5596 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

1Section 297D(c) of the AMA explicitly preserved 

the authority of the U.S. Food and Drug 

Administration (FDA) to promulgate regulations 

and guidance related to the production of hemp 

under the Federal Food, Drug, and Cosmetic Act (21 

U.S.C. 301 et seq.) (FD&C Act) and section 351 of 

the Public Health Service Act (42 U.S.C. 262) (PHS 

Act). See section 297D(c)(1) (‘‘Nothing in this 

subchapter shall affect or modify . . . the Federal 

Food, Drug, and Cosmetic Act (21 U.S.C. 301 et 

seq.); section 351 of the Public Health Service Act 

(42 U.S.C. 262); or the authority of the 

Commissioner of Food and Drugs and the Secretary 

of Health and Human Services . . . ’’ under those 

Acts). 

2Although the statutory spelling is ‘‘marihuana’’ 

in the Controlled Substances Act, this rule uses the 

more commonly used spelling of marijuana. 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 990 

[Doc. No. AMS–SC–19–0042; SC19–990–2 

FR] 

Establishment of a Domestic Hemp 

Production Program 

AGENCY: Agricultural Marketing Service, 

Department of Agriculture (USDA). 

ACTION: Final rule. 

SUMMARY: This final rule supersedes the 

interim final rule that established the 

Domestic Hemp Production Program, as 

mandated by the Agriculture 

Improvement Act of 2018 (2018 Farm 

Bill). This rule includes regulations 

used by the Department of Agriculture 

(USDA) to approve plans submitted by 

States and Indian Tribes for the 

domestic production of hemp. This rule 

also includes regulations on the Federal 

hemp production plan for producers in 

States or territories of Indian Tribes that 

do not have their own USDA-approved 

plans. The program provides 

requirements for maintaining records 

about the land where hemp is produced, 

testing the levels of total delta-9 

tetrahydrocannabinol, disposing of noncompliant plants, licensing hemp 

producers, and ensuring compliance 

under the new program. 

DATES: This rule is effective March 22, 

2021. 

FOR FURTHER INFORMATION CONTACT: Bill 

Richmond, Branch Chief, U.S. Domestic 

Hemp Production Program, Specialty 

Crops Program, AMS, USDA; 1400 

Independence Ave. SW, Stop 0237, 

Washington, DC, 20250–0237; 

Telephone: (202) 720–2491, Fax: (202) 

720–8938, or Email: 

William.Richmond@usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under the authority of section 

10113 of the 2018 Farm Bill (Pub. L. 

115–334; December 20, 2018), which 

amended the Agricultural Marketing Act 

of 1946, as previously amended (7 

U.S.C. 1621 et seq.) (AMA), by adding 

Subtitle G (sections 297A through 

297E). Section 297B of the AMA 

requires the Secretary of Agriculture 

(Secretary) to evaluate and approve or 

disapprove State or Tribal plans 

regulating the production of hemp. 

Section 297C of the AMA requires the 

Secretary to establish a Federal plan for 

producers in States and territories of 

Indian Tribes not covered by plans 

approved under section 297B. Section 

297D of the AMA requires the Secretary 

to promulgate regulations and 

guidelines relating to the production of 

hemp under sections 297B and 297C in 

consultation with the U.S. Attorney 

General. 

AMS issued an interim final rule (IFR) 

on October 31, 2019 (84 FR 58522), and 

began its initial implementation of the 

program. To date, USDA has approved 

approximately 45 State and Tribal hemp 

plans. However, not all of the States and 

Tribes have implemented their plans for 

various reasons, including the need to 

take additional steps to complete State 

legislative or rulemaking processes or to 

establish the regulatory scheme as well 

as the extension of the 2014 Farm Bill 

Program. Thus, as of November 2020, 

twenty States and nine Tribes have 

submitted reports on their respective 

programs. Based on the reports 

submitted by States and Tribes in 2020, 

producers have planted 6,166 acres 

under the 2018 Farm Bill hemp plans, 

of which approximately 730 acres were 

subject to disposal. 

As of the effective date of this final 

rule, the interim final rule is 

superseded. This final rule replaces the 

IFR at 7 CFR part 990, effective March 

22, 2021. The Agricultural Marketing 

Service (AMS), which has been 

delegated authority to administer the 

U.S. Domestic Hemp Production 

Program, provided multiple 

opportunities for public comment. AMS 

accepted comments during an initial 

comment period from October 31, 2019, 

through December 31, 2019. This initial 

comment period was extended for an 

additional 30 days on December 18, 

2019 (84 FR 69295), ending January 29, 

2020. AMS reopened the comment 

period for 30 additional days on 

September 8, 2020 (85 FR 55363), 

ending October 8, 2020. A total of 

approximately 5,900 comments were 

received during all comment periods 

from States; Indian Tribes; industry and 

agricultural organizations; private 

citizens; members of Congress, the 

scientific community; agencies; and 

individuals involved in the growing, 

processing, transporting and marketing 

of hemp. A summary of the public 

comments received and AMS’s 

responses appear under ‘‘Comment 

Analysis’’ in section IX of this 

document. 

I. Introduction 

Hemp is a commodity with numerous 

industrial and horticultural uses 

including fabric, paper, construction 

materials, food products, cosmetics, 

production of cannabinoids (such as 

cannabidiol or CBD), and other 

products.1 While hemp was produced 

previously in the United States (U.S.) 

for hundreds of years, its use 

diminished in favor of alternatives. 

Hemp fiber, for instance, which had 

been used to make rope and clothing, 

was replaced by less expensive jute and 

abaca imported from Asia. Rope made 

from these materials was lighter, more 

buoyant, and more resistant to saltwater 

than hemp rope, which required tarring. 

Improvements in technology further 

contributed to the decline in hemp use. 

The cotton gin, for example, simplified 

the processing of cotton, which replaced 

hemp in the manufacture of textiles. 

The hemp industry continued in the 

U.S. until the Marihuana Tax Act of 

1938. This Act ended the legal 

production of hemp in the United 

States, and hemp was added to 

Schedule I of the Controlled Substances 

Act (CSA), 21 U.S.C. 801 et seq. Prior to 

the 2018 Farm Bill, all Cannabis sativa 

L., regardless of delta-9 

tetrahydrocannabinol (THC) 

concentration level, fell within the CSA 

definition of ‘‘marihuana’’ unless the 

product fell under a narrow range of 

exceptions (e.g., the ‘‘mature stalks’’ of 

the plant).2 As a result, many aspects of 

domestic production of what is now 

defined as hemp was limited to persons 

registered under the CSA to do so. 

Under the Agricultural Act of 2014 

(2014 Farm Bill), Public Law 113–79, 

State departments of agriculture and 

institutions of higher education were 

permitted to produce hemp as part of a 

pilot program for research purposes. 

The authority for hemp production 

provided in the 2014 Farm Bill was 

extended until January 1, 2022, by the 

Continuing Appropriations Act, 2021, 

and Other Extensions Act (Pub. L. 116– 

260) (2021 Continuing Appropriations 

Act). 

Hemp production in the U.S. has seen 

a resurgence in the last several years. 

Since importation of seed is covered 

under USDA’s Animal and Plant Health 

Inspection Service (APHIS) regulations, 

this final rule does not regulate hemp 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5597 

3We note that if an Alaskan Native Corporation 

wants to produce hemp on land it owns in fee 

simple, it would need to have a State or USDA 

license, whichever is applicable, because that land 

does not qualify as Indian Country and the 

Corporation does not have jurisdiction over that 

land. 

seed imports. APHIS regulates the 

importation of all seeds for planting to 

ensure safe agricultural trade. Hemp 

seeds can be imported into the U.S. 

from Canada if accompanied by either: 

(1) A phytosanitary certification from 

Canada’s national plant protection 

organization to verify the origin of the 

seed and confirm that no plant pests are 

detected; or (2) a Federal Seed Analysis 

Certificate (SAC, PPQ Form 925) for 

hemp seeds grown in Canada. Hemp 

seeds imported into the U.S. from 

countries other than Canada may be 

accompanied by a phytosanitary 

certificate from the exporting country’s 

national plant protection organization to 

verify the origin of the seed and confirm 

that no plant pests are detected. 

This final rule does not address the 

exportation of hemp. Should there be 

sufficient public interest in exporting 

hemp in the future, USDA will work 

with industry and other Federal 

agencies to help facilitate this process. 

The 2018 Farm Bill requires USDA to 

promulgate regulations and guidelines 

to establish and administer a program 

for the production of hemp in the 

United States. Under this new authority, 

a State or Indian Tribe that wants to 

have primary regulatory authority over 

the production of hemp in that State or 

territory of that Indian Tribe may 

submit, for the approval of the 

Secretary, a plan concerning the 

monitoring and regulation of such hemp 

production. For States or Indian Tribes 

without an approved plan, the Secretary 

is directed to establish a Departmental 

plan to monitor and regulate hemp 

production in those areas. 

The 2018 Farm Bill specifies 

requirements that all hemp producers 

must meet. These include licensing 

requirements; recordkeeping 

requirements for maintaining 

information about the land where hemp 

is produced; procedures for testing the 

THC concentration levels for hemp; 

procedures for disposing of noncompliant plants; compliance 

provisions; and procedures for handling 

violations. 

For the purposes of 7 CFR part 990, 

and as defined in the 2018 Farm Bill, 

the term ‘‘hemp’’ means the plant 

species 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 

percent on a dry weight basis. Delta-9 

tetrahydrocannabinol, or THC, is the 

primary intoxicating component of 

cannabis. Cannabis with a THC level 

exceeding 0.3 percent is considered 

marijuana, which remains classified as 

a Schedule I controlled substance 

regulated by the Drug Enforcement 

Administration (DEA) under the CSA. 

The term ‘‘State’’ means any of one of 

the fifty States of the United States of 

America, the District of Columbia, the 

Commonwealth of Puerto Rico, and any 

other territory or possession of the 

United States. The term ‘‘Indian Tribe’’ 

or ‘‘Tribe’’ has the same definition as in 

section 4 of the Indian SelfDetermination and Education 

Assistance Act (25 U.S.C. 5304). This 

final rule also includes the definition of 

‘‘territory of an Indian Tribe’’ to provide 

clarity to the term because the AMA 

does not define it. The final rule defines 

‘‘territory of the Indian Tribe’’ as (a) all 

land within the limits of any Indian 

reservation under the jurisdiction of the 

United States Government, 

notwithstanding the issuance of any 

patent, including rights-of-way running 

through the reservation; (b) all 

dependent Indian communities within 

the borders of the United States whether 

within the original or subsequently 

acquired territory thereof, and whether 

within or without the limits of a state; 

(c) all Indian allotments, the Indian 

titles to which have not been 

extinguished, including rights-of-way 

running through the same; and (d) any 

lands title to which is either held in 

trust by the United States for the benefit 

of any Indian Tribe or individual or 

held by any Indian Tribe or individual 

subject to restriction by the United 

States against alienation and over which 

an Indian Tribe exercises jurisdiction. 

Under an approved Tribal plan, the 

Indian Tribe will have regulatory 

authority over hemp production within 

its Territory.3 A full list of terms and 

definitions relating to part 990 can be 

found under ‘‘Definitions’’ in section IV. 

This rule is divided into several 

sections. The first section provides a 

general introduction to the rule. This 

section does not go into a detailed 

description of all parts of the rule or 

about the provisions of the rule that are 

discussed later on in other sections. 

