Bill Text: IA SSB3159 | 2023-2024 | 90th General Assembly | Introduced


Bill Title: A bill for an act providing for the regulation of hemp and hemp products, providing penalties, and making penalties applicable.(See SF 2352.)

Spectrum: Committee Bill

Status: (Introduced) 2024-02-13 - Committee report approving bill, renumbered as SF 2352. [SSB3159 Detail]

Download: Iowa-2023-SSB3159-Introduced.html
Senate Study Bill 3159 - Introduced SENATE/HOUSE FILE _____ BY (PROPOSED DEPARTMENT OF PUBLIC SAFETY BILL) A BILL FOR An Act providing for the regulation of hemp and hemp products, 1 providing penalties, and making penalties applicable. 2 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 3 TLSB 5341XD (5) 90 da/ns
S.F. _____ H.F. _____ DIVISION I 1 IOWA HEMP ACT 2 Section 1. Section 204.2, Code 2024, is amended by adding 3 the following new subsections: 4 NEW SUBSECTION . 01. “Advertise” means to present a 5 commercial message in any medium, including but not limited 6 to print, radio, television, sign, display, label, tag, or 7 articulation. 8 NEW SUBSECTION . 6A. “Distribute” means to transfer 9 possession. 10 NEW SUBSECTION . 15A. “Registrant” means a person who is 11 registered with the department of health and human services 12 pursuant to section 204.7. 13 Sec. 2. Section 204.2, subsection 2, paragraph c, Code 2024, 14 is amended to read as follows: 15 c. A hemp product is deemed to be a consumable hemp product 16 if it is any of the following all of the following apply : 17 (1) It is any of the following: 18 (a) Designed by the processor, including the manufacturer, 19 to be introduced into the human body. 20 (2) (b) Advertised as an item to be introduced into the 21 human body. 22 (3) (c) Distributed, exported, or imported , offered for 23 sale , or distribution sold to be introduced into the human 24 body. 25 (2) Its maximum tetrahydrocannabinol concentration is less 26 than or equal to the maximum tetrahydrocannabinol concentration 27 allowed under section 124.204, subsection 7. 28 Sec. 3. Section 204.2, subsection 14, Code 2024, is amended 29 by striking the subsection. 30 Sec. 4. Section 204.4, subsection 10, paragraph b, Code 31 2024, is amended to read as follows: 32 b. A third violation of a provision of this chapter in 33 a five-year period. The department shall disapprove any 34 application of a person for a five-year period following the 35 -1- LSB 5341XD (5) 90 da/ns 1/ 12
S.F. _____ H.F. _____ date of the person’s last violation in the same manner as 1 provided in section 204.15 . 2 Sec. 5. Section 204.7, subsection 4, Code 2024, is amended 3 to read as follows: 4 4. The department shall adopt rules regulating the 5 production of hemp, including but not limited to inspection 6 and testing requirements under section 204.8 or 204.9 , and the 7 issuance of a temporary harvest and transportation permit or 8 certificate of analysis under section 204.8 . The department 9 shall adopt rules as necessary to administer the negligent 10 violation program. The department may adopt other rules as 11 necessary or desirable to administer and enforce the provisions 12 of this chapter relating to hemp or hemp products. 13 Sec. 6. Section 204.7, subsection 8, paragraph a, 14 subparagraph (3), Code 2024, is amended to read as follows: 15 (3) The consumable hemp product complies with packaging 16 and labeling requirements, which shall be established by rules 17 adopted by the department of health and human services by rule . 18 Sec. 7. Section 204.7, subsection 8, paragraph a, Code 2024, 19 is amended by adding the following new subparagraphs: 20 NEW SUBPARAGRAPH . (4) The consumable hemp product complies 21 with restrictions upon the sale or other distribution of a 22 consumable hemp product established by rules adopted by the 23 department of health and human services. 24 NEW SUBPARAGRAPH . (5) The consumable hemp product meets 25 requirements for total delta-9 tetrahydrocannabinol potency on 26 a per serving and per container basis, as set forth by rules 27 adopted by the department of health and human services. 28 Sec. 8. Section 204.7, subsection 8, Code 2024, is amended 29 by adding the following new paragraph: 30 NEW PARAGRAPH . 0b. (1) A person is engaged in the retail 31 sale of a consumable hemp product, if any of the following 32 apply: 33 (a) The person offers to distribute a consumable hemp 34 product to a consumer in exchange for consideration. 35 -2- LSB 5341XD (5) 90 da/ns 2/ 12
