Colorado Industrial Hemp Production Act of 1996

A BILL FOR AN ACT CONCERNING THE PRODUCTION OF INDUSTRIAL HEMP AS AN AGRICULTURAL COMMODITY.

Unofficial Short Title:

"Hemp Production"

Bill Summary

(Note: This summary applies to this bill as introduced and does not necessarily reflect any amendments which may be subsequently adopted.)

Defines the non-psychoactive variety of the cannabis plant which has less than one percent concentration of tetrahydrocannabinols (THC) as "industrial hemp". Makes it legal to possess, grow, produce and sell industrial hemp. Redefines "marihuana" and "marihuana concentrate" for purposes of the controlled substances laws as the variety of the cannabis plant which has THC concentration greater than one percent. States that this new article regulating the production of industrial hemp shall not affect or be construed to interfere with the strict enforcement of the criminal laws regarding the control of marihuana and marihuana concentrate.

Classifies industrial hemp as an agricultural product subject to regulation by the commissioner of agriculture through licensed industrial hemp production associations. Requires that prior to licensing by the Department of Agriculture, an industrial hemp production association must first demonstrate to the director of the Colorado Bureau of Investigation (CBI) that its by-laws and procedures adequately and safely control the production of industrial hemp. Requires the commissioner to set fees for such licenses by rule and directs that such fees be credited to the hemp production cash fund, created in this act. Requires persons growing industrial hemp to register with an approved industrial hemp production association and to comply with any applicable federal law prior to growing industrial hemp under this act.

Permits planting no more than forty acres of industrial hemp in Colorado in 1996 for agricultural, commercial, and scientific research. Requires that the commissioner of agriculture determine the number of acres that may be planted in 1997 after consultation with any industrial hemp production associations and the director of the CBI. Allows full scale commercial production of industrial hemp to begin in 1998. Orders the commissioner of agriculture to submit a written report in 1996 and 1997 to the general assembly that describes industrial hemp production in the state and recommends any necessary amendments to this act.

Provides that this act not interfere with the strict control of marihuana and that no person may use this act as an affirmative defense to any state or federal prosecution for violation of marihuana control laws if that person is not also in compliance with the provisions in this act.

Be it enacted by the General Assembly of the State of Colorado:

Section 1. Title 35, Colorado Revised Statues, 1984 Repl. Vol., as amended, is amended BY THE ADDITION OF A NEW artICLE to read:

artICLE 27.5

Hemp Production Act

35-27.5-101. Short Title.

This article shall be known and may Be cited as the "Industrial Hemp Production Act".

35-27.5-102. Legislative Declaration.

THE GENERAL ASSEMBLY HEREBY FINDS, DETERMINES AND DECLARES THAT THE COMMERCIALIZATION OF INDUSTRIAL HEMP IS IN THE BEST INTEREST OF THE STATE ECONOMY AND THAT THE PRODUCTION OF INDUSTRIAL HEMP CAN BE REGULATED TO MAINTAIN COMPLIANCE WITH ALL STATE AND FEDERAL MARIHUANA CONTROL LAWS AND IS CONSISTENT WITH THE UNITED STATES' OBLIGATIONS UNDER INTERNATIONAL TREATIES, CONVENTIONS AND PROTOCOLS. THE GENERAL ASSEMBLY DECLARES THAT THE PURPOSE OF THIS LAW IS TO PROMOTE THE PUBLIC HEALTH, SAFETY AND WELFARE BY PERMITTING THE DEVELOPMENT OF AN INDUSTRIAL HEMP INDUSTRY WHILE MAINTAINING THE STRICT CONTROL OF MARIHUANA.

35-27.5-103. Definitions.