Sections for State and Tribal plans as 

well as the USDA plan contain general 

information on land use, tribal 

jurisdiction authority, sampling, testing, 

disposal and remediation, compliance 

provisions, information sharing, 

certification of resources, and State and 

Tribal plan approvals. The USDA 

section also includes USDA hemp 

license provisions and suspension. 

These two sections provide general 

provisions that are discussed in more 

detail in the comment analysis section. 

Sections containing definitions, 

severability and the regulatory analysis 

are included before the regulatory 

language. The reader may be best served 

by reading the comment section to 

determine the changes made to this rule. 

II. State and Tribal Plans 

Section 297B (7 U.S.C. 1639p) of the 

AMA requires that States or Indian 

Tribes seeking primary regulatory 

authority over the production of hemp 

in that State or territory of that Indian 

Tribe, submit, for the approval of the 

Secretary, a plan concerning the 

monitoring and regulation of such hemp 

production. State or Tribal plans must 

be submitted to USDA and approved 

prior to their implementation. Nothing 

preempts or limits any law of a State or 

Tribe that regulates the production of 

hemp and is more stringent than the 

provisions in Subtitle G of the AMA. 

AMS received extensive public input 

on the regulatory requirements for State 

and Tribal hemp plans. Incorporating 

the input received, the following 

sections explain the changes to the 

regulatory requirements for State and 

Tribal hemp plans. 

A. Land Used for Production 

The 2018 Farm Bill and the IFR 

required that plans include a process by 

which relevant information regarding 

the land used for hemp production in 

their jurisdiction is collected and 

maintained. Certain information on 

mailing addresses and hemp production 

sites must be collected for each licensee 

covered by the State or Tribal plan. 

The information required to be 

collected includes a legal description of 

the land and geospatial location for each 

field, greenhouse, or other site where 

hemp is produced. Geospatial location 

is necessary because many rural 

locations do not have specific addresses, 

and these coordinates will assist with 

the proper identification of hemp 

production locations. 

In addition to the land information 

required to be collected by the 

appropriate State or Indian Tribe, AMS 

chose to require licensed producers, 

including those under the USDA plan, 

to report their hemp crop acreage to the 

Farm Service Agency (FSA). Although 

many commenters opposed this 

requirement based on costs around the 

time and travel expense necessary to 

physically visit the appropriate FSA 

County Office, AMS has determined 

that maintaining the FSA reporting 


khammond on DSKJM1Z7X2PROD with RULES6
5598 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

requirement is essential for several 

reasons. AMS recognizes that in some 

cases producers may travel to FSA 

offices miles away incurring additional 

time and cost. These costs are 

incorporated in the expected burden of 

this program. 

First, USDA is statutorily required to 

provide law enforcement with certain 

‘‘real-time’’ information about who is 

growing hemp, whether their license is 

in good standing with the regulatory 

body issuing the license, and the 

location(s) where hemp is being grown. 

Having FSA collect the necessary 

information enables USDA to provide 

the most accurate and ‘‘real-time’’ 

information to law enforcement, as 

required by Subtitle G of the AMA. 

Second, FSA offices serve as useful 

resources to all farmers and, in 

collaboration with other USDA 

agencies, can provide a wide range of 

insurance, risk management, and 

conservation program guidance and 

information. These offices currently 

serve the agricultural industry within 

their communities, where producers can 

establish farm and producer records, 

record their licensing information, and 

report crop acreage. The producer may 

also, with supporting documentation, 

update their FSA farm records for 

leases, sub-leases, or land ownership. 

Requiring farmers to visit the FSA office 

ensures that they receive information on 

the availability of these helpful tools 

and programs. This is particularly 

important for new farmers, who may not 

be aware of the wide range of programs 

and services offered by USDA. 

Further, FSA maintains the 

technology necessary for data collection 

and geographical land identification. 

These tools will provide easy access to 

information needed for law enforcement 

and for other agricultural programs. 

AMS has determined, for these reasons, 

to continue to require the reporting of 

hemp crop acreage to FSA. 

Based on input from commenters, 

USDA is also clarifying the distinction 

between the term ‘‘lot’’ as defined in the 

IFR, and the term ‘‘subfield’’ as it relates 

to FSA reporting. Although this final 

rule uses the term ‘‘lot’’ to discuss the 

land where hemp is grown, when a 

producer visits the FSA office to report 

hemp crop acreage, FSA staff will help 

producers determine the applicable 

FSA-specific term for designating the 

location(s) where hemp is being grown. 

The terminology used by FSA to denote 

land areas include terms like ‘‘farm,’’ 

‘‘tract,’’ ‘‘field,’’ and ‘‘subfield,’’ which 

are equivalent to AMS’s term ‘‘lot.’’ FSA 

staff will not provide a ‘‘lot number’’ to 

producers as described in the IFR. FSA 

will use designations that they currently 

use such as track, field, or subfield, 

depending on the specific area. This 

designation does not change the 

requirements or the information 

submitted for law enforcement. AMS 

will amend the form to reflect these 

terms. When reporting to FSA, 

producers must provide their State or 

Tribe-issued license or authorization 

number. A link to FSA information on 

how to report hemp crop acreage to FSA 

is available at https://www.fsa.usda.gov/ 

Assets/USDA-FSA-Public/usdafiles/ 

FactSheets/2019/crop-acreagereporting-19.pdf and is available on the 

USDA hemp production program 

website. 

As described in the IFR, certain State 

hemp pilot programs operating under 

the 2014 Farm Bill authority developed 

‘‘seed certification’’ programs to help 

producers identify hemp strains with 

potentially lower THC concentrations. 

The term ‘‘certification’’ in this context 

means tested or verified, but it does not 

necessarily mean certified for varietal 

purity. USDA acknowledges that this 

remains a significant hurdle to the hemp 

industry and is committed to assisting 

with the research and development of 

compliant hemp varietals. Although 

AMS encourages States and Tribes to 

develop seed-certification programs if 

sufficient data is available, AMS has 

determined, at this time, that requiring 

the use of certain ‘‘compliant’’ varietals 

or establishing National rules for Statelevel certification programs is 

inappropriate. AMS will look at best 

practices from States and Tribes to 

evaluate if a program would be 

applicable to a USDA plan. If 

applicable, USDA may develop a 

performance-based sampling program. 

Such a program will require USDA to 

conduct rulemaking and comment 

procedures. 

The term ‘‘seed certification,’’ as 

found in the Federal Seed Act and its 

Regulations, refers to a third-party 

verification process that assures seed 

customers that they are receiving pure 

varieties and high-quality seed for 

planting purposes. The Federal Seed 

Act grants authority to seed certifying 

agencies in each State to administer 

varietal seed certification standards for 

all major agricultural crops, including 

hemp. Recognized seed certifying 

agencies are members of the Association 

of Official Seed Certifying Agencies 

(AOSCA), and they administer uniform 

AOSCA standards and inspect crops 

being grown for seed throughout the 

production process to maintain varietal 

purity. These activities protect seed 

customers in both domestic and export 

markets. Seed produced under these 

types of certification programs ensure a 

distinct, recognized variety that is 

properly tested and legally labeled. Seed 

certification under the Federal Seed Act 

is concerned with many varietal 

characteristics, not solely THC 

concentration. This enables farmers to 

confidently purchase seed of a suitable 

variety, by purchasing seed certified as 

to variety. Using certified seed, as 

described in the Federal Seed Act 

regulations and AOSCA standards, is an 

option for states and tribes if they have 

the data to support that the seed would 

work in their environment. While 

varietal certification does not absolutely 

ensure a specific THC content, the fact 

is that THC content (or at least a range) 

is a reliable varietal characteristic. 

Therefore, if the farmer is able to 

confidently purchase seed of a suitable 

variety by purchasing seed certified to 

variety, they at least know what to 

expect from the variety in their area. 

For this reason, AMS recommends the 

use of hemp seed from varieties that 

have undergone varietal certification, 

following the process outlined in the 

Federal Seed Act Regulations, and 

produced following AOSCA standards. 

This recommendation will assist hemp 

farmers to purchase recognized hemp 

varieties that have been tested for purity 

and are properly labeled. 

Additionally, AMS administers the 

Plant Variety Protection Office (PVPO) 

that is actively accepting applications of 

seed-propagated hemp for plant variety 

protection. The PVPO provides 

intellectual property protection to 

breeders of new varieties of seeds, 

tubers, and asexually reproduced plants. 

Under the U.S. Plant Variety Protection 

Act, PVPO examines new applications 

and grants certificates that protect 

varieties for 20 years (25 years for vines 

and trees). Certificate owners have 

rights to exclude others from marketing 

and selling their varieties, manage the 

use of their varieties by other breeders, 

and enjoy legal protection of their work. 

This work, however, does not certify 

seeds for THC content. 

B. Tribal Jurisdictional Authority 

The final rule clarifies the extent of a 

Tribe’s regulatory authority over hemp 

production within its Territory. Several 

commenters stated that language in the 

IFR raised uncertainty as to whether 

Indian Tribes could regulate hemp 

production by non-Indians operating on 

fee lands within a Tribe’s Territory. To 

address this uncertainty, § 990.4(b)(4) of 

the final rule now provides that ‘‘[u]pon 

USDA approval of a Tribal plan, a Tribe 

may exercise jurisdiction and therefore 

primary regulatory authority over all 

production of hemp in its Territory 

regardless of the extent of its inherent 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5599 

regulatory authority.’’ Thus, as long as 

the land at issue qualifies as land within 

the territory of an Indian Tribe under 

§ 990.1 of the final rule, an Indian Tribe 

with a USDA-approved plan may 

regulate all hemp production on that 

land. USDA determined that this 

additional language is consistent with 

Congressional intent in the 2018 Farm 

Bill and best ensures that hemp 

production is managed consistently 

throughout the Territory of an Indian 

Tribe. 

If an Indian Tribe desires to have 

primary regulatory authority over the 

production of hemp in its Territory, 

under the 2018 Farm Bill, the Tribe may 

submit a plan to USDA. Section 297C of 

the AMA provides that ‘‘In the case of 

a State or Indian Tribe for which a State 

or Tribal plan is not approved under 

section 297B, the production of hemp in 

that State or the territory of that Indian 

Tribe shall be subject to a plan 

established by the Secretary to monitor 

and regulate that production.’’ Hence if 

a Tribe does not regulate hemp 

production within its Tribal Territory, 

USDA, not a State with an approved 

plan, will regulate hemp production 

program within that Territory. 

Sections 297B and C plainly show 

that Congress chose to take a territorial 

approach to the Tribal regulation of 

hemp production under the AMA. If 

Congress only wanted Indian Tribes to 

assume primary regulatory authority 

over hemp production in areas within 

their inherent jurisdictional authority it 

could have stated this. Instead, Congress 

opted for a land-based approach and 

delegated to Tribes the authority to 

assume hemp production regulatory 

authority throughout their territories. In 

consideration of the statutory language 

and the overall statutory scheme of the 

2018 Farm Bill, USDA has determined 

that an Indian Tribe with an approved 

plan may regulate hemp production 

throughout its territory without regard 

to the Indian Tribe’s ability to 

demonstrate inherent regulatory 

authority under the factors set forth in 

Montana v. United States, 450 U.S. 544 

(1981). Because Congress did not define 

Territory of the Indian Tribe in the 

AMA and did not include discussion in 

the legislative history of the meaning of 

this term, USDA is exercising its 

authority to issue regulations to 

implement the provisions in the 2018 

Farm Bill to define this term in this 

manner. 

