a corrective action plan, which department of agriculture or Tribal to noncompliance as defined in must be reviewed and approved by the government, as applicable, on its paragraph (b)(2) of this section and USDA. The corrective action plan must compliance with the State or Tribal plan § 990.5, producers licensed or include a reasonable date by which the and corrective action plan for a period authorized to produce hemp under the State or Indian Tribe will correct make of not less than the next 2 years from the revoked State or Tribal plan may corrections. USDA will approve or deny date of the negligent violation. continue to produce for the remainder the corrective action plan within 60 (3) A producer that negligently of the calendar year in which the days of its receipt. USDA will conduct violates a State or Tribal plan approved revocation became effective. Producers a second audit to determine if the State under this part shall not as a result of operating in a State or Tribal territory or Indian Tribe is in compliance with that violation be subject to any criminal

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enforcement action by the Federal, any information contained in an (c) Falsifying material information on State, Tribal, or local government. application to participate in such application. Any person who materially (4) A producer that negligently program shall be ineligible to participate falsifies any information contained in an violates a State or Tribal plan three in that program. application for a license under the times during a 5-year period shall be (g) Appeals. For States and Indian USDA plan shall be ineligible to ineligible to produce hemp for a period Tribes who wish to appeal an adverse participate in the USDA plan. of 5 years beginning on the date of the action, subpart D of this part will apply. third violation. § 990.21 USDA hemp producer license. (5) The State or Indian Tribe shall § 990.7 Establishing records with USDA (a) General application Farm Service Agency. conduct an inspection to determine if requirements—(1) Requirements and the corrective action plan has been All producers licensed to produce license application. Any person implemented as submitted. hemp under an USDA-approved State or producing or intending to produce (d) Culpable violations. Each USDA- Tribal plan shall report hemp crop hemp must have a valid license prior to approved State or Tribal plan shall acreage to FSA and shall provide, at producing hemp. A valid license means contain provisions relating to producer minimum, the following information: the license is unexpired, unsuspended, violations made with a culpable mental (a) Street address and, to the extent and unrevoked. state greater than negligence, including practicable, geospatial location for each (2) Application dates. Applicants may that: lot or greenhouse where hemp will be submit an application for a license at (1) If the State or Tribal government produced. If an applicant operates in any time. determines that a producer has violated more than one location, or is producing (3) Required information on the plan with a culpable mental state under multiple licenses, production application. The applicant shall provide greater than negligence, the State or information shall be provided for each the information requested on the Tribal government, as applicable, shall location. application form, including: immediately report the producer to: (b) Acreage dedicated to the (i) Contact information. Full name, (i) The U.S. Attorney General; and production of hemp, or greenhouse or residential address, telephone number, (ii) The chief law enforcement officer indoor square footage dedicated to the and email address. If the applicant is a of the State or Indian Tribe, as production of hemp. business entity, the full name of the applicable. (c) License or authorization identifier business, the principal business location (2) Paragraphs (b) and (c) of this in a format prescribed by USDA. address, full name and title of the key section shall not apply to culpable § 990.8 Production under Federal law. participants, title, email address (if violations. Nothing in this subpart prohibits the available), and employer identification (e) Felonies. Each USDA-approved production of hemp in a State or the number (EIN) of the business; and State or Tribal plan shall contain territory of an Indian Tribe for which a (ii) Criminal history report. A current provisions relating to felonies. Such State or Tribal plan is not approved criminal history report for an provisions shall state that: under this subpart if produced in individual, or if the applicant is a (1) A person with a State or Federal accordance with subpart C of this part, business entity, all key participants, felony conviction relating to a and if the production of hemp is not dated within 60 days of the application controlled substance may not otherwise prohibited by the State or submission date. A license application participate in the plan and may not Indian Tribe. will not be considered complete without produce hemp under the State or Tribal all required criminal