Bill Summary – FastDemocracy

LEGISLATIVE GENERAL COUNSEL                                               S.B. 1006
Approved for Filing: M.E. Curtis 6
          6 05-17-21 5:27 PM 6
                                       HEMP AMENDMENTS
                                     2021 FIRST SPECIAL SESSION
                                            STATE OF UTAH
                                 Chief Sponsor: David P. Hinkins
                             House Sponsor: Jennifer Dailey-Provost
 6
 LONG TITLE
 General Description:
          This bill amends provisions of Title 4, Chapter 41, Hemp and Cannabinoid Act, to
 provide clarity regarding existing and developing cannabinoids and regulate production
 and sale.
 Highlighted Provisions:
          This bill:
          < defines terms;
          < allows industrial hemp producers to procure background checks through a federal
 system;
          < identifies an unlawful act for a person to:
              C   distribute, sell, or market a product that exceeds the acceptable hemp THC
 level;
              C   transport material outside of the state that exceeds the acceptable hemp THC
 level; or
              C   produce, sell, or use a cannabinoid product that is added to food other than a
 dietary supplement, added to an alcoholic beverage, or enticing to children;
          < allows for increased flexibility in dosage forms;
          < provides for registration of a product class rather than individual products; and
                                                                                                       S.B. 1006
          < makes technical and conforming changes.
 Money Appropriated in this Bill:
     *SB1006*
       S.B. 1006                                                                 05-17-21 5:27 PM
        None
 Other Special Clauses:
        This bill provides a special effective date.
 Utah Code Sections Affected:
 AMENDS:
        4-41-102, as last amended by Laws of Utah 2020, Chapters 12 and 14
        4-41-103.2, as enacted by Laws of Utah 2020, Chapter 14
        4-41-104, as enacted by Laws of Utah 2018, Chapter 227
        4-41-105, as last amended by Laws of Utah 2020, Chapter 14
        4-41-204, as enacted by Laws of Utah 2018, Chapter 446
38
 Be it enacted by the Legislature of the state of Utah:
        Section 1. Section 4-41-102 is amended to read:
        4-41-102. Definitions.
        As used in this chapter:
        (1) "Acceptable hemp THC level" means total tetrahydrocannabinol concentration of
 not more than 0.3% on a dry weight basis if laboratory testing confirms a result within a
 measurement of uncertainty that includes the total tetrahydrocannabinol concentration of 0.3%.
        (2) "Cannabidiol" or "CBD" means the cannabinoid identified as CAS# 3556-78-3.
        (3) "Cannabidiolic acid" or "CBDA" means the cannabinoid identified as CAS#
 1244-58-2.
        [(1)] (4) "Cannabinoid product" means [a chemical compound extracted from a hemp]
 any product that:
        [(a) is processed into a medicinal dosage form; and]
        [(b) contains less than 0.3% tetrahydrocannabinol by dry weight.]
        (a) contains or is represented to contain naturally occurring, derivative, or synthetic
 cannabinoids; and
        (b) does not contain more than the acceptable hemp THC level.
        (5) "Delta-9-tetrahydrocannabinol" or "delta-9-THC" means the cannabinoid identified
 as CAS# 1972-08-03, the primary psychotropic cannabinoid in cannabis.
        (6) "Derivative cannabinoid" means any cannabinoid that has been intentionally
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       05-17-21 5:27 PM                                                                      S.B. 1006
 created using a process to convert a naturally occurring cannabinoid into another cannabinoid.
        (7) (a) "Dosage form" means the form in which a product is produced for individual
 dosage that is not specified as unlawful in this chapter.
        (b) "Dosage form" does not include industrial hemp flower.
        [(2)] (8) "Industrial hemp" means any part of a cannabis plant, whether growing or not,
 with a concentration of less than 0.3% tetrahydrocannabinol by dry weight.
        [(3)] (9) "Industrial hemp certificate" means a certificate that the department issues to a
 higher education institution to grow or cultivate industrial hemp under Subsection 4-41-103(1).
        [(4)] (10) "Industrial hemp certificate holder" means a person possessing an industrial
 hemp certificate that the department issues under this chapter.
        [(5)] (11) "Industrial hemp laboratory permit" means a permit that the department
 issues to a laboratory qualified to test industrial hemp under the state hemp production plan.
        [(6)] (12) "Industrial hemp producer license" means a license that the department
 issues to a person for the purpose of cultivating or processing industrial hemp or an industrial
 hemp product.
        [(7)] (13) "Industrial hemp retailer permit" means a permit that the department issues
 to a retailer who sells any industrial hemp product.
        [(8)] (14) "Industrial hemp product" means a product derived from, or made by,
 processing industrial hemp plants or industrial hemp parts.
