16 September 2021 CSBS Job Aid

CSBS Cannabis Job Aid

Industrial was legalized federally by the 2018 Farm Bill. States across the country are now establishing regulatory schemes for hemp production. The job aid is an examiner reference tool providing background as well as state-specific information, such as legalization status and related topics, on both hemp and marijuana. As federal and state cannabis laws change, we expect that frequent updates will be necessary to keep this job aid up to date.

The CSBS State Supervisory Processes Committee approved the release of this job aid to assist state examiners in the examination of a financial institution that may be banking cannabis-related businesses. If you notice something in the job aid that needs to be edited contact Daniel Berkland ([email protected]).

Table of Contents Hemp Job Aid ...... 2 Marijuana Job Aid ...... 13 State by State Cannabis Policy ...... 28 Territory Cannabis Policy ...... 41 Indian Tribe Hemp Status ...... 42 Reference Documents ...... 46

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Hemp Job Aid

Hemp Related Businesses1 Information for Examiners Relevant Policy Examiner Notes

Part I - Background Information

This section is designed to help examiners understand the hemp industry.

1. What is hemp (or • Hemp is any part of the Cannabis Hemp is defined as the plant Cannabis industrial hemp)? sativa L. plant that contains less than sativa L. and any part of that plant, 0.3% of THC. including the seeds thereof and all • The same plant produces marijuana derivatives, extracts, , isomers, acids, salts, and salts of isomers, whether and hemp – the difference is the growing or not, with a delta-9 amount of THC in that plant. (THC) concentration of not more than 0.3 percent on a dry weight basis 2. What are the plans in • Until new USDA plans were available The USDA regulations, 7 CFR 990, were place now for hemp as provided for in the 2018 Farm Bill, published in the Federal Register January production? the plans that were applicable under 19, 2021 as a final rule effective March 22, the 2014 Farm Bill remain in effect. 2021. • The old plans found at 7 USC 5940 are Establishment of a Domestic Hemp repealed on September 30, 2021. Production Program

1 This job aid uses the term Hemp Related Business (HRB) to mean any business that is directly or indirectly related to the hemp industry.

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Hemp Related Businesses1 Information for Examiners Relevant Policy Examiner Notes

3. When did the USDA issue • The USDA interim final rule was The USDA issued a final rule for domestic its regulations on hemp? published October 31, 2019. hemp production effective March 22, 2021 • The final rule was published on at 7 CFR 990. January 19, 2021. Hemp Production Program USDA web site. • The authority for hemp production provided in the 2014 Farm Bill was extended until January 1, 2022, by the Continuing Appropriations Act, 2021, (Pub. L. 116-260). 4. Must each state, • Each state, territory, or tribe may 7 CFR 990.4 States, territories, and tribes territory, or tribe write create its own plan for governing may submit their plans for review by the plan that govern the local hemp production following the 2018 USDA. The USDA has 60 days to review production of hemp? Farm Bill's provisions. each plan.

• The USDA has 60 days to review plans. States may opt to continue to operate • Federal rules will apply to jurisdictions under their 2014 pilot plans until January 1, that have not prohibited hemp, but 2022. which have not written their own rules. Status of state and tribal plans under review • The USDA estimates there will be 100 is here. The first state and tribal plans were state and tribe plans with 5,500 approved December 27, 2019. producers in 2020 (along with 1,000 producers under USDA plan) going up to 8,000 state and tribal producers in 2022.

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Hemp Related Businesses1 Information for Examiners Relevant Policy Examiner Notes

5. What must be included in • Each plan must include processes to 7 CFR 990.3 specifies the requirements for each state, territory, or gather (and maintain for at least three state and tribal plans tribe’s plan? years) the following: 7 CFR990.5 specifies the audit requirements . Specific land used for production for state and tribal plans . Sampling and testing procedures 7 CFR 990.70 specifies the reporting requirements for state and tribal plans . Disposal of non-compliant plants

As well set up for reporting and States and tribes with approved plans must information sharing with USDA complete these forms – the producer report and the disposal report are required • State and tribal plans must be audited monthly and there is an annual report as at least every three years by the USDA well. 6. Can hemp and hemp • Interstate transportation of hemp and 7 CFR 990.63 No State or Indian Tribe may products be transported hemp products is specifically prohibit the transportation or shipment of across state lines? authorized by the 2018 Farm Bill. hemp or hemp products (produced in accordance with an approved plan) through the State or the territory of the Indian Tribe, as applicable. 7. What if my state • States and tribes may prohibit the 7 CFR 990.20 States or tribes may put more prohibits the production production of hemp. restrictive parameters on the production of of hemp? hemp but are not authorized to alter the definition of hemp or put in place policies that are less restrictive than the 2018 Farm Bill. 8. What information is • To produce hemp, a grower must be Information for hemp producers is found on required to get a license licensed or authorized under a State the USDA site here to be a hemp grower? hemp program, a Tribal hemp The USDA maintains a list of all state grower program, or the USDA hemp program contacts.

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9. When is a hemp producer • A valid license is required before 7 CFR 990.21 Any person producing or license required? producing, cultivating, or storing intending to produce hemp must have a hemp. valid license prior to producing, cultivating, • A producer must secure a license from or storing hemp. the state or tribal authority that has jurisdiction; if hemp is legal, but there is no governing state or tribal authority, the producer must secure a USDA license • USDA license applications will be accepted after December 2, 2019 • For the 2020 growing season license applications may be made anytime, but in subsequent years they will be accepted from August 1 to October 31 10. Can felons participate in • There is a prohibition against hemp 7 CRF 990.20(b) Unless previously approved hemp production? production by persons convicted of under the provisions of the 2014 Farm Bill, certain felonies. no person convicted of a felony related to a controlled substance may participate in hemp production for ten years following the date of conviction. 11. How is hemp tested for • The crop must be harvested no later 7 CFR 990.3(a)(2)(i) describes collection THC levels to ensure it than 30 days after the testing samples 7 CFR 990.24 - 25 describe testing has not ‘gone hot’ are collected The USDA delayed enforcement of the (exceeded the THC limit)? • Sampling must be sufficient at a testing and disposal requirements. Latest information is here. confidence level of 95 percent that no Guidelines for sampling and testing; listing more than one percent of the plants of approved hemp testing laboratories in the lot would exceed the is here acceptable THC limit

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12. Can hemp growers get • On December 23, 2019 the USDA Hemp is now eligible for federal crop federal crop insurance? announced a pilot crop insurance insurance. Section 502(b) of the Federal program for hemp link that covers Crop Insurance Act 7 USC 1502(b) was multi-peril crop insurance (MPCI) for amended to include hemp as a commodity eligible producers in certain counties eligible for federal crop insurance. Hemp in Alabama, California, Colorado, and Farm Programs | Farmers.gov Illinois, Indiana, Kansas, Kentucky, Maine, Michigan, Minnesota, The USDA clarified on August 27, 2019 that Montana, New Mexico, New York, farmers who were authorized under a North Carolina, North Dakota, Section 7606 state or university research Oklahoma, Oregon, Pennsylvania, pilot as part of the 2014 Farm Bill can get Tennessee, Virginia, and Wisconsin. whole-farm revenue protection federal crop • To be eligible for the MPCI pilot insurance. program, among other requirements, a hemp producer must comply with More information about USDA crop applicable state, tribal or federal insurance is found at regulations for hemp production, www.rma.usda.gov/en have at least one year of history

producing the crop, and have a contract for the sale of the insured Details of the risk management programs hemp. Producers also must be a part for hemp producers were announced of a Section 7606 state or university February 6, 2020 link research pilot, as authorized by the 2014 Farm Bill, or be licensed under a state, tribal or federal program approved under the USDA Agricultural Marketing Service (AMS) interim final rule issued in October 2019.

