On Thursday, June 4, 2020, the North Carolina General Assembly passed S.B. 315, referred to as the State Farm Bill, which was subsequently signed into law by the Governor. The bill was pending all last session and stalled, allegedly over a dispute about how to treat smokable hemp. As I understand it, the bill originally intended to clarify that hemp in all forms (including smokable hemp) was legal (here is an earlier version of the bill taking that approach). After hearing objections from law enforcement and prosecutors (as detailed in the SBI memo on the subject), the proposed bill was changed to ban smokable hemp and regulate the rest of the hemp industry in a variety of ways. When the bill was last being discussed in the news, the dispute at the General Assembly had apparently narrowed to when the smokable hemp ban was to kick in. But, the bill never passed last session, and we were without a Farm Bill until this month. So, what big changes does the bill have in store for hemp in North Carolina?
The Big Change? In short, the bill changes nothing about hemp. Therefore, at least for the time being, smokable hemp and all other forms of hemp remain legal and largely unregulated after it leaves the farm. The State Farm Bill, as enacted, cut all references to hemp from earlier versions and simply left the issue alone. As I’ve written before, the existence of smokable hemp (and other hemp products) raises thorny issues regarding probable cause and drug identification for law enforcement and prosecutors in marijuana cases. Thus, the challenges identified in my earlier post remain unsettled in North Carolina for now, and defenders should continue to make probable cause arguments and challenge drug identification in any case involving marijuana. Sample motions on those points are available here and here (thanks to Sarah Olson and Matt Ruby for their work there). In addition to raising the issues with pretrial motions, I recommend defenders engage the services of an expert to assist in any drug identification argument.
What’s in Store? Another bill from last session, S.B. 352, separately proposed banning smokable hemp. The definition of marijuana would be amended to include smokable hemp, thus treating it as a Schedule VI controlled substance. An exception would exist for licensed growers and processors to handle the raw hemp product before it is either made into a legal hemp product or sold to someone in a jurisdiction where smokable hemp remains legal. The ban would not affect other hemp products, such as hemp oils, edibles, or vape products. Thus, this proposed legislation would create a situation where the miniscule amount of THC in smokable hemp is treated as marijuana, but the same amounts of THC in other hemp products would be treated as a legal product. While the ban on smokable hemp would seemingly allow the State to avoid the problems with marijuana enforcement when it comes to cannabis flowers (aka the smokable “buds”), the same issues of probable cause and drug identification would still exist for other forms of cannabis that could either be marijuana or hemp, as I discussed in part here.
Can They Do That? At least one other state, Indiana, passed legislation attempting to ban smokable hemp. That regulation was promptly challenged in federal court on the ground that the U.S. Farm Bill of 2018 preempted this type of state ban and that any such ban violated commerce clause principles. The judge agreed with the preemption argument and issued a preliminary injunction, prohibiting the ban from taking effect for the time being. I’ll leave it to other scholars to analyze the strength of these arguments, but a similar challenge seems sure to arise in North Carolina if a smokable hemp ban becomes law.
The Future of Cannabis in North Carolina. The continued confusion over hemp and marijuana is not the only consequence of where our legislative scheme stands at the moment. Without some authorizing legislation to renew our existing hemp program, the future of the hemp industry remains uncertain, as detailed here. Basically, the State has until October 31, 2020 to submit a plan to the U.S. Department of Agriculture; otherwise, existing hemp licenses in the state will likely expire. The state entity tasked with running the hemp industry, the N.C. Dept. of Agriculture and Consumer Services (“NCDA&CS”), currently lacks statutory authority to submit such a plan to the federal government. As I understand it, the General Assembly could grant the NCAD&CS the authority to submit a plan, but the clock is ticking fast. Earlier versions of the State Farm Bill provided the necessary authorization to the NCAD&CS, but that too was cut from the final law. Even if the General Assembly were to act on this point soon, it’s not clear the NCAD&CS will be able to formulate the plan and obtain federal approval in time, as noted in the linked article above. The U.S. Congress could also extend the deadline to a later time, but so far that hasn’t happened. If North Carolina fails to meet the deadline, individual growers could seek permits from the U.S. Department of Agriculture, but this situation creates confusion for the industry as a whole. North Carolina initially was a leader among the states in creating a program for legal hemp. Other states have taken a different approach. In Louisiana, for instance, no hemp licenses have yet been granted while the state tries to develop regulations for the industry. On the other hand, Louisiana also just today greatly expanded its medicinal marijuana program, something that does not exist in North Carolina. Whatever your feelings on it, more legislation in this area seems certain to come. When that happens, you can read about it here.
Readers, I’m interested to know how the hemp/marijuana issues are being handled in your jurisdiction. From my perspective, it seems that marijuana prosecutions on the local level vary considerably from place to place. Post a comment and let me know how you’ve litigated the arguments, and how the issue is being treated in the courts in your area.