Bill Text: NY S06612 | 2019-2020 | General Assembly | Introduced

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Bill Title: Relates to the growth of industrial hemp and the regulation of hemp extract and provides for the licensing of cannabinoid related hemp extract and the requirements for such licenses.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2020-01-08 - REFERRED TO AGRICULTURE [S06612 Detail]

Download: New_York-2019-S06612-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          6612

                               2019-2020 Regular Sessions

                    IN SENATE

                                      June 20, 2019
                                       ___________

        Introduced  by  Sen. METZGER -- read twice and ordered printed, and when
          printed to be committed to the Committee on Rules

        AN ACT to amend the agriculture and markets law and  the  public  health
          law,  in  relation to the growth of industrial hemp and the regulation
          of hemp extract; and to repeal certain provisions of  the  agriculture
          and markets law relating thereto

          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:

     1    Section 1. Subdivision 1 of section 505 of the agriculture and markets
     2  law, as added by chapter 524 of the laws of 2014, is amended and  a  new
     3  subdivision 3 is added to read as follows:
     4    1.  "Industrial  hemp" means the plant Cannabis sativa L. and any part
     5  of  such  plant,  including  the  seeds  thereof  and  all  derivatives,
     6  extracts,  cannabinoids,  isomers,  acids,  salts, and salts of isomers,
     7  whether growing or not,  with  a  delta-9  tetrahydrocannabinol  concen-
     8  tration of not more than 0.3 percent on a dry weight basis.
     9    3.  "Hemp  extract"  means any product made or derived from industrial
    10  hemp, including the seeds thereof and all derivatives, extracts,  canna-
    11  binoids, isomers, acids, salts, and salts of isomers, whether growing or
    12  not,  with a delta-9 tetrahydrocannabinol concentration of not more than
    13  an amount determined by the department in regulation, for  the  purposes
    14  of  extracting,  processing  and  manufacturing  such  product  used  or
    15  intended for human or animal consumption  on  use  for  its  cannabinoid
    16  content,  as  determined  by  the  commissioner in regulation. Provided,
    17  however when such product is packaged or  offered  for  sale  that  such
    18  concentration is not more than 0.3 percent delta-9 tetrahydrocannabinol.
    19  Hemp  extract  excludes industrial hemp used or intended exclusively for
    20  an industrial purpose and those food and/or food  ingredients  that  are
    21  generally  recognized  as safe by the department, and shall not be regu-
    22  lated as hemp extract within the meaning of this article.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD13458-01-9
        S. 6612                             2

