85R13094 BEF-F
	By: Zedler	H.B. No. 3587

	A BILL TO BE ENTITLED
	AN ACT
	relating to industrial hemp; requiring an occupational license;
	authorizing fees.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1.  Section 61.001(1), Agriculture Code, is amended
	to read as follows:
	(1)  "Agricultural seed" includes the seed of any
	grass, forage, cereal, or fiber crop, any other kind of seed
	commonly recognized in this state as agricultural or field seed,
	and any mixture of those seeds. The term includes the seed of
	industrial hemp, as that term is defined by Section 112.001.
	SECTION 2.  The heading to Subtitle E, Title 5, Agriculture
	Code, is amended to read as follows:
	SUBTITLE E.  PRODUCTION, PROCESSING, AND SALE OF FIBER PRODUCTS
	SECTION 3.  Subtitle E, Title 5, Agriculture Code, is
	amended by adding Chapter 112 to read as follows:
	CHAPTER 112. PRODUCTION OF INDUSTRIAL HEMP
	SUBCHAPTER A. GENERAL PROVISIONS
	Sec. 112.001.  DEFINITIONS. In this chapter:
	(1)  "Collective yield" means a hammer milled,
	pulverized, or ground sample of a whole plant, including roots,
	stalks, leaves, flowers, and seeds.
	(2)  "Compliant use" means the use or recommended use
	of a hemp-derived product with a delta-9 tetrahydrocannabinol
	concentration of not more than 0.3 percent for any purpose,
	including food for human consumption, human application, feed for
	animal consumption, animal application, fiber production, or
	product manufacturing.
	(3)  "Hemp-derived product" includes:
	(A)  a plant segment; and
	(B)  an end product derived from an industrial
	hemp plant or a plant segment, including extract, oil, grain, cake,
	meal, flower, resin, fiber, or hurd.
	(4)  "Industrial hemp" means a plant or any part of a
	plant, whether growing or not, of the species Cannabis sativa L.
	with a delta-9 tetrahydrocannabinol concentration of not more than
	0.3 percent on a dry weight basis.
	(5)  "Institution of higher education" has the meaning
	assigned by 20 U.S.C. Section 1001.
	(6)  "License" means an industrial hemp producer's
	license issued under this chapter.
	(7)  "License holder" means a person who holds a
	license.
	(8)  "Plant segment" means an individual segment of a
	plant, including the roots, stalks, leaves, flowers, or seeds of a
	plant.
	(9)  "THC compliance threshold" means a delta-9
	tetrahydrocannabinol concentration of not more than 0.3 percent:
	(A)  on a dry weight basis for industrial hemp; or
	(B)  in a hemp-derived product.
	Sec. 112.002.  INDUSTRIAL HEMP RESEARCH. The department or
	an institution of higher education may research the cultivation of
	industrial hemp using certified or noncertified seed, cultivars,
	and clones.
	Sec. 112.003.  LEGISLATIVE INTENT REGARDING COMPLIANCE
	RESPONSIBILITIES. It is the intent of the legislature that:
	(1)  license holders be responsible for growing and
	cultivating department-approved, certified industrial hemp seed,
	cultivars, and clones that meet the THC compliance threshold and
	are in compliance with other applicable laws;
	(2)  manufacturers of hemp-derived products for human
	consumption be responsible for meeting the THC compliance threshold
	and complying with applicable food manufacturing laws;
	(3)  manufacturers of hemp-derived products not for
	human consumption be responsible for meeting the THC compliance
	threshold and complying with other applicable laws; and
	(4)  wholesalers, retailers, and consumers of
	hemp-derived products not be responsible for unknowingly buying or
	selling products that do not meet the THC compliance threshold,
	unless the person intentionally or knowingly adulterates the
	product.
	SUBCHAPTER B. POWERS AND DUTIES OF DEPARTMENT
	Sec. 112.051.  RULES. (a) The department shall adopt rules
	to regulate industrial hemp production in this state, including:
	(1)  license application and renewal procedures;
	(2)  requirements for license applicants and license
	holders to provide global positioning system coordinates for each
	location where the person grows or cultivates, or intends to grow or
	cultivate, industrial hemp;
	(3)  plant inspection requirements;
	(4)  procedures to notify law enforcement officials of
	the licensed growth or cultivation of industrial hemp;
	(5)  requirements for license holders to post notice of
	industrial hemp cultivation; and
	(6)  provisions governing acquisition of certified
	seed, cultivars, and clones by license holders and institutions of
	higher education.
	(b)  Rules adopted under this chapter must be comparable to
	similar rules governing the production of other crops.
	Sec. 112.052.  FEES. (a) The department shall prescribe
	reasonable license application and renewal fees, inspection fees,
	and plant sample testing fees in amounts comparable to fees
	associated with the production of other crops.
	(b)  Fees collected under this chapter may be appropriated
	only to the department for the purpose of administering this
	chapter.
	Sec. 112.053.  INSPECTIONS. (a) The department may inspect
	plants grown or cultivated by a license holder to determine whether
	the plants meet the THC compliance threshold and are being grown or
	cultivated in compliance with department rules.
	(b)  Inspections and testing under this chapter shall be
	conducted according to best practices established by the department
	and institutions of higher education.
	SUBCHAPTER C. INDUSTRIAL HEMP PRODUCER'S LICENSE
	Sec. 112.101.  LICENSE REQUIRED. A person may not grow or
	cultivate industrial hemp in this state unless the person is a
	license holder.