USDA’s decision is in-line with 

agency determinations where the agency 

determined that Congress delegated a 

Tribe with authority to exercise 

regulatory authority over non-Tribal fee 

land within reservations. EPA 

Interpretive Rule: Revised Interpretation 

of Clean Water Act Tribal Provision, 81 

FR 30183 (May 16, 2016); EPA Final 

Rule: Indian Tribes—Air Quality 

Planning and Management, 63 FR 7254 

(Feb. 12, 1998); Arizona Public Serv. Co. 

v. EPA, 211 F.3d 1280 (D.C. Cir. 2000). 

Moreover, USDA’s decision is 

practicable and prevents piecemeal 

licensing by Tribes and USDA within a 

single Tribal Territory. If a Tribe was 

only able to exercise primary regulatory 

authority over hemp production within 

its Territory when it could demonstrate 

the inherent authority to do so, USDA 

could be required to regulate some 

hemp production within the Territory— 

for example, it could foreseeably be 

required to regulate hemp production by 

non-Indians operating on fee lands in 

certain cases. Such a system would be 

confusing for producers and regulators 

alike. 

For the foregoing reasons, the final 

rule now clearly explains that upon 

USDA approval of a Tribal plan, a Tribe 

may exercise primary regulatory 

authority over all production of hemp in 

its Territory regardless of the extent of 

its inherent regulatory authority, as 

reflected in §§ 990.2 and 990.4 of the 

final rule. 

C. Sampling for Total THC 

AMS is changing certain aspects of 

the sampling requirements. This section 

addresses performance-based sampling, 

how to sample hemp plants, sampling 

agents, and the harvest window after 

sampling takes place. 

Sampling Requirements 

AMS received significant input from 

commenters on how hemp sampling 

procedures and requirements should be 

changed. When referring to ‘‘sampling,’’ 

we mean the process of collecting 

cuttings from hemp plants for purposes 

of compliance testing. 

Performance Based Sampling 

The IFR required State and Tribal 

hemp programs to collect samples from 

the flower material of the cannabis 

plant. The IFR also required State and 

Tribal hemp programs to collect enough 

samples to ensure at a confidence level 

of 95 percent that no more than one 

percent (1%) of the plants in the lot 

would exceed the acceptable hemp THC 

level. Guidance issued concurrently 

with the IFR explained these 

requirements in greater detail. The 

sampling requirements in the IFR did 

not consider geography, environmental 

factors, State or Tribal level seed 

certification programs, or other factors 

faced by States and Tribes when 

developing sampling requirements for 

their hemp programs. AMS is modifying 

the sampling provisions as presented in 

the IFR to allow States and Tribes to 

develop performance-based sampling 

requirements. Performance-based 

sampling achieves defined objectives 

and focuses on results. It differs 

significantly from a prescriptive action 

in which licensees are provided detailed 

direction on how those results are to be 

obtained. A performance-based 

approach would simply set a 

performance objective (e.g., reliability of 

95 percent) and allow the States and 

Tribes considerable freedom in how to 

achieve that reliability objective with 

their sampling methodology. 

Some State hemp regulators have 

successfully developed sampling 

requirements that ensure adherence to 

State and Federal regulations, while 

allowing for flexibilities due to limited 

State resources and State and Tribal 

differences. States expressed extensive 

concerns about the requirements in the 

IFR that all lots must be sampled and 

tested, due to significant logistical and 

fiscal impacts. They explained that, 

since most hemp in a given region is 

harvested at the same time, sampling 

must be completed within a very short 

time frame by only a few individuals. 

Several States also explained how 

sampling occurs under established State 

programs and described the different 

ways that perceived risk determines 

State requirements. Some States utilize 

different sampling requirements for 

broad end-use categories like ‘‘fiber/ 

grain’’ hemp versus ‘‘cannabinoid’’ 

hemp, while others base their 

requirements on historical THC 

concentrations of certain varietals or on 

the characteristics and growing history 

of a certain farm or producer. While 

these States’ plans have not been 

approved under the 2018 Farm Bill 

regulations, we believe that providing 

States and Tribes the flexibility to 

develop sampling plans based on data 

they gather during an extended period 

of time may be an effective method at 

ensuring the overall acceptable hemp 

THC level of hemp grown in the State 

or Tribe. AMS agrees that sampling 

requirements should allow States and 

Indian Tribes more flexibility in the 

management of their hemp regulatory 

programs. 

AMS agrees that requiring sampling 

from every lot may be burdensome and 

expensive for State and Tribal 

regulatory entities and producers. AMS 

also finds compelling the arguments 

presented by States’ regulatory agencies 

and other commenters that there are 

different risk factors for hemp used for 

fiber and grain versus hemp used for 

cannabinoids. Data submitted with 


khammond on DSKJM1Z7X2PROD with RULES6
5600 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

comments show that the THC levels of 

hemp used for cannabinoids are 

frequently higher than those of hemp for 

fiber and grain. The FDA authorizes the 

marketing of few types of cannabinoid 

products. This final rule does not cover 

cannabinoid products. 

AMS also acknowledges that research 

institutions face special circumstances 

when conducting hemp research. 

Accordingly, this rule provides 

sampling and testing flexibility to these 

institutions and producers working with 

them to conduct hemp research. 

Producers that produce hemp for 

research, along with the research 

institution itself, must obtain a license 

from a State, Tribal Government, or 

USDA. However, the hemp that is 

produced for research is not subject to 

the same sampling requirements 

provided that the producer adopts and 

carries out an alternative sampling 

method that has the potential to ensure, 

at a confidence level of 95 percent, that 

the cannabis plant species Cannabis 

sativa L. that will be subject to this 

alternative method will not test above 

the acceptable hemp THC level. 

Research institutions and producers 

growing hemp for research purposes 

shall ensure the disposal of all noncompliant plants. Research institutions 

and producers growing hemp for 

research purposes shall also comply 

with the reporting requirements 

including reporting disposal of noncompliant plants. Research institutions 

that handle ‘‘hot’’ hemp must follow 

CSA requirements for handling 

marijuana. 

States and Indian Tribes are allowed 

to develop performance-based 

requirements for these institutions. 

However, the alternative method must 

have the potential to ensure, at a 

confidence level of 95 percent, that the 

cannabis plant species Cannabis sativa 

L. that will be subject to the alternative 

method will not test above the 

acceptable hemp THC level. 

AMS views this flexibility as 

necessary to help support research and 

development as it relates to hemp 

production. This decision allows these 

types of research facilities and 

institutions to confidently oversee the 

study of hemp through trialing and 

genetics research, which AMS believes 

to be critical to the growth of industry, 

particularly in its infancy. Over time, 

the flexibility provided by this final rule 

will help to stabilize industry by 

providing greater understanding of 

hemp genetics and how certain varietals 

respond differently to growing 

conditions in various geographic 

locations. All producers are expected to 

benefit from such knowledge as they 

will be made aware of the more stable 

and consistently reliable hemp varietals. 

Any non-compliant plants produced by 

research institutions as a result of 

research and development will still 

need to be disposed and verified 

through documentation. Research and 

development facilities are still required 

to be licensed by States and Tribes. 

Research institutions must follow 

licensing and reporting requirements. 

In performance-based approaches, 

measurable or calculable parameters are 

available to determine whether the 

performance standard is met. These 

performance parameters are identified 

to provide measures of performance and 

the opportunity to take corrective action 

if performance is lacking. In the case of 

hemp, the performance parameter is the 

0.3 percent THC level and other 

measures are included in this final rule 

if the parameter is not achieved such as 

disposal and remediation. 

USDA finds that in order to increase 

regulatory effectiveness, it makes sense 

to allow States and Indian Tribes to 

consider performance-based alternatives 

when developing sampling plans. If the 

objective or intended result can be 

achieved by setting a readily measurable 

standard that is enforceable, the 

proposed requirement should merely 

specify the objective or result to be 

obtained rather than prescribe to the 

licensee how the objective or result is to 

be attained. In other words, 

requirements should be performancebased, and highly prescriptive rules and 

requirements should be avoided absent 

good cause to the contrary. 

The sampling requirements for State 

and Tribal plans allow for States and 

Indian Tribes to develop unique 

sampling protocols for hemp growing 

facilities under their jurisdiction. 

Sampling protocols must be sufficient at 

a confidence level of 95 percent that no 

more than one percent of the plants in 

each lot would exceed the acceptable 

hemp THC level and ensure that a 

representative sample is collected that 

represents a homogeneous composition 

of the lot. Alternatively, the final rule 

allows States and Indian Tribes to adopt 

a performance-based sampling protocol. 

A performance-based protocol must 

have the potential to ensure, at a 

confidence level of 95 percent, that the 

cannabis plants will not test above the 

acceptable hemp THC level. USDA 

encourages the alternative protocol to 

consider seed certification processes or 

process that identifies varieties that 

have consistently demonstrated to result 

in compliant hemp plants in that State 

or territory of the Indian Tribe, whether 

the producer is conducting research on 

hemp at an institution of higher 

learning, whether a producer has 

consistently produced compliant hemp 

plants over an extended period of time, 

and other similar factors. AMS believes 

this will provide needed flexibility to 

States and Indian Tribes to develop 

logical and enforceable sampling 

requirements that take into 

consideration their unique 

circumstances. AMS will still require 

States and Indian Tribes to submit their 

individual sampling requirements for 

review as a component of the plan 

approval process. Sampling protocols 

submitted by States and Indian Tribes 

must comply with the thresholds 

established by the 2018 Farm Bill and 

this final rule. If performance-based 

sampling requirements are not included 

in a State or Tribal plan, the method 

used for sampling must be sufficient at 

a confidence level of 95 percent that no 

more than one percent of the plants in 

each lot would exceed the acceptable 

hemp THC level and ensure that a 

representative sample is collected from 

every lot, and thereby every producer 

must be sampled and tested. When 

evaluating sampling protocols 

submitted by States and Indian Tribes, 

USDA will evaluate the risk of 

producing non-compliant material to 

determine approval or disapproval. In 

evaluating the risk, USDA will take into 

consideration whether the performancebased factors the State or Indian Tribe 

used have the potential to assure 

compliance at a 95 percent confidence 

level. 

Since USDA cannot develop 

performance metrics that would be 

applicable independently from where 

the producer is located, producers 

licensed under the USDA plan are 

subject to the sampling requirements in 

the rule. USDA guidelines provided on 

the USDA website at https://

www.ams.usda.gov/rules-regulations/ 

hemp/information-sampling describe 

best practices for complying with those 

requirements. 

USDA recognizes that several States 

and Tribes may include performancebased sampling in their plans and that 

their experience could demonstrate that 

their sampling procedures may be 

adaptable to the USDA plan. If USDA 

finds this to be the case, USDA will 

explore a performance-based sampling 

scheme for producers under the USDA 

plan in the future through notice and 

comment rulemaking. 

Where To Take Samples on the Hemp 

Plant 

AMS will retain the requirement that 

pre-harvest samples be taken from the 

flower material of hemp plants. 

However, this rule clarifies the number 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5601 

of inches of plant material needed for 

the sample and provides greater detail 

as to where exactly on the plant to make 

a cutting. The IFR required that samples 

be taken from the ‘‘flower material’’ of 

hemp plants. Further, in guidance 

material issued concurrently with the 

IFR, AMS explained in greater detail 

where exactly on the plant to make a 

cutting by recommending samples be 

taken from the top third of the plant, 

‘‘just underneath a flowering material.’’ 