     1    § 2. Section 506 of the agriculture and markets  law,  as  amended  by
     2  section  1  of  part OO of chapter 58 of the laws of 2017, is amended to
     3  read as follows:
     4    §  506.  Growth,  sale, distribution, transportation and processing of
     5  industrial hemp [and] products derived from such hemp, and hemp extract,
     6  permitted. [Notwithstanding any provision of law to the contrary, indus-
     7  trial] 1. Industrial hemp and products derived from such hemp are  agri-
     8  cultural  products which may be grown, produced [and], possessed [in the
     9  state,  and],  sold,  distributed,  transported  [or]  and/or  processed
    10  [either]  in  [or  out of] state [as part of agricultural pilot programs
    11  pursuant to authorization under federal law and the provisions  of  this
    12  article]   pursuant  to  authorization  under  federal  law  and/or  the
    13  provisions of this article.  [Notwithstanding any provision  of  law  to
    14  the contrary restricting the growing or cultivating, sale, distribution,
    15  transportation  or  processing  of  industrial hemp and products derived
    16  from such hemp, and subject to authorization under federal law, the]
    17    2. The commissioner may authorize the growing or cultivating of indus-
    18  trial hemp as part of  agricultural  pilot  programs  conducted  by  the
    19  department and/or an institution of higher education to study the growth
    20  and  cultivation,  sale,  distribution, transportation and processing of
    21  such hemp [and], products derived from  such  hemp,  and  hemp  extract,
    22  provided  that  the  sites  and programs used for growing or cultivating
    23  industrial hemp are certified by, and registered with, the department.
    24    3. The industrial hemp used for  research  pursuant  to  this  section
    25  shall  be sourced from authorized New York state industrial hemp produc-
    26  ers. The research partner may obtain an  exemption  for  only  grain  or
    27  fiber  from  this requirement upon a satisfactory showing to the depart-
    28  ment that a suitable variety of industrial hemp for the research project
    29  is not grown in New York and/or the use of New York sourced hemp is  not
    30  practicable  for  the  project.    Hemp extract can only be sourced from
    31  authorized New York state industrial hemp  producers,  unless  otherwise
    32  authorized by the department.
    33    4. Nothing in this section shall limit the jurisdiction of the depart-
    34  ment under any other article of this chapter.
    35    §  3. Section 507 of the agriculture and markets law is REPEALED and a
    36  new section 507 is added to read as follows:
    37    § 507. Licensing; fees. 1. No person  shall  grow,  process,  extract,
    38  manufacture,  produce,  distribute and/or sell industrial hemp, products
    39  derived from industrial hemp, or hemp extract, in the state  unless  (a)
    40  licensed biennially by the commissioner or (b) authorized by the commis-
    41  sioner  as  part  of  an agricultural research pilot program established
    42  under this article.
    43    2. Application for a license to grow industrial  hemp  shall  be  made
    44  upon  a  form  prescribed by the commissioner, accompanied by a per-acre
    45  license fee and a non-refundable application  fee  up  to  five  hundred
    46  dollars.
    47    3.  Application  for a license to process, extract, and/or manufacture
    48  hemp extract shall be made upon a form prescribed by  the  commissioner,
    49  accompanied by a license fee, which may be based upon the amount of hemp
    50  extract to be processed, extracted and/or manufactured and a non-refund-
    51  able application fee up to five hundred dollars.
    52    4.  The applicant shall furnish evidence of his or her good character,
    53  experience and competency, that the applicant has  adequate  facilities,
    54  equipment,  process  controls,  testing  capability and security to grow
    55  hemp.
        S. 6612                             3

     1    5. A renewal application shall be submitted  to  the  commissioner  at
     2  least sixty days prior to the commencement of the next license period.
     3    §  4. Section 508 of the agriculture and markets law is REPEALED and a
     4  new section 508 is added to read as follows:
     5    § 508. Compliance action plan. If the commissioner  determines,  after
     6  notice  and  an opportunity for hearing, that a licensee has negligently
     7  violated a provision of and/or a regulation promulgated pursuant to this
     8  article, that licensee shall be required to  comply  with  a  corrective
     9  action  plan established by the commissioner to correct the violation by
    10  a reasonable date and to periodically report to  the  commissioner  with
    11  respect  to  the licensee's compliance with this article for a period of
    12  no less than the next two calendar years following the commencement date
    13  of the compliance action plan. The provisions of this section shall  not
    14  be  applicable to research partners conducting hemp research pursuant to
    15  a research partner agreement, the terms of which shall control.
    16    § 5. Section 509 of the agriculture and markets law is REPEALED and  a
    17  new section 509 is added to read as follows:
    18    §  509.  Granting,  suspending or revoking licenses.  The commissioner
    19  may decline to grant a new license, may decline to renew a license,  may
    20  suspend  or revoke a license already granted after due notice and oppor-
    21  tunity for hearing whenever he or she finds that:
    22    1. any statement contained in  an  application  for  an  applicant  or
    23  licensee is or was false or misleading;
    24    2.  the  applicant  or  licensee  does  not  have  good character, the
    25  required experience and/or competency, adequate  facilities,  equipment,
    26  process  controls, testing capability and/or security to produce hemp or
    27  products derived from hemp, including hemp extract;
    28    3. the applicant or licensee has failed  or  refused  to  produce  any
    29  records  or provide any information demanded by the commissioner reason-
    30  ably related to the administration and enforcement of this article; or
    31    4. the applicant or licensee, or any officer, director, partner, hold-
    32  er of ten percent of the voting stock, or any  other  person  exercising
    33  any  position  of management or control has failed to comply with any of
    34  the provisions of this article  or  rules  and  regulations  promulgated
    35  pursuant thereto.
    36    §  6. Section 510 of the agriculture and markets law is REPEALED and a
    37  new section 510 is added to read as follows:
    38    § 510. Regulations.  The commissioner may develop regulations consist-
    39  ent with the provisions of this article for the growing and cultivation,
    40  processing, extracting, manufacturing, sale, distribution, and transpor-
    41  tation of industrial hemp grown in the state and hemp extract  processed
    42  and/or manufactured in the state, including:
    43    1.  the  authorization  or licensing of any person who may: acquire or
    44  possess industrial hemp plants or seeds; grow  or  cultivate  industrial
    45  hemp plants; and/or sell, purchase, distribute, or transport such indus-
    46  trial hemp plants, plant parts, or seeds;
    47    2. maintaining relevant information regarding land on which industrial
    48  hemp  is  produced  within the state, including the legal description of
    49  the land, for a period of not less than three calendar years;
    50    3. the procedure for testing of industrial hemp produced in the  state
    51  for  delta-9-tetrahydrocannabinol levels, using a representative non-de-
    52  carboxylated sample of flowers and leaves from the whole plant or  other
    53  similarly reliable methods;
    54    4.  the  procedure for effective disposal of industrial hemp plants or
    55  products derived from hemp that are produced in violation of this  arti-
    56  cle;
        S. 6612                             4