S.F. _____ H.F. _____ (b) The person is an owner of a business that distributes 1 consumable hemp products to consumers in exchange for 2 consideration. 3 (c) The person is a business that distributes consumable 4 hemp products to consumers in exchange for consideration and 5 presents a consumable hemp product to a consumer in the form 6 of a gift. 7 (2) A person, including a business, is engaged in the sale 8 of a consumable hemp product regardless of whether the person 9 is registered with the department of health and human services 10 as provided in this section. 11 Sec. 9. Section 204.11, subsection 3, Code 2024, is amended 12 to read as follows: 13 3. The suspension or revocation of a hemp license is in 14 addition to an order of disposal under section 204.10 ; the 15 imposition of a civil penalty under section 204.12 , subject 16 to the provisions of section 204.15 ; or the imposition of any 17 other civil or criminal penalty authorized under state law. 18 Sec. 10. Section 204.12, Code 2024, is amended to read as 19 follows: 20 204.12 Civil penalties —— general . 21 1. A Unless another civil penalty is otherwise provided in 22 this chapter, a person who violates a provision of this chapter 23 is subject to a civil penalty of not less than five hundred 24 dollars and not more than two thousand five hundred dollars. 25 The department shall impose, assess, and collect the civil 26 penalty. Each day that a continuing violation occurs may be 27 considered a separate offense. 28 2. Notwithstanding subsection 1 , a civil penalty shall not 29 be imposed, assessed, or collected against a licensee who is 30 participating in or has successfully completed the negligent 31 violation program pursuant to section 204.15 . 32 3. 2. All civil penalties collected under this section 33 shall be deposited into the general fund of the state. 34 Sec. 11. Section 204.14A, Code 2024, is amended by adding 35 -3- LSB 5341XD (5) 90 da/ns 3/ 12
S.F. _____ H.F. _____ the following new subsection: 1 NEW SUBSECTION . 1A. A rebuttable presumption exists that a 2 raw or dried flower form of a hemp product is a consumable hemp 3 product intended for introduction into the body of a human by 4 a method of inhalation. 5 Sec. 12. NEW SECTION . 204.14B Sale of consumable hemp 6 product —— failure to register —— civil penalty. 7 1. A person engaged in the retail sale of a consumable 8 hemp product in this state without being registered with the 9 department of health and human services as required in section 10 204.7 shall be subject to a civil penalty of not more than ten 11 thousand dollars. The department of health and human services 12 shall impose, assess, and collect the civil penalty. Each day 13 that a continuing violation occurs may be considered a separate 14 offense. 15 2. All civil penalties collected under this section shall be 16 deposited into the general fund of the state. 17 3. A person in violation of this section is not also subject 18 to a civil penalty as provided in section 204.12. 19 Sec. 13. NEW SECTION . 204.14C Sale of consumable hemp 20 product —— failure to register —— criminal penalty. 21 1. a. A person engaged in the retail sale of a consumable 22 hemp product who is not registered with the department of 23 health and human services as required in section 204.7 commits 24 a serious misdemeanor. 25 b. A person engaged in the retail sale of an item advertised 26 as a consumable hemp product that is not a consumable hemp 27 product commits a serious misdemeanor. 28 2. This section shall be presumed not to be in conflict with 29 or limit a prosecution for a violation of any other provision 30 of law, including but not limited to chapter 124 or 21 U.S.C. 31 ch. 13. 32 Sec. 14. NEW SECTION . 204.14D Persons under legal age —— 33 criminal offense. 34 1. A person shall not sell, give, or otherwise distribute 35 -4- LSB 5341XD (5) 90 da/ns 4/ 12
S.F. _____ H.F. _____ a consumable hemp product to a person under twenty-one years 1 of age. 2 2. A person who violates subsection 1 is guilty of a simple 3 misdemeanor. 4 Sec. 15. NEW SECTION . 204.14E Persons under legal age —— 5 scheduled violation and community service. 6 1. A person under twenty-one years of age shall not consume, 7 possess, purchase, or attempt to purchase a consumable hemp 8 product. 9 2. A person who violates subsection 1 shall be subject to a 10 scheduled violation in the form of a civil penalty pursuant to 11 section 805.8C, subsection 3, paragraph “d” . 12 3. In addition to the imposition of a civil penalty as 13 provided in subsection 2, a person who violates subsection 1 14 shall be subject to a court appearance as provided in section 15 805.10. The court shall sentence the person to perform a 16 specified number of hours of unpaid community service as deemed 17 appropriate by the court subject to the following: 18 a. For a first violation, eight hours, unless waived by the 19 court. 20 b. For a second offense, twelve hours. 21 c. For a third or subsequent offense, sixteen hours. 22 4. A person who violates this section is not subject to a 23 civil penalty as provided in section 204.12. 