Many commenters argued that samples 

should be taken from the ‘‘whole plant’’ 

or that a ‘‘homogenized’’ sample should 

be taken to include the stem, stalk, 

leaves, and seeds along with flower 

material. Alternatively, some 

commenters proposed that samples be 

taken post-harvest from shredded whole 

plant material, otherwise known as 

‘‘biomass.’’ Advocates of these positions 

asserted that THC levels of the whole 

hemp plant are better represented by 

samples collected from the entire plant, 

and not just from floral material. Other 

commenters advocated for sampling of a 

certain size or length of cutting. Such 

commenters advocated adoption of the 

sampling methods they or others had 

used under pilot programs. Many State 

agriculture departments suggested AMS 

continue to require samples taken from 

flower material. 

Even though many commenters felt 

that whole plant sampling should be 

allowed, AMS is of the opinion that 

since THC is concentrated in the flower 

material of the plant, the flower material 

is more appropriate to test than the 

entire plant. AMS will modify the 

sampling requirement to state that the 

sample shall be approximately five to 

eight inches from the ‘‘main stem’’ (that 

includes the leaves and flowers), 

‘‘terminal bud’’ (that occurs at the end 

of a stem), or ‘‘central cola’’ (cut stem 

that could develop into a bud) of the 

flowering top of the plant. This change 

is consistent with the sampling 

practices in several States that 

established hemp programs pursuant to 

the 2014 Farm Bill authority. AMS 

determined that this standard strikes an 

appropriate balance between the need to 

collect a sufficiently large portion of the 

plant’s flower (where THC and other 

cannabinoids are at their most 

concentrated), and the need to avoid 

cutting a portion that is so large that it 

would be logistically difficult to 

transport, dry, and prepare for lab 

testing. Based on the information 

discussed above and the experience and 

expertise of States and other 

commenters already engaged in hemp 

production pursuant to the 2014 Farm 

Bill authority, AMS is including new 

requirements herein. 

AMS is publishing updated sampling 

guidance concurrently with this final 

rule. This guidance describes how to 

comply with this requirement regarding 

where to take the sample from the plant 

as well as other sampling requirements 

in the final rule. While the sampling 

guidance provides best practices for 

meeting the requirements, States, Indian 

Tribes, and USDA licensees may adopt 

sampling procedures that differ from the 

guidance so long as those procedures 

meet the standards in this final rule. 

Sampling Agents 

The IFR required a Federal, State, 

local, or Tribal law enforcement agency 

or other Federal, State, or Tribal 

designated person to collect hemp 

samples for the purposes of testing THC 

levels in hemp. Comments in response 

to the IFR presented several concepts 

concerning how sampling agents should 

be designated and/or trained. Comments 

mostly suggested the need for enhanced 

training requirements for sampling 

agents to promote consistency in the 

ways that samples are collected 

nationwide. Based on comments 

received regarding sampling agents, 

AMS will provide additional training 

resources for sampling agents. These 

training documents will explain how 

sampling agents can meet the sampling 

requirements of this regulation. States 

and Indian Tribes with an approved 

plan may require the sampling agents 

used in their jurisdiction to take the 

USDA training, or they may develop 

their own custom training incorporating 

USDA requirements with additional 

State or Tribal requirements. States and 

Tribes must maintain information, 

available to producers, about trained 

sampling agents. 

Other comments on the topic of 

sampling agents spoke to the strain on 

State and Tribal resources of requiring 

agents to take samples instead of 

producers. Commenters presented two 

proposals to alleviate this strain— 

allowing producers to collect their own 

samples and reducing the volume of 

farms and plants from which samples 

are collected. AMS is retaining the 

requirement that only designated agents 

can collect samples. This ensures that 

there is consistency in sampling 

throughout the industry. The 

flexibilities provided to States and 

Indian Tribes with primary regulatory 

authority over hemp in their jurisdiction 

will likely reduce the number of 

samples required to be collected and 

thus reduce the burden on designated 

sampling agents. 

Harvest Window 

The IFR required harvest within 15 

days of sampling. AMS received 

comments regarding the challenges 

presented by the 15-day harvest 

requirement, including the logistical 

challenges to State and Tribal agencies 

charged with overseeing the collection 

of samples in this short timeframe, the 

logistical challenges to producers in 

harvesting hemp crops in this short 

timeframe, and testing challenges faced 

by laboratories in having to conduct 

compliance analyses in this short 

timeframe. Commenters suggested 

lengthening the 15-day harvest 

requirement to a longer period of time— 

with some asking for up to 60 days. 

AMS agrees with the arguments 

presented by commenters and 

recognizes the challenges imposed on 

the industry by the 15-day harvest 

requirement. AMS must also balance the 

logistical challenges of a harvest 

window requirement with the fact that 

THC concentration in hemp generally 

increases the longer the plant is in the 

ground. AMS now understands from 

data provided in comments that THC 

concentration does not increase linearly 

and is impacted by a myriad of 

environmental factors including 

moisture, wind, temperature, disease, 

sunlight, and soil, as discussed in the 

Comment Analysis section of this rule. 

The regulatory objective is to ensure, as 

best as possible, harmonization of the 

THC levels in the pre-harvest sample 

and that of the harvested material. 

Requiring that samples be taken prior to 

harvest is the best way to judge the THC 

concentration of the plant and the lot 

the sample represents. AMS recognizes 

that the most accurate measurement 

would be at time of harvest, but also 

understands the logistical practicalities 

discussed above and therefore has 

determined the most balanced approach 

is 30 days. For these reasons, AMS is 

expanding the window within hemp 

must be harvested after sampling to 30 

days. 

Under this final rule, no more than 30 

days prior to the anticipated harvest of 

cannabis plants, a ‘‘sampling agent’’ 

must collect samples for compliance 

testing. If producers do not harvest 

within 30 days of sampling, the plant 

will likely have a higher THC level at 

harvest than the sample that is being 

tested. This requirement balances the 

need for accuracy with the logistical 

realities faced in the sampling and 

testing processes and will yield the most 

accurate measurement of the THC level 

at the point of harvest. Increasing the 

window within hemp must be harvested 

after sampling from 15 to 30 days will 


khammond on DSKJM1Z7X2PROD with RULES6
5602 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

4www.ams.usda.gov/press-release/usda-deaprovide-options-labs-disposal-non-complianthemp-plants. 5Small, E.; Beckstead, H.D.; Chan, A. The 

Evolution of Cannabinoid Phenotypes in Cannabis. 

Economic Botany, 29, 219–232, 1975. 

better allow for variables such as testing, 

weather, agricultural practices, and 

equipment delays. 

D. Testing Laboratories 

The IFR introduced regulatory 

requirements for laboratories testing 

hemp for compliance purposes. AMS 

also issued guidance with the IFR to 

explain best practices for hemp testing 

laboratories (www.ams.usda.gov/rulesregulations/hemp). Based on comments 

to the IFR, AMS is changing certain 

parts of these regulations and updating 

the accompanying testing guideline. 

While the testing guidance provides best 

practices for meeting the regulatory 

requirements, States, Indian Tribes, and 

USDA licensees may use test procedures 

that differ from the guidance so long as 

those procedures meet the standards in 

the final rule. 

Registration With DEA 

The IFR required all hemp testing 

laboratories to be registered with the 

DEA in accordance with the CSA (21 

U.S.C. 823(f)). On February 27, 2020, 

AMS announced a delay in enforcement 

of this requirement until October 31, 

2020, or the publication of a final rule, 

whichever came first (USDA, DEA 

Provide Options for Labs, Disposal of 

Non-Compliant Hemp Plants. Thursday, 

Feb. 27, 2020) 4 AMS announced this 

enforcement delay to allow additional 

time to increase DEA registered 

analytical lab capacity and avoid 

potential delays to producers in 

receiving test results. Although AMS 

received comments in opposition to this 

requirement, AMS is retaining the 

requirement in this final rule that any 

laboratory testing hemp for purposes of 

regulatory compliance must be 

registered with DEA to conduct 

chemical analysis of controlled 

substances in accordance with 21 CFR 

1301.13. This requirement also applies 

to any laboratory testing hemp 

throughout the growing season to 

informally monitor THC concentration. 

Registration is necessary because 

laboratories could potentially handle 

cannabis that tests above 0.3 percent 

THC on a dry weight basis, which is, by 

definition, marijuana and a Schedule 1 

controlled substance. Instructions for 

laboratories to obtain DEA registration, 

along with a list of approved 

laboratories, are available on the USDA 

Domestic Hemp Production Program 

website. AMS is aware that there are 

still not enough DEA-registered hemp 

testing facilities in some States or 

territories of Indian Tribes. However, 

since the IFR was published, numerous 

laboratories have applied for registration 

and DEA is working diligently to 

process these requests. Given the 

limited number of DEA-registered labs 

available to hemp producers, delay in 

enforcement of this requirement is 

continued until December 31, 2022. 

AMS anticipates this delay will provide 

adequate time for testing facilities to 

obtain DEA registration. 

Laboratory Testing Requirements 

Section 297B(a)(2)(A)(ii) of the AMA 

requires that State and Tribal plans for 

primary regulatory jurisdiction include 

a ‘‘procedure for testing, using postdecarboxylation or other similarly 

reliable methods, delta-9 

tetrahydrocannabinol concentration 

levels of hemp produced in the State or 

territory of the Indian Tribe.’’ Since not 

all testing methods include 

decarboxylation, AMS is requiring that 

the total THC, which includes the 

potential conversion of 

tetrahydrocannabinolic acid (THCA) 

into THC, be reported and used for 

purposes of determining the THC 

content of a hemp sample. 

The IFR included requirements on 

how laboratories conduct hemp testing 

for the purposes of regulatory 

compliance to assure that total THC 

levels were measured. Commenters 

provided extensive input on testing 

requirements, particularly the 

requirement to test for ‘‘total’’ THC 

instead of only ‘‘delta-9’’ THC. AMS is 

retaining this requirement. 

AMS looked at current testing 

methodologies that would meet the 

decarboxylation requirement set in the 

2018 Farm Bill. In gas chromatography 

(GC) testing, heat is applied to the 

sample, which decarboxylates THCA, 

producing delta-9 THC, so that the final 

delta-9 THC result is actually a total 

THC result. GC is the more traditional 

technique used for THC testing and was 

the technique used by Dr. Small 5 in his 

research that derived the 0.3 percent 

threshold that was used as a basis for 

the 2018 Farm Bill requirement and is 

used by law enforcement as the 

threshold to differentiate hemp from 

marijuana. In his research papers, the 

0.3 percent threshold is based on total 

available delta-9 THC, which is the sum 

of THCA and delta-9 THC in the plant 

material. 

Liquid chromatography (LC) testing 

does not involve the use of significant 

heat, so that the THCA in a sample does 

not generally decarboxylate. Results can 

be reported for THCA and delta-9 THC 

separately. When LC is used, the total 

THC needs to be calculated post-testing 

in order to report results as a ‘‘postdecarboxylation’’ delta-9 THC value. 

The requirement to report the total THC 

value as the THC content regardless of 

testing methodology used ensures 

testing consistency across the program. 

Samples must be tested using postdecarboxylation or other similarly 

reliable analytical methods by which 

the total THC concentration level 

reported accounts for the conversion of 

THCA into THC. Acceptable testing 

methodologies currently include gas or 

liquid chromatography with detection. 