history reports. plan for 10 years from the date of the Subpart C—USDA Hemp Production (4) Submission of completed conviction. An exception applies to a Plan application forms. Completed person who was lawfully growing hemp application forms shall be submitted to under section 7606 of the Agricultural § 990.20 USDA requirements for the USDA. Act of 2014 (7 U.S.C. 5940) before production of hemp. (5) Incomplete application December 20, 2018, and whose (a) General hemp production procedures. Applications missing conviction also occurred before that requirements. The production of hemp required information shall be returned date. in a State or territory of an Indian Tribe to the applicant as incomplete. The (2) The State or Tribal plan shall where there is no USDA approved State applicant may resubmit a completed define who is participating in the plan or Tribal plan must be conducted in application. or program and is subject to the felony accordance with this subpart, provided (6) License expiration. USDA-issued conviction restriction for purposes of that the production of hemp is not hemp producer licenses shall be valid paragraph (e)(1) of this section. To prohibited by the State or territory of an until December 31 of the year three determine whether a person is subject to Indian Tribe where production will years after the year in which license was the felony conviction restriction, the occur. issued. State or Tribe much obtain a criminal (b) Convicted felon ban. A person (b) License renewals. USDA hemp history report for that person. The State with a State or Federal felony producer licenses must be renewed or Indian Tribe may require additional conviction relating to a controlled prior to license expiration. Licenses are reports or checks as it deems necessary. substance is subject to a 10-year not automatically renewed. (3) For each license or authorization ineligibility restriction on participating Applications for renewal shall be that the State or Indian Tribe issues, its in and producing hemp under the subject to the same terms, information plan must identify at least one USDA plan from the date of the collection requirements, and approval individual as participating in the plan conviction. An exception applies to a criteria as provided in this subpart for and for whom it will obtain a criminal person who was lawfully growing hemp initial applications unless there has history report to determine eligibility under section 7606 of the Agricultural been an amendment to the regulations under paragraph (e)(1) of this section. Act of 2014 (7 U.S.C. 5940) before in this part or the law since approval of (f) False statement. Each USDA- December 20, 2018, and whose the initial or last application. approved State or Tribal plan shall state conviction also occurred before that (c) License modification. A license that any person who materially falsifies date. modification is required if there is any

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change to the information submitted in (7) The State or territory of the Indian (b) Have samples collected from the the application including, but not Tribe where the person produces or flowering tops of the plant by cutting limited to, sale of a business, the intends to produce hemp does not have the top five to eight inches from the production of hemp in a new location, a USDA-approved plan or has not ‘‘main stem’’ (that includes the leaves or a change in the key participants submitted a plan to USDA for approval and flowers), ‘‘terminal bud’’ (that under a license. and is awaiting USDA’s decision. occurs at the end of a stem), ’’or ‘‘central (d) Licensing for research. (1) (8) The State or territory of the Indian cola’’ (cut stem that could develop into Producers that produce hemp for Tribe where the person produces or a bud) of the flowering top of the plant. research must obtain a USDA license. intends to produce hemp does not Sampling guidelines and training However, the hemp that is produced for prohibit the production of hemp. requirements for sampling agents are research and does not enter the stream (b) USDA shall provide written available from USDA. The method used of commerce is not subject to the notification to applicants whether the for sampling must be sufficient at a sampling requirements in §§ 990.24 and application has been approved or confidence level of 95 percent that no 990.26; provided that the producer denied. USDA shall provide written more than one percent (1%) of the adopts and carries out a USDA notification to applicants in a State or plants in the lot would exceed the approved alternative sampling method territory of an Indian Tribe that has acceptable hemp THC level. The that has the potential to ensure, at a submitted a plan to USDA and is method used for sampling must ensure confidence level of 95 percent, that the awaiting USDA approval that their that a representative sample is collected cannabis plant species Cannabis sativa application is being returned. that represents a homogeneous L. that will be subject to this alternative (1) If an application is approved, a composition of the lot. method