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13. Can growers get • The USDA is now accepting intellectual property applications for plant variety protection for new protection under the Plant Variety Plant variety protection site of the USDA. varieties of hemp? Protection Act. If granted the protection lasts 20 years. 14. Can hemp seeds be • 2018 Farm Bill, Section 10113, Hemp seeds can be imported from Canada imported? removed hemp and hemp seeds from if accompanied by either: 1) a phytosanitary the Drug Enforcement certification from Canada’s national plant Administration’s (DEA) schedule of protection organization to verify the origin Controlled Substances. This action of the seed and confirm that no plant pests are detected; or 2) a Federal Seed Analysis removed hemp and hemp seeds from Certificate (SAC, PPQ Form 925) for hemp DEA authority for products containing seeds grown in Canada. Hemp seed may be THC levels less than 0.3 percent. imported from other countries if • DEA no longer has authority to accompanied by a phytosanitary certificate require hemp seed permits for import from the exporting county to verify the purposes. origin and lack of pests.

Importation of seed is covered under USDA Animal and Plant Health Inspection Service regulations, so the new rule does not further address hemp seed imports or exports. 15. Can hemp be sent • The US Postal System allows hemp through the US mail? products to be mailed if the mailer complies with applicable federal, state, and local laws. The mailer must USPS web site policy document retain proof of compliance with such laws for at least two years after mailing.

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16. What is CBD or CBD • One of the main byproducts of While hemp is now off the Schedule 1 list, it oil? Is it legal? industrial hemp is or CBD remains subject to regulation by the Food oil. The Farm Bill authorizes CBD only and Drug Administration (FDA), which to the extent that is contained in considers CBD a drug and an illegal food hemp grown in a manner consistent ingredient.

with the Farm Bill and other federal One anti-seizure drug for children produced and state regulations. from CBD has been approved for use, • Cannabidiol (CBD), which is regulated Epidiolex. by the Food and Drug Administration, remains illegal for human Hemp seed oil (which does not contain consumption. CBD) has been deemed “generally • Hemp seeds and seed oil generally do recognized as safe” by the FDA. not contain CBD. 17. Where is the most • The FDA maintains a question-and- current information from answer website on cannabis with the FDA website Q&A the FDA on hemp? latest information. 18. Hemp ingredients in • The Alcohol and Tobacco Tax and alcohol beverages Trade Bureau of Treasury previously banned hemp ingredients because it was a Schedule 1 drug. Their TTB Industry Circular 2019-1 guidance is in process of being updated to reflect hemp's new legal status.

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19. Are financial institutions • Because hemp is no longer a Schedule For hemp-related customers, required to file 1 controlled substance under the institutions are expected to follow Suspicious Activity Controlled Substances Act, standard SAR procedures, and file a SAR Reports (SARs) for HRB? institutions are not required to file a if indicia of suspicious activity warrants. SAR on customers solely because they are engaged in the growth or Providing Financial Services to cultivation of hemp in accordance Customers Engaged in Hemp-Related with applicable laws and regulations. Businesses • Note this requirement is different than for marijuana-related businesses FinCEN Guidance Regarding Due Diligence Requirements under the Bank Secrecy Act for Hemp-Related Business Customers June 29, 2020

Part II - Current and Planned Activities

The questions in this section are intended to help the examiner build an understanding of an institution's posture regarding the hemp industry.

20. Is the institution • Hemp industry may include growers, Pursuant to the 2018 Farm Bill, hemp is no currently banking any transporters, processors, and longer a Schedule 1 controlled substance, customers related to the manufacturers (among others). and it is legal under federal law to hemp industry? manufacture, distribute or dispense hemp.

It may be illegal under state law.

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Hemp Related Businesses1 Information for Examiners Relevant Policy Examiner Notes

21. What discussions have • This question is intended to help taken place at the Board develop an understanding of how the of Directors about HRB? institution's management team views banking the HRB industry. It is not Not addressed in federal policy. intended to imply that specific provisions or steps should have been taken by the institution.

Part III - Risk Management Consideration

The questions in this section are intended to build an understanding of the institution's posture regarding the hemp industry.

22. What if my financial • The financial institution is making a Federal regulators and the CSBS issued a institution is engaged in risk management decision. Financial statement clarifying the legal status of banking HRB? institutions considering whether to hemp production and the relevant bank hemp-related businesses should requirements under the Bank Secrecy Act. be confident in their ability to assess the risk of agriculture operations of similar size and business models. 23. What is the state's hemp • A state may prohibit the production of See your state’s department of agriculture regulatory setup? hemp (see 7 CFR 990.20). for updated information. Links are • If not prohibited, the primary provided in the State by State Cannabis regulator may be the USDA if state Policy section. regulatory plans have not been Current status of state and tribal plans approved by the USDA. under review is here

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24. Did management • Management would be expected to perform a review of ensure that any applicable licenses or applicable federal and regulatory requirements have been state laws prior to the met before establishing a relationship banking of HRB with any HRB. These reviews should customers? occur on a regular basis to ensure that Not addressed in federal policy. no licenses have lapsed, or no regulatory requirements have been missed by the HRB that could jeopardize their ability to operate their business. 25. How will the financial • If the state is not the primary institution monitor regulator of hemp the federal compliance with Not addressed in federal policy. government is (unless hemp is applicable state (or prohibited by the state). federal) requirements? 26. Do the institution’s • There is no requirement that separate policies address banking policies or procedures be developed of HRBs? for HRBs, but if an institution has HRB Not addressed in federal policy. customers, the handling of such relationships should be addressed in existing or separate policies. 27. Has the institution • Risks specific to HRBs should be adjusted their risk included in the institution’s risk Not addressed in federal policy. management practices to assessments if they have current or include HRBs? planned HRB relationships. 28. What challenges has the • Responses should help an examiner institution encountered understand how HRBs have impacted Not addressed in federal policy. in banking HRBs? the institution’s risk profile.

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29. What training has been • Specific training requirements have done for employees not been articulated. Not addressed in federal policy. regarding HRBs?

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Marijuana Job Aid

Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

Part I - Current and Planned Activities The questions in this section are intended to build an understanding of the institution's posture regarding the marijuana industry.

1. Is the institution • The distinction between a direct Pursuant to the Controlled currently banking any marijuana relationship and an indirect Substances Act, 21 USC §812, customers related to the marijuana relationship is not well marijuana is a Schedule 1 controlled marijuana industry? defined. Customer due diligence (CDD) substance, and it is illegal under guidance requires that for customers federal law to manufacture, who pose higher money laundering risks, distribute or dispense marijuana. enhanced procedures and processes 31 CFR 1020.210(b)(5) is the should be followed. regulation governing CDD. • The FFIEC BSA/AML Examination Manual discusses enhanced CDD for higher-risk customers, including obtaining the following from the customer: description of the business operations, the anticipated volume of currency and total sales, and a list of major customers and sales.

