Clearing the Haze: Does the 2018 Farm Bill Legalize CBD in all 50 States or Not?

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After the U.S. House and Senate easily passed the $867 billion 2018 Farm Bill, headlines began cropping up immediately about the language within that officially ends decades of senseless prohibition of the hemp plant.

In doing so, the hemp plant will effectively be removed from the Schedule I definition of ‘marihuana’ in the federal Controlled Substances Act. You may remember that it was the DEA that had the final call on the cannabis-derived CBD anti-seizure medication Epidiolex, assigning it Schedule V status earlier this year while insisting that its parent plant still holds no medicinal value.

This new Farm Bill takes hemp production out from under the thumb of the DEA and passes control over to the Department of Agriculture (USDA).

The USDA will oversee all licensing, cultivation, processing, and manufacturing of hemp products.

When it comes to dietary products, food products, or cosmetic products with any ingredients derived from the hemp plant, the federal Food and Drug Administration (FDA) will be in charge.

Since the Marihuana Tax Act of 1937, the hemp plant has been ignorantly vilified by lawmakers. Though regulations have been eased slightly over the course of the past decade, its Schedule I status always made the plant ineligible for otherwise common benefits like crop insurance and federal agricultural grants and certifications.

That all changes as soon as Trump scribbles his signature on the bill which is expected to happen as soon as this week.

There are many beneficial uses for hemp, but these days most of the headlines swirl around CBD, the non-psychoactive healing cannabinoid that can be bred in relative abundance in hemp plants.

In the wake of the passage of the 2018 Farm Bill we have seen conflicting news stories about just what this new law will mean for the highly popular cannabinoid, particularly on a nationwide scale.

So what about hemp-derived CBD, now that hemp cultivation will be legal?

Once our heads stopped spinning from the whirlwind of varying articles, we decided to go straight to the source.

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Reading directly from Section 297a under Subtitle G in the 2018 Farm Bill, it defines hemp as, “The term ‘hemp’ means 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 2 of isomers, whether growing or not, with a delta-9 3 tetrahydrocannabinol concentration of not more than 0.3 percent on a dry weight basis.” (emphasis ours)

This language makes it very clear that it is not just the plant that is now legal, but also its “derivatives, extracts, and cannabinoids” which obviously includes CBD.

You’ll also notice that, technically, hemp-derived THC was also bumped from Schedule I, as long as it does not exceed 0.3%

Though it seems pretty black and white, unfortunately, there is still quite a bit of grey area.

When it comes to CBD-infused or enhanced foods, beverages, or cosmetic products, the FDA still has full control. The last we heard from them was that they consider CBD to be “impermissible as an ingredient”.

We will likely begin to see a framework of regulation around industrial hemp begin to form in early 2019, but in reality it will probably be 6-12 months before it really takes form.

In that time, the FDA may amend its stance on CBD as an ingredient, but until then, CBD and other hemp extracts do not currently meet certain necessary standards such as being GRAS (Generally Recognized as Safe), mainly because until this bill passes, the plant was being treated like a destructive drug instead of as a multifaceted medicine.

Will this stop the inevitable wave of CBD-infused products from continuing to flood the market in 2019?

No. You’ll still either sink or swim on your own if you’re trying to navigate those waters as a businessperson. As long as products are not making highly visible and truly preposterous claims about curing diseases, the worst they are likely to see is a warning letter from the FDA who has yet to show an appetite for much more “enforcement” than that.

To get the FDA onboard with CBD would not take an act of Congress, or a vote of the people. It is simply their current opinion, and they could change that in hemp’s favor at any time.

The FDA will not comment on pending legislation so, for now, things remain a bit hazy at the federal level.

Will hemp-derived products, particularly CBD, be allowed in all 50 states?

This is another point of confusion that took some digging for us to wrap our heads around.

Each state will be asked to submit an individual plan to the USDA about how they will approach this lucrative new sector of agriculture.

States are not forced to submit a plan.

In fact, referring back to the Farm Bill itself, states are clearly given the right to enact laws regarding hemp cultivation, processing, manufacturing, or selling, that are “more stringent than this subtitle”.

Currently, Idaho, Nebraska, and South Dakota are the only three states that outlaw all forms of “marijuana” and under the 2018 Farm Bill it is their right to continue to do so if they choose.

Our prediction is that intense pressure from their own voting constituents, plus the green envy of seeing the rest of the country reap the many benefits of hemp production, and the newfound wiggle room from the feds will encourage these states to loosen their own laws regarding hemp and hemp-derived CBD.

The best advice is to keep a close watch on your own state’s laws. As we see happening with cannabis, each state will likely put its own twist on legalization.  Get involved!

Does this mean that federal cannabis reform is up next?

Even though the 2018 Farm Bill essentially defines hemp as any part or derivative of cannabis with a THC level below 0.3%, we still feel it will be a while before the feds budge on actual buds.

Sen. Mitch McConnell (R - KY) signs the 2018 Farm Bill with a pen crafted from hemp

Sen. Mitch McConnell (R - KY) signs the 2018 Farm Bill with a pen crafted from hemp

The main reason why hemp legalization made it into this bill at all was due to the support of the senior senator from Kentucky, Republican Mitch McConnell wanted it there.

McConnell is the most powerful member of his party and knows exactly how to manipulate the system to his advantage in almost all situations.

This time, it worked out in our favor.

When asked earlier this year for his opinion about whether hemp legalization is a gateway to federal cannabis reform, McConnell flatly stated “I do not have any plans to endorse the legalization of marijuana,” He later referred to marijuana as hemp’s “illicit cousin” which he says he has chosen “not to embrace”.

Like him or not (we don’t), you better believe him when he says it though, as his track record is pretty strong once he has his mind made up.

We are definitely on our way to following in Canada’s footsteps. Sending prohibitionists like Pete and Jeff Sessions packing was a good start and we need to keep picking off political opponents in 2019.

In conclusion

  • Hemp and all of its extracts and derivatives (CBD) have been removed from Schedule I of the Controlled Substances Act. In fact, hemp has been descheduled completely

  • States will retain full discretion over how (or if) they choose to enact and regulate federal laws surrounding hemp cultivation, processing, manufacturing, and sales

  • Hemp farmers will finally be eligible for federally backed programs like crop insurance, banking services, and other benefits and opportunities

  • There is still some question about how the FDA will treat CBD-infused foods, beverages, and cosmetic products as they currently consider them “impermissible”