AS USED IN THIS artICLE, UNLESS THE CONTEXT OTHERWISE REQUIRES:
  1. "COMMISSIONER" MEANS THE COMMISSIONER OF AGRICULTURE.
  2. "DIRECTOR" MEANS THE DIRECTOR OF THE COLORADO BUREAU OF INVESTIGATION.
  3. "GROWER" MEANS ANY PERSON WHO PRODUCES INDUSTRIAL HEMP.
  4. "HEMP PRODUCTS" MEANS ALL PRODUCTS MADE FROM INDUSTRIAL HEMP INCLUDING, BUT NOT LIMITED TO CLOTH, CORDAGE, FIBER, FOOD, FUEL, PAINT, PAPER, PartICLE BOARD, PLASTICS OR SEED FOR CONSUMPTION OR CULTIVATION.
  5. "INDUSTRIAL HEMP" MEANS ALL PartS AND VARIETIES OF THE PLANT CANNABIS SATIVA, WHETHER GROWING OR NOT, THAT CONTAIN LESS THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT. "INDUSTRIAL HEMP" IS SEPARATE AND DISTINCT FROM "MARIHUANA" OR "MARIJUANA".
  6. "INDUSTRIAL HEMP PRODUCTION ASSOCIATION" MEANS ANY BUSINESS ENTITY EXISTING AND RECOGNIZED UNDER THE LAWS OF THIS JURISDICTION THAT IS LICENSED TO PRODUCE INDUSTRIAL HEMP BY THE COMMISSIONER OF AGRICULTURE.
  7. "MARIHUANA" OR "MARIJUANA" MEANS ALL PartS OF THE PLANT CANNABIS SATIVA, THE PLANT CANNABIS INDICA, OR THE PLANT CANNABIS RUDERALIS, WHETHER GROWING OR NOT, THE RESIN EXTRACTED FROM ANY Part OF THE PLANT, AND EVERY COMPOUND, MANUFACTURE, SALT, DERIVATIVE, MIXTURE, OR PREPARATION OF THE PLANT OR ITS RESINS THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT.
  8. "MARIHUANA CONCENTRATE" MEANS HASHISH, TETRAHYDROCANNABINOLS, OR ANY ALKALOID, SALT, DERIVATIVE, PREPARATION, COMPOUND, OR MIXTURE, WHETHER NATURAL OR SYNTHESIZED THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT.
  9. "PERSON" MEANS ANY PERSON, PartNERSHIP, SOLE PROPRIETOR, ASSOCIATION, OR CORPORATION.
  10. "RECORDS" MEANS ALL COMMERCIAL DOCUMENTS RELATED TO THE PRODUCTION OF INDUSTRIAL HEMP INCLUDING, BUT NOT LIMITED TO ACCOUNTS AND CORRESPONDENCE, DECLARATIONS, PURCHASE ORDERS, REGISTERS, SEED INVOICES, AND TETRAHYDROCANNABINOL CONCENTRATION ANALYSIS REPORTS.
  11. "TETRAHYDROCANNABINOLS" SHALL HAVE THE SAME MEANING AS SET FORTH IN SECTION 12-22-303 (32), C.R.S.

35-27.5-104. Industrial Hemp As An Agricultural Product.

GROWING, PRODUCING, POSSESSING, AND ENGAGING IN COMMERCE IN INDUSTRIAL HEMP SHALL BE PERMITTED IN THE STATE OF COLORADO PURSUANT TO THE PROVISIONS OF THIS artICLE. INDUSTRIAL HEMP SHALL BE CLASSIFIED AS AN AGRICULTURAL PRODUCT AND SHALL BE SUBJECT TO REGULATION BY THE COMMISSIONER UNDER THIS artICLE.

35-27.5-105. Licensing, CBI Approval, Application, Fees, Cash Cund.