2 This job aid uses the term marijuana related business (MRB) to mean any business that is directly or indirectly related to the marijuana industry. States may define the term MRB differently.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

2. How does the institution • Be aware that the identification of 2014 FinCEN Guidance (FIN-2014- determine whether MRBs, especially indirect MRBs, can be G001) directs financial institutions, current customers are difficult. Use this question to assess the when assessing the risk of providing related to the marijuana robustness of the institution's CDD services to a MRB, to collect and verify the following information from industry? processes and to identify whether gaps exist related to MRB identification. relevant state authorities: whether the MRB is duly licensed and registered, if the MRB license application (and related documentation) was submitted by the business to the state authorities, and any available information about the MRB and related parties. State licensing authorities are listed on the State by State Cannabis Policy page within this Job Aid.

3. Is the institution • This question is intended to help develop 2014 FinCEN Guidance (FIN-2014- planning to permit the an understanding of the institution's G001) lays out factors that banks should consider when banking an opening of relationships strategy (if any) related to banking MRBs. MRB: 1) Whether the MRB is with MRBs? If so, when? violating any Cole Memo Priorities, 2) whether money laundering is still occurring unrelated to marijuana, 3) whether the MRB can produce sufficient documentation for licensing, 4) whether the state cannabis board has levied an enforcement action, etc.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

4. Summarize the • This question is intended to help develop 2014 FinCEN Guidance (FIN-2014- discussions that have an understanding of how the G001) states that the decision to taken place at Board of institution's management team views open, close or refuse any particular account or relationship should be Directors meetings banking the MRB industry. It is not intended to imply that specific provisions made by each financial institution about banking MRBs. based on a number of specific factors or steps should have been taken by the to that institution, including: the management team. institution's particular business objectives, an evaluation of the risks associated with offering a particular product or service, and its capacity to manage those risks effectively.

If the answers to the first four questions indicate that this institution does not have any current or planned banking relationships that are related to the marijuana industry, the remaining questions on this job aid may be disregarded.

5. What types of MRBs • Your state may have a regulatory body Pursuant to the Controlled have relationships with that issues certain license types to Substances Act, 21 USC §812, marijuana is a Schedule 1 controlled the institution and MRBs. As a starting point, identify the substance, and it is illegal under approximately how license types that your state licenses and ask whether any such customers have federal law to manufacture, many accounts does this distribute or dispense marijuana. relationships at this institution. Links to include? state websites are listed in the State by State Cannabis Policy section.

Part II - Risk Management

The questions in this section are designed to help examiners assess the sufficiency of the institution's risk management practices for MRBs.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

6. Does the institution • There is no requirement that separate Financial institutions should adjust have policies and policies or procedures be developed for policies and procedures related to procedures specific to MRBs, but if an institution has MRB MRBs per FIN-2014-G001.

the banking of MRBs? customers, the handling of such relationships should be addressed in existing policies or separate policies. One important consideration is that MRBs may not be treated as non-listed businesses for Currency Transaction Report (CTR) purposes and are not eligible for an exemption from CTR requirements.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

7. Has the institution • Risks specific to MRBs should be FIN-2014-G001 lays out the adjusted their risk included in the institution's risk following risk assessment priorities assessment to include assessment if they have current or if a financial institution is planned MRB relationships. considering banking MRBs: MRBs? 1) verifying with the appropriate state authorities if the business is duly licensed and registered; 2) reviewing the license application submitted by the business for obtaining a state license to operate its marijuana related business, 3) requesting from state licensing and enforcement authorities available information about the business and related parties, 4) developing an understanding of the normal and expected activity from the business, including types of products to be sold and the type of customers to be served, 5) ongoing monitoring of publicly available sources for adverse information about the business and related parties, 6) ongoing monitoring for suspicious activity and 7) refreshing information obtained as part of customer due diligence on a periodic basis and commensurate with the risk.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

8. What challenges have • Note - this question is not intended to FIN-2014-G001 gives guidance to been encountered elevate the current disagreement financial institutions that deem it through banking MRBs? between state and federal legal status of necessary to terminate a relationship marijuana. Rather, it is intended to with a marijuana-related business in encourage dialogue between the order to maintain an effective anti- money laundering program. Financial institution and examiner about specific institutions should file a SAR and account or relationship challenges that note in the narrative the basis for have been encountered. Responses termination. In this instance, financial should help an examiner understand institutions should use the term whether MRB relationships at this "MARIJUANA TERMINATION" in the institution have been unexpectedly narrative section. FinCEN encourages challenging or are carrying more institutions that have been made inherent risks. aware of previous accountholders seeking banking relationships to utilize the voluntary information sharing process as outlined in Section 314(b) of the BSA. 9. How have account • There are no standards for account Financial institutions should adjust opening procedures opening procedures specifically related policies and procedures related to MRBs per . been adjusted to to MRBs. However, if an institution is FIN-2014-G001

consider MRBs? engaged in this industry, processes to help determine MRBs would be expected as part of customer due diligence.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

10. Did management • Management would be expected to FIN-2014-G001 directs financial perform a legal review ensure that any applicable licenses or institutions to file a "Marijuana of applicable federal and regulatory requirements have been met Priority SAR" if the MRB violates state law or Cole Memo priorities. state laws prior to the before establishing a relationship with any MRB. These reviews should occur on banking of MRB a regular basis to ensure that no licenses customers? have lapsed, or no regulatory requirements have been missed by the MRB that could jeopardize their ability to operate their business. 11. What processes are in • This question is intended to encourage FIN-2014-G001 directs financial place to identify discussion about the institution's processes institutions to seek licensee whether existing loan for reviewing loan customer relationships. information from the state licensing For instance, if a borrower for a authority. In many instances, state customers have a commercial property was leasing that law requires MRBs to disclose, relationship with an property, or a portion of that property, to through the licensing process, MRB? an MRB this would be an indirect MRB individuals that have financial relationship. interest in the MRB. • Banks should have a process to identify if activity is suspicious in these indirect cases, Footnote 7 in FIN-201-G001 provides but there is no expectation for them to more detail on this topic. scour their customer base or loans for activity that may be marijuana related. If they know about it, or identify it, then they should have a process to assess if a SAR filing is warranted. • Banks should fully document this process.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

12. Have the cash handling • Given the current legal disagreements FIN-2014-G001 states that financial demands of the MRB between state and federal law related to institutions should reach out to state been considered? marijuana, some MRBs may have licensing authorities to obtain data substantial cash inflows or outflows. on MRBs. In many jurisdictions, MRBs Institution management should are required to disclose transactional data. Contact your relevant state evaluate, with the MRB, what level of licensing authority for available cash services would be anticipated. information within your state. Understanding these needs prior to the establishment of a relationship would allow the institution to better detect suspicious activities. 13. For MRB borrowers, has • This question is intended to help an Not directly addressed in federal the institution evaluated, examiner understand what, if any, guidance, but financial institutions through their allowance contingency plans the institution or MRB should consider preparing a strategy for credit losses or has made for a change in legal status of in the event of a legislative or policy change at the State or Federal level. otherwise, the impact a marijuana. For example, if federal

change in marijuana's legal enforcement of marijuana law changes,

status may have on the there is a possibility that collateral institution's collateral securing the borrower's debt could be position as a creditor? encumbered in an enforcement case or its value could deteriorate rapidly.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

14. Does management have a • As in the previous question, it would be This is not directly addressed in contingency plan that prudent for an institution to have a plan federal guidance, but financial considers a possible quick to quickly exit or terminate MRB institutions should consider exit from this business relationships. The assessment should preparing a strategy in the event of a should there be a change consider liquidity, collateral positions, legislative or policy change at the State or Federal level. in the policies and and other impacts an abrupt separation

forbearances from the from these relationships were to Federal and State become necessary. governments?