     1    5.  a  procedure for conducting at least a random sample of industrial
     2  hemp producers to verify that hemp is not produced in violation of  this
     3  article;
     4    6.  methods  of  producing,  processing,  and  packaging hemp extract;
     5  conditions of sanitation, environmental and energy standards, and stand-
     6  ards of ingredients, quality, and  identity  of  hemp  extract  products
     7  cultivated, processed, packaged or sold by licensees;
     8    7. any required security measures; and
     9    8.  such other and further regulation as the commissioner deems appro-
    10  priate or necessary.
    11    § 7. Section 511 of the agriculture and markets law is REPEALED and  a
    12  new section 511 is added to read as follows:
    13    §  511.  Prohibitions. 1. Except as authorized by state law, and regu-
    14  lations promulgated thereunder,  the  growth,  cultivation,  processing,
    15  sale, and/or distribution of industrial hemp is prohibited.
    16    2.  Except  as  authorized  in this article, the manufacturing of hemp
    17  extract for human or animal consumption and the distribution and/or sale
    18  thereof is prohibited in this state unless the manufacturer is  licensed
    19  under  this  article.  Hemp  extract  and products derived therefrom for
    20  human and animal consumption produced  outside  the  state  may  not  be
    21  distributed  or  sold  in  this state unless they meet all standards and
    22  requirements established for such  product  manufactured  in  the  state
    23  under  this  article  and its rules and regulations as determined by the
    24  department.
    25    § 8. Section 512 of the agriculture and markets law is REPEALED and  a
    26  new section 512 is added to read as follows:
    27    §  512.  Industrial  hemp  data collection and best farming practices.
    28  The commissioner shall have the power to collect and  publish  data  and
    29  research  concerning,  among  other  things,  the  growth,  cultivation,
    30  production and  processing  methods  of  industrial  hemp  and  products
    31  derived from industrial hemp and work with the New York state college of
    32  agriculture  and life science at Cornell pursuant to section fifty-seven
    33  hundred twelve of the education law and the Cornell  cooperative  exten-
    34  sion  pursuant  to  section two hundred twenty-four of the county law to
    35  promote best farming practices for industrial hemp which are  compatible
    36  with state water quality and other environmental objectives.
    37    §  9.  Sections  513  and  514  of the agriculture and markets law are
    38  REPEALED and a new section 513 is added to read as follows:
    39    § 513. Aids to enforcement. 1. The commissioner shall have full access
    40  to all premises, buildings, factories,  farms,  vehicles,  cars,  boats,
    41  airplanes,  vessels,  containers,  packages, barrels, boxes, and/or cans
    42  for the purpose of enforcing the provisions of this article. The commis-
    43  sioner may, at such locations, examine industrial hemp and hemp products
    44  and may open any package and/or container reasonably believed to contain
    45  industrial hemp or hemp products, including hemp  extract  to  determine
    46  whether  such  industrial hemp or hemp products follow applicable law or
    47  regulation.
    48    2. A search warrant shall be issued by any court to which  application
    49  is made therefor, whenever it shall be made to appear to such court that
    50  a licensee has: refused to permit any industrial hemp or hemp extract to
    51  be inspected or samples taken therefrom; refused to permit access to any
    52  premises,  or  place  where  licensed  activities  are conducted; and/or
    53  refused or prevented access thereto by any inspector of  the  department
    54  and  that  such  inspector  has  reasonable grounds to believe that such
    55  person has any industrial hemp or hemp extract in his or her possession,
    56  or under his or her control and/or is in violation of the provisions  or
        S. 6612                             5

