Docket No. 21-R-07
WISCONSIN DEPARTMENT OF AGRICULTURE,
TRADE AND CONSUMER PROTECTION
EMERGENCY RULE
The Wisconsin Department of Agriculture, Trade and Consumer Protection hereby adopts the following emergency rule to repeal and recreate ch. ATCP 22 relating to hemp and affecting small businesses. ______________________________________________________________________________
Analysis Prepared by the Department
of Agriculture, Trade and Consumer Protection
This emergency rule updates the existing hemp research program (Hemp Program) created under Wis. Stat. s. 94.55 (2), to allow the people of this state the greatest possible opportunity to engage in hemp production. Under Wis. Stat. s. 94.55 (2) and (3w), the Department of Agriculture, Trade and Consumer Protection (Department) is required to promulgate rules regulating hemp activities. This emergency rule specifies the application process for obtaining a license to grow and a license to process hemp for research purposes under the Hemp Program administered by the Department.
Pursuant to Wis. Stat. s. 94.55 (3w), the Department is not required to provide a finding of emergency or prepare a statement of scope of the rules. The Department is also not required to submit the final draft to the Governor for approval. This rule repeals and replaces emergency rule EmR2039, which was published and effective on October 29, 2020. The repeal and replacement was necessary as the United States Department of Agriculture (USDA) published 7 C.F.R. 990 (Final Rule) on January 19, 2021 with an effective date of March 22, 2021, which offers more flexibilities for the Hemp Program. This new rule will operate under the authority of the 2014 Farm Bill for the 2021 growing season by taking advantage of the program extensions offered in Section 122 of the Continuing Appropriations Act and Section 782 of the Consolidated Appropriations Act. These Acts extended the 2014 Farm Bill until September 30, 2021 and then through December 31, 2021, respectively. The Department retains authority to operate a hemp program under Wis. Stat. s. 94.55 (2). Wis. Stat. s. 94.55 (2) (b) 2. requires the Department to regulate hemp production only to the extent required under federal law and in a manner that allows “…the greatest possible opportunity to engage in those activities.” Operating under a 2014 Farm Bill research program while incorporating certain flexibilities offered in the Final Rule provides Wisconsin hemp growers the greatest opportunity to produce hemp. This emergency rule takes effect upon publication and remains in effect until the date on which rules promulgated pursuant to Wis. Stat. s. 94.55 (3w) take effect. Statutes Interpreted
Statutory Authority
Explanation of Statutory Authority
Wis. Stat. s. 94.55 (2) requires the Department to promulgate administrative rules to regulate hemp activities. Wis. Stat. s. 94.55 (2) (b) 2. requires the Department to regulate hemp activities only to the extent required under federal law and in a manner that allows “…the greatest possible opportunity to engage in those activities.” Pursuant to Wis. Stat. s. 94.55 (3w), the Department may use the emergency rulemaking procedures under Wis. Stat. s. 227.24 to promulgate rules under Wis. Stat. s. 94.55. Related Rules or Statutes
Wis. Stat. s. 961.32 (3) relates to the Hemp Program as it creates authorized possession of hemp within the Wisconsin Controlled Substances Act and details when referrals from the Department are necessary for criminal prosecution in relation to the Hemp Program. Plain Language Analysis
The Department currently operates under the Hemp Program, a hemp research program authorized by the 2014 Farm Bill. The Hemp Program is designed to study the growth, cultivation, and marketing of hemp in Wisconsin. Growers and processors provide information to the Department related to hemp production. This rule implements some of the changes outlined in the Final Rule, and thus provides growers with the greatest opportunity to produce hemp in Wisconsin as pursuant to Wis. Stat. s. 94.55 (2). Adopting these changes from the USDA Final Rule allows growers to operate under a less restrictive framework. The 2018 Farm Bill sunsetted the 2014 Farm Bill’s authorization of states to operate hemp research programs, effective one year after the USDA established an approval process of state and tribal plans to produce hemp. The USDA issued Interim Final Rule (IFR), 7 C.F.R. Part 990, effective October 31, 2019, and thus all state hemp pilot research programs were set to expire pursuant to Section 7605 (b) of the 2018 Farm Bill on October 31, 2020. However, on October 1, 2020, Section 122 of the Continuing Appropriations Act, 2021 and Other Extensions Act extended the authority of states to operate hemp pilot research programs until September 30, 2021. This program extension gave states’ more time to develop a USDA-approved State Plan. States’ authority to operate hemp research programs was extended a second time on December 27, 2020 through Section 782 of the Consolidated Appropriations Act. This Act extends the 2014 Farm Bill expiration date to December 31, 2021, this change allows states to avoid switching program authority during the growing season. To continue primary jurisdiction over hemp programs, states and tribes now must have a plan approved by USDA by December 31, 2021.
The Department retains authority to operate a hemp program under Wis. Stat. s. 94.55 (2). Subsection (2) (am) allows the Department to operate a hemp program if federal law requires hemp licenses, and if USDA approves the state’s program. Section 7606 of the 2014 Farm Bill requires licensed hemp production. Section 782 of the Consolidated Appropriations Act requires the USDA to approve the continuation of state hemp research programs through December 31, 2021. Wis. Stat. s. 94.55 (2) (b) 2. requires the Department to regulate hemp production only to the extent required under federal law and in a manner that allows “…the greatest possible opportunity to engage in those activities.” Continuing to operate under a 2014 Farm Bill research program provides participants the greatest opportunity to produce hemp. USDA published the completed hemp Final Rule on January 19, 2021, with an effective date of March 22, 2021. The Final Rule replaces the IFR effective March 22, 2021 and outlines new flexibilities and program requirements. This emergency rule incorporates parts of the Final Rule to give growers the greatest opportunity to produce hemp. These adapted aspects are outlined below.
The Final Rule, or 7 C.F.R. 990, gives licensed growers the option to remediate, resample, and retest non-compliant hemp. As defined in this rule, remediation is the process of a licensed grower rendering part of the cannabis crop unusable by destroying the flower material. A large portion of the delta-9 THC found in cannabis plants is stored within the plant’s floral material; by allowing growers to destroy this part of the cannabis plant, they are more likely to have a compliant crop. A second permitted form of remediation is for the grower to shred or grind the entire lot into a homogeneous biomass. Growers may only remediate after their hemp has been tested and is found to be non-compliant by the Department. Remediated hemp must be sampled and pass regulatory testing. The option of remediation is a new addition to the hemp program and was incorporated to give growers a greater chance of having a compliant and marketable crop. The emergency rule includes clarifying language on negligent enforcement and violations for licensed participants. This rule outlines when a grower or processor would have a license denied, suspended, or revoked. For example, a licensee may be denied a license if they apply while their current license is suspended, apply in place of another licensee, violate this rule or Wis. Stat. s. 94.55, or doesn’t follow a written order from the Department. This rule also provides more detail on corrective action plans for when a licensee negligently violates this rule. These changes are reflective of current program procedures. This emergency rule was promulgated because the federal Final Rule was published on January 19, 2021, with an effective date of March 22, 2021. The Department will incorporate certain provisions of the Final Rule into their program through this emergency rule while continuing to operate under the 2014 Farm Bill. The updated rule repeals and replaces Emergency Rule 2039 and incorporates minor changes to the program.