15. Does the institution's • Beyond what may be required by a This is not directly addressed in blanket bond insurer bonding company or blanket bond federal guidance. require that MRB provider, there are no requirements to customer relationships be notify the institution's bonding company disclosed to the blanket of the existence of MRB customer bond insurance provider? relationships. This question is intended If so, have those to determine whether the institution has disclosures been made? taken whatever steps may be required under their specific blanket bond. 16. What training has been • An effective risk management process This is not directly addressed in provided to staff related to includes maintaining an aware and well- federal guidance. the marijuana industry? trained staff. Training on MRBs for financial institution employees should consider BSA/AML risks, account opening procedures specific to the institution, and an internal escalation processes if an employee detects changes in a customer's risk profile.

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Part III - Cole Memo Priorities

A memo released by the Department of Justice, often known as "The Cole Memo," provided parameters around which federal enforcement of marijuana laws will be prioritized. While the provisions of the memo could not be considered a safe harbor for financial institutions, taking steps to comply with the provisions in the memo may have reduced the risk of federal enforcement. A link to The Cole Memo can be found on the "Reference Documents" table in this Job Aid. The Cole Memo provisions are the included in the FIN-2014-G001 guidance. In January 2018, the Cole Memo was rescinded by the Attorney General. However, FinCEN has not yet updated their guidance or reference to the Cole Memo provisions. FinCEN has advised FI's to continue to follow FIN-2014-G001 in its entirety as such examiners should continue to examine banks in compliance with that guidance.

17. Is the institution aware of the following Cole Memo priorities? Pursuant to FinCEN guidance, if an insured depository institution (IDI) becomes aware of • Use the following questions to assess provisions of FIN-2014-G001. an MRB violating Cole Memo priorities and/or state law, then FIN- 2014-G001 directs IDIs to file a Priority SAR.

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a. Preventing the FIN-2014-G001 guidance directs distribution of marijuana institutions to consider whether an to minors MRB implicates one of the Cole Memo priorities or related state law(s) when performing customer due diligence. Additionally, if a financial institution finds that an MRB • Each provision is separated and designed has violated a Cole Memo priority, to be answered in a yes/no manner. FIN-2014-G001 directs the institution to file a "Marijuana Priority" SAR. The guidance also lists several "red flags" that may indicate that an MRB may be engaged in activity that implicates one of the Cole Memo priorities, or violates state law. b. Preventing revenue from the sale of marijuana from going to criminal See above See above enterprises, gangs, and cartels

c. Preventing the diversion of marijuana from states where it is legal under See above See above state law in some form to other states

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d. Preventing state- authorized marijuana activity from being used as a cover or pretext for See above See above the trafficking of other illegal drugs or other illegal activity

e. Preventing violence and the use of firearms in the cultivation and See above See above distribution of marijuana

f. Preventing drugged driving and the exacerbation of other adverse public health See above See above consequences associated with marijuana use

g. Preventing the growing of marijuana on public lands and the attendant public safety and environmental See above See above dangers posed by marijuana production on public lands

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h. Preventing marijuana possession or use on See above See above federal property

Part IV - FinCEN Filings3

FinCEN has provided guidance for financial institutions that governs how CTRs and SARs are to be handled for MRBs. The questions in this section are intended to help examiners assess an institution's understanding of, and compliance with, the provisions of this guidance.

3 Consistent with FinCEN regulations, the obligation to file a SAR is unaffected by any state law that legalizes marijuana-related activity.

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1. Are SAR filing • As an example, a financial institution Pursuant to FAQs released by FinCEN requirements understood providing financial services to an MRB regarding SAR filing in combination and followed by institution that it reasonably believes, based on its with FIN-2014-G001, financial employees? customer due diligence, does not institutions that do not suspect that implicate one of the Cole Memo MRB account holders have violated state law or Cole Memo priorities priorities or violate state law should file should file a continuing activity a "Marijuana Limited" SAR. The content report, with the filing deadline being of this SAR should be limited to the 120 days after the date of the following information: (i) identifying previously related SAR filing. A information of the subject and related "Marijuana Limited" SAR should be parties; (ii) addresses of the subject and filed using those prescribed related parties; (iii) the fact that the guidelines. A "Marijuana Priority" filing institution is filing the SAR solely SAR should be filed on an MRB that because the subject is engaged in a the institution reasonably believes, marijuana-related business; and (iv) the based on customer due diligence, fact that no additional suspicious activity implicates one of the Cole Memo priorities or violates state law. A has been identified. Financial institutions "Marijuana Termination" SAR should should use the term “MARIJUANA be filed if a financial institution LIMITED” in the narrative section. FIN- deems it necessary to terminate a 2014-G001 established three new SAR relationship with an MRB in order to filings pertaining to MRB's. These should maintain an effective anti-money be included in a Banks BSA/AML policy if laundering compliance program. they operate in a state where there is some form of legalized marijuana.

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Marijuana Related Information for Examiners Relevant Policy Examiner Notes Businesses2

2. Does management review • An MRB's risk profile may change FIN-2014-G001 recommends customer information quickly. This question is intended to refreshing information obtained as obtained as part of their assess how an institution manages these part of customer due diligence on a customer due diligence changing risks and whether the periodic basis and commensurate program at least every 90 necessary adjustments are made to with the risk presented by the MRB. With respect to information the state days to determine remain in compliance with FinCEN plan licensure obtained in connection with whether a change in SAR and guidance. If management deems it such customer due diligence, a filing is warranted? necessary to terminate a relationship financial institution may reasonably with a marijuana-related business the rely on the accuracy of information term “Marijuana Termination” should be provided by state licensing used in the narrative portion of the authorities, where states make such accompanying SAR. information available.

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State by State Cannabis Policy

State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

Hemp plan under review by USDA, but AL will continue to operate Alabama Yes No N/A Yes Industrial Hemp (alabama.gov) under its 2014 pilot rules. Medical marijuana legalized May 17, 2021.

Drafting a hemp plan for USDA Home, Alcohol & Marijuana Alaska Plant Materials Center | Alaska Yes Yes Yes review, but AK will continue to Control Office (alaska.gov) Division of Agriculture operate under its 2014 pilot rules.

Industrial Hemp Program | Hemp plan under review by USDA ADHS - Medical Marijuana - Arizona Yes Yes Yes Arizona Department of Physicians (azdhs.gov) Marijuana legalization passed on Agriculture (az.gov) November 3, 2020.