The total THC, derived from the sum 

of the THC and THCA content, shall be 

determined and reported on a dry 

weight basis. In order to provide 

flexibility to States and Tribes in 

administering their own hemp 

production programs, alternative testing 

protocols will be considered if they are 

comparable to and similarly reliable as 

the baseline mandated by section 

297B(a)(2)(A)(ii) of the AMA and 

established under USDA regulations 

and procedures. Updated USDA 

procedures for sampling and testing will 

be issued concurrently with this rule 

and will be provided on the USDA 

website. 

Reporting requirements for 

laboratories are discussed later in 

Section X (Regulatory Analysis) of this 

final rule. To clarify these requirements, 

laboratories conducting testing for 

purposes of monitoring THC 

concentration throughout the growing 

season are not subject to these reporting 

requirements. These tests are for the 

producer to monitor his or her 

production as it grows and not to 

comply with pre-harvest testing 

requirements in this rule. Only 

laboratories conducting the ‘‘final’’ test 

that will be used to determine whether 

a sample is compliant are subject to 

reporting requirements. 

Measurement of Uncertainty 

This final rule requires that 

laboratories calculate and include the 

Measurement of Uncertainty (MU) when 

they report THC test results. 

‘‘Measurement of uncertainty’’ is 

defined as ‘‘the parameter, associated 

with the result of a measurement, that 

characterizes the dispersion of the 

values that could reasonably be 

attributed to the particular quantity 

subject to measurement.’’ This 

definition is based on the definition of 

‘‘uncertainty (of measurement)’’ in 

section 2.2.3 of the Joint Committee for 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5603 

6The Joint Committee for Guides in Metrology is 

composed of international organizations working in 

the field of metrology. Its membership includes the 

Bureau International des Poids et Mesures, the 

Organisation Internationale de Me ́trologie Le ́gale, 

the International Organization for Standardization, 

the International Electrotechnical Commission, the 

International Union of Pure and Applied Chemistry, 

the International Union of Pure and Applied 

Physics, the International Federation of Clinical 

Chemistry and Laboratory Medicine, and the 

International Laboratory Accreditation Cooperation. 

7USDA established the Association of Official 

Agricultural Chemists in 1884. In 1965, it changed 

its name to the Association of Official Analytical 

Chemists and became an independent organization 

in 1979. In 1991, it adopted its current, legal name 

as AOAC International. 

8https://physics.nist.gov/cuu/Uncertainty/ 

international1.html. 

Guides in Metrology 6 100:800, 

Evaluation of measurement data— 

‘‘Guide to the Expression of Uncertainty 

in Measurement’’ (JCGM Guide). The 

National Institute of Standards and 

Technology (NIST) Technical Note 

1297, ‘‘Guidelines for Evaluating and 

Expressing the Uncertainty of NIST 

Measurement Results’’ (TN 1297), is 

based on the JCGM Guide. AMS also 

relied on the Eurachem/Co-Operation 

on International Traceability in 

Analytical Chemistry’s ‘‘Guide on Use 

of Uncertainty Information in 

Compliance Assessment, First Edition 

2007’’. Colloquially, the measurement of 

uncertainty is similar to a margin of 

error. When the measurement of 

uncertainty, normally expressed as a 

+/¥ with a number (e.g. +/- 0.05), is 

combined with the reported 

measurement, it produces a range, and 

the actual measurement has a known 

probability of falling within that range 

(typically 95%). Laboratories should 

meet the AOAC International 7 standard 

method performance requirements for 

selecting an appropriate method to 

determine the MU. 

This final rule requires that 

laboratories report the MU as part of any 

hemp test results. The rule also includes 

a definition of ‘‘acceptable hemp THC 

level’’ to account for the uncertainty in 

the test results. The reported THC 

concentration of a sample may not be 

the actual concentration level in the 

sample. However, the actual THC 

concentration is expected to be within 

the distribution or range calculated 

when the reported THC concentration is 

combined with the measurement of 

uncertainty. 

The use of MU for purposes of 

determining the acceptable hemp THC 

level does not alter Federal law with 

regard to the definition of hemp or 

marijuana. As stated above, the 2018 

Farm Bill defines hemp as the plant 

species 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 THC of not more than 0.3 

percent on a dry weight basis. Likewise, 

the Federal (CSA) definition of 

marijuana continues to include those 

parts of the cannabis plant as specified 

in 21 U.S.C. 802(16) (and derivatives 

thereof) that contain more than 0.3 

percent THC on a dry weight basis. The 

foregoing provisions of Federal law 

remain in effect for purposes of Federal 

criminal prosecutions, as well as 

Federal, civil, and administrative 

proceedings arising under the CSA. 

The definition of ‘‘acceptable hemp 

THC level’’ is also retained in this final 

rule. States and Indian Tribes shall 

adopt this concept in their plans. This 

definition explains how to interpret test 

results that include the MU with an 

example. The application of the MU to 

the reported delta-9 

tetrahydrocannabinol concentration on 

a dry weight basis produces a 

distribution, or range. If 0.3 percent or 

less is within the distribution or range, 

then the sample will be considered to be 

hemp for the purpose of compliance 

with the requirements of State, Tribal, 

or USDA hemp plans. For example, if a 

laboratory reports a result as 0.35 

percent with a measurement of 

uncertainty of +/¥0.06, the distribution 

or range is 0.29 percent to 0.41percent. 

Because 0.3 percent is within that 

distribution or range, the sample, and 

the lot it represents, is considered hemp 

for the purpose of compliance with the 

requirements of State, Tribal, or USDA 

hemp plans. However, if the MU for that 

sample was 0.02 percent, the 

distribution or range is 0.33 percent to 

0.37 percent. Because 0.3 percent or less 

is not within that distribution or range, 

the sample is not considered hemp for 

the purpose of plan compliance, and the 

lot it represents will be subject to 

disposal. Thus the ‘‘acceptable hemp 

THC level’’ is the application of the MU 

to the reported delta-9 

tetrahydrocannabinol content on a dry 

weight basis producing a distribution or 

range that includes 0.3 percent or less. 

As such, the regulatory definition of 

‘‘acceptable hemp THC level’’ describes 

how State, Tribal, and USDA plans must 

account for uncertainty in test results in 

their treatment of cannabis. This 

definition affects neither the statutory 

definition of hemp, 7 U.S.C. 1639o(1), in 

the 2018 Farm Bill nor the definition of 

‘‘marihuana,’’ 21 U.S.C. 802(16), in the 

CSA. 

Sections 297B(a)(2)(A)(iii) and 

297C(a)(2)(C) of the AMA require that 

cannabis plants that have a THC 

concentration level of greater than 0.3 

percent on a dry weight basis be 

disposed of in accordance with the 

applicable State, Tribal, or USDA plan. 

Because of this requirement, producers 

whose cannabis crop is not hemp will 

likely lose most of the economic value 

of their investment. Thus, AMS believes 

that there must be a high degree of 

certainty that the THC concentration 

level is accurately measured and is in 

fact above 0.3 percent on a dry weight 

basis before requiring disposal of the 

crop. 

The NIST Reference on Constants, 

Units, and Uncertainty states that 

‘‘measurement result is complete only 

when accompanied by a quantitative 

statement of its uncertainty. The 

uncertainty is required in order to 

decide if the result is adequate for its 

intended purpose and to ascertain if it 

is consistent with other similar 

results.’’ 8 Simply stated, knowing the 

measurement of uncertainty is necessary 

to evaluate the accuracy of test results. 

Comments to the IFR generally 

expressed support for requiring that the 

measurement of uncertainty (MU) be 

accounted for when testing the THC 

concentration of hemp, due to the 

variability in laboratory testing 

equipment and complex mathematical 

principles involved. Comments also 

provided several suggestions on ways to 

improve the calculation of MU. Many 

comments advocated specifying an MU 

to create uniformity in testing across the 

nation. 

USDA does not recommend 

establishing an MU upper limit 

(maximum) because (1) MU is typically 

not standardized, but is controlled using 

standard test methods, and (2) USDA 

does not have the data to set an upper 

limit so setting it would be arbitrary, not 

scientific. The hemp and scientific 

industries are just beginning to discuss 

standard test methods and the final rule 

does not establish an explicit test 

method. Setting an upper limit or 

maximum MU does not resolve the core 

issue and would not encourage or drive 

labs to improve accuracy and precision. 

Setting an upper limit would in effect 

be setting a maximum or absolute MU. 

This may encourage labs to adopt the 

maximum MU as their MU, rather than 

drive for a smaller uncertainty. USDA 

may allow for establishing limits in the 

future, if needed, once methods are 

established and USDA has access to 

Proficiency Testing results and the 

reported MUs. We encourage States and 

Tribes to monitor, review and evaluate 

MU to evaluate trends and outliers, 

which may indicate ‘‘lab shopping’’ for 

higher MUs. The requirement for hemp 


khammond on DSKJM1Z7X2PROD with RULES6
5604 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

testing laboratories to incorporate a MU 

is being retained in this regulation. 

Laboratory Accreditation 

In the IFR, AMS requested input on 

establishing a fee-for-service hemp 

laboratory approval process or a 

requirement for laboratories to obtain 

ISO 17025 accreditation for labs that 

wish to offer THC testing services. 

Comments reflected a range of views 

across the industry, both in support of 

and in opposition to additional 

laboratory certification requirements. In 

general, commenters preferred more 

regulatory flexibility to address the 

widespread concern of insufficient 

laboratory capacity as a result of 

laboratory certification/registration/ 

accreditation requirements. Other 

commenters were opposed to 

accreditation requirements due to the 

cost. While AMS strongly encourages 

laboratories to be accredited to ISO/IEC 

17025 (by an International Laboratory 

Accreditation Cooperation Mutual 

Recognition Agreement (ILAC MRA) 

signatory accreditation body), we also 

acknowledge that ISO 17025 

accreditation requires significant time 

and financial commitment to pursue 

and maintain. The time and cost 

involved is most challenging for smaller 

and start-up labs. The initial 

accreditation can cost $5,000–$10,000 

(and in some case more) and yearly 

ongoing costs are $3,000–$8,000. 

Smaller labs may not have the resources 

to pursue accreditation in a timely 

manner or they may have to spend 

additional time and money for 

consultants to assist them in setting up 

a quality management system and to 

navigate the application and audit 

processes. 

Based on insufficient laboratory 

capacity at this time and the cost 

involved in adding this requirement, 

AMS will not provide an AMS 

administered lab approval program or 

require ISO 17025 accreditation. 

However, AMS remains committed to 

assisting the hemp laboratory testing 

community and is available to assist in 

the development of a laboratory 

approval program in the future. As 

explained in the IFR, if such hemp 

laboratory approval program is 

developed by AMS, such process will be 

conducted by USDA, AMS Laboratory 

Approval Service, which administers 

the Laboratory Approval Program (LAP). 

State and Tribal plans are free to 

include certain additional requirements 

for hemp testing laboratories, including 

ISO accreditation or other proficiency 

schemes. 

E. Disposal and Remediation of NonCompliant Plants 

State and Tribal plans are currently 

required to include procedures for 

ensuring effective disposal or 

remediation of plants produced in 

violation of part 990. Plants that are 

removed as a result of poor plant health, 

pests, disease, or weather events, along 

with removal of male or hermaphrodite 

plants as part of a cross-pollination 

prevention plan, are not subject to the 

disposal requirements herein. This final 

rule retains the disposal requirements 

explained in the IFR but clarifies what 

‘‘disposal’’ means and explains how the 

process must be conducted. This final 

rule also includes remediation as an 

option to remove non-compliant plants. 

