OHIO LEGISLATIVE SERVICE COMMISSION
Office of Research Legislative Budget
www.lsc.ohio.gov and Drafting Office
S.B. 57 Final Analysis
133rd General Assembly
Click here for S.B. 57’s Fiscal Note
Version: As Passed by the General Assembly
Primary Sponsors: Sens. Hill and S. Huffman
Effective date: Emergency: July 30, 2019; conforming amendments to future-version statutes
effective September 20, 2019, and March 22, 2020
Effective Date:
Carlen Zhang-D’Souza, Attorney
SUMMARY
 Decriminalizes hemp and hemp products, thereby allowing anyone to (1) buy, sell, or
possess hemp or a hemp product, and (2) cultivate and process hemp, if properly
licensed.
 Requires the Director of Agriculture to submit a plan to regulate hemp cultivation to the
U.S. Secretary of Agriculture for approval.
 If the plan is approved, requires the Director to establish a Hemp Cultivation and
Processing Program to monitor and regulate hemp cultivation and, though not
specifically required under federal law, hemp processing.
 Requires the Director to adopt rules that establish federally compliant standards and
procedures for the program.
 Requires a person who intends to cultivate hemp to obtain a hemp cultivation license
from the Director.
 Requires a person who intends to process hemp into any hemp product to obtain a
hemp processing license from the Director.
 Requires the Director, in consultation with the Governor and the Attorney General, to
adopt rules establishing standards and procedures for the program that comply with
federal law.
 Establishes prohibitions, procedures (including corrective action plan requirements),
and criminal penalties to enforce the program.
 Authorizes the Director, when the Director determines that certain emergency
conditions exist, to issue an order requiring those conditions to be mitigated.
September 16, 2019
Office of Research and Drafting LSC Legislative Budget Office
 Establishes the Hemp Program Fund in the state treasury for the Department of
Agriculture to use to administer and enforce the program.
 Establishes a Hemp Marketing Program.
 Specifically allows land used for hemp farming to be valued according to its current
agricultural use value (CAUV).
 Authorizes, under certain circumstances, the release of hemp and hemp products seized
prior to the act’s effective date.
TABLE OF CONTENTS
Introduction .................................................................................................................................... 2
Hemp decriminalization .................................................................................................................. 3
Hemp Cultivation and Processing Program .................................................................................... 4
Hemp cultivation license and hemp processing license ............................................................. 4
Rules ............................................................................................................................................ 5
Enforcement ................................................................................................................................ 7
Prohibitions ............................................................................................................................ 8
Negligence: corrective action plan ......................................................................................... 8
Recklessness: criminal penalties and prosecution ................................................................. 8
Additional enforcement mechanisms for compliance ........................................................... 9
Release of previously seized hemp ............................................................................................. 9
Adulteration of products ...................................................................................................... 10
Hemp Program Fund ..................................................................................................................... 10
Hemp Marketing Program ............................................................................................................ 10
DETAILED ANALYSIS
Introduction
Hemp is a variety of the plant Cannabis sativa L. (cannabis) that can be used in a variety
of applications, such as paper, textiles, biofuel, animal feed, and personal care products. Both
hemp and marijuana come from the cannabis plant. However, hemp contains a lower
concentration (0.3% or below) of cannabis’s psychoactive constituent, delta-9
tetrahydrocannabinol (THC).
Federal law did not distinguish between hemp and marijuana until the federal
Agriculture Improvement Act of 2018, which: (1) decriminalizes hemp by exempting hemp–
grown in accordance with the federal act from the federal Controlled Substances Act (CSA), and
(2) authorizes states to regulate hemp under specific conditions. The federal act was signed into
law on December 20, 2018. Prior to the federal act, hemp was considered marijuana and was
P a g e |2 S.B. 57
As Passed by the General Assembly
Office of Research and Drafting LSC Legislative Budget Office
classified as a Schedule I controlled substance (meaning it was prohibited and no prescription
could be written for it).
Prior to this act, Ohio did not have any specific laws regarding hemp or hemp products:
both were generally prohibited because hemp was considered marijuana. Thus, hemp was also
considered a Schedule I controlled substance under Ohio law.1
Hemp decriminalization
The act decriminalizes hemp and hemp products, thereby allowing a person to:
1. Buy, sell, or possess hemp or a hemp product;
2. Cultivate and process hemp, provided the person is properly licensed in accordance
with the act.