Hemp plan under review by USDA, Medical Marijuana Arkansas Hemp Home - Arkansas Arkansas Yes No Yes but AR will continue to operate Department of Health Department of Agriculture under its 2014 pilot rules.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

Drafting a hemp plan for USDA review Cannabis | California Cannabis CDFA - Plant - Industrial Hemp California Yes Yes Yes Portal (ca.gov) The attorney general released new medicinal cannabis guidelines August 6, 2019. link

State plan approved by USDA under Marijuana Home | DOR SBG Industrial Hemp | Department of the final rule in 2021. Colorado Yes Yes Yes (colorado.gov) Agriculture (colorado.gov) Online portal for hemp growers to submit applications and payment.

A recreational marijuana law (S.B. No. 1201 passed and was signed Connecticut Hemp Research into law June 22, 2021. Connecticut Yes Yes Cannabis in Connecticut Yes Pilot Program State hemp plan under review, but CT will continue to operate under its 2014 pilot rules.

Medical Marijuana Program - Hemp Program - Delaware State hemp plan approved by the Delaware Yes No Delaware Health and Social Yes Department of Agriculture - USDA as of January 28, 2020. Services - State of Delaware State of Delaware

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

Recreational marijuana in DC is not taxed and regulated in DC, but individuals over 21 are able to District of legally possess and cultivate limited Yes Yes Program No N/A Columbia amounts of marijuana for recreational use under Initiative 71 Marijuana can be donated, but not sold.

Hemp/CBD in Florida / OMMU – Office Of Medical Cannabis/Hemp / Home - Florida State hemp plan approved by USDA Florida Yes No Marijuana Use Yes Department of Agriculture & as of April 16, 2020. (knowthefactsmmj.com) Consumer Services (fdacs.gov)

State hemp plan approved by USDA Low THC Oil Registry Page | as of March 9, 2020. Georgia Hemp Program - Ga Georgia Yes No Georgia Department of Public Yes Dept of Agriculture Qualified persons in Georgia can Health possess up to 20 fluid ounces of low THC oil.

Medical Cannabis Program Department of Agriculture | State will operate under USDA hemp Hawaii Yes No Yes (hawaii.gov) Hemp Production (hawaii.gov) rules.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

Governor Little signed H.B. 126 Hemp – Idaho State Department legalizing hemp production in the Idaho No No N/A Yes of Agriculture state April 16, 2021 – Idaho was the last state to legalize hemp.

State hemp plan approved by the USDA as of October 19, 2020, but IL will continue to operate under its 2014 pilot rules. Medical Cannabis Program - Industrial Hemp - Plants Illinois Yes Yes Yes Illinois was the first state to fully MCPP (illinois.gov) (illinois.gov) legalize through the legislative process – effective January 1, 2020.

Cannabis frequently asked questions link

State hemp plan approved by the Indiana Hemp Regulatory Indiana No No N/A Yes USDA as of October 19, 2020. Website (purdue.edu) Medical use of CBD oil is allowed.

Hemp Program | Iowa The Office of Medical Department of Agriculture and State hemp plan approved by the Iowa Yes No Yes Cannabidiol (iowa.gov) Land Stewardship USDA as of March 19, 2020. (iowaagriculture.gov)

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by USDA Kansas No No N/A Yes Industrial Hemp (ks.gov) under the final rule for use beginning in the fall of 2021.

State hemp plan under review by Industrial Hemp Research Pilot USDA, but KY will continue to Kentucky No No N/A Yes Program (kyagr.com) operate under its 2014 pilot rules. Medical use of CBD oil is allowed.

Medical Marijuana - Department Industrial Hemp - Department of State hemp plan approved by USDA Louisiana Yes No of Agriculture and Forestry Yes Agriculture and Forestry December 27, 2019. (state.la.us) (state.la.us)

State hemp plan approved by USDA Medical Use | Office of Hemp: Animal and Plant Health: as of September 2, 2020, but ME will Maine Yes Yes Yes Marijuana Policy (maine.gov) Maine DACF continue to operate under its 2014 pilot rules.

Maryland Medical Cannabis State hemp plan approved by USDA Maryland Yes No Yes Maryland Hemp Program Commission as of August 11, 2020.

Cannabis Control Commission Industrial Hemp Program | State hemp plan approved by the Massachusetts Yes Yes Massachusetts Yes Mass.gov USDA as of May 11, 2020. (masscannabiscontrol.com)

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by USDA MRA - Marijuana Regulatory MDARD - Industrial Hemp as of October 19, 2020. Michigan Yes Yes Yes Agency (michigan.gov) (michigan.gov) www.michigan.gov/marijuana is a good landing page for a variety of marijuana-related information Medical Cannabis - Minnesota Hemp Program | Minnesota State hemp plan approved by USDA Minnesota Yes No Department of Health Yes Department of Agriculture under the final rule in 2021. (state.mn.us) (state.mn.us)

Medical marijuana passed on November 3, 2020, but the state Hemp Cultivation in Mississippi - supreme court overturned that Mississippi Department of result on May 14, 2021. Mississippi No No N/A Yes Agriculture and Commerce Hemp farmers will need a USDA (ms.gov) license because no funds were appropriated for the hemp program this year. State Site

Medical Marijuana Regulation | State plan approved by USDA under Health Services Regulation | Industrial Hemp Program Missouri Yes No Yes the final rule in 2021. Health & Senior Services (mo.gov) Updated application process (mo.gov)

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by the USDA as of March 9, 2020, but MT Cannabis Control Division - will continue to operate under its Montana Yes Yes Montana Department of Yes Hemp (mt.gov) 2014 pilot rules. Revenue (mtrevenue.gov) Marijuana legalization passed on November 3, 2020.

State hemp plan approved by the USDA as of January 28, 2020. Hemp | Nebraska Department of Nebraska No No N/A Yes On September 10, 2020 the Agriculture Nebraska Supreme Court removed the medical marijuana legalization initiative from the November ballot.

State hemp plan approved by USDA Nevada Yes Yes Medical Marijuana (nv.gov) Yes Hemp Program (nv.gov) under the final rule in 2021.

State will operate under USDA hemp Therapeutic Cannabis Program rules. New New Hampshire Department of NH Department of Agriculture, Yes No Yes HB 459 allows for hemp growing and Hampshire Health and Human Services Markets and Food set up a committee to study federal (nh.gov) guidelines with a report due November 1, 2019.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

Recreation use of marijuana passed NJ Division of Medical Marijuana on November 3, 2020. New state Department of Agriculture | laws on cannabis signed on New Jersey Yes Yes Cannabis Regulatory Yes New Jersey Hemp Program February 22, 2021. (nj.gov) Commission Homepage (nj.gov) State plan approved by USDA under the final rule in 2021.

State hemp plan approved by the USDA as of October 19, 2020, but NM will continue to operate under 2014 pilot rules. Hemp Program - New Mexico Medical Cannabis New Mexico Yes [Yes] Yes Department of Agriculture Marijuana legalized for adults April (nmhealth.org) (nmsu.edu) 12, 2021 – retails sales are to begin by April 1, 2022.