        (15) "Industrial hemp product class" means a group of industrial hemp or cannabinoid
 products that have ingredients in common, as established by the department under Section
 4-41-204.
        (16) "Key participant" means any individual who has access to raw hemp materials
 within the industrial hemp facility.
        [(9)] (17) "Laboratory permittee" means a person possessing an industrial hemp
 laboratory permit that the department issues under this chapter.
        [(10)] (18) "Licensee" means a person possessing an industrial hemp producer license
 that the department issues under this chapter.
        [(11) "Medicinal dosage form" means:]
        [(a) a tablet;]
        [(b) a capsule;]
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        S.B. 1006                                                                  05-17-21 5:27 PM
        [(c) a concentrated oil;]
        [(d) a liquid suspension;]
        [(e) a sublingual preparation;]
        [(f) a topical preparation;]
        [(g) a transdermal preparation;]
        [(h) a gelatinous cube, gelatinous rectangular cuboid, or lozenge in a cube or
 rectangular cuboid shape; or]
        [(i) other preparations that the department approves.]
        [(12)] (19) "Non-compliant material" means a hemp plant or hemp product that does
 not comply with this chapter, including a cannabis plant or product that contains a
 concentration of 0.3% [tetrahydrocannabinol] total THC or greater by dry weight.
        [(13)] (20) "Permittee" means a person possessing a permit that the department issues
 under this chapter.
        [(14)] (21) "Person" means:
        (a) an individual, partnership, association, firm, trust, limited liability company, or
 corporation; and
        (b) an agent or employee of an individual, partnership, association, firm, trust, limited
 liability company, or corporation.
        [(15)] (22) "Research pilot program" means a program conducted by the department in
 collaboration with at least one licensee to study methods of cultivating, processing, or
 marketing industrial hemp.
        [(16)] (23) "Retailer permittee" means a person possessing an industrial hemp retailer
 permit that the department issues under this chapter.
        [(17)] (24) "State hemp production plan" means a plan submitted by the state to, and
 approved by, the United States Department of Agriculture in accordance with 7 C.F.R. Chapter
 990.
        (25) "Synthetic cannabinoid" means any cannabinoid that:
        (a) was chemically synthesized from starting materials other than a naturally occurring
 cannabinoid; and
        (b) is not a derivative cannabinoid.
        (26) "Tetrahydrocannabinol" or "THC" means a substance derived from cannabis or a
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        05-17-21 5:27 PM                                                                        S.B. 1006
 synthetic cannabinoid equivalent as described in Subsection 58-37-4(2)(a)(iii)(AA).
         (27) "Total cannabidiol" or "total CBD" means the combined amounts of cannabidiol
 and cannabidiolic acid, calculated as "total CBD = CBD + (CBDA x 0.877)."
         (28) "Total tetrahydrocannabinol" or "total THC" means the sum of the determined
 amounts of delta-9 THC and tetrahydrocannabinolic acid, calculated as "total THC = delta-9
 THC + (THCA x 0.877)."
         Section 2. Section 4-41-103.2 is amended to read:
         4-41-103.2. Industrial hemp producer license.
         (1) The department or a licensee of the department may cultivate or process industrial
 hemp.
         (2) A person seeking an industrial hemp producer license shall provide to the
 department:
         (a) the legal description and global positioning coordinates sufficient for locating the
 fields or greenhouses the person uses to grow industrial hemp; and
         (b) written consent allowing a representative of the department and local law
 enforcement to enter all premises where the person cultivates, processes, or stores industrial
 hemp for the purpose of:
         (i) conducting a physical inspection; or
         (ii) ensuring compliance with the requirements of this chapter.
         (3) An individual who has been convicted of a drug-related felony within the last 10
 years is not eligible to obtain an industrial hemp producer license.
         (4) The department may set a fee in accordance with Subsection 4-2-103(2) for the
 application for an industrial hemp producer license.
         (5) A licensee may only market industrial hemp that the licensee cultivates or
 processes.
         (6) (a) Each applicant for a license to cultivate or process industrial hemp shall submit
 to the department, at the time of application, from each key participant:
         (i) a fingerprint card in a form acceptable to the Department of Public Safety;
         (ii) a signed waiver in accordance with Subsection 53-10-108(4) acknowledging the
 registration of the individual's fingerprints in the Federal Bureau of Investigation Next
 Generation Identification System's Rap Back Service; and
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        S.B. 1006                                                                  05-17-21 5:27 PM
         (iii) consent to a fingerprint background check by:
         (A) the Bureau of Criminal Identification; and
         (B) the Federal Bureau of Investigation.