will not test above the license will be issued. (c) Have an authorized representative acceptable hemp THC level. (2) Licenses will be valid until of the USDA licensee present at the (2) USDA licensees shall ensure the December 31 of the year three after the growing site during a scheduled sample disposal of all non-compliant plants in year in which the license was issued. collection, if possible. accordance with § 990.27. Only research (3) Licenses may not be sold, (d) Ensure that sampling agents are institutions registered with DEA to assigned, transferred, pledged, or provided with complete and handle marijuana can keep hemp that otherwise disposed of, alienated or unrestricted access during business tests over the 0.3 acceptable hemp THC encumbered. hours to all hemp and other cannabis (4) If a license application is denied, level until the end of the study. plants, (whether growing or harvested), the notification from USDA will explain (3) USDA licensees shall comply with all hemp production and storage areas, the reason for denial. Applicants may the reporting requirements in § 990.71 all land, buildings, and other structures appeal the denial in accordance with including reporting disposal of non- used for the cultivation, handling, and subpart D of this part. compliant plants. storage of all hemp and other cannabis (c) If the applicant is producing in plants, and all locations listed in the § 990.22 USDA hemp producer license more than one State or territory of an producer license. approval. Indian Tribe, the applicant may have (e) Not harvest the cannabis crop prior (a) A license shall not be issued more than one license to grow hemp. If to samples being taken. unless: the applicant has operations in a (f) Use post-harvest samples only for (1) The application submitted for location covered under a State or Tribal remediated biomass. USDA review and approval is complete plan, that operation must be licensed under the State or Tribal plan, not the § 990.25 Standards of performance for and accurate. detecting total delta-9 tetrahydrocannabinol (2) The criminal history report(s) USDA plan. (THC) concentration levels. submitted with the license application § 990.23 Reporting hemp crop acreage Analytical testing for purposes of confirms that all key participants to be with USDA Farm Service Agency. determining total THC in cannabis covered by the license have not been All USDA licensees shall report hemp plants shall meet the standards in this convicted of a felony, under State or crop acreage to FSA within 30 days of section. Federal law, relating to a controlled hemp been planted and shall provide, at (a) Laboratory quality assurance must substance within the past ten (10) years a minimum, the following information: ensure the validity and reliability of test unless the exception in § 990.20(b) (a) Street address and, to the extent results. applies. practicable, geospatial location of the (b) Analytical method selection, (3) The applicant, if the applicant was lot, greenhouse, building, or site where validation, and verification must ensure previously or is currently licensed, hemp will be produced. All locations that the testing method used is submitted all reports required as a where hemp is produced must be appropriate (fit for purpose), and that participant in the hemp production reported to FSA. the laboratory can successfully perform program by this part. (b) Acreage dedicated to the the testing. (4) The application contains no production of hemp, or greenhouse or (c) The demonstration of testing materially false statements or indoor square footage dedicated to the validity must ensure consistent, misrepresentations and the applicant production of hemp. accurate analytical performance. has not previously submitted an (c) The hemp license number. (d) Method performance application with any materially false specifications must ensure analytical statements or misrepresentations. § 990.24 Responsibility of a USDA licensee tests are sufficiently sensitive for the (5) The applicant’s license is not prior to harvest. purposes of the detectability currently suspended, if the applicant is USDA licensees must: requirements of this part. currently licensed. (a) No more than 30 days prior to the (e) Laboratory must have an effective (6) The applicant is not applying for anticipated harvest of cannabis plants, disposal procedure for non-compliant a license as a stand-in for someone have a sampling agent collect samples samples that do not meet the whose license has been suspended, from the cannabis plant for total delta- requirements of this part. revoked, or is otherwise ineligible to 9 tetrahydrocannabinol concentration (f) Measurement of uncertainty (MU) participate. level testing. must be estimated and reported with