Updated hemp frequently asked questions link

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

NY will continue to operate under New York State Medical 2014 pilot rules. Industrial Hemp Research Marijuana Program (ny.gov) Recreational marijuana legalized New York Yes Yes Yes Initiative | Empire State March 31, 2021. Office of Cannabis Management Development (ny.gov) (ny.gov) Hemp legislation was signed into law on December 9, 2019 S 6184-A

North Carolina Department of NC will continue under its 2014 North Carolina No No N/A Yes Agriculture & Consumer Services hemp pilot rules. (ncagr.gov)

Hemp | North Dakota State hemp plan under review by Division of Medical Marijuana | North Dakota Yes No Yes Department of Agriculture USDA, but ND will continue to Department of Health (nd.gov) (nd.gov) operate under its 2014 pilot rules.

State hemp plan approved by USDA Welcome to the Hemp Program Ohio Medical Marijuana Control December 27, 2019. Ohio Yes No Yes | Ohio Department of Program Agriculture Senate Bill 57 legalized hemp and hemp-derived CBD on July 30, 2019.

Oklahoma Medical Marijuana Plant Industry – ODAFF (ok.gov) State hemp plan approved by USDA Oklahoma Yes No Yes Authority Scroll down to Industrial Hemp as of October 19, 2020.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan under review by Marijuana and Hemp (Cannabis): Oregon Yes Yes Yes State of Oregon: Hemp USDA, but OR will continue to State of Oregon operate under its 2014 pilot rules.

Medical Marijuana Program State hemp plan approved by the Pennsylvania Yes No Yes Industrial Hemp (pa.gov) (pa.gov) USDA under the final rule in 2021.

Medical Marijuana Information Rhode Island Department of State hemp plan approved by the Rhode Island Yes No for Patients and Caregivers: Yes Business Regulation: (ri.gov) USDA as of January 11, 2021. Department of Health Scroll down to Industrial Hemp

Hemp Farming Program - South State hemp plan approved by USDA South Carolina No No N/A Yes Carolina Department of under the final rule in 2021. Agriculture (sc.gov)

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by USDA under the final rule in 2021. House Bill 1203 was signed into law Medical Marijuana - Medical March 25, 2021 authorizing banks to engage in business with hemp and Cannabis (sd.gov) South Dakota Industrial Hemp South Dakota Yes* Yes* Yes marijuana licensees Medical Cannabis in South Program (sd.gov) Dakota (sd.gov) *Both ballot initiatives passed on November 3, 2020 and are effective July 1, 2021. Recreational use is currently being litigated in the SD Supreme Court.

Hemp plan approved by the USDA as of July 15, 2020, but TN will Tennessee No No N/A Yes Hemp Industry (tn.gov) continue to operate under its 2014 pilot rules.

Compassionate Use Program | State hemp plan approved by the Texas Industrial Hemp Program Texas Yes No Department of Public Safety Yes USDA as of January 28, 2020. (texasagriculture.gov) (texas.gov) Medical use of CBD oil is allowed.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by the Industrial Hemp Program | Utah USDA as of September 14, 2020, but Utah Yes No Home - Utah Medical Cannabis Yes Department of Agriculture and UT will continue to operate under its

Food 2014 pilot rules.

State drafting new hemp rules, but VT will continue to operate under its Hemp Program | Agency of Home Page | Marijuana Registry 2014 pilot rules. Vermont Yes Yes* Yes Agriculture, Food and Markets (vermont.gov) (vermont.gov) *Despite legalization in 2018, retail sales are not expected to begin until May 2022.

VA will continue to operate under its 2014 pilot rules.

Recreational marijuana was Virginia Yes Yes Cannabis.Virginia.gov Yes Industrial Hemp (virginia.gov) legalized to begin July 1, 2021. Historical Note - In 1619, the Virginia colony passed a law requiring farmers to grow hemp.

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State State Marijuana Authority State Hemp Authority Additional Notes Hemp Medical Use Recreational Use

State hemp plan approved by USDA General Information about Hemp | Washington State under the final rule in 2021. Washington Yes Yes Marijuana | Washington State Yes Department of Agriculture Liquor and Cannabis Board Information on hemp for marijuana licensees link

State hemp plan approved by the Industrial Hemp Licenses : West Office of Medical Cannabis USDA as of March 31, 2020 but WV West Virginia Yes No Yes Virginia Department of (wv.gov) will continue to operate under its

Agriculture (wv.gov) 2014 pilot rules.

State hemp plan under review by DATCP Home Hemp Research USDA, but WI will continue to Wisconsin No No N/A Yes Program (wi.gov) operate under its 2014 pilot rules. Medical use of CBD oil is allowed.

State hemp plan approved by the USDA as of February 26, 2020. Wyoming No No N/A Yes Wyoming Hemp Program The governor issued an update on hemp August 6. link

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Territory Cannabis Policy

Territory Territory Marijuana Authority Territory Hemp Authority Additional Notes Hemp

Medical Use Recreational Use Plan for cultivation and sale are expected in April 2020 - link to news Cannabis Control Board | Guam report. The Cannabis Control Board Guam Yes Yes Dept. of Revenue and Taxation issued a fact sheet on cannabis.

(guamtax.com) Guam has not submitted a hemp plan to the USDA.

Hemp rules pending legislation Northern Cannabis | CNMI Office of the Yes Yes Yes Marianas Governor Recreational use law amended August 2019 Public Law 21-05

HEMP Licensing and Inspection Hemp plan approved by USDA as of Puerto Rico Yes No Yes Office | PRDA (agricultura.pr) July 15, 2020.

VIDA | Department of Virgin Islands Cannabis Advisory Hemp plan approved by USDA as of Virgin Islands Yes No Yes Agriculture Board (VICAB) - VIBE HIGH May 29, 2020. Scroll down to Hemp Program

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Indian Tribe Hemp Status

Tribe Location Tribe Web Site Status of Tribal Plan

Assiniboine and Sioux Tribes of the Fort MT www.fortpecktribes.org/ Tribe will use USDA Hemp Producer Licenses Peck Reservation Blackfeet Nation Tribal Council MT https://blackfeetnation.com/ Tribe hemp plan approved under interim rule Cahuilla Band of Indians CA www.cahuilla.net/ Tribe hemp plan approved under the final rule. Cayuga NY https://cayuganation-nsn.gov/index.html Tribe hemp plan approved under interim rule Cheyenne and Arapaho Tribe OK https://cheyenneandarapaho-nsn.gov/ Tribe hemp plan approved under interim rule Cheyenne River Sioux SD www.sioux.org/ Tribe hemp plan approved under interim rule

Chippewa Cree MT www.chippewacree-nsn.gov/ Tribe hemp plan approved under interim rule Colorado River Indian Tribes AZ CA www.crit-nsn.gov/ Tribe hemp plan approved under interim rule Comanche Nation OK https://comanchenation.com/ Tribe hemp plan approved under interim rule Confederated Salish & Kootenai Tribes of MT www.cskt.org Tribe will use USDA Hemp Producer Licenses the Flathead Reservation Confederated Tribes of Warm Springs OR https://warmsprings-nsn.gov/ Tribe hemp plan approved under interim rule Cow Creek Band of Umpqua Tribe of OR www.cowcreek-nsn.gov/ Tribe hemp plan approved under interim rule Indians Eastern Tribe of Cherokee Indians NC https://ebci.com/ Tribe hemp plan approved under interim rule Flandreau Santee Sioux SD https://santeesioux.com/ Tribe hemp plan approved under interim rule Fort Belknap Indian Community MT https://ftbelknap.org/ Tribe hemp plan approved under interim rule