24 5. A person does not violate subsection 1 by possessing 25 a consumable hemp product if the person is employed by a 26 registrant and the person is possessing the consumable hemp 27 product as part of their employment. 28 Sec. 16. NEW SECTION . 204.14F Persons under legal age —— 29 exception —— cooperation with department of public safety or 30 local law enforcement agency. 31 1. a. A person who would otherwise act to commit an offense 32 under section 204.14D is not guilty of that offense if the 33 person acts under the direction or consent of the department 34 of public safety or a local law enforcement agency as part of 35 -5- LSB 5341XD (5) 90 da/ns 5/ 12
S.F. _____ H.F. _____ an enforcement investigation. 1 b. A person who would otherwise act to commit a violation 2 under section 204.14E is not subject to that offense if the 3 person acts under the direction or consent of the department 4 of public safety or a local law enforcement agency as part of 5 an enforcement investigation. 6 2. In enforcing this section, the department of public 7 safety or a local law enforcement agency shall take all 8 measures necessary to ensure that a consumable hemp product 9 is not introduced into the body of a person under the age of 10 twenty-one. 11 3. Notwithstanding chapter 22, any personal information 12 identifying the person committing an offense or violation as 13 described in this section shall be confidential. 14 Sec. 17. NEW SECTION . 204.15A Hemp products —— order of 15 confiscation and disposal. 16 1. The department of health and human services may order the 17 confiscation and disposal of a hemp product based on any of the 18 following: 19 a. It is falsely advertised, sold, or distributed as a 20 consumable hemp product. 21 b. It exceeds the maximum tetrahydrocannabinol concentration 22 allowed under section 124.204, subsection 7, or this chapter. 23 c. It is a consumable hemp product manufactured, sold, 24 or distributed by a person who is not registered with the 25 department of health and human services as is required in 26 section 204.7. 27 2. The department of health and human services shall act 28 in consultation with the department of public safety. The 29 department of health and human services may request assistance 30 from the department of public safety or a local law enforcement 31 agency as necessary to carry out the provisions of this 32 section. The department of health and human services, upon 33 request, shall deliver any sample of the item to the department 34 of public safety or a local law enforcement agency. 35 -6- LSB 5341XD (5) 90 da/ns 6/ 12
S.F. _____ H.F. _____ 3. A person required to be registered with the department of 1 health and human services as provided in section 204.7 shall 2 pay the department of health and human services all actual 3 and reasonable costs of the destruction of the item. If that 4 department assumes any amount of the costs, it may charge that 5 amount to the person. 6 Sec. 18. Section 805.8C, subsection 3, Code 2024, is amended 7 by adding the following new paragraph: 8 NEW PARAGRAPH . d. (1) For violations of section 204.14E, 9 the scheduled fine is as follows: 10 (a) If the violation is a first offense, the scheduled fine 11 is seventy dollars. 12 (b) If the violation is a second offense, the scheduled fine 13 is one hundred thirty-five dollars. 14 (c) If the violation is a third or subsequent offense, the 15 scheduled fine is three hundred twenty-five dollars. 16 (2) The fine shall be imposed as a civil penalty. 17 (3) The crime services surcharge under section 911.1 shall 18 not be added to the penalty, and the court costs pursuant to 19 section 805.9, subsection 6, shall not be imposed. 20 (4) Notwithstanding section 602.8106 or any other 21 provision to the contrary, any civil penalty paid under this 22 subsection shall be retained by the city or county enforcing 23 the violation. 24 Sec. 19. Section 805.10, subsection 1, Code 2024, is amended 25 by adding the following new paragraph: 26 NEW PARAGRAPH . e. When a violation charged involves the 27 consumption, possession, purchase, or attempt to purchase of 28 a consumable hemp product as provided in section 204.14E, for 29 which there is a community service sentence. 30 Sec. 20. REPEAL. Sections 124.401G, 204.15, and 453B.18, 31 Code 2024, are repealed. 32 DIVISION II 33 REGULATION OF ALCOHOLIC BEVERAGES 34 Sec. 21. Section 123.49, subsection 2, Code 2024, is amended 35 -7- LSB 5341XD (5) 90 da/ns 7/ 12