  1. ANY BUSINESS ENTITY EXISTING AND RECOGNIZED UNDER THE LAWS OF THIS JURISDICTION THAT ENGAGES IN THE PRODUCTION OF INDUSTRIAL HEMP WITHIN THIS STATE SHALL BE LICENSED BY THE COMMISSIONER AS AN INDUSTRIAL HEMP PRODUCTION ASSOCIATION. A LICENSE SHALL NOT BE TRANSFERABLE AND SHALL EXPIRE ONE YEAR AFTER IT IS ISSUED.
  2. AS A PREREQUISITE TO LICENSING BY THE COMMISSIONER, AN INDUSTRIAL HEMP PRODUCTION ASSOCIATION MUST FIRST DEMONSTRATE TO THE DIRECTOR THAT IT TAKES ADEQUATE STEPS TO ENSURE THE SAFE PRODUCTION OF INDUSTRIAL HEMP. SUCH STEPS MAY INCLUDE:
    1. REGISTERING ONLY THOSE FARMERS WITH A DEMONSTRATED INTENT AND ABILITY TO FARM. SUCH INTENT MAY BE DEMONSTRATED BY FILING EVIDENCE OF FINANCIAL RESPONSIBILITY IN THE FORM OF A SAVINGS ACCOUNT, DEPOSIT, OR CERTIFICATE OF DEPOSIT MEETING THE REQUIREMENTS OF SECTION 11-35-101, C.R.S., OR AN IRREVOCABLE LETTER OF CREDIT MEETING THE REQUIREMENTS OF SECTION 11-35-101.5, C.R.S., OR AN APPROVED SURETY BOND IN THE SUM OF NOT LESS THAN TWO THOUSAND DOLLARS WITH THE INDUSTRIAL HEMP PRODUCTION ASSOCIATION FOR THE USE AND BENEFIT OF ANY PERSON OR THE STATE OF COLORADO SUFFERING LOSS OR DAMAGE FROM VIOLATIONS OF THIS artICLE OR TO COVER THE COST OF DESTROYING ANY INDUSTRIAL HEMP CROP THAT IS NOT IN COMPLIANCE WITH THIS artICLE.
    2. CONTROLLING THE SUPPLY OF INDUSTRIAL HEMP SEEDS TO ENSURE THAT ONLY THOSE VARIETIES THAT MEET THE TETRAHYDROCANNABINOL LIMITATIONS IN THIS artICLE ARE CULTIVATED.
    3. PERIODICALLY INSPECTING AND TESTING THE INDUSTRIAL HEMP CROP FOR TETRAHYDROCANNABINOL CONTENT TO ENSURE COMPLIANCE WITH THIS artICLE AND PROVIDING FOR SANCTIONS OR SUSPENSION OF MEMBERS WHO ARE REPEATEDLY OUT OF COMPLIANCE.
    4. ENSURING THAT THE AMOUNT OF INDUSTRIAL HEMP PRODUCED BY THE MEMBERS OF THE INDUSTRIAL HEMP PRODUCTION ASSOCIATION DOES NOT EXCEED REASONABLE EXISTING MARKET DEMAND.
    5. REQUIRING THAT MEMBERS TAKE ADEQUATE STEPS TO ENSURE THE INTEGRITY OF THE INDUSTRIAL HEMP CROP WHILE IT IS IN THE FIELD INCLUDING, BUT NOT LIMITED TO DECLARING THE ACREAGE SOWN, PROVIDING FIELD REFERENCE INFORMATION, AND SOWING COVER CROPS TO OBSCURE THE INDUSTRIAL HEMP.
    6. ENSURING THAT ALL PartS OF THE INDUSTRIAL HEMP PLANT NOT ENTERING THE STREAM OF COMMERCE AS HEMP PRODUCTS, SUCH AS FLOWERS AND LEAVES, ARE DESTROYED OR RECYCLED AT THE PLACE OF PRODUCTION.
    7. MAINTAINING RECORDS THAT ACCURATELY REFLECT MEMBERS' COMPLIANCE WITH THE INDUSTRIAL HEMP PRODUCTION ASSOCIATION'S BY-LAWS AND THE PROVISIONS OF THIS artICLE.
  3. AN APPLICATION FOR AN INDUSTRIAL HEMP PRODUCTION ASSOCIATION LICENSE SHALL BE SUBMITTED ON A FORM PRESCRIBED BY THE COMMISSIONER.
  4. THE COMMISSIONER SHALL ESTABLISH BY RULE ANNUAL LICENSE FEES FOR INDUSTRIAL HEMP PRODUCTION ASSOCIATIONS BASED ON THE TOTAL ACREAGE TO BE CULTIVATED.
  5. ALL FEES COLLECTED PURSUANT TO THIS artICLE SHALL BE TRANSMITTED TO THE STATE TREASURER, WHO SHALL CREDIT THE SAME TO THE HEMP PRODUCTION CASH FUND, WHICH FUND IS HEREBY CREATED. THE MONEYS IN THE FUND SHALL BE SUBJECT TO ANNUAL APPROPRIATION BY THE GENERAL ASSEMBLY TO THE DEPartMENT OF AGRICULTURE FOR THE DIRECT AND INDIRECT COSTS OF THE ADMINISTRATION OF THIS artICLE. IN ACCORDANCE WITH SECTION 24-36-114, C.R.S., ALL INTEREST DERIVED FROM THE DEPOSIT AND INVESTMENT OF THIS FUND SHALL BE CREDITED TO THE GENERAL FUND.

35-27.5-106. Registration, Inspections, Record Keeping, Federal Law.

