SB655 HD1

SECTION 1. The legislature finds that overregulation hinders the growth of the hemp industry, which otherwise could foster sustainable resources and food security in Hawaii, particularly with regard to the fiber, fuel, and seed grain sectors. Hemp seeds are high in essential fatty acids as well as vitamins E, B1, B2, B6, and D; calcium; magnesium; and potassium and contain more digestible proteins than meat, eggs, cheese, and milk, which is expected to drive their demand as a food. Hemp has been used as a biofuel for decades and has been proven to be a soil remediator. There are numerous projects in the State examining ways to make building materials from hemp and using hemp in affordable housing, but most of these projects have to import hemp due to the regulatory barriers to growing hemp in Hawaii.

The legislature further finds that hemp crops look more like traditional grain crops than their psychoactive counterpart, with tight spacing between the stalks, and are easily distinguishable from hemp crops grown for cannabinoids. There is little to zero risk of hemp fiber, fuel, and food grain producers harvesting a crop that exceeds the federal legal limit of 0.3 per cent tetrahydrocannabinol, or THC. The testing and handling requirements that center on regulation increase costs and impede growth of the hemp industry and, in effect, also the development and production of sustainable building materials, cloth, food, and fuel.

The legislature also understands that the United States Congress will be amending federal hemp cultivation laws in the near future to allow for exemptions with industrial hemp crops that are grown for fiber, fuel, or grain for food. The federal exemptions may include relief from testing and transportation requirements. The legislature recognizes the department of agriculture should be allowed to amend hemp cultivation rules to align with federal law when the United States Congress amends federal laws.

Accordingly, the purpose of this Act is to authorize the department of agriculture to amend its rules to align with any federal exemptions for hemp fiber, fuel, and food grain; provided that the rules do not exceed federal law.

SECTION 2. Section 141-42, Hawaii Revised Statutes, is amended to read as follows:

"[[]§141-42[]] Commercial hemp production. (a) It shall be legal for an individual or entity to produce hemp, as defined in title 7 United States Code section 1639o, if that individual or entity has a license to produce hemp, issued by the Secretary of the United States Department of Agriculture pursuant to title 7 United States Code section 1639q; provided that:

(1) Any person convicted of a felony related to a controlled substance under state or federal law is prohibited from producing hemp, or being a key participant in an entity producing hemp, for a period of ten years following the date of conviction;

(2) Hemp shall not be grown outside of a state agricultural district;

(3) Hemp shall not be grown within 500 feet of pre-existing real property comprising a playground, childcare facility, or school; provided that this restriction shall not apply to an individual or entity licensed to grow hemp in those areas under the State industrial hemp pilot program prior to August 27, 2020;

(4) Hemp shall not be grown within 500 feet of any pre-existing house, dwelling unit, residential apartment, or other residential structure that is not owned or controlled by the license holder; provided that this restriction shall not apply to an individual or entity licensed to grow hemp in those areas under the State industrial hemp pilot program prior to August 27, 2020; and

(5) Hemp shall not be grown in any house, dwelling unit, residential apartment, or other residential structure[.], except for a home or dwelling that is part of a United States Department of Agriculture licensed production area.

(b) An individual or entity licensed to produce hemp pursuant to paragraph (a) may transport hemp within the State to a facility authorized by law to process hemp or to another licensed producer's grow area, provided that:

(1) The hemp to be transported has passed all compliance testing required by the United States Department of Agriculture; and

(2) The transportation has been authorized by the department. The department may require movement reports, inspections, sampling, and testing of the hemp to be transported and may deny authorization if the hemp is found to not comply with any law or regulation.

(1) The hemp to be exported has passed all compliance testing required by the United States Department of Agriculture; and

(2) The licensed producer complies with all laws relating to the exportation of hemp, including state and federal laws and the laws of the state or country of import.

(d) Any individual or entity who violates this section or any rule adopted pursuant to this section shall be fined not more than $10,000 for each separate offense. Any notice of violation of this section may be accompanied by a cease and desist order, the violation of which constitutes a further violation of this section. Any action taken to collect the penalty provided for in this subsection shall be considered a civil action.

(e) For any judicial proceeding to recover an administrative penalty imposed by order or to enforce a cease and desist order against a hemp producer, the department may petition any court of appropriate jurisdiction and need only show that:

(1) Notice was given;

(2) A hearing was held or the time granted for requesting a hearing has expired without such a request;

(3) The administrative penalty was imposed on the individual or entity producing hemp; and

(4) The penalty remains unpaid or the individual or entity continues to produce hemp.

(f) The department of agriculture may amend hemp production rules to align with federal exemptions for hemp fiber, fuel, and seed grain crops; provided that the rules shall not exceed federal law on the regulation of hemp production in the State."

SECTION 3. Section 141-43, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

"(a) The department of agriculture shall adopt rules pursuant to chapter 91 to effectuate the purpose of this part[,including any rules necessary to address any nuisance issues, including smell, noise, and excessive lighting arising out of the activities of hemp growers licensed under the State's industrial hemp pilot program who grow hemp within areas prohibited under section 141-42(a)(3) and (4)]. The rules may align with federal exemptions for hemp fiber, fuel, and seed grain crops; provided that the rules shall not exceed federal law on the regulation of hemp production in the State."

SECTION 4. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 5. This Act shall take effect on June 30, 3000.

THE SENATE	S.B. NO.	655
THIRTY-SECOND LEGISLATURE, 2023		S.D. 1
STATE OF HAWAII		H.D. 1