S.F. _____ H.F. _____ by adding the following new paragraph: 1 NEW PARAGRAPH . l. Sell, give, or otherwise supply any 2 alcoholic beverage containing tetrahydrocannabinol as described 3 in chapter 124, including any isomers, derivatives, or analogs 4 of tetrahydrocannabinol, whether naturally occurring or 5 synthesized, to any person on the licensed premises. 6 Sec. 22. NEW SECTION . 123.49A Restriction on alcoholic 7 beverages containing tetrahydrocannabinol. 8 A holder of a license, permit, or certificate of compliance 9 issued by the department under this chapter shall not 10 manufacture, import, or sell at wholesale in this state an 11 alcoholic beverage containing tetrahydrocannabinol as described 12 in chapter 124, including any isomers, derivatives, or analogs 13 of tetrahydrocannabinol, whether naturally occurring or 14 synthesized. 15 EXPLANATION 16 The inclusion of this explanation does not constitute agreement with 17 the explanation’s substance by the members of the general assembly. 18 BACKGROUND. This bill amends Code chapter 204, the 19 “Iowa Hemp Act” (IHA) (Code section 204.1), authorizing 20 the production of a certain type of cannabis (sativa L.) 21 and the sale of products processed from hemp (Code section 22 204.7). Hemp is defined as composed of a species of cannabis 23 (sativa L.) having a maximum concentration of delta-9 24 tetrahydrocannabinol (THC) that does not exceed three-tenths 25 of 1 percent on a dry weight basis (Code section 204.2). 26 The IHA removed hemp from the list of schedule I controlled 27 substances and the excise tax imposed on the sale of controlled 28 substances (see Code chapters 124 and 453B). The applicable 29 criminal penalty for an offense under those Code chapters 30 ranges from imprisonment for not more than six months or a 31 fine of not more than $1,000 to 50 years imprisonment and a 32 fine of not more than $1 million (see Code sections 124.401 33 and 453B.12). In order for cannabis to be classified as hemp 34 and not a controlled substance, a person must comply with IHA 35 -8- LSB 5341XD (5) 90 da/ns 8/ 12
S.F. _____ H.F. _____ requirements. The IHA in turn must satisfy certification 1 requirements adopted by the United States department of 2 agriculture (USDA) under the federal Agriculture Improvement 3 Act of 2018 (federal hemp law) (Pub. L. No. 115-334), which 4 allows states and tribes to assume primary regulatory 5 authority over its production, including harvest, storage, 6 and distribution. The IHA and the USDA has designated Iowa’s 7 department of agriculture and land stewardship (DALS) as 8 primarily responsible for regulating hemp production in 9 cooperation with the department of public safety (DPS). 10 The IHA defines a hemp product as derived from or made by 11 processing hemp or parts of hemp. Generally, the IHA allows a 12 person to engage in the retail sale of a hemp product so long 13 as the hemp was produced in this state or another state in 14 compliance with the federal hemp law (Code section 204.7). By 15 its own terms, the federal hemp law is not construed to affect 16 or modify certain federal law, including the federal Food, 17 Drug, and Cosmetic Act (21 U.S.C. §301 et seq.). Generally, 18 the United States food and drug administration (FDA) regulates 19 human foods and additives, dietary supplements, drugs, and 20 cosmetics (see 7 U.S.C. §1639r), but the FDA has not adopted 21 a comprehensive regulatory framework. In the meantime, 22 the IHA recognizes a consumable hemp product (CHP) that is 23 metabolized when introduced into the human body, including by 24 ingestion or absorption but excluding inhalation (Code sections 25 204.2 and 204.14A). In this case, the IHA requires a person 26 manufacturing or selling a CHP to register with the department 27 of health and human services (HHS) (Code section 204.7 and 641 28 IAC ch. 156). HHS’s regulations include packaging and labeling 29 requirements. A person violating the IHA is subject to a 30 civil penalty of not less than $500 and not more than $2,000 31 (Code section 204.12). DALS may impose, assess, and collect 32 the civil penalty (Code section 204.12). DALS in cooperation 33 with DPS or a local law enforcement agency (county sheriff or 34 municipal police department) may also confiscate and destroy 35 -9- LSB 5341XD (5) 90 da/ns 9/ 12