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test results. Laboratories shall use marijuana, a schedule I controlled with the plan for a period of not less appropriate, validated methods and substance under the Controlled than two calendar years following the procedures for all testing activities and Substances Act (CSA), 21 U.S.C. 801 et violation. The producer’s evaluate measurement of uncertainty. seq., and producers must either use a implementation of a corrective action (g) At a minimum, analytical testing DEA-registered reverse distributor or plan may be reviewed by USDA during of samples for total THC must use post- law enforcement to dispose of non- a future site visit or audit. If additional decarboxylation or other similarly compliant plants or ensure the disposal instances of noncompliance occur, reliable methods approved by the of such cannabis plant on site at the USDA may revoke the producer’s USDA Secretary. The testing methodology farm or hemp production facility. license for one year or until the must consider the potential conversion (b) Producers must notify USDA of producer becomes compliant whichever of THCA in hemp into THC and the test their intent to dispose of or remediate occurs later. result must reflect the total available non-conforming plants and verify THC derived from the sum of the THC disposal or remediation by submitting § 990.29 Violations. and THCA content. Testing required documentation. Violations of this part shall be subject methodologies meeting the (c) If a producer elects to perform to enforcement in accordance with the requirements of this paragraph (g) remediation activities, an additional terms of this section. include, but are not limited to, gas or sampling and testing of the post- (a) Negligent violations. Hemp liquid chromatography with detection. remediated crop must occur to producers are not subject to more than (1) The total THC shall be determined determine THC concentration levels. one negligent violation per calendar and reported on a dry weight basis. year. A hemp producer shall be subject § 990.28 Compliance. Additionally, measurement of to enforcement for negligently: uncertainty (MU) must be estimated and (a) Audits. USDA licensees may be (1) Failing to provide an accurate legal reported with test results. Laboratories audited by the USDA. The audit may description of land where hemp is shall use appropriate, validated include a review of records and produced; methods and procedures for all testing documentation, and may include site (2) Producing hemp without a license; activities and evaluate measurement of visits to farms, fields, greenhouses, and uncertainty. storage facilities, or other locations (3) Producing cannabis exceeding the (2) Any sample test result exceeding affiliated with the producer’s hemp acceptable hemp THC level. Hemp the acceptable hemp THC level shall be operation. The audit may include the producers do not commit a negligent conclusive evidence that the lot current crop year, as well as any violation under this paragraph (a) if they represented by the sample is not in previous crop year(s). The audit may be make reasonable efforts to grow hemp compliance with this part. performed remotely or in person. and the cannabis does not have a total (3) After December 31, 2022, USDA (b) Frequency of audit verifications. THC concentration of more than 1.0 licensees may only use laboratories Audit verifications may be performed percent on a dry weight basis. registered with the DEA to conduct once every three (3) years unless (b) Corrective action for negligent testing under this section. otherwise determined by USDA. If the violations. For each negligent violation, results of the audit find negligent USDA will issue a Notice of Violation § 990.26 Responsibility of a USDA violations, a corrective action plan may and require a corrective action plan producer after laboratory testing is be established. from the producer. The producer shall performed. (c) Assessment of producer’s hemp comply with the corrective action plan (a) The producer shall harvest the operations for conformance. The to cure the negligent violation. crop no later than thirty (30) days after producer’s operational procedures, Corrective action plans will be in place the date of sample collection. documentation, recordkeeping, and for a minimum of two (2) years from the (b) If the producer fails to complete other practices may be verified during date of their approval. Corrective action harvest within thirty (30) days of sample the audit verification. The auditor may plans will, at a minimum, include: collection, a second pre-harvest sample also visit the production, cultivation, or (1) The date by which the producer of the lot shall be required to be storage areas for hemp listed on the shall correct each negligent violation; submitted for testing. producer’s license. (2) Steps that will be taken to correct (c) Harvested lots of hemp plants shall (1) Records and documentation. The each negligent violation; and not be commingled with other harvested auditor shall assess whether required (3) A description of the procedures lots or other material. reports, records, and documentation are that will demonstrate compliance must (d) Lots that meet the acceptable properly maintained for accuracy and be submitted to USDA. hemp THC level may enter the stream completeness. (c) Negligent violations and criminal of commerce. (2) [Reserved] enforcement. A producer who (e) Lots that do not meet the (d) Audit reports. Audit reports will negligently violates this part shall not, acceptable hemp THC level are subject be issued to the producer no later than as a result of that violation, be subject to § 990.27. 