         (b) The Bureau of Criminal Identification shall:
         (i) check the fingerprints the applicant submits under Subsection (6)(a) against the
 applicable state, regional, and national criminal records databases, including the Federal
 Bureau of Investigation Next Generation Identification System;
         (ii) report the results of the background check to the department;
         (iii) maintain a separate file of fingerprints that applicants submit under Subsection
 (6)(a) for search by future submissions to the local and regional criminal records databases,
 including latent prints;
         (iv) request that the fingerprints be retained in the Federal Bureau of Investigation Next
 Generation Identification System's Rap Back Service for search by future submissions to
 national criminal records databases, including the Next Generation Identification System and
 latent prints; and
         (v) establish a privacy risk mitigation strategy to ensure that the department only
 receives notifications for an individual with whom the department maintains an authorizing
 relationship.
         (c) The department shall:
         (i) assess an individual who submits fingerprints under Subsection (6)(a) a fee in an
 amount that the department sets in accordance with Section 63J-1-504 for the services that the
 Bureau of Criminal Identification or another authorized agency provides under this section; and
         (ii) remit the fee described in Subsection (6)(c)(i) to the Bureau of Criminal
 Identification.
         Section 3. Section 4-41-104 is amended to read:
         4-41-104. Product registration required for distribution -- Application -- Fees --
 Renewal.
         (1) An industrial hemp product that is not registered with the department may not be
 distributed in this state.
         (2) A person seeking registration for an industrial hemp product shall:
         (a) apply to the department on forms provided by the department; and
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        05-17-21 5:27 PM                                                                        S.B. 1006
         (b) submit an annual registration fee, determined by the department pursuant to
 Subsection 4-2-103(2), for each industrial hemp product class the person intends to distribute
 in this state.
         (3) The department may conduct tests, or require test results, to ensure that any claim
 made by an applicant about an industrial hemp product is accurate.
         (4) Upon receipt by the department of a proper application and payment of the
 appropriate fee, as described in Subsection (2), the department shall issue a registration to the
 applicant allowing the applicant to distribute the registered hemp product in the state [through
 June 30 of each year] for one year from the date of the payment of the fee, subject to
 suspension or revocation for cause.
         (5) The department shall mail, either through the postal service or electronically, forms
 for the renewal of a registration to a registrant at least 30 days before the day on which the
 registrant's registration expires.
         Section 4. Section 4-41-105 is amended to read:
         4-41-105. Unlawful acts.
         (1) It is unlawful for a person to:
         (a) cultivate, handle, process, or market living industrial hemp plants, viable hemp
 seeds, leaf materials, or floral materials derived from industrial hemp without the appropriate
 license or permit issued by the department under this chapter[.];
         [(2)] (b) [It is unlawful for any person to] distribute, sell, or market an industrial hemp
 or cannabinoid product that is not registered with the department pursuant to Section
 4-41-104[.];
         (c) distribute, sell, or market an industrial hemp or cannabinoid product that contains
 greater than the acceptable hemp THC level;
         (d) transport outside the state extracted material or final product that exceeds the
 acceptable hemp THC level;
         (e) produce, sell, or use a cannabinoid product that is:
         (i) added to a conventional food unless the product is marketed and sold as a dietary
 supplement, as that term is defined in 21 U.S.C. Sec. 321;
         (ii) added to an alcoholic beverage; or
         (iii) marketed or manufactured to be enticing to children, as the department specifies in
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        S.B. 1006                                                                   05-17-21 5:27 PM
 rule in accordance with Section 4-41-204; or
         (f) distribute, sell, or use industrial hemp flower.
         [(3)] (2) The department may seize and destroy non-compliant material.
         [(4)] (3) Nothing in this chapter authorizes any person to violate federal law,
 regulation, or any provision of this title.
         Section 5. Section 4-41-204 is amended to read:
         4-41-204. Department to make rules regarding cultivation and processing.
         The department shall make rules, in accordance with Title 63G, Chapter 3, Utah
 Administrative Rulemaking Act:
         (1) to ensure:
         (a) cannabis cultivated in the state pursuant to this chapter is cultivated from
 state-approved seed sources; and
         (b) a private entity contracted to cultivate cannabis has sufficient security protocols;
 [and]
         (2) governing an entity that puts cannabis into a [medicinal] dosage form, including
 standards for health and safety[.];
         (3) regarding what constitutes a product that is marketed or manufactured to be
 enticing to children; and
         (4) to establish industrial hemp product classes or the characteristics that constitute an
 industrial hemp product class in a way that reduces product registration fees and streamlines
 the product registration process.
         Section 6. Effective date.
         If approved by two-thirds of all the members elected to each house, this bill takes effect
 upon approval by the governor, or the day following the constitutional time limit of Utah
 Constitution, Article VII, Section 8, without the governor's signature, or in the case of a veto,
 the date of veto override.
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Statutes affected: 
Introduced: 4-41-102, 4-41-103.2, 4-41-104, 4-41-105, 4-41-204