S.F. _____ H.F. _____ illegally produced hemp. DALS or the attorney general may seek 1 injunctive relief in order to restrain a person violating the 2 Code chapter by petitioning the district court (Code section 3 204.13). The injunction could address either hemp or a hemp 4 product. 5 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (THC POTENCY). 6 The bill authorizes HHS to adopt rules regulating the sale of 7 consumable hemp products. The bill also authorizes HHS to 8 adopt rules setting forth the THC potency of consumable hemp 9 products on a per serving and per container basis (amended Code 10 section 204.7). 11 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (PRESUMPTION 12 OF GUILT FOR INHALATION OFFENSE). The bill creates a 13 rebuttable presumption that a raw or dried flower form of 14 a hemp product is a consumable hemp product intended for 15 inhalation (amended Code section 204.14A) for purposes of 16 the criminal offense. A person who violates the provision 17 is guilty of a serious misdemeanor, which is punishable by 18 confinement for no more than one year and a fine of at least 19 $430 but not more than $2,560 (Code section 204.14A). 20 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (CRIMINAL AND 21 CIVIL PENALTY FOR FAILURE TO REGISTER). The bill provides 22 that a person engaged in the retail sale of a CHP who is not 23 registered with HHS commits both a serious misdemeanor and 24 is subject to a civil penalty assessed as an administrative 25 remedy (new Code sections 204.14B and 204.14C). The civil 26 penalty cannot exceed $10,000, with each day of a violation 27 constituting a separate offense. 28 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (SALE TO 29 MINORS —— CRIMINAL PENALTY AND SCHEDULED VIOLATION). The bill 30 provides that a person who sells or otherwise distributes 31 a CHP to a person under the age of 21 is guilty of a simple 32 misdemeanor (new Code section 204.14D). A simple misdemeanor 33 is punishable by confinement for no more than 30 days and a 34 fine of at least $105 but not more than $855. The bill also 35 -10- LSB 5341XD (5) 90 da/ns 10/ 12
S.F. _____ H.F. _____ provides that a person under the age of 21 is prohibited from 1 possessing or purchasing a CHP (new Code section 204.14E). The 2 penalty is a scheduled violation. The first offense is subject 3 to a scheduled fine of $75, the second offense is subject to 4 a scheduled fine of $135, and the third and each subsequent 5 offense is subject to a scheduled fine of $325. Each fine is 6 a civil penalty (amended Code section 805.8C). In addition, 7 the person subject to the violation may also be sentenced to 8 perform a number of hours of community service; ranging from 9 8 to 16 hours depending upon the number of previous offenses 10 committed. The bill provides an exception for an offense 11 committed by a person under the age of 21 acting in cooperation 12 with the DPS or a local law enforcement agency (new Code 13 section 204.14F). 14 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (CONFISCATION 15 AND DISPOSAL). The bill authorizes HHS to order the 16 confiscation and disposal of a hemp product under three 17 circumstances: it is falsely advertised, sold, or distributed 18 as a consumable hemp product; it exceeds the maximum THC limit; 19 or it is a consumable hemp product manufactured, sold, or 20 distributed by a person who is not registered as required (Code 21 section 204.7). The person may be assessed costs associated 22 with the order (Code section 204.15A). 23 BILL’S PROVISIONS —— CONSUMABLE HEMP PRODUCTS (REGULATION 24 OF ALCOHOLIC BEVERAGES). The bill regulates persons engaged 25 in the business of selling alcoholic beverages (wine, beer, or 26 spirits) in this state, including under a license, permit, or 27 certificate issued by the department of revenue (Code chapter 28 123). The bill prohibits such a person from manufacturing, 29 selling, giving, importing, or otherwise supplying any 30 alcoholic beverage containing tetrahydrocannabinol. By 31 operation of law, a person violating these provisions is 32 subject to criminal penalties set forth under Code sections 33 123.90 and 123.91. 34 BILL’S PROVISIONS —— ELIMINATION OF THE NEGLIGENT VIOLATION 35 -11- LSB 5341XD (5) 90 da/ns 11/ 12
S.F. _____ H.F. _____ PROGRAM. The IHA provides for a negligent violation program 1 (NVP) as set forth in the federal hemp law. The NVP applies to 2 a qualifying person issued a license by DALS to produce hemp 3 but who unintentionally violates the provisions of the IHA. 4 The NVP allows a participating licensee to avoid a criminal 5 offense or civil violation for producing, possessing, using, 6 harvesting, handling, or distributing the plant cannabis. 7 However, a person does not qualify for the program if the 8 person produced hemp with a THC concentration of more than 2 9 percent (repealed Code section 204.15). The bill eliminates 10 the program. The bill also eliminates certain provisions that 11 shielded from prosecution a producer who produced cannabis 12 in violation of the IHA but who is participating in or has 13 successfully participated in the NVP, including Code chapter 14 124 regulating controlled substances and Code chapter 453B 15 providing for the excise tax on controlled substances (repealed 16 Code sections 124.401G and 453B.18). 17 -12- LSB 5341XD (5) 90 da/ns 12/ 12
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