As explained in the IFR, if a producer 

grows cannabis exceeding the legal 0.3 

percent THC level, the material must be 

disposed of in accordance with the CSA 

and DEA regulations because such 

material constitutes marijuana, a 

Schedule I controlled substance under 

the CSA. The material must be collected 

for disposal by a person authorized 

under the CSA to handle marijuana, 

such as a DEA-registered reverse 

distributor, or a duly authorized 

Federal, State, Tribal, or local law 

enforcement officer. In the final rule, 

AMS is incorporating flexibilities for 

disposal that were announced on 

February 27, 2020 (https://

www.ams.usda.gov/rules-regulations/ 

hemp/enforcement). Some of these new 

options include, but are not limited to, 

plowing under non-compliant plants, 

composting into ‘‘green manure’’ for use 

on the same land, tilling, disking, burial, 

or burning. These methods are intended 

to allow producers to apply common 

on-farm practices for the disposal of 

non-compliant plants. One of the top 

considerations in making this change 

was to minimize, to the extent possible, 

the resource impact to State, Tribal, and 

local law enforcement in handling hemp 

that is out of compliance. In addition, 

we are confident that any disposal 

options make the product unusable and 

therefore is not at risk for entering any 

streams of commerce. Based on 

comments received, AMS is 

permanently retaining these on-farm 

disposal flexibilities. 

AMS received comments on this 

requirement describing the expense 

associated with destroying cannabis in 

accordance with the CSA, primarily the 

requirement that disposal be conducted 

offsite by a reverse distributor or other 

law enforcement officer. Based on this 

input, AMS, in coordination with DEA 

partners, delayed enforcement of the 

disposal requirements in the IFR. In the 

final rule, producers have several 

options on how to handle noncompliant plants. Producers do not need 

to use a DEA-registered reverse 

distributor or law enforcement to 

dispose of non-compliant plants. 

Producers may dispose of the plants 

using one or more of the means 

described by AMS at https://

www.ams.usda.gov/rules-regulations/ 

hemp/disposal-activities. It is the 

Agency’s intent that these methods 

allow producers to apply common onfarm practices as a means of disposal 

while rendering the controlled 

substance non-retrievable or noningestible. Under this final rule, State 

and Tribal plans must still include 

procedures to verify disposal. This may 

come in the form of in-person 

verification by State or Tribal 

representatives, or alternative 

requirements the direct growers to 

provide pictures, videos, or other proof 

that disposal occurred successfully. 

Producers under the USDA plan must 

document the disposal of all noncompliant plants. States and Indian 

Tribes operating under approved hemp 

production plans and producers under 

the USDA plan must notify USDA of 

any occurrence of non-conforming 

plants or plant material and provide the 

disposal record of those plants and 

materials monthly. 

State and Tribal plans must include 

procedures to verify disposal, whether 

through the use of in-person verification 

by State or Tribal representatives, or 

requirements for producers to provide 

pictures, videos, or other proof that 

disposal did in fact occur. State and 

Tribal plans must also include 

requirements to submit to AMS the 

monthly disposal and remediation 

report documenting any on-farm 

disposals or remediations that occurred 

during the prior month. As of November 

2020, twenty States and nine Tribes 

operating under the 2018 Farm Bill 

reported 4,192 licensed producers 

representing 6,166 acres planted. Of 

these acres planted, there were 231 

disposals representing 730 acres 

disposed due to not meeting the 0.3 

percent acceptable hemp THC level. 

AMS did not provide additional 

remediation options in the IFR. The 

only remediation alternative was to 

completely dispose of the noncompliant material. AMS is adding 

remediation to this final rule based on 

comment. AMS received many 

comments suggesting the inclusion of 

procedures to allow for non-compliant 

cannabis to be ‘‘remediated.’’ AMS 

agrees with this suggestion and is 

publishing remediation techniques 

concurrently with this rule that can be 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5605 

followed to remediate non-compliant 

plant material into compliant form. As 

described in the IFR, hemp exceeding 

the acceptable THC level may not be 

further handled, processed, or enter the 

stream of commerce. AMS believes that 

hemp producers should have the 

opportunity to remediate non-compliant 

crops in order to minimize financial risk 

associated with the loss of investment in 

their hemp crop. For this reason, this 

final rule allows remediation activities, 

either disposing of flower materials and 

salvaging the remainder of the plant or 

blending the entire plant into biomass 

plant material. Through both forms of 

remediation, producers may be able to 

minimize losses, and in some cases 

produce a return on investment while 

ensuring that non-compliant material 

does not enter commerce. 

If a producer elects to perform 

remediation activities as allowable 

under this final rule’s provisions 

(referenced above), an additional 

sampling and testing of the postremediated crop must occur to 

determine THC concentration levels. 

Only those successfully remediated 

crops will be allowed to enter the 

stream of commerce, and all other 

remaining non-compliant crops must 

then be disposed. 

AMS believes the inclusion of 

remediation and post-harvest sampling 

into the final rule provides the 

additional flexibility requested by 

commenters that expressed the need for 

producers to have greater opportunity 

for success as established and beginning 

farmers entering hemp production. 

F. Compliance With Enforcement 

Procedures, Including Determination of 

Negligence and Annual Inspection of 

Hemp Producers 

The IFR required State and Tribal 

plans to include compliance procedures 

to ensure hemp was being produced in 

accordance with the requirements of 

this part. Comments to the IFR were 

generally opposed to the compliance 

requirements, particularly as they relate 

to the definition of negligence. 

Producers, along with State and Tribal 

regulatory agencies, found the 

negligence requirements in the IFR 

overly harsh and strict. This final rule 

changes these compliance procedures, 

particularly how ‘‘negligence’’ is 

determined. In the context of this 

regulation, negligence is defined as a 

failure to exercise the level of care that 

a reasonably prudent person would 

exercise in complying with the 

regulation. The definition employed in 

this rule is derived from the definition 

of negligence in Black’s Law Dictionary. 

See BLACK’S LAW DICTIONARY (10th 

ed. 2014) (defining negligence as ‘‘[t]he 

failure to exercise the standard of care 

that a reasonably prudent person would 

have exercised in a similar situation’’). 

This final rule increases the 

negligence threshold from 0.5 to 1.0 

percent THC and clarifies how States 

and Indian Tribes determine when to 

suspend or revoke a producer’s license. 

AMS believes that raising the negligence 

threshold from 0.5 percent to 1.0 

percent THC will increase flexibility to 

farmers as they learn more about how to 

grow compliant hemp and as the 

availability of stable hemp genetics 

improves. In developing the compliance 

requirements for State and Tribal plans, 

AMS recognizes that there may be 

significant differences across States and 

Indian Tribes in how they will 

administer their respective hemp 

programs. This final rule provides that 

a producer shall not be subject to more 

than one negligent violation per 

calendar year. 

State and Tribal hemp plans must still 

include requirements to conduct annual 

inspections of, at a minimum, a random 

sample of hemp producers to verify 

hemp is not being produced in violation 

of this rule, along with a procedure for 

handling violations. 

In accordance with the 2018 Farm 

Bill, States and Indian Tribes with their 

own hemp production plans have 

certain flexibilities in determining 

whether hemp producers have violated 

their approved plans. However, there 

are certain compliance requirements 

that all State and Tribal plans must 

contain. This includes procedures to 

identify and attempt to correct certain 

negligent acts, such as failing to provide 

a legal description of the land on which 

the hemp is produced, not obtaining a 

license or other required authorizations 

from the State or Tribal government, or 

producing plants exceeding 0.3 percent 

total THC. States and Indian Tribes may 

include additional requirements in their 

plans. 

This final rule specifies that hemp 

producers do not commit a negligent 

violation if they produce plants that 

exceed the acceptable hemp THC level 

and use reasonable efforts to grow hemp 

and the plant does not have a THC 

concentration of more than 1.0 percent 

on a dry weight basis. AMS recognizes 

that hemp producers may take the 

necessary steps and precautions to 

produce hemp, such as using certified 

seed, using other seed that has reliably 

grown compliant plants in other parts of 

the country, or engaging in other best 

practices, yet still produce plants that 

exceed the acceptable hemp THC level. 

AMS believes that a hemp producer in 

that scenario has exercised a level of 

care that a reasonably prudent person 

would exercise if the plant does not 

have a THC concentration of more than 

1.0 percent on a dry weight basis. AMS 

arrived at this increased tolerance based 

on input from commenters, particularly 

State agriculture departments that 

operated hemp research programs under 

the 2014 Farm Bill, along with data 

provided by laboratories testing hemp 

subject to 2018 Farm Bill requirements. 

The 0.5 percent was based on data from 

three states participating in the 2014 

Farm Bill pilot program. AMS believes 

raising the negligent violation threshold 

from 0.5 percent to 1.0 percent in the 

final rule provides a greater buffer and 

reduces farmers’ exposure to risk of 

violation accrual and license 

suspension. 

AMS recognizes the violation 

threshold may incentivize (or 

disincentivize) innovation by research 

institutions and producers. AMS 

acknowledges more innovation and 

research across industry will bring more 

stability to stakeholders. AMS believes 

the 1.0 percent threshold incentivizes 

innovation across industry more so than 

a 0.5 percent violation threshold. 

Further, comments addressed the 

negative impact of the accrual of 

negligent violations on the financial 

stability of the individual business. 

They described how a hemp grower’s 

access to credit and insurance is 

jeopardized when negligent violations 

accumulate and lead to a determination 

of culpable negligence. Comments 

explained that lending institutions and 

insurance providers look for risk factors. 

They also raised questions about how 

the accrual of negligent violations may 

be interpreted by lender or providers. 

Comments said that many insurers will 

not cover crop losses if losses are due 

to the growers’ negligence. 

AMS acknowledges institutional 

lenders view violations as risk factors in 

decision making. AMS also notes that 

not all culpable violations are derived 

from the accrual of negligent violations. 

Culpable violations may be the result of 

producers violating other parts of the 

2018 Farm Bill. However, the 2018 Farm 

Bill explicitly considers certain actions 

as constituting negligent violations. 

AMS’s intention is to provide a 

threshold between 0.3 percent THC 

level and what would be considered a 

negligent violation so not all hemp that 

tests over the 0.3 percent be considered 

a negligent violation. Because a 

producer will not have committed a 

negligent violation every time he or she 

grows hemp with a concentration of 

hemp above the 0.3 percent level, this 

will assist producers when requesting 

loans or other financial assistance. 


khammond on DSKJM1Z7X2PROD with RULES6
5606 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

Several comments suggested that a 0.5 

percent negligence threshold threatens 

the survival of farmers in an emerging 

industry. Comments suggested that the 

low threshold is a barrier to entry for 

new farmers or farmers with no 

experience growing hemp, who risk 

high initial capital investments to 

establish operations. Comments argued 

that the low threshold favors larger 

farms using industrialized hemp 

varieties and production practices, and 

that the low negligence threshold in the 

IFR would unnecessarily criminalize 

farmers working with a legal 

agricultural commodity. Increasing this 

threshold to 1.0 percent benefits 

producers, including small and new 

farmers, that intended to grow hemp but 

whose crops tested ‘‘hot’’ even though 

they made reasonable efforts to grow 

hemp. 

In cases where a State or Indian Tribe 

determines a negligent violation has 

occurred, a corrective action plan shall 

be established. The corrective action 

plan must include a reasonable date by 

which the producer will correct the 

negligent violation. Producers operating 

under a corrective action plan must also 

periodically report to the State or Tribal 

government, as applicable, on their 

compliance with the plan for a period 

of not less than two calendar years 

following the violation. A producer who 

negligently violates a State or Tribal 

plan three times in a five-year period 

will be ineligible to produce hemp for 

a period of five years from the date of 

the third violation. 

