May 14, 2021
For years, industrial hemp has played an important role in our nation’s history. From the colonial times when hemp was top cash crop to the 20th century when parachutes used during the D-Day invasion were made from hemp. Today, industrial hemp is used as a fiber to make clothes; it’s used in the car manufacturing process, it can also build buildings and pave roads; and it is widely used for nutrition and wellness in foods, cosmetics and dietary supplements. There is no other commodity on the market that has such a diverse range of use.
Hemp is a non-intoxicating crop that was officially legalized under Federal law when the 2018 Farm Bill was signed into law. Subsequently, tens of thousands of acres have been licensed throughout our country for hemp production by states, territories and tribes as prescribed by law.
Hemp is not intoxicating because the tetrahydrocannabinols in the plant—namely Delta-8 THC and Delta-9 THC—are in such minuscule concentrations that they have no psychoactive effect. When Congress legalized hemp they specified that all hemp products contain no more than 0.3% Delta-9 THC, thus ensuring that no products would contain intoxicating levels of that compound, but the statutory definition was (and remains) silent on the less-intoxicating Delta-8, perhaps because the plant produces it in much smaller quantities than Delta-9. Unfortunately, some in our industry are exploiting that loophole to artificially produce Delta-8 THC in very high concentrations that are orders of magnitude greater than what can feasibly be extracted and concentrated from the plant, let alone found in it naturally.
While NIHC welcomes efforts to address the Delta-8 problem, HB 3000 is chock-full of unintended consequences that would actually open the door to Delta-8 products produced out of state while also effectively decimating Oregon’s own legitimate hemp industry.
NIHC remains steadfast in our position and want to make it abundantly clear to the Oregon state legislature: we believe that psychoactive concentrations of Delta-8 THC should not be allowed into the market as hemp, just as Delta-9 is not. This is one of the main reasons why NIHC continues to urge Congress to modify the federal definition of hemp to include all tetrahydrocannabinols, in line with the recent bipartisan proposal by the National Association of State Departments of Agriculture (NASDA), which would settle this problem conclusively.
However, the bill, H.B. 3000 being considered by the Oregon state legislature unfortunately would not. While NIHC welcomes efforts to address the Delta-8 problem, HB 3000 is chock-full of unintended consequences that would actually open the door to Delta-8 products produced out of state while also effectively decimating Oregon’s own legitimate hemp industry. This is largely due to the provisions in its Section 17, which would require all hemp products for human consumption to be processed and sold only through marijuana manufacturers and dispensaries. The real-world consequence of this would be that Oregon consumers, including teenagers, will turn to on-line purchases from out of state for delivery to doorsteps all across Oregon, not only for hemp products but also Delta-8, while major brands like Sephora, which has popularized CBD-infused cosmetics, would not be able to sell products at their retail locations in Oregon.
NIHC certainly agrees with legislators seeking to keep intoxicating products out of the hands of minors. We also believe in stronger regulations and enforcement measures that would close the Delta-8 loophole of bad actors trying to cash in on the legalization of industrial hemp. But this bill is not the answer; the answer is to enact a change in the Federal definition of hemp to keep Delta-8 out of the hemp market. And while awaiting that change we would encourage Oregon legislators to prohibit Delta-8 at the product level instead, which is a sensible approach to restricting Delta-8 in the marketplace while allowing Oregon’s legitimate hemp industry to remain viable.
At present, most if not all banking service providers take a risk-management approach to hemp business customers that presumes that they may be held liable for their clients’ compliance with USDA regulatory requirements, even though these laws have no explicit bearing on the legality of hemp in commerce. (All hemp is legal for commerce nationwide if it meets the statutory definition of hemp, without regard to the USDA Rule).