  1. AT LEAST THIRTY DAYS BEFORE PLANTING, EVERY PERSON GROWING INDUSTRIAL HEMP WITHIN THIS STATE SHALL REGISTER WITH A LICENSED INDUSTRIAL HEMP PRODUCTION ASSOCIATION.
  2. THE COMMISSIONER AND THE COMMISSIONER'S AUTHORIZED AGENTS ARE AUTHORIZED, DURING REASONABLE BUSINESS HOURS, WITH OR WITHOUT NOTICE, TO ENTER UPON OR INTO ANY PREMISES, LAND, BUILDINGS OR PLACES WHERE INDUSTRIAL HEMP IS BEING PRODUCED IN ORDER TO MONITOR COMPLIANCE WITH THIS artICLE. THE COMMISSIONER OR AGENT MAY TAKE SAMPLES OF UP TO ONE PERCENT OF THE TOTAL INDUSTRIAL HEMP CROP FOR TETRAHYDROCANNABINOL ANALYSIS.
  3. GROWERS ARE REQUIRED TO KEEP RECORDS FOR AT LEAST THREE YEARS. RECORDS MUST BE PRESENT AT THE SITE WHERE INDUSTRIAL HEMP IS PRODUCED AND MUST BE PRESENTED FOR INSPECTION BY THE COMMISSIONER OR THE COMMISSIONER'S AUTHORIZED AGENT UPON REQUEST.
  4. PRIOR TO PLANTING ANY INDUSTRIAL HEMP AS AUTHORIZED UNDER THE PROVISIONS OF THIS artICLE, EVERY GROWER MUST FIRST COMPLY WITH ALL EXISTING FEDERAL LAW REGULATING SUCH CULTIVATION.

35-27.5-108. Revocation and Suspension of License.

  1. PURSUANT TO THE PROVISIONS OF artICLE 4 OF TITLE 24, C.R.S., THE COMMISSIONER MAY DENY, SUSPEND, REVOKE, OR REFUSE TO RENEW THE LICENSE OF ANY INDUSTRIAL HEMP PRODUCTION ASSOCIATION THAT:
    1. MAKES A FALSE STATEMENT OR MISREPRESENTATION ON AN APPLICATION FOR A LICENSE OR RENEWAL OF A LICENSE;
    2. HAS FAILED TO COMPLY WITH OR VIOLATED ANY PROVISION OF THIS artICLE OR ANY RULE PROMULGATED PURSUANT TO THIS artICLE;
    3. HAS FAILED TO TAKE ACTION AGAINST MEMBERS FOUND TO BE IN REPEATED VIOLATION OF THE TETRAHYDROCANNABINOL CONCENTRATIONS ALLOWED IN THIS artICLE.
  2. REVOCATION OR SUSPENSION OF A LICENSE MAY BE IN ADDITION TO, OR IN LIEU OF, ANY PENALTIES OR FINES IMPOSED ON INDUSTRIAL HEMP PRODUCTION ASSOCIATIONS, OR INDIVIDUAL MEMBERS, PURSUANT TO SECTION 18-18-406, C.R.S.

35-27.5-109. Rule Making.

THE COMMISSIONER MAY PROMULGATE RULES NECESSARY FOR THE ADMINISTRATION AND ENFORCEMENT OF THIS artICLE. SUCH RULES SHALL BE PROMULGATED IN ACCORDANCE WITH artICLE 4 OF TITLE 24, C.R.S.

35-27.5-110. Authorized Acreage Under Cultivation, Commissioner's Report.

  1. Authorized Acreage
    1. DURING THE 1996 GROWING SEASON, THE COMMISSIONER MAY AUTHORIZE THE CULTIVATION OF NO MORE THAN FORTY ACRES OF INDUSTRIAL HEMP IN THIS STATE FOR AGRICULTURAL, COMMERCIAL, AND SCIENTIFIC RESEARCH. ALL INDUSTRIAL HEMP CULTIVATED UNDER THIS artICLE MAY BE SOLD FOR A PROFIT BY THE INDUSTRIAL HEMP PRODUCTION ASSOCIATIONS.
    2. THE COMMISSIONER, AFTER CONSULTATION WITH ANY INDUSTRIAL HEMP PRODUCTION ASSOCIATIONS AND THE DIRECTOR, SHALL DETERMINE THE AMOUNT OF INDUSTRIAL HEMP THAT IS CULTIVATED DURING THE 1997 GROWING SEASON.
    3. BEGINNING IN 1998, THE INDUSTRIAL HEMP PRODUCTION ASSOCIATIONS SHALL BE PERMITTED TO DETERMINE THE AMOUNT OF INDUSTRIAL HEMP THAT THEY BRING UNDER CULTIVATION BASED ON EXISTING MARKET DEMAND.
  2. ON OR BEFORE DECEMBER 31, 1996 AND AGAIN, ON OR BEFORE DECEMBER 31, 1997 THE COMMISSIONER SHALL SUBMIT A WRITTEN REPORT TO THE GENERAL ASSEMBLY THAT DESCRIBES THE COMMERCIALIZATION OF INDUSTRIAL HEMP IN THIS STATE AND THAT RECOMMENDS ANY NECESSARY AMENDMENTS TO THIS artICLE.

