Hemp growers and processors are required to register with the state Agency of Agriculture, which plans to use the fees to regulate the industry and test its products.
The crop, a relative of marijuana, was classified as illegal under federal law until late last year, though cultivation in some states, including Vermont, was allowed in recent years. This bill, S.58, would set up a regulatory structure for hemp and hemp products in Vermont now that the federal ban has been lifted.
The proposed fee structure is based on the amount of acreage cultivated for hemp fiber or cannabinoids, and starts at $50 for less than half an acre. Growing 10 to 50 acres would cost $500, and more than 50 acres would set growers back $1,500.
Companies or individuals that process hemp to make hemp-infused products would have to pay $1,500 under the proposal.
Many hemp growers and processors said Friday the fees seem reasonable to them.
“You are definitely the lowest in the country,” said Erica McBride Stark, executive director of the National Hemp Association in Washington, D.C., said of the state’s proposed fee rates. “Most are at least $500.”
Agriculture Committee Chair Sen. Bobby Starr, D-Orleans, a former dairy farmer, said he doesn’t plan to grow any hemp himself. But “it has created a lot of enthusiasm in the rural areas.”
According to Starr, the bill’s sponsor, Sen. John Rodgers, D-Orleans, is a hemp grower.
Hundreds of people have registered about 2,000 acres of land with the Agency of Agriculture for growing hemp.
David Muller, an entrepreneur who has proposed using a state-owned former prison property in Windsor for growing and processing hemp, also had no problem with the fees.
“The reality is that if someone is growing 50 acres of hemp they aren’t going to notice $1,500 and the larger plots will require more work for the state’s surveillance and testing program,” Muller said. “Given the current economics of hemp those fees are quite reasonable.”
The bill proposes to establish policies and procedures for growing, processing, testing and marketing hemp and hemp products in Vermont “that comply with federal law.”
The proposal defines hemp as an agricultural commodity. It defines hemp products or hemp-infused products as all products that contain the federally defined level (now set at .3 percent) for tetrahydrocannabinol, or THC. THC is the psychoactive ingredient in the cannabis plant, and .3 percent is a level now generally seen as too low to produce any psychoactive effects.
The definition of hemp products and hemp-infused products in the bill includes food, cosmetics, personal care products, and plastics. It also includes products that contain cannabinoids, such as CBD, a compound that is promoted as having healing qualities.
The bill also calls for registered growers to describe the location and acreage of all land parcels where the hemp is being grown, although map and coordinate information would be kept private. It allows registered growers to purchase or import hemp genetics from any state that complies with the federal requirements for the cultivation of industrial hemp.
Registering with the state to grow hemp for seed, fiber, grain or textile would cost $100. Registering to grow hemp for compounds such as CBD would be based on acreage.
“The processing and analytics fees are not so onerous as to scare away any entrepreneurs in those fields,” said Dan Chang, co-owner of the South Burlington processing company Kria Botanicals. “I’m sure there will be some angling to lower them, but this is not — in my opinion– an unfair fee schedule,” he said.
The bill will now head to the Senate Finance Committee.