Several comments explained how 

these requirements as written in the IFR 

were confusing and difficult to 

administer. Particularly, commenters 

explained how a producer could easily 

receive three negligent violations during 

one growing season, which would lead 

to an automatic licensing revocation for 

the following five years. For example, a 

producer may grow hemp in three 

different locations. If the hemp becomes 

non-compliant cannabis, all in one 

season, the producer would lose the 

license in one season. Commenters 

described this as too strict and too 

severe a penalty for honest mistakes that 

many first-year hemp producers will 

certainly make. AMS agrees and wishes 

to clarify that this is not the intent of the 

regulation. AMS acknowledges that 

producers may have more than one 

production area and that they may 

harvest at different times. Tests results 

may be over the allowable limit on those 

production areas but the planting was 

performed at the same time using the 

same seeds. Allowing for only one 

violation per season would help 

minimize duplication of enforcement. 

This final rule provides that a producer 

shall not be subject to more than one 

negligent violation per calendar year. As 

it is customary in agriculture, practices 

vary due to many factors such as 

weather, availability of labor, 

transportation and storage capacity and 

more. Due to many factors, producers 

make determinations about planting and 

harvest cycles. In certain circumstances, 

producers may plant before the first 

cycle has been harvested specially when 

they plant in multiple locations. 

Calendar year is easier to administer 

and will allow for various growing 

seasons. 

Each geographical area has a growing 

season based on specific temperature, 

weather, soil or other factors in that 

region, therefore this rule is defining 

growing season as a calendar year. This 

will allow flexibility, including a yearround season if States and Indian Tribes 

have a warmer climate or greenhouse 

growing. 

Negligent violations are still not 

subject to criminal enforcement action 

by local, Tribal, State, or Federal 

government authorities under this 

regulation. 

State and Tribal plans also must 

contain provisions relating to producer 

violations made with a culpable mental 

state greater than negligence, meaning 

acts made intentionally, knowingly, or 

with recklessness. This definition is 

derived from the definition of 

negligence in Black’s Law Dictionary. 

See BLACK’S LAW DICTIONARY (10th 

ed. 2014) (giving as a definition of 

negligence ‘‘[t]he failure to exercise the 

standard of care that a reasonably 

prudent person would have exercised in 

a similar situation’’). If it is determined 

a violation was committed with a 

culpable mental state greater than 

negligence, the State agriculture 

department or Tribal government, as 

applicable, shall immediately report the 

producer to the Attorney General, 

USDA, and the chief law enforcement 

officer of the State or Indian Tribe. 

State and Tribal plans also must 

prohibit any person convicted of a 

felony related to a controlled substance 

under State or Federal law from 

participating in the State or Tribal plan 

and from producing hemp for 10-years 

following the date of conviction. An 

exception applies to a person who was 

lawfully growing hemp under the 2014 

Farm Bill before December 20, 2018, 

and whose conviction also occurred 

before that date. This exemption 

language must be included in all State 

and Tribal hemp plans, whether they 

administered a 2014 Farm Bill research 

pilot program or not. 

The 2018 Farm Bill does not define 

what it means to ‘‘participate in the 

[State or Tribal] program.’’ AMS is not 

requiring States and Indian Tribes to 

adopt a specific definition. Instead, they 

must define who those persons are in 

their plan. The definition must include 

one individual for whom a criminal 

history records check can be conducted 

for each license or authorization that the 

State or Indian Tribe issues. The final 

rule identifies and defines ‘‘key 

participants’’ as those participating in 

the USDA plan. State and Tribes may, 

but are not required, to adopt this 

definition for their plans. 

The State or Indian Tribe will need to 

review criminal history reports for each 

individual identified as participating in 

its program. The final rules defines 

‘‘criminal history report’’ as the Federal 

Bureau of Investigation’s Identity 

History Summary. The State or Indian 

Tribe may review additional reports or 

checks to determine whether an 

individual may participate in its plan. 

Finally, any person found by the USDA, 

State, or Tribal government to have 

materially falsified any information 

submitted to the program will be 

ineligible to participate. 

G. Information Sharing 

The IFR included requirements for 

State and Tribal plans to contain 

procedures for reporting specific 

information to USDA. Limited 

comments were received on these 

requirements. This information has been 

transmitted already by many States and 

Tribes to USDA. This information meets 

the requirements set in the 2018 Farm 

Bill. Therefore, the following 

requirements are the same as required 

under the IFR and are in subpart F of 

this final rule. This is separate from the 

requirement to report hemp crop 

acreage with FSA as discussed above. 

The information required includes 

contact information for each hemp 

producer covered under the plan, 

including name, address, telephone 

number, and email address (if 

available). If the producer is a business 

entity, the information must include the 

full name of the business, address of the 

principal business location, full name 

and title of each employee for whom the 

entity is required to submit a criminal 

history report, and an email address if 

available, and Employee Identification 

Number (‘‘EIN’’) of the business entity. 

Producers must report the legal 

description and geospatial location for 

each hemp production area, including 

each field, greenhouse, or other site 

used by them, as stated in section A of 

this preamble. The report also shall 

include the status of the license or other 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5607 

required authorization from the State or 

Tribal government, as applicable, for 

each producer under a hemp production 

plan. States and Indian Tribes will 

submit this information to USDA not 

later than 30 days after the date it is 

received using the appropriate reporting 

requirements as determined by USDA. 

These reporting requirements are 

found at § 990.70 in this final rule. 

Further explanation of the specific 

information to be submitted, the 

appropriate format, and the specific due 

dates for the information is discussed in 

Section X (Regulatory Analysis) of this 

final rule. This information submitted 

from each State and Tribal plan, along 

with the equivalent information 

collected from individuals participating 

under the USDA plan, will be 

assembled and maintained by USDA 

and made available in real time to 

Federal, State, Tribal, and local law 

enforcement, as required by the 2018 

Farm Bill. All information supporting, 

verifying, or documenting the 

information submitted to USDA must be 

maintained by the States and Indian 

Tribes for at least three years. 

Under § 990.70(c), States and Indian 

Tribes must also submit annual reports 

regarding the total planted, harvested, 

and disposed acreage. Additionally, 

because the final rule provides for 

remediation of plants, the final rule 

requires all remediated acreage to be 

reported as well. Similarly, under 

§ 990.71(c), all USDA hemp plan 

producers must submit annual reports 

to USDA detailing total planted acreage, 

total acreage disposed and remediated, 

and total harvested acreage. 

H. Certification of Resources 

All State and Tribal plans submitted 

for USDA approval must also have a 

certification stating the State or Indian 

Tribe has the resources and personnel 

necessary to carry out the practices and 

procedures described in their plan. 

Section 297B of the AMA requires this 

certification, and the information is 

important to USDA’s approval of State 

and Tribal plans, in that all such plans 

must be supported by adequate 

resources to effectively administer them. 

This section has not changed from the 

IFR. 

I. State and Tribal Plan Approval, 

Technical Assistance and USDA 

Oversight 

Since the publication of the IFR, AMS 

has worked extensively with States and 

Indian Tribes in developing hemp 

production plans. As States and Indian 

Tribes begin the work of modifying their 

plans to incorporate the changes herein, 

we encourage States and Indian Tribes 

to continue working with and sharing 

information with AMS. States and 

Tribes may need to change plans based 

on changes in this final rule because 

their State or Tribal laws may no longer 

match the requirements in this final 

rule. Even though some of the changes 

in this final rule are less burdensome, 

State and Tribal plans must follow their 

own legislations. Accordingly. They 

must amend their plans. During the plan 

development and/or revision process, 

States and Indian Tribes are encouraged 

to contact USDA so we may provide 

technical assistance in developing plan 

specifics. Since the publication of the 

IFR, USDA approved over 60 State and 

Tribal plans within the 60-day 

requirement. USDA approved plans that 

comply with the 2018 Farm Bill and 

with the provisions of the IFR. For the 

2021 planting season, the 2018 Farm 

Bill, amended by the Continuing 

Resolution (CR) (Agriculture 

Improvement Act of 2018 (7 U.S.C. 5940 

note; Pub. L. 116–260)), provided that 

States and institutions of higher 

education can continue operating under 

the authorities of the 2014 Farm Bill 

until January 1, 2022. AMS clarified the 

avenues for Tribal participation under 

authorities in the 2014 Farm Bill to 

grow industrial hemp for research 

purposes. This clarification is available 

on the AMS website: https://

www.ams.usda.gov/content/usdaclarifies-industrial-hemp-productionindian-Tribes. 

Due to this extension, many States 

decided to remain under the 2014 Farm 

Bill provisions and rescinded their 

previously approved plans. All States 

are eligible to remain or start programs 

under the 2014 Farm Bill provisions. As 

a result, USDA will oversee 20 State and 

20 Tribal plans under the 2018 Farm 

Bill until new States and Tribes submit 

more plans under the 2018 Farm Bill 

provisions. 

As of November 2020, States and 

Tribes operating under the 2018 Farm 

Bill reported 4,192 licensed producers 

representing 6,166 acres planted. Of 

these acres planted, there were 231 

disposals representing 730 acres 

disposed due to not meeting the 0.3 

percent acceptable hemp THC level. 

This data is limited because even 

though many States and Tribes have 

approved plans, they have not all been 

fully implemented. USDA expects more 

data will be available as the 2021 season 

begins and States and Tribes implement 

their programs. 

USDA will use the procedures in this 

rule, which are substantively similar to 

those in the IFR, to review and approve 

State and Tribal plans. If a plan does not 

comply with the requirements of the Act 

and this regulation, it will not be 

approved. However, USDA has worked 

with many States and Tribes submitting 

plans to assist them in meeting the 

requirements and obtaining approval for 

their plans. 

If a plan is not approved, USDA 

provides a letter of notification 

outlining the deficiencies identified. 

The State or Tribal government may 

then submit an amended plan for 

review. If the State or Tribe disagrees 

with the determination made by USDA 

regarding the plan, a request for 

reconsideration can be submitted to 

USDA using the appeal process as 

outlined in section V of this document. 

Plans submitted by States and Indian 

Tribes must be approved by USDA 

before they can be implemented. 

States and Indian Tribes can submit 

their plans to USDA through electronic 

mail at farmbill.hemp@usda.gov or by 

postal carrier to USDA. The specific 

mailing address is provided on the 

USDA Domestic Hemp Production 

Program website. 

If the State or Tribal plan application 

is complete and meets the criteria of this 

part, USDA issues an approval letter. 

Approved State and Tribal plans, 

including their respective rules, 

regulations, and procedures, are posted 

on USDA’s hemp program website. 

A USDA-approved State or Tribal 

plan will remain in effect, unless 

approval is revoked by USDA pursuant 

to the revocation procedures discussed 

in this section or unless the State or 

Tribe makes substantive revisions to 

their plan or their laws that alter the 

way the plan meets the requirements of 

this regulation. Additionally, changes to 

the provisions or procedures under this 

rule or to the language in the 2018 Farm 

Bill may require plan revision and 

resubmission to USDA for approval. 

Changes to applicable Federal and State 

or Tribal statutes may also require plan 

revision and resubmission to USDA for 

approval and may lead to plan 

revocation if the plan is not amended. 

Should States or Indian Tribes have 

questions regarding the need to 

resubmit their plans, they should 

contact USDA for guidance. 

A State or Tribal government may 

submit an amended plan to USDA for 

approval if: (1) The Secretary 

disapproves a State or Tribal plan; or (2) 

the State or Tribe makes substantive 

revisions to their plan or to their laws 

that alter the way the plan meets the 

requirements of this regulation, or as 

necessary to bring the plan into 

compliance with changes in other 

applicable law or regulations. 

If the plan previously approved by 

USDA needs to be amended because of 


khammond on DSKJM1Z7X2PROD with RULES6
5608 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

changes to the State’s or Tribe’s laws or 

regulations, such resubmissions should 

be provided to USDA within 60 days 

from when the new State or Tribal law 

or regulations are effective. Producers 

will be held to the requirements of the 

previous plan until such modifications 

are approved by USDA. If State or Tribal 

government regulations in effect under 

the USDA-approved plan change, but 

the State or Tribal government does not 

resubmit a modified plan within 60 

days of the effective date of the change, 

USDA will issue a notification to the 

State or Tribal government that approval 

of its plan will be revoked. The 

revocation will be effective no earlier 

than the beginning of the next calendar 

year. If a plan is revoked, producers 

previously subject to an approved plan 

would be eligible to apply to USDA for 

a license. This is a change from the IFR 

that allowed for resubmission because 

of a change in State or Tribal law or 

regulations within a calendar year. This 

modification is due to USDA’s need to 

know in a timelier manner, since such 

laws and regulations are the foundations 

of the hemp plans. The words of the 

plans do not have meaning if they are 

not aligned with current authorities. 

USDA has the authority to audit 

States and Tribes to determine if they 

are in compliance with the terms and 

conditions of their approved plans. If a 

State or Indian Tribe is noncompliant 

with their plan, USDA will work with 

that State or Indian Tribe to develop a 

corrective action plan. However, if 

additional instances of noncompliance 

occur, USDA has the authority to revoke 

the approval of the State or Tribal plan 

for one year or until the State or Tribe 

become compliant. AMS still believes 

that one year is sufficient time for a 

noncompliant State or Indian Tribe to 

evaluate problems with their plan and 

make the necessary adjustments. Should 

USDA determine the approval of a State 

or Tribal plan should be revoked, such 

a revocation would begin after the end 

of the current calendar year, so 

producers will have the opportunity to 

adjust their operations as necessary. 

This will allow producers to apply for 

a license under the USDA plan so that 

their operations do not become 

disrupted due to the revocation of the 

State or Tribal plan. 

III. Department of Agriculture Plan 

The 2018 Farm Bill requires USDA to 

administer a hemp production plan for 

producers in jurisdictions where hemp 

production is legal but is not covered by 

an approved State or Tribal plan. The 

USDA licensing remains available to 

producers in States and Tribal territories 

without a USDA-approved hemp plan. 

All hemp produced in a jurisdiction 

without an approved State or Tribal 

plan must meet the requirements of the 

USDA plan. The requirements for 

producers operating under the USDA 

plan are similar to those operating 

under approved State and Tribal plans. 

Regulatory requirements for 

producers licensed under the USDA 

plan in this final rule differ in some 

cases from corresponding requirements 

in the IFR and are explained in the 

following section. Comments submitted 

to the IFR generally did not address 

these requirements specifically; rather 

they focused on the broader 

requirements around sampling, testing, 

and disposal, to which all hemp 

producers are subject, whether licensed 

by a State, a Tribe, or USDA. 

A. USDA Hemp Producer License and 

Criminal History Report 

To produce hemp under the USDA 

plan, producers must apply for and be 

issued a license from USDA. USDA has 

been accepting applications from 

producers since October 2019. Any 

license issued by USDA prior to 

publication of this final rule will remain 

in effect and subject to the original 

expiration date. As of the issuance of 

this final rule, USDA has issued 380 

licenses under the USDA plan. 

While a State or Tribal government 

has a draft hemp production plan 

pending for USDA approval, USDA will 

not issue USDA hemp production 

licenses to individual producers located 

within that State or Tribal territory. 

Once USDA approves a hemp 

production plan from a State or Tribe, 

it will deny any license applications 

from individuals located in the 

applicable State or Tribal territory. If 

USDA disapproves a State or Tribal 

hemp production plan, individual 

producers located in the State or Tribal 

territory may apply for a USDA hemp 

production license, unless hemp 

production is illegal in the State or 

Tribal territory where they intend to 

produce hemp. 

Comments to the IFR described 

confusion around the application 

window for when USDA would receive 

and process applications as described in 

the IFR. The IFR said that for the first 

year after USDA began to accept 

applications, applications could be 

submitted any time. For all subsequent 

years, license applications and license 

renewal applications would have to be 

submitted between August 1 and 

October 31. AMS requested input on 

this application window, and 

commenters were generally opposed. 

Under this final rule, USDA will accept 

applications for USDA hemp production 

licenses on a rolling basis to better 

accommodate the needs of producers. 

AMS continues to encourage the 

submission of applications well before 

the planting season so AMS has 

adequate time to process the 

applications. All applications must 

comply with the requirements as 

described below. The license 

application is available online at the 

USDA Domestic Hemp Production 

Program website at https://

www.ams.usda.gov/rules-regulations/ 

hemp/information-producers. 

Applications may be submitted 

electronically or by mail. 

The producer license application 

requires contact information such as 

name, address, telephone number, and 

email address (if available). If the 

applicant represents a business entity, 

and that entity will be the producer, the 

application will require the full name of 

the business, address of the principal 

business location, full name and title of 

the key participants on behalf of the 

entity, an email address if available, and 

EIN of the business entity. All 

applications must be accompanied by a 

completed criminal history report. 

Several comments to the IFR expressed 

opposition to this requirement. AMS is 

retaining this requirement since 

verification of compliance with the 

felony restriction is a statutory 

requirement. If the application is for a 

business entity, a completed criminal 

history report must be provided for each 

key participant. 

Some commenters expressed concern 

with the requirements pertaining to 

‘‘key participants,’’ particularly with the 

requirement that all key participants 

undergo a background check. To the 

extent the commenters equated a 

criminal history check with a 

background check, AMS is retaining this 

requirement, since key participants are 

those individuals responsible for 

ensuring compliance with the regulatory 

requirements contained herein. If key 

participants are not subject to criminal 

history checks, AMS cannot ensure 

statutory restrictions on individuals 

with felony convictions related to 

controlled substances are met per 

Section 297B(e)(3)(B)(i) of the AMA. 

AMS notes that it will not conduct any 

other checks into the background of key 

participants. 

Key participants are a person or 

persons who have a direct or indirect 

financial interest in the entity producing 

hemp, such as an owner or partner in a 

partnership. A key participant also 

includes a person in a corporate entity 

at executive levels including the chief 

executive officer, chief operating officer, 

and chief financial officer. This does not 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5609 

include other management positions 

like farm, field, or shift managers. The 

final rule also specifies that the 

definition of key participant does not 

include a member of the leadership of 

a Tribal government who is acting in 

their capacity as a Tribal leader, except 

when that member exercises executive 

managerial control over hemp 

production. AMS added this 

specification to address concerns raised 

by Indian Tribes regarding issues that 

can arise when a Tribal leader is also 

involved in the production of hemp in 

their capacity as a Tribal leader. While 

AMS understands the issues that can 

arise when a Tribal leader is subject to 

the felony conviction restriction, AMS 

must also ensure that all required 

entities operating under a USDA plan 

comply with Section 297B(e)(3)(B) of 

the AMA. Therefore, the definition of 

key participants still encompasses 

Tribal leaders who exercise executive 

managerial control over hemp 

production. 

USDA will not accept criminal history 

reports completed more than 60 days 

before the submission of an application, 

because the 60-day window provides 

USDA with an expectation that the 

findings of the report are reasonably 

current and accurate. 

The criminal history report must 

indicate the applicant has not been 

convicted of a State or Federal felony 

related to a controlled substance for the 

10 years prior to the date of when the 

report was completed. An exception 

applies to a person who was lawfully 

growing hemp under the 2014 Farm Bill 

before December 20, 2018, and whose 

conviction also occurred before that 

date. 

In addition to providing the 

information specified, the application 

will also require license applicants to 

certify they will adhere to the 

provisions of the plan. 

Once all the necessary information 

has been provided, applications will be 

reviewed by USDA for completeness 

and to determine an applicant’s 

eligibility. USDA will approve or deny 

license applications unless the 

applicant is intending to produce hemp 

in a jurisdiction that has submitted a 

plan to USDA or has a plan approved 

by USDA, in which case the application 

for a USDA license will be denied. 

Applicants will be notified if they have 

been granted or denied a license either 

by mail or email. 

If an application is denied, the 

applicant will receive a notification 

letter or email specifying why the 

application was denied. If an 

application is denied because it is 

incomplete, the applicant will have the 

option of resubmitting a revised 

application. If the application was 

denied for other reasons, the applicant 

will have the opportunity to appeal 

USDA’s decision in accordance with the 

appeals process outlined in the 

regulation in subpart D. 

Once a license application has been 

approved, USDA will issue the producer 

license. Licenses are not transferrable in 

any manner. An applicant whose 

application has been approved will not 

be considered a licensed producer 

under the USDA plan until the 

applicant receives their producer 

license. Licenses do not renew 

automatically and must be renewed 

every three years. 

Applications for renewal will be 

subject to the same terms and approved 

under the same criteria as initial 

applications unless there has been an 

intervening change in the applicable 

law or regulations since approval of the 

initial or last application. In such a case, 

the subsequently enacted law or 

regulation shall govern renewal of the 

license. Licenses will be valid until 

December 31 of the year that is at least 

three years after the license is issued. 

This date is not tied to the harvest and 

planting season. For example, if a 

producer applies for a license on August 

1, 2021, and is granted a license on 

September 15, 2021, the license would 

expire December 31, 2024. A December 

31 expiration date will allow licensed 

producers time to apply for a license 

renewal prior to their prior license’s 

expiration and prevent a gap in 

licensing. 

A producer licensed by USDA must 

report their hemp crop acreage to FSA. 

Producers must provide specific 

information to FSA, including, but not 

limited to, USDA license number, the 

specific location where hemp is 

produced and the acreage, greenhouse, 

building, or site where hemp is 

produced. The specific location where 

hemp is produced must be identified, to 

the extent practicable, by the geospatial 

location. FSA will provide assistance in 

identifying the hemp growing location. 

Please refer to the Section II of this 

document on State and Tribal hemp 

production program requirements for 

further discussion on FSA reporting 

requirements. 

If at any time there is a change to the 

information submitted in the license 

application, a license modification is 

required. A license modification is 

required if, for example, the licensed 

business is sold to a new owner or hemp 

will be produced in a new location not 

described on the original application. 

Producers must notify USDA 

immediately should there be any change 

in the information provided on the 

license application. 

B. Sampling for THC 

The IFR stated that all hemp 

production must be sampled and tested 

for THC concentration levels. It is the 

responsibility of the licensed producer 

to pay any fees associated with 

sampling. AMS issued guidance on 

sampling procedures that meet the 

sampling requirements to coincide with 

publication of the IFR and will update 

the guidance with this final rule. AMS 

is requiring that all samples tested for 

THC concentration levels be conducted 

in DEA-registered laboratories. 

However, this requirement will not be 

applicable until December 31, 2022. 

Significant input was received on the 

IFR sampling requirements. Please refer 

to section B under State and Tribal 

plans above and the discussion of 

comments below for a summary of 

findings. Producers under the USDA 

plan are subject to the sampling and 

testing requirements as outlined in the 

USDA guidelines for sampