After successfully pushing for an extended comment period to allow Upstate New York hemp farmers to share their concerns with the final rule, U.S. Senator Charles E. Schumer today called on the United States Department of Agriculture (USDA) to delay the issuance of a U.S. Domestic Hemp Production Program final rule until 2022 and allow hemp growers and producers across the country and in Upstate New York to continue to operate under the 2014 Farm Bill pilot program regulations until that time. Schumer said with the economic devastation of the COVID-19 pandemic across all sectors, implementing additional regulations would crush the budding hemp industry.
“When it comes to an industry as promising as industrial hemp in Upstate New York, the feds must do everything they can to nurture its potential. Regulating this rapidly-emerging industry is a must, but the timing of new regulations is important and the current economic crisis must be considered,” said Senator Schumer. “That’s why today I’m urging USDA to delay their issuance of a final rule until 2022 so the hemp industry across the country and in Upstate New York has a chance to grow and create good-paying jobs at a time when jobs are needed the most. Delaying new regulations will help pull New York along in the recovery process as the nation deals with the impacts of the pandemic.”
Allan Gandelman, President of New York Cannabis Growers and Processors Association said, “There are over 700 registered hemp farmers across New York who would be negatively affected by the USDA’s Interim Final Rule on hemp. The costs and bureaucracy of implementing the new rules as written create unnecessary financial burdens on farmers and our state agencies. The existing hemp pilot program has been sufficient in making sure farmers are complaint with all testing and public safety protocols. We would like to see the pilot program extended until 2022 and the USDA modify the program to let hemp become a widespread agricultural commodity like Congress intended by the passage of the 2018 Farm Bill.”
Schumer explained, prior to the pandemic, the industrial hemp industry had begun to show significant growth in New York, adding a considerable number of good-paying jobs and bringing in significant revenue to the state, making it an indispensable crop in New York’s agricultural future. Operating under the full benefits of the 2018 Farm Bill, hemp farmers have reported difficulty integrating the Interim Final Rules into their operations, Specifically, Schumer said, the cost of complying with the Rules has proven to be suffocating for the emerging industry. Compliance costs for reporting alone would be $17,363.40 according to USDA calculations, and testing would add over $700 per sample.
The senator said these costs are simply too high for the budding industry to shoulder at a time when New York and the entire country is experiencing an economic crisis. Additionally, Schumer noted, implementing the Interim Final Rules now, also requires states to alter their Pilot Program budgets to meet standards, something which states slammed with COVID-related issues simply cannot spare the time and resources for.
Schumer also pointed out in light of COVID concerns, the timing and testing outlined in the Interim Final Rules would likely push farmers to rush harvests and increase the number of people working in facilities at once, leading to higher risk of COVID transmission among workers. The senator says that delaying implementation until January 2022 and allowing states to continue operating under the 2014 Farm Bill will address these issues, protecting both the hemp industry in New York and farm workers from potential COVID spread.
Senator Schumer’s letter to USDA Secretary Perdue appears below:
Dear Secretary Perdue,
I write in regard to deep concerns that USDA’s U.S. Domestic Hemp Production Program Interim Final Rules will hinder the advancement of the hemp industry and create significant compliance costs both for State Governments and producers. Despite these concerns being reflected in the numerous comments submitted on behalf of industry trade groups, businesses, and State Agriculture Departments during the extended public comment period, no significant changes were made. As you know, the 2018 Farm Bill removed federal regulatory restrictions from industrial hemp production, manufacturing, and sales with the intent of developing a new agricultural commodity for United States farmers. The timing of implementation of the Interim Final Rules, especially during the COVID crisis, will create extreme disruption in this nascent industry. I ask that you delay the issuance of a final rule until January 2022 and allow states to continue to operate under the 2014 Farm Bill pilot program authority until then.
In New York, the industrial hemp industry has started to grow significantly, with new farms and businesses emerging and existing ones expanding operations. This has brought considerably better paying jobs and revenue to Upstate New York, making industrial hemp a critical new part of the state’s agricultural future. However, as industrial hemp farmers and businesses explore the full benefits of the 2018 Farm Bill, they have experienced serious difficulty integrating the Interim Final Rules into their operations. Particularly in the current COVID climate, I see many farmers and processors in New York struggle with incorporating these changes into the existing state Pilot Programs. In a time when farmers and producers struggle with economic uncertainty, the implementation of the Interim Final Rules will create costs without the support of offsetting revenues. USDA calculated compliance costs for reporting alone of $17,363.40 with testing adding approximately an additional $714.50 per sample (see 7 CFR Part 990, 58537 and 58545).
These costs do not just impact businesses across the United States but also state budgets that must alter their Pilot Programs to meet the demands of the Interim Final Rules. With bandwidth completely consumed by COVID concerns, the state regulatory agencies cannot focus on implementation of the Interim Final Rules. At this point, only 19 states have approved plans in place and enforcement efforts will deal a significant economic blow to the industry.
Lastly, I have concerns that the Interim Final Rules will potentially create public health issues in our current COVID environment. As we move into harvest season, farmers will need to operate with as much certainty as possible but timing and testing requirements will likely create bottlenecks that will push farmers to rush harvests. The potential for greater numbers of people working in facilities to meet the rush may create opportunities for COVID to spread among farm workers.
The Interim Final Rules provide a first step in developing regulations for the hemp industry. The critiques from the comment period will provide USDA with areas to consider revisions that further encourage economic opportunity for farmers and producers. However, COVID creates hurdles for states and producers to comply with the Interim Final Rules. Under the circumstances, the Interim Final Rules will harm the very businesses we hoped to help with this new agricultural commodity. We can easily remedy this situation by delaying implementation until January 2022 and allow states to continue under the 2014 Farm Bill until then. This will allow USDA to address some of the more pressing regulatory critiques while giving states and producers additional time to come into compliance.
Once again, I appreciate your efforts to help establish guidelines to develop a thriving American hemp industry. Thank you for your attention to this important matter and please let me know if I can be of any assistance.