60 days after the audit is concluded. If to any criminal enforcement action by (f) Any producer may request USDA determines through an audit that any Federal, State, Tribal, or local additional pre-harvest testing if it is the producer is not compliant with the government. believed that the original total delta-9 Act or this part, USDA shall require a (d) Subsequent negligent violations. If tetrahydrocannabinol concentration corrective action plan. The corrective a subsequent negligent violation occurs level test results were in error. action plan must include a reasonable while a corrective action plan is in Additional testing may be conducted by date by which the producer will correct place, a new corrective action plan must the laboratory that conducted the initial the negligent violation. USDA will be submitted with a heightened level of test, or another laboratory. approve or deny the corrective action quality control, staff training, and plan within 60 days of its receipt. quantifiable action measures. § 990.27 Non-compliant cannabis plants. Producers operating under a corrective (e) Negligent violations and license (a) Cannabis plants exceeding the action plan must also periodically revocation. A producer that negligently acceptable hemp THC level constitute report to USDA on their compliance violates the license 3 times in a 5-year

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period shall have their license revoked USDA or its representatives with a license renewal under the USDA hemp and be ineligible to produce hemp for a culpable mental state greater than production program may appeal such period of 5 years beginning on the date negligence; or decision to the AMS Administrator. of the third violation. (c) Is found to be growing cannabis (c) Persons who believe they are (f) Culpable mental state greater than exceeding the acceptable hemp THC adversely affected by the revocation or negligence. If USDA determines that a level with a culpable mental state suspension of a USDA hemp production licensee has violated the terms of the greater than negligence or negligently license may appeal such decision to the license or of this part with a culpable violated this part three times in five AMS Administrator. mental state greater than negligence: years. (d) States and Indian Tribes that (1) USDA shall immediately report believe they are adversely affected by the licensee to: § 990.32 Recordkeeping requirements. the denial of a proposed State or Tribal (i) The U.S. Attorney General; and (a) USDA licensees shall maintain hemp plan may appeal such decision to (ii) The chief law enforcement officer records of all hemp plants acquired, the AMS Administrator. of the State or Indian territory, as produced, handled, disposed of, or applicable, where the production is remediated as will substantiate the § 990.41 Appeals under the USDA hemp located; and required reports. production plan. (2) Paragraphs (a) and (b) of this (b) All records and reports shall be (a) Appealing a denied USDA-plan section shall not apply to culpable maintained for at least three years. license application. A license applicant violations. (c) All records shall be made available may appeal the denial of a license for inspection by USDA inspectors, application. § 990.30 USDA producers; License (1) If the AMS Administrator grants suspension. auditors, or their representatives during reasonable business hours. The an applicant’s appeal of a licensing (a) USDA may issue a notice of following records must be made denial, the applicant will be issued a suspension to a producer if USDA or its available: USDA hemp production license. representative receives some credible (1) Records regarding acquisition of (2) If the AMS Administrator denies evidence establishing that a producer hemp plants; an appeal, the applicant’s license has: application will be denied. The (1) Engaged in conduct violating a (2) Records regarding production and handling of hemp plants; applicant may request a formal provision of this part; or adjudicatory proceeding within 30 days (2) Failed to comply with a written (3) Records regarding storage of hemp plants; and to review the decision. Such proceeding order from the USDA–AMS shall be conducted pursuant to the U.S. Administrator related to negligence as (4) Records regarding disposal and remediation of all cannabis plants that Department of Agriculture’s Rules of defined in this part. Practice Governing Adjudicatory (b) Any producer whose license has do not meet the definition of hemp. Proceedings, 7 CFR part 1, subpart H. been suspended shall not handle or (d) USDA inspectors, auditors, or their representatives shall have access to (b) Appealing a denied USDA-plan remove hemp or cannabis from the license renewal. A producer may appeal location where hemp or cannabis was any premises where hemp plants may be held during reasonable business the denial of a