     1  regulations  of  this article. In such a case, a warrant shall be issued
     2  in the name of the people, directed to a police officer, commanding  him
     3  or  her  to:  (a) search any place of business, factory, building, prem-
     4  ises,  or  farm where licensed activities have occurred and any vehicle,
     5  boat, vessel, container, package, barrel, box, tub or  can,  containing,
     6  or believed to contain industrial hemp or hemp extract in the possession
     7  or  under  the control of any person who shall refuse to allow access to
     8  such hemp for inspection or sampling,  (b)  permit  the  inspection  and
     9  sampling  of  any industrial hemp or hemp extract found in the execution
    10  of the warrant, as the officer applying for  the  search  warrant  shall
    11  designate  when the same is found, by an inspector or a department offi-
    12  cial authorized by the commissioner  or  by  this  chapter,  and/or  (c)
    13  permit  access to any place where access is refused or prevented, and to
    14  allow and enable a department inspector or other department official  to
    15  conduct  an  inspection  of  the  place.   The provisions of article six
    16  hundred ninety of the criminal procedure law shall apply to such warrant
    17  as far as applicable thereto. The officer to whom the warrant is  deliv-
    18  ered  shall make a return in writing of his or her proceedings thereunto
    19  to the court which issued the same.
    20    3. The commissioner may quarantine industrial  hemp  or  hemp  extract
    21  when  he  or she has reason to believe that such commodity does not meet
    22  the definition thereof, set forth in subdivision  one  of  section  five
    23  hundred  five  of  this article, or is otherwise in violation of or does
    24  not meet a standard set forth in,  applicable  law  or  regulation.  The
    25  quarantine may by the issuance of an order directing the owner or custo-
    26  dian  of  industrial  hemp  not  to distribute, dispose of, or move that
    27  commodity without  the  written  permission  of  the  commissioner.  The
    28  commissioner  may  also  quarantine  a product by placing a tag or other
    29  appropriate marking  thereon  or  adjacent  thereto  that  provides  and
    30  requires  that  such  product  must  not be distributed, disposed of, or
    31  moved without his or her written permission, or may quarantine a product
    32  by otherwise informing the owner or custodian thereof that  such  condi-
    33  tion must be complied with.
    34    4.  The  commissioner  may  seize  industrial  hemp or hemp extract by
    35  taking physical possession of industrial hemp or hemp extract when he or
    36  she has substantial evidence to believe that  such  commodity  does  not
    37  meet  the  definition  thereof,  set forth in subdivision one of section
    38  five hundred five of this article, or is otherwise in violation  of,  or
    39  does not meet a standard set forth in, applicable law or regulation.
    40    5.  Subsequent  to  quarantining  or  seizing  industrial hemp or hemp
    41  extract as authorized in subdivisions three and four  of  this  section,
    42  the  commissioner  shall promptly give the owner or custodian thereof an
    43  opportunity to be heard to show cause why such industrial hemp  or  hemp
    44  extract  should not be ordered destroyed. The commissioner shall, there-
    45  after, consider all the relevant evidence and information presented  and
    46  shall  make a determination whether such industrial hemp or hemp extract
    47  should be ordered to be destroyed; that determination may be reviewed as
    48  provided for in article seventy-eight of  the  civil  practice  law  and
    49  rules.
    50    §  10.  The  agriculture and markets law is amended by adding nine new
    51  sections 515, 516, 517, 518, 519, 520, 521,  522  and  523  to  read  as
    52  follows:
    53    §  515.  Limitations of licensure; duration. 1. No license pursuant to
    54  this article may be issued to a person under the age of eighteen years.
        S. 6612                             6