Fort Peck Indian Reservation MT http://fortpecktribes.org/index.html Hemp plan under review

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Tribe Location Tribe Web Site Status of Tribal Plan

Iowa Tribe of Kansas and Nebraska KS NE www.iowatribeofkansasandnebraska.com/ Tribe hemp plan approved under interim rule Kanosh Band of Paiute Indians UT Paiute Indian Tribe of Utah Hemp plan under review La Jolla Band of Luiseno Indians CA www.lajollaindians.com/ Tribe hemp plan approved under interim rule Lac Courte Oreilles WI www.lcotribe.com/ Tribe hemp plan approved under interim rule

Little Traverse Bay Band of Odawa Indians MI www.ltbbodawa-nsn.gov/ Tribe hemp plan approved under interim rule Waganakising Odawak Lower Brule Sioux Tribe SD Lower Brule Sioux Tribe Tribe will use USDA Hemp Producer Licenses Lower Sioux Indian Community MN https://lowersioux.com/ Tribe hemp plan approved under interim rule Miccosukee Tribe of Indians of Florida FL https://tribe.miccosukee.com/ Tribe hemp plan approved under interim rule Navajo Nation San Juan River Farm NM www.navajonationfarmboard.com/ Hemp plan to be resubmitted Nez Perce Tribe ID https://nezperce.org/ Tribe hemp plan approved under interim rule Oglala Sioux Tribe SD http://oglalalakotanation.info/index.html Tribe hemp plan approved under interim rule Otoe-Missouria Tribe OK www.omtribe.org/ Tribe hemp plan approved under interim rule Pala Band of Mission Indians CA www.palatribe.com/ Tribe hemp plan approved under interim rule Pauma Band of Luiseno Indians CA www.paumatribe.com Tribe hemp plan approved under the final rule. Pawnee Nation of Oklahoma OK www.pawneenation.org/ Tribe hemp plan approved under interim rule Prairie Band Potawatomi Nation KS www.pbpindiantribe.com/ Tribe hemp plan approved under the final rule. Pueblo of Picuris Tribe NM www.picurispueblo.org/ Tribe hemp plan approved under interim rule Red Lake Band of Chippewa MN www.redlakenation.org/ Tribe hemp plan approved under interim rule Rosebud Sioux Tribe SD www.rosebudsiouxtribe-nsn.gov/ Tribe hemp plan approved under interim rule

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Tribe Location Tribe Web Site Status of Tribal Plan

Sac & Fox Tribe of the Mississippi in Iowa IA https://meskwaki.org/ Tribe hemp plan approved under interim rule Saint Regis Mohawk Tribe NY www.srmt-nsn.gov/ Hemp plan under review San Carlos Apache Tribe AZ www.sancarlosapache.com/home.htm Tribe hemp plan approved under interim rule Santa Rosa Band of Cahuilla Indians CA www.santarosacahuilla-nsn.gov/ Tribe hemp plan approved under interim rule Santee Sioux Nation NE http://santeesiouxnation.net/ Tribe hemp plan approved under interim rule Seminole Nation of Oklahoma OK www.sno-nsn.gov/ Tribe hemp plan approved under interim rule Seneca Nation NY https://sni.org/ Tribe hemp plan approved under interim rule Shoshone-Bannock Tribe ID www.sbtribes.com/ Hemp plan under review Sisseton-Wahpeton Oyate SD www.swo-nsn.gov/ Tribe hemp plan approved under interim rule Soboba Band of Luiseno Indians CA www.soboba-nsn.gov Tribe hemp plan approved under interim rule

Southern Ute Indian Tribe CO Southern Ute Indian Tribe Hemp plan under review

Standing Rock Santee Sioux ND www.standingrock.org/ Tribe hemp plan approved under interim rule Torres Martinez Desert Cahuilla Indians CA http://torresmartinez.org/ Tribe hemp plan approved under interim rule Turtle Mt. Band of Chippewa Indians ND https://tmchippewa.com/ Tribe hemp plan approved under interim rule Ute Mountain Ute CO www.utemountainutetribe.com/ Drafting hemp plan White Earth Band of the Minnesota MN White Earth Nation Tribe will use USDA Hemp Producer Licenses Chippewa

Wichita and Affiliated Tribes OK https://wichitatribe.com/ Tribe hemp plan approved under the final rule.

Winnebago Tribe of Nebraska NE www.winnebagotribe.com/ Tribe hemp plan approved under interim rule Yankton Sioux Tribe SD www.yanktonsiouxtribe.net/ Drafting hemp plan

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Tribe Location Tribe Web Site Status of Tribal Plan

Ysleta Del Sur Pueblo TX www.ysletadelsurpueblo.org/ Tribe hemp plan approved under interim rule Yurok Tribe CA http://yuroktribe.org/ Tribe hemp plan approved under interim rule

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Reference Documents

Document Description Link

With the passage of the 2014 Farm Bill, a State department of agriculture or institution of higher education can grow or cultivate industrial hemp if 1) the industrial hemp is grown or cultivated for 2014 Farm Bill purposes of research conducted under an agricultural pilot program or other agricultural or – www.nifa.usda.gov/industrial-hemp academic research; and 2) the growing or cultivating 7 U.S.C. 5940 of industrial hemp is allowed under the laws of the State in which such institution of higher education or State department of agriculture is located and such research occurs. This page has been updated for the 2018 Farm Bill.

2014 Farm Bill - general USDA web page with links to reference materials www.fsa.usda.gov/programs-and-services/farm-bill/index information

2014 Farm Bill Signed February 7, 2014 https://www.ams.usda.gov/sites/default/files/media/2014FarmBill.pdf pdf

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Document Description Link

The 2018 Farm Bill removed hemp from the list of Schedule 1 drugs and authorized industrial hemp 2018 Farm Bill cultivation, transportation, and research. Hemp is defined as any part of the plant L. – www.congress.gov/bill/115th-congress/house-bill/2/text that includes a delta-9 tetrahydrocannabinol (THC) 7 USC 1621 concentration of not more than 0.3 percent. The USDA plans to issue implementing regulations in 2019 to support the 2020 growing season.

Signed December 20, 2018

The 2018 Farm Bill (the Agriculture Improvement Act 2018 Farm Bill of 2018) directed USDA to develop a program by www.ams.usda.gov/sites/default/files/media/2018FarmBill.pdf pdf which it will review and approve plans submitted by each state, territory and Indian tribal agency outlining their production of hemp for commercial uses.

USDA conducted a three-hour webinar to solicit 2018 Farm Bill public comments on the hemp sections of the 2018 www.ams.usda.gov/event/2018-farm-bill-webinar-domestic-hemp-production- Webinar Farm Bill. The recorded webinar and written program comments are available for review

Signed on December 27, 2020

2021 Officially known as “Continuing Appropriations Act, Continuing 2021" [Section 782] extends the states’ ability to Consolidated Appropriations Act, 2021 Resolution operate under their 2014 hemp pilot rules from September 30, 2021 to January 1, 2022.

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Document Description Link

21 CFR Part Established marihuana [sic] extract as a separate www.gpo.gov/fdsys/pkg/FR-2016-12-14/pdf/2016-29941.pdf 1308 Schedule 1 drug

Cole The was rescinded on January 4, www.justice.gov/opa/pr/justice-department-issues-memo-marijuana-enforcement Memorandum 2018.