license renewal. located at the time when USDA issued (1) If the AMS Administrator grants a its notice of suspension, without prior hours. (e) All reports and records required to producer’s appeal of a licensing renewal written authorization from USDA. denial, the applicant’s USDA hemp (c) Any person whose license has be submitted to USDA as part of production license will be renewed. been suspended shall not produce hemp participation in the program in this part which include confidential data or (2) If the AMS Administrator denies during the period of suspension. the appeal, the applicant’s license will (d) A producer whose license has business information, including but not not be renewed. The denied producer been suspended may appeal that limited to information constituting a may request a formal adjudicatory decision in accordance with subpart D trade secret or disclosing a trade proceeding within 30 days to review the of this part. position, financial condition, or (e) A producer whose license has been business operations of the particular decision. Such proceeding shall be suspended and not restored on appeal licensee or their customers, shall be conducted pursuant to the U.S. may have their license restored after a received by, and at all times kept in the Department of Agriculture’s Rules of waiting period of one year from the date custody and control of, one or more Practice Governing Formal Adjudicatory of the suspension. If the license was employees of USDA or their Proceedings, 7 CFR part 1, subpart H. issued more than three years prior to the representatives. Confidential data or (c) Appealing a USDA-plan license date of restoration, the producer shall business information may be shared termination or suspension. A USDA submit a new application and criminal with applicable Federal, State, Tribal, or hemp plan producer may appeal the history report to USDA. local law enforcement or their designee revocation or suspension of a license. (1) If the AMS Administrator grants (f) A producer whose license has been in compliance with the Act. suspended may be required to provide, the appeal of a license termination or and operate under, a corrective action Subpart D—Appeals suspension, the producer will retain plan to fully restore their license. their license. § 990.40 General adverse action appeal (2) If the AMS Administrator denies § 990.31 USDA licensees; Revocation. process. the appeal, the producer’s license will USDA shall immediately revoke the (a) Persons who believe they are be terminated or suspended. The license of a USDA licensee if such adversely affected by the denial of a producer may request a formal licensee: license application under the USDA adjudicatory proceeding within 30 days (a) Pleads guilty to, or is convicted of, hemp production program may appeal to review the decision. Such proceeding any felony related to a controlled such decision to the AMS shall be conducted pursuant to the U.S. substance; or Administrator. Department of Agriculture’s Rules of (b) Made any materially false (b) Persons who believe they are Practice Governing Formal Adjudicatory statement with regard to this part to adversely affected by the denial of a Proceedings, 7 CFR part 1, subpart H.

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(d) Filing period. The appeal of a suspension or revocation, the associated remainder of this part or the denied license application, denied hemp production plan will remain in applicability thereof to other persons or license renewal, suspension, or place and effective. circumstances shall not be affected revocation must be filed within the (2) If the AMS Administrator denies thereby. time-period provided in the letter of an appeal, the State or Tribal hemp notification or within 30 business days production plan will be suspended or § 990.62 [Reserved] from receipt of the notification, revoked as applicable. Producers § 990.63 Interstate transportation of hemp. whichever occurs later. The appeal will located in that State or territory of the No State or Indian Tribe may prohibit be considered ‘‘filed’’ on the date Indian Tribe may continue to produce the transportation or shipment of hemp received by the AMS Administrator. hemp under their State or Tribal license lawfully produced under a State or The decision to deny an appeal of a until the end the calendar year in which Tribal plan approved under subpart B of license application or renewal, or the State or Tribal plan’s disapproval this part, under a license issued under suspend or terminate a license, is final was effective or when the State or Tribal subpart C of this part, or under 7 U.S.C. unless a formal adjudicatory proceeding license expires, whichever is earlier. 