To decriminalize hemp, the act aligns Ohio’s controlled substance schedules with the
federal CSA by providing for the removal of hemp from the schedules. It also decriminalizes
hemp by excluding hemp and hemp products from both the definition of “drug” in the
pharmacy dangerous drug law and from the definition of “marijuana” in the law governing
controlled substances and its criminal enforcement.2
For purposes of the act, hemp is:
The plant Cannabis sativa L. and any part of that plant, including
the seeds thereof and all derivatives, extracts, cannabinoids,
isomers, acids, salts, and salts of isomers, whether growing or not,
with a delta-9 tetrahydrocannabinol concentration of not more
than 0.3% on a dry weight basis.3
A hemp product is any product made with hemp that contains a delta-9
tetrahydrocannabinol (THC) concentration of not more than 0.3%. This includes cannabidiol,
which is a compound derived from hemp.4
Additionally, the act defines “delta-9 tetrahydrocannabinol,” the psychoactive
component of cannabis, to include both the actual THC amount and the potential THC amount
(tetrahydrocannabinolic acid (THCa)): the sum of the percentage by weight of THCa multiplied
by 0.877 plus the percentage by weight of THC. Otherwise put:
delta-9 tetrahydrocannabinol = THC + (THCa x 0.877)
1
R.C. 3719.01(O) and 3719.41(C)(19) and (27), amended in Section 1. Note that the act amends the
current versions of R.C. 3719.01 and 3719.41 in Section 1 and the future versions of those sections
(R.C. 3719.01(M), 3719.41(C) and (D)) in Section 5.
2
R.C. 3719.01(O), 3719.41(C)(27), and 4729.01(E), amended in Section 1; R.C. 3719.01(M), 3719.41(C)
and (D), 4729.01(E), amended in Section 5.
3
R.C. 928.01(C).
4
R.C. 928.01(F).
P a g e |3 S.B. 57
As Passed by the General Assembly
Office of Research and Drafting LSC Legislative Budget Office
THCa (which is not psychoactive), as it exists in cannabis’s plant form, converts to THC
when heated or dried. As such, the definition encompasses the total potential THC amount.5
Hemp Cultivation and Processing Program
Under the provisions of the federal Agriculture Improvement Act of 2018, hemp and
hemp products may be legally cultivated, produced, and sold under two circumstances:
1. The state submits a plan for hemp regulation to the U.S. Secretary of Agriculture that
complies with the federal act’s requirements; or
2. If the state does not submit a plan and hemp is not prohibited by that state, the
Secretary establishes a plan to monitor and regulate hemp in that state.
In accordance with (1) above, the act requires the Ohio Director of Agriculture, in
consultation with the Governor and Attorney General, to submit a plan to regulate hemp to the
Secretary for approval by January 27, 2020 (180 days after the act’s effective date).6 The state’s
plan must include:
 A way to keep track of land where hemp is cultivated within the state;
 Methods the state will use to test how much THC is in hemp plants;
 A way to dispose of plants or products that have a higher THC concentration than is
legally allowed;
 A procedure for inspecting hemp cultivators;
 Procedures for enforcing the plan;
 A procedure for annual inspections;
 A system for disseminating a hemp cultivator’s information to the U.S. Department of
Agriculture (USDA); and
 Assurances that the state has the resources to carry out the plan.7
Hemp cultivation license and hemp processing license
In response to the federal requirements, the act requires the Director of Agriculture to
establish a Hemp Cultivation and Processing Program to monitor and regulate hemp cultivation.
It also adds additional requirements, not specifically required under federal law, governing the
processing of hemp.
Under the program, the Director must issue hemp cultivation licenses and hemp
processing licenses to eligible applicants. Thus, any person who plants or harvests hemp, and
5
R.C. 928.01(J).
6
Section 7.
7
Agriculture Improvement Act of 2018, Public Law No. 115-334, § 10113.