Continuing Signed into law September 27, 2019. Appropriation s Act, 2020, Also known as H.R. 4378 – provides $16.5 million to www.congress.gov/bill/116th-congress/house-bill/4378/text and Health continue the implementation of the Hemp Extenders Act Production Program (Section 10113 of Public Law 115-334). of 2019

The Controlled Substances Act (CSA), passed into law in 1970, is the statute prescribing federal U.S. Controlled drug policy. The statute places all substances into Substances five schedules, and is based upon the substance's www.dea.gov/druginfo/csa.shtml Act 21 USC medical use, potential for abuse, and safety or §812 dependence liability. Schedules also determine the extent of prosecution and regulation. Marijuana is a Schedule 1 drug.

Controlled SEC. 12619 Conforming Changes to Controlled Substances 21 U.S.C. 802(16) Substances Act removes hemp from Schedule 1 Act changes

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Document Description Link

www.rma.usda.gov/ www.rma.usda.gov/en/News-Room/Press/Press-Releases/2019- USDA’s Risk Management Agency has both whole Crop News/Hemp-Crop-Insurance-Coverage-Available-for-2020 farm revenue protection and multi-peril crop Insurance for insurance options available for certain hemp www.rma.usda.gov/en/News-Room/Press/Press-Releases/2019- Hemp growers – see programs for details News/USDA-Announces-Pilot-Insurance-Coverage-for-Hemp-Growers www.usda.gov/media/radio/daily-newsline/2020-12-04/improvements- hemp-multi-peril-crop-insurance

The Environmental Protection Agency (EPA) has EPA Approved published a list of pesticides that are approved for Pesticides for Pesticide Products Registered for Use on Hemp use on hemp since December 2019, including Hemp biopesticides.

FDA FAQs on FDA has concluded that THC and CBD products are www.fda.gov/news-events/public-health-focus/fda-regulation-cannabis- Cannabis and excluded from the dietary supplement definition. and-cannabis-derived-products-questions-and-answers Cannabis FDA held a hearing in May 2019 to gather www.fda.gov/news-events/public-health-focus/fda-regulation-cannabis- Derived information about CBD. Products and-cannabis-derived-products-including-cannabidiol-cbd

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Document Description Link

FDA Statement on regulation of It is unlawful under the FD&C Act to introduce food products containing added CBD or THC into interstate containing commerce, or to market CBD or THC products as, or www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm628988.htm cannabis and in, dietary supplements, regardless of whether the cannabis substances are hemp-derived derived compounds

FinCEN guidance, titled BSA Expectations Regarding Marijuana Related Businesses, clarifies how financial institutions can provide services to marijuana related businesses (MRB). The guidance provides FIN-2014-G001 detail on how to assess the risk of a marijuana- related business, including information that should www.fincen.gov/sites/default/files/shared/FIN-2014-G001.pdf FinCEN BSA be collected during customer due-diligence. Guidance Additionally, FinCEN provides guidance on how to file suspicious activity reports (SARs) and currency transaction reports (CTRs) for MRBs, including red flags that should be considered when filing a Priority SAR.

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Document Description Link

As of March 31, 2021, FinCEN has received a total of 186, 151 SARs using the key phrases associated with MRBs. Several of the SARs contain more than one key phrase, which accounts for the numbers for each key phrase being greater than the total.

510 banks and 174 credit unions filed MRB SARs. FinCEN The number of institutions filing MRB SARSs remains Marijuana below the high of 747 reported in November 2019. Frequently Requested FOIA-Processed Records | FinCEN.gov Banking Update • FinCEN received 143,521 SARs from filers using the key phrase “Marijuana Limited.”

• FinCEN received 13,429 SARS from filers using the key phrase “Marijuana Priority.”

• FinCEN received 38,858 SARs from filers using the key phrase “Marijuana Termination.”

FinCEN FinCEN Guidance Regarding Due Diligence Guidance for Requirements under the Bank Secrecy Act for Hemp- FinCEN Guidance, FIN-2020-G001 Hemp-Related Related Business Customers June 29, 2020 Business Customers

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Document Description Link

USDA issued an interim final rule establishing the Hemp plan and regulations to produce hemp on October www.federalregister.gov/documents/2019/10/31/2019-23749/establishment-of-a- Production 31, 2019. domestic-hemp-production-program Program Regulation USDA issued a final rule January 19, 2021 which Federal Register: Establishment of a Domestic Hemp Production Program became effective March 22, 2021.

Joint Guidance on Providing Guidance on Providing Financial Services to Financial Customers Engaged in Hemp-Related Businesses www.fdic.gov/news/news/press/2019/pr19115a.pdf Services to issued by CSBS, FDIC, Federal Reserve, FinCEN, and Hemp-Related the OCC December 3, 2019 Businesses

NCUA The NCUA issued a Regulatory Alert, 19-RA-02 Guidance for Serving Hemp Businesses August 2019 and a follow- 19-RA-02 Serving Hemp Businesses Servicing up credit union letter 20-CU-19 Additional Guidance Hemp Related Regarding Servicing Hemp-Related Businesses June 20-CU-19 Additional Guidance Regarding Servicing Hemp-Related Businesses Businesses 2020

The 2018 Farm Bill directed USDA to establish a national regulatory framework for hemp production in the United States. USDA established the U.S. Domestic Hemp Production Program through an More Members of the industry with questions about the U.S. Domestic Hemp Production interim final rule. This rule outlines provisions for information Program should contact the Agricultural Marketing Service (AMS) at 202-720-2491 the USDA to approve plans submitted by States and or [email protected]. on hemp Indian Tribes for the domestic production of hemp. It also establishes a Federal plan for producers in States or territories of Indian tribes that do not have their own USDA-approved plan.

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Document Description Link

USDA Agricultural The Agricultural Marketing Service has been Marketing designated as the lead USDA agency to administer Hemp Production | Agricultural Marketing Service (usda.gov) Service Hemp the new Hemp Production Program. Website

USDA Agricultural Hemp production questions and answers maintained Hemp Production Program Questions and Answers Marketing by the USDA Service Q&As

USDA USDA clarified hemp production for Indian Tribes on Clarification May 28, 2019 and provided an updated on October USDA Clarifies Industrial Hemp Production for Indian Tribes for Tribes 31, 2019.

USDA announced a delay in the enforcement of the testing and hot hemp disposal requirements based USDA Enforcement Discretion Enforcement on comments received on February 27, 2020. Hemp Disposal Activities Discretion Additional “common on-farm practices” allowed as hemp disposal activities are described.

USDA Final Final rule on hemp production (7 CFR 990) published Hemp Production Hemp Rule January 19, 2021 effective March 22, 2021. Hemp Rulemaking Documents

USDA Hemp Laboratories testing hemp for THC concentration under the Hemp Production Program must be Analytical registered with the Drug Enforcement Hemp Analytical Testing Laboratories Testing Administration (DEA) to handle controlled Laboratories substances.

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Document Description Link

The USDA maintains a web site with information for USDA Hemp hemp farmers that includes links to policies and Web Site for Hemp and Farm Programs | Farmers.gov frequently asked questions on topics such as crop Farmers insurance.

2021 version 9

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