5940 through the State or territory of the is requested within 30 days to review Producers may apply for a USDA Indian Tribe, as applicable. the decision. Such proceeding shall be license under subpart C of this part conducted pursuant to the U.S. unless hemp production is otherwise Subpart F—Reporting Requirements Department of Agriculture’s Rules of prohibited by the State or Indian Tribe. Practice Governing Adjudicatory The State or Indian Tribe may request § 990.70 State and Tribal hemp reporting Proceedings, 7 CFR part 1, subpart H. a formal adjudicatory proceeding be requirements. (e) Where to file. Appeals to the initiated to review the decision. Such (a) State and Tribal hemp producer Administrator must be filed in the proceeding shall be conducted pursuant report. Each State and Indian Tribe with manner as determined by AMS. to the U.S. Department of Agriculture’s a plan approved under this part shall (f) What to include. All appeals must Rules of Practice Governing Formal submit to USDA, by the first of each include a copy of the adverse decision Adjudicatory Proceedings, 7 CFR part 1, month, a report providing the contact and a statement of the appellant’s subpart H. information and the status of the license reasons supporting why the decision (c) Filing period. The appeal of a State or other authorization issued for each was not proper or made in accordance or Tribal hemp production plan producer covered under the applicable with applicable program regulations in suspension or revocation must be filed State and Tribal plans. If the first of the this part, policies, or procedures. within the time-period provided in the month falls on a weekend or holiday, letter of notification or within 30 the report is due by the first business § 990.42 Appeals under a State or Tribal day following the due date. The report hemp production plan. business days from receipt of the notification, whichever occurs later. The shall be submitted using a digital format (a) Appealing a State or Tribal hemp appeal will be considered ‘‘filed’’ on the compatible with USDA’s information production plan application. A State or date received by the AMS sharing systems, whenever possible. Indian Tribe may appeal the denial of a Administrator. The decision to deny a The report shall contain the information proposed State or Tribal hemp State or Tribal plan application or described in this paragraph (a). production plan by the USDA to the suspend or revoke approval of a plan, is (1)(i) For each new producer who is AMS Administrator. final unless the decision is appealed in an individual and is licensed or (1) If the AMS Administrator grants a a timely manner. authorized under the State or Tribal State or Indian Tribe’s appeal of a (d) Where to file. Appeals to the plan, the report shall include the full denied hemp plan application, the Administrator must be filed in the name of the individual, license or proposed State or Tribal hemp manner as determined by AMS. authorization identifier, Employee production plan shall be established as (e) What to include in appeal. All Identification Number (‘‘EIN’’) of the proposed. appeals must include a copy of the business entity, business address, (2) If the AMS Administrator denies adverse decision and a statement of the telephone number, and email address (if an appeal, the proposed State or Tribal appellant’s reasons supporting why the available). hemp production plan shall not be decision was not proper or made in (ii) For each new producer that is an approved. Prospective producers accordance with applicable program entity and is licensed or authorized located in the State or territory of the regulations in this part, policies, or under the State or Tribal plan, the report Indian Tribe may apply for hemp procedures. shall include full name of the entity, the licenses under the terms of the USDA principal business location address, plan. The State or Indian Tribe may Subpart E—Administrative Provisions license or authorization identifier, and request a formal adjudicatory the full name, title, and email address proceeding be initiated within 30 days § 990.60 Agents. (if available) of each employee for to review the decision. Such proceeding As provided under 7 CFR part 2, the whom the entity is required to submit shall be conducted pursuant to the U.S. Secretary may name any officer or a criminal history report. Department of Agriculture’s Rules of employee of the United States or name (iii) For each producer that was Practice Governing Adjudicatory any agency or division in the United included in a previous report and whose Proceedings, 7 CFR part 1, subpart H. States Department of Agriculture, to act reported information has changed, the (b) Appealing the suspension or as their agent or representative in report shall include the previously termination of a State or Tribal hemp connection with any of the provisions of reported information and the new production plan. A State or Tribe may this part. information. appeal the revocation by USDA of an (2) The status of each producer’s approved State or Tribal hemp § 990.61 Severability. license or authorization. production plan. If any provision of this part is (3) The period covered by the report. (1) If the AMS Administrator grants a declared invalid or the applicability (4) Indication that there were no State or Indian Tribe’s appeal of a State thereof to any person or circumstances changes during the current reporting or Tribal hemp production plan is held invalid, the validity of the cycle, if applicable.