P a g e |4 S.B. 57
As Passed by the General Assembly
Office of Research and Drafting LSC Legislative Budget Office
processes and stores hemp on the site of cultivation until transported for sale, must obtain a
hemp cultivation license. A person who converts hemp into a hemp product must obtain a
hemp processing license.8 However, a person may possess, buy, or sell hemp or a hemp product
without a license, provided the person is not cultivating or processing the hemp.9
A person seeking to cultivate or process hemp must apply to the Director for a license,
which is valid for three years (unless the Director has suspended or revoked the license).10 But,
as authorized by the Director, the Department of Agriculture or a university may cultivate hemp
or process hemp for research purposes without a license.11
Rules
The Director, in consultation with the Governor and the Attorney General, must adopt
rules that establish standards and procedures to regulate hemp cultivation and processing. The
act incorporates all of the elements required to be included in a state plan by the federal
Agriculture Improvement Act of 2018 and additional elements. The rules must include all of the
following:
 The form of an application for a hemp cultivation license and a hemp processing license,
and information required to be included in each application;
 The amount of the initial application fee and annual license fee that must be submitted
with each application:
 The Director must establish the fees at a rate that does not exceed an amount
sufficient to cover costs the Department incurs to administer and enforce the
program.
 The rate for the application fee and annual license fee must be uniform for all hemp
cultivation licensees.
 Requirements and procedures for applicant background investigations, including a
requirement that a license applicant comply with existing procedures that govern
criminal background checks. (The Bureau of Criminal Identification and Investigation
must conduct the criminal background check, and the Director may not issue a license to
an applicant who fails to comply.)
 Requirements regarding the experience, equipment, facilities, or land necessary to
obtain a hemp cultivation license;
 Requirements and procedures regarding financial responsibility standards for each
applicant for a hemp processing license;
8
R.C. 928.01(B) and (I) and R.C. 928.02.
9
R.C. 928.02(C).
10
R.C. 928.02(B).
11
R.C. 928.02(A).
P a g e |5 S.B. 57
As Passed by the General Assembly
Office of Research and Drafting LSC Legislative Budget Office
 Procedures and requirements for license issuance, renewal, denial, suspension, and
revocation, including providing for an administrative hearing with regard to a license
denial, suspension, or revocation;
 Grounds for license denial, suspension, and revocation, including a requirement that the
Director revoke a person’s hemp cultivation or processing license, for ten years, if the
person pleads guilty to or is convicted of a felony related to a controlled substance;
 A requirement that the Director cannot issue any license to any person who has pleaded
guilty to or been convicted of a felony related to a controlled substance in the ten years
immediately prior to submitting an application;
 A requirement that any person who materially falsifies information in an application is
ineligible to receive either license;
 A practice for maintaining relevant information regarding land on which hemp
cultivation licensees cultivate hemp, including a legal description of the land;
 Requirements prohibiting a hemp cultivation licensee and a hemp processing licensee
from cultivating or processing marijuana, respectively;
 A procedure for testing, using post-decarboxylation or other similarly reliable methods,
the delta-9 THC concentration of plants and products for determining compliance with
the program;
 Requirements and procedures governing hemp byproduct production, storage, and
disposal.
 The act allows a hemp byproduct to exceed a delta-9 THC concentration of 0.3% and
still maintain its status as a hemp product that is exempt from regulation or criminal
enforcement as marijuana.
 The exemption only applies if the byproduct is produced, stored, and disposed of in
accordance with rules.
 Requirements and procedures for the issuance, administration, and enforcement of
corrective action plans (see “Negligence: corrective action plan“);
 A procedure for conducting, at a minimum, random annual inspections of hemp
cultivation license holders and hemp processing license holders to verify that they are in
compliance with the program;
 A procedure for complying with federally required enforcement procedures;
 A procedure for the effective disposal of:
 Plants that violate program requirements;
 Products derived from plants that violate program requirements; and
 Products produced in violation of program requirements;
P a g e |6 S.B. 57
As Passed by the General Assembly
Office of Research and Drafting LSC Legislative Budget Office
 Requirements that prohibit hemp processing in a building used as a personal residence
or on land that is zoned residential;
 Procedures and requirements for transporting and storing hemp and hemp products;
 Procedures for sharing information regarding hemp cultivation license holders with the
USDA;
 A setback distance requirement that specifies how far away a hemp cultivation licensee
must locate hemp plants from a location where medical marijuana is being cultivated.
 This does not apply if a medical marijuana cultivator locates medical marijuana
within the setback distance after the hemp cultivation license holder has already
begun operating.
 Annual reporting requirements and procedures for hemp cultivation license holders and
hemp processing license holders;
 Recordkeeping and documentation mainte