     1    2. The department shall have the authority to limit, by canopy,  plant
     2  count  or  other  means, the amount of hemp extract allowed to be culti-
     3  vated, processed, extracted or sold by a licensee.
     4    3.  All  licenses  under this article shall expire two years after the
     5  date of issue and be subject to any rules or limitations  prescribed  by
     6  the commissioner in regulation.
     7    § 516. License renewal. 1. Each license, issued pursuant to this arti-
     8  cle,  may  be  renewed upon application therefor by the licensee and the
     9  payment of the fee for such license as prescribed by this article.
    10    2. The department may make such rules as may be necessary, not  incon-
    11  sistent  with  this  chapter,  regarding  applications  for  renewals of
    12  licenses and permits and the time for making the same.
    13    3. The department shall have the authority to  charge  applicants  for
    14  licensure  under this article a non-refundable application fee. Such fee
    15  may be based  on  the  type  of  licensure  sought,  cultivation  and/or
    16  production  volume, or any other factors deemed reasonable and appropri-
    17  ate by the department to achieve the policy and purpose of this chapter.
    18    § 517. Inspections and ongoing requirements. All  licensees  shall  be
    19  subject to reasonable inspection by the department, in consultation with
    20  the  department  of  health,  and a person who holds a license must make
    21  himself or herself, or an agent thereof, available and present  for  any
    22  inspection required by the department. The department shall make reason-
    23  able  accommodations  so  that  ordinary business is not interrupted and
    24  safety and security procedures are not compromised by the inspection.
    25    § 518. Packaging and labeling of hemp extract. 1. The  department,  in
    26  consultation  with  the  department  of  health, is hereby authorized to
    27  promulgate rules and regulations governing the packaging and labeling of
    28  hemp extract products, sold or possessed for sale in New York state.
    29    2. Such regulations shall include, but not be  limited  to,  requiring
    30  labels warning consumers of any potential impact on human health result-
    31  ing  from the consumption of hemp extract products that shall be affixed
    32  to those products when sold, if such labels are deemed warranted by  the
    33  department.  No  label  may  state  that hemp extract can treat, cure or
    34  prevent any disease without approval pursuant to federal law.
    35    3. Such rules and regulations shall establish a QR code which  may  be
    36  used  in  conjunction  with  similar technology for labels and establish
    37  methods and procedures for  determining,  among  other  things,  serving
    38  sizes  for  hemp  extract products, active cannabinoid concentration per
    39  serving size, number of servings per container, and the growing  region,
    40  state  or  country  of  origin if not from the United States. Such regu-
    41  lations shall also require a supplement  fact  panel  that  incorporates
    42  data regarding serving sizes and potency thereof.
    43    4.  The  packaging,  sale,  or  possession by any licensee of any hemp
    44  product intended for human or animal consumption or use not  labeled  or
    45  offered  in conformity with rules and regulations promulgated in accord-
    46  ance with this section shall be grounds for the imposition  of  a  fine,
    47  and/or suspension, revocation or cancellation of a license.
    48    §  519. Provisions governing the growing, manufacturing and extracting
    49  of hemp extract. 1. Cultivators of hemp extract shall comply with  plant
    50  cultivation regulations, standards, and guidelines issued by the depart-
    51  ment, in consultation with the department of environmental conservation.
    52  Such regulations, standards, and guidelines shall be guided by sustaina-
    53  ble  farming principles and practices such as organic, regenerative, and
    54  integrated pest management models, and  shall  restrict  to  the  extent
    55  practicable,  the  use of pesticides, herbicides and fungicides to those
        S. 6612                             7