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(b) State and Tribal hemp disposal or (3) Business address of producer. USDA no later than 30 days after the remediation report. If a producer has (4) Lot identification number for the date of completion of disposal or produced cannabis exceeding the sample. remediation activity. The report shall acceptable hemp THC level, the (5) Name of laboratory and, no later contain the information described in cannabis must be disposed of or than December 31, 2022, the DEA this paragraph (b). remediated. States and Tribes with registration number of laboratory for (1) Name and address of the producer. plans approved under this part shall testing. (2) The USDA licensee’s USDA submit to USDA, by the first of each (6) Date of test and report. license number. month, a report notifying USDA of any (7) Identification of a pre-harvest or (3) Geospatial location, or other valid occurrence of non-conforming plants or post-harvest retest. land descriptor, for the production area plant material and providing a disposal (8) Test result. subject to disposal or remediation. or remediation record of those plants § 990.71 USDA plan reporting (4) Date of completion of disposal or and materials. This report would requirements. remediation. include information regarding name and (a) USDA licensing application. (5) Signature of the USDA licensee or contact information for each producer USDA will accept applications on a authorized representative. subject to a disposal or remediation rolling basis. Licenses will be valid until (c) USDA licensee annual report. Each during the reporting period, and date December 31 of the year three years after USDA licensee shall submit an annual disposal or remediation was completed. the license is issued. The license report to USDA. The report form shall If the first of the month fall on a application will be used for both new be submitted by December 15 of each weekend or holiday, reports are due by and renewal applicants. The application year and contain the information the first business day following the due shall include: described in this paragraph (c). date. The report shall contain the (1) Contact information. (i) For an (1) USDA licensee ’s license number. information described in this paragraph applicant who is an individual, the (2) USDA licensee ’s name. (b). application shall include full name of (3) USDA licensee’s address. (1) Name and address of the producer. (4) Lot, location type, geospatial (2) Producer license or authorization the individual, Employee Identification Number (‘‘EIN’’) of the business entity, location, total planted acreage, total identifier. acreage disposed and remediated, and (3) Location information, such as lot business address, telephone number, total harvested acreage. number, location type, and geospatial and email address (if available). (d) Test results report. Each USDA location or other location descriptor for (ii) For an applicant that is an entity, licensee must ensure that the laboratory the production area subject to disposal the application shall include full name that conducts the test of the sample(s) or remediation. of the entity, the principal business (4) Disposal or remediation location address, and the full name, from its lots reports the test results for completion date. title, and email address (if available) of all samples tested to USDA. Informal (5) Total acreage. each key participant of the entity. testing conducted throughout the (c) Annual report. Each State or (2) Criminal history report. As part of growing season for purposes of Indian Tribe with a plan approved a complete application, each applicant monitoring THC concentration do not under this part shall submit an annual shall provide a current Federal Bureau need to be reported to USDA. The test report to USDA. The report form shall of Investigation’s Identity History results report shall contain the be submitted by December 15 of each Summary. If the applicant is a business information described in this paragraph year and contain the information entity, a criminal history report shall be (d) for each sample tested. described in this paragraph (c). provided for each key participant. (1) USDA licensee ’s license number. (1) Total planted acreage. (i) The applicant shall ensure the (2) Name of the USDA licensee. (2) Total harvested acreage. criminal history report accompanies the (3) Business address of the USDA (3) Total acreage disposed and application. licensee. remediated. (ii) The criminal history report must (4) Lot identification number for the (d) Test results report. Each producer be dated within 60 days of submission sample. must ensure that the laboratory that of the application submittal. (5) Name of testing laboratory. conducts the test of the sample(s) from (3) Consent to comply with program (6) Date of test and report. its lots reports the test results to USDA. requirements. All applicants submitting (7) Identification of a pre-harvest or Informal testing conducted throughout a completed license application, in post-harvest retest. the growing season for purposes of doing so, consent to comply with the (8) Test result. monitoring THC concentration do not requirements of this part. need to be reported to USDA. The test (b) USDA licensee disposal and Bruce Summers, results report shall contain: remediation form. USDA licensee Administrator, Agricultural Marketing (1) Producer’s license or authorization conducts a disposal or remediation Service. identifier. activity, that licensee must report the [FR Doc. 2021–00967 Filed 1–15–21; 8:45 am] (2) Name of producer. activity on the appropriate form to BILLING CODE P

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