	Sec. 112.102.  ISSUANCE OF LICENSE. (a) An applicant for a
	license must apply to the department and pay the required
	application fee.
	(b)  The application must:
	(1)  be notarized to affirm the applicant's identity;
	(2)  include the global positioning system coordinates
	of each location where the applicant will grow or cultivate
	industrial hemp; and
	(3)  include the contact information, including an
	electronic mail address if available, of the sheriff for each
	county where the applicant will grow or cultivate industrial hemp.
	(c)  The department shall issue a license to a qualified
	applicant not later than the 60th day after the date the department
	receives the completed application and the required fee.
	(d)  The department shall send a copy of each license issued
	under this chapter to the sheriff for each county where the license
	holder will grow or cultivate industrial hemp, including the global
	positioning system coordinates of each location where the license
	holder will grow or cultivate industrial hemp.
	Sec. 112.103.  LICENSE TERM. A license is valid for one year
	and may be renewed as provided by department rule.
	Sec. 112.104.  REVOCATION. The department shall revoke a
	license if the department finds that the license holder violated
	this chapter, a rule adopted under this chapter, or is
	intentionally or knowingly growing plants with the intent to
	produce marihuana.
	SUBCHAPTER D.  INDUSTRIAL HEMP SEED, CULTIVARS, AND CLONES
	Sec. 112.151.  SEED, CULTIVAR, AND CLONE CERTIFICATION. (a)
	The department or the State Seed and Plant Board may certify under
	Chapter 61 or 62 industrial hemp seed and industrial hemp plants,
	cultivars, and clones.
	(b)  The department or the State Seed and Plant Board may
	adopt rules necessary to implement this section.
	Sec. 112.152.  ACQUISITION OF SEEDS AND PLANTS. (a) A
	license holder, the department, or an institution of higher
	education may transport and use industrial hemp plants, industrial
	hemp plant clones, and other industrial hemp cultivars from states
	that allow the cultivation of industrial hemp in compliance with
	federal law.
	(b)  The department shall acquire any necessary permits from
	the United States Drug Enforcement Administration to acquire
	industrial hemp seed from domestic and foreign sources.
	Sec. 112.153.  INDUSTRIAL HEMP EXCEEDING THC COMPLIANCE
	THRESHOLD. (a)  The department shall suspend the certification of
	certified industrial hemp seed, cultivars, or clones if the
	collective yield and average samplings from seed, cultivar, or
	clone inspections exceed the THC compliance threshold.
	(b)  Seed, cultivars, or clones for which the collective
	yield and average samplings exceed the THC compliance threshold
	shall be destroyed at the license holder's expense according to
	department rules.
	SUBCHAPTER E. EXCEPTIONS FROM MARIHUANA LAWS FOR INDUSTRIAL HEMP
	Sec. 112.201.  APPLICABILITY OF OTHER LAW. (a) The term
	"marihuana," as defined by Section 481.002, Health and Safety Code,
	does not include:
	(1)  industrial hemp grown or cultivated by the
	department, an institution of higher education, or a license
	holder; or
	(2)  a hemp-derived product that meets the THC
	compliance threshold.
	(b)  Except as provided by Subsection (c), a person does not
	violate Section 481.120, 481.121, 481.122, or 481.125, Health and
	Safety Code, if the person:
	(1)  manufactures, delivers, or possesses a
	hemp-derived product for a compliant use;
	(2)  manufactures, delivers, or possesses equipment
	used for the manufacture or processing of a hemp-derived product
	for a compliant use;
	(3)  grows industrial hemp, without intent, as the
	result of the natural spread of seeds onto property owned or
	controlled by the person; or
	(4)  is the department, an institution of higher
	education, or a license holder and:
	(A)  grows, cultivates, manufactures, delivers,
	or possesses industrial hemp;
	(B)  manufactures, delivers, or possesses
	equipment used for the cultivation or processing of industrial
	hemp; or
	(C)  without intent, grows or cultivates a plant
	from a department-approved, certified seed, cultivar, or clone that
	on inspection is found to exceed the THC compliance threshold if the
	person destroys the plant in accordance with department rules as
	soon as practicable after learning the plant exceeds the THC
	compliance threshold.
	(c)  Subsection (b) does not apply to a person who
	intentionally or knowingly grows a plant or produces a product with
	the intent to produce marihuana.
	SECTION 4.  Section 481.002(26), Health and Safety Code, is
	amended to read as follows:
	(26)  "Marihuana" means the plant Cannabis sativa L.,
	whether growing or not, the seeds of that plant, and every compound,
	manufacture, salt, derivative, mixture, or preparation of that
	plant or its seeds. The term does not include:
	(A)  the resin extracted from a part of the plant
	or a compound, manufacture, salt, derivative, mixture, or
	preparation of the resin;
	(B)  the mature stalks of the plant or fiber
	produced from the stalks;
	(C)  oil or cake made from the seeds of the plant;
	(D)  a compound, manufacture, salt, derivative,
	mixture, or preparation of the mature stalks, fiber, oil, or cake;
	[or]
	(E)  the sterilized seeds of the plant that are
	incapable of beginning germination; or
	(F)  an item described by Section 112.201(a),
	Agriculture Code.
	SECTION 5.  Not later than January 1, 2018, the Department of
	Agriculture shall adopt rules necessary to implement Chapter 112,
	Agriculture Code, as added by this Act.
	SECTION 6.  This Act takes effect September 1, 2017.