35-27.5-111. Controlled Substance Laws Relating to Marihuana, Affirmative Defenses.

  1. EXCEPT AS THE DEFINITIONS OF "MARIHUANA" AND "MARIHUANA CONCENTRATE" IN SECTION 12-22-303 (17) AND (18), C.R.S., AND SECTION 18-18-102 (18) AND (19), C.R.S., ARE AMENDED BY SENATE BILL 96-___, ALL LAWS CONCERNING THE STRICT CONTROL OF MARIHUANA AND MARIHUANA CONCENTRATE AS A CONTROLLED SUBSTANCE SHALL REMAIN IN EFFECT. THIS artICLE SHALL NOT BE CONSTRUED TO INTERFERE WITH THE ENFORCEMENT OF SECTION 18-18-106, C.R.S.
  2. NO PERSON SHALL USE THIS artICLE AS AN AFFIRMATIVE DEFENSE TO CRIMINAL PROSECUTION FOR VIOLATION OF ANY STATE OR FEDERAL MARIHUANA CONTROL LAWS IF THAT PERSON IS NOT ALSO IN COMPLIANCE WITH THE PROVISIONS OF THIS artICLE. ANY PERSON WHO CULTIVATES OR ATTEMPTS TO CULTIVATE INDUSTRIAL HEMP WITHOUT THE APPLICABLE REGISTRATION SHALL BEAR THE BURDEN OF PROVING THAT SUCH MATERIAL IS, IN FACT, INDUSTRIAL HEMP AND NOT MARIHUANA.

SECTION 2. 12-22-303 (17) and (18), Colorado Revised Statutes, 1991 Repl. Vol., are amended to read:

12-22-303. Definitions. As used in this part 3, unless the context otherwise requires:

(17) "Marihuana" or "marijuana" means all parts of the plant cannabis sativa L., whether growing or not, the seeds thereof, the resin extracted from any part of the plant, and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds or its resin It THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT. "MARIHUANA" OR "MARIJUANA" does not include fiber produced from the stalks, oil or cake made from the seeds of the plant, or sterilized seed of the plant which is incapable of germination, if these items exist apart from any other item defined as "marihuana" in this subsection (17). "MARIHUANA" OR "MARIJUANA" DOES NOT INCLUDE INDUSTRIAL HEMP AS DEFINED IN SECTION 35-27.5-103 (5), C.R.S. "Marihuana" does not include marihuana concentrate as defined in subsection (18) of this section.

(18) "Marihuana concentrate" means hashish, tetrahydrocannabinols, or any alkaloid, salt, derivative, preparation, compound, or mixture, whether natural or synthesized, of tetrahydrocannabinols THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT.

SECTION 3. 18-18-102 (18) and (19), Colorado Revised Statutes, 1986 Repl. Vol., as amended, are amended to read:

18-18-102. Definitions. As used in this article:

(18) "Marihuana" or "marijuana" means all parts of the plant cannabis sativa L., whether growing or not, the seeds thereof, the resin extracted from any part of the plant, and every compound, manufacture, salt, derivative, mixture, or preparation of the plant, its seeds, or its resin It THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT. "MARIHUANA" OR "MARIJUANA" does not include fiber produced from the stalks, oil or cake made from the seeds of the plant, or sterilized seed of the plant which is incapable of germination if these items exist apart from any other item defined as "marihuana" in this subsection (18). "MARIHUANA" OR "MARIJUANA" DOES NOT INCLUDE INDUSTRIAL HEMP AS DEFINED IN SECTION 35-27.5-103 (5), C.R.S. "Marihuana" does not include marihuana concentrate as defined in subsection (19) of this section.

(19) "Marihuana concentrate" means hashish, tetrahydrocannabinols, or any alkaloid, salt, derivative, preparation, compound, or mixture, whether natural or synthesized, of tetrahydrocannabinols THAT CONTAINS MORE THAN ONE PERCENT CONCENTRATION OF TETRAHYDROCANNABINOLS BY WEIGHT.

SECTION 4. Effective Date.

This act shall take effect July 1, 1996.

SECTION 5. Safety Clause.

The general assembly hereby finds, determines and declares that this act is necessary for the preservation of the public peace, health, and safety.
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