     1  which are botanical and/or biological pursuant to the federal and  state
     2  organic agriculture rules and regulations.
     3    2.  The nonpharmaceutical or nonmedical production, marketing, sale or
     4  distribution of beverages, food, or food products within the state  that
     5  contain  hemp or any part of the hemp plant, including the seeds and all
     6  naturally occurring  cannabinoids,  compounds,  concentrates,  extracts,
     7  isolates,  terpenes,  resins, isomers, acids, salts, salts of isomers or
     8  cannabidiol derivatives, may not be restricted or prohibited within  the
     9  state  based  solely  on  the  inclusion of hemp or any part of the hemp
    10  plant. Upon request of a processor, manufacturer or seller of beverages,
    11  food or food products that contain hemp or any part of such hemp  plant,
    12  such  as terpenes, that are generally recognized as safe, the department
    13  shall issue a declaration that such products shall not be  regulated  as
    14  hemp extract.
    15    3.  All  hemp  extract products shall be extracted and manufactured in
    16  accordance with good manufacturing processes, pursuant to  Part  111  or
    17  117  of  Title  21 of the Code of Federal Regulations as may be modified
    18  and decided upon by the commissioner in regulation.
    19    § 520. Laboratory testing. 1. The department in consultation with  the
    20  department  of  health  shall  issue  regulations  regarding  laboratory
    21  requirements of hemp extract licensees.
    22    2. Every hemp extract licensee  shall  contract  with  an  independent
    23  laboratory to test the hemp extract products produced by the licensee.
    24    3.  On-site  laboratory  testing by licensees is permissible; however,
    25  such testing shall not be certified  by  the  department  and  does  not
    26  exempt  the  licensee from the requirements of quality assurance testing
    27  pursuant to this section.
    28    § 521. Penalties and violations of this article.  Notwithstanding  the
    29  provision  of  any  law  to the contrary, the failure to comply with the
    30  requirements of this article,  the  rules  and  regulations  promulgated
    31  thereunder,  after notice and opportunity to be heard, may be punishable
    32  by a fine of not more than one thousand dollars for a  first  violation;
    33  not more than five thousand dollars for a second violation; and not more
    34  than  ten  thousand  dollars  for  a third violation and each subsequent
    35  violation thereafter.
    36    § 522. Hemp workgroup. The commissioner shall appoint a New York state
    37  industrial hemp and hemp extract  workgroup,  composed  of  researchers,
    38  producers,  processors,  manufacturers  and  trade associations, to make
    39  recommendations for the industrial hemp and hemp extract programs, state
    40  and federal policies and policy initiatives, and opportunities  for  the
    41  promotion  and marketing of industrial hemp and hemp extract as consist-
    42  ent with federal and state laws, rules and regulations, which  workgroup
    43  shall continue for such time as the commissioner deems appropriate.
    44    §  523. Severability. If any provision of this article or the applica-
    45  tion thereof to any person or circumstances is held invalid, such  inva-
    46  lidity  shall not affect other provisions or applications of the article
    47  which can be given effect without the invalid provision or  application,
    48  and to this end the provisions of this article are declared to be sever-
    49  able.
    50    §  11.  Subdivision  21  of  section 3302 of the public health law, as
    51  added by chapter 878 of the laws of 1972 and as  renumbered  by  chapter
    52  537 of the laws of 1998, is amended to read as follows:
    53    21.  "Marihuana"  means  all parts of the plant of the genus Cannabis,
    54  whether growing or not; the seeds thereof; the resin extracted from  any
    55  part  of  the  plant; and every compound, manufacture, salt, derivative,
    56  mixture, or preparation of the plant, its seeds or resin.  It  does  not
        S. 6612                             8

     1  include  the mature stalks of the plant, fiber produced from the stalks,
     2  oil or cake made from the seeds of the plant, any other compound,  manu-
     3  facture,  salt, derivative, mixture, or preparation of the mature stalks
     4  (except  the  resin  extracted  therefrom),  fiber, oil, or cake, or the
     5  sterilized seed of the plant which is incapable of  germination.  "Mari-
     6  huana"  shall  not include industrial hemp as defined in subdivision one
     7  of section five hundred five of the agriculture and markets law.
     8    § 12. This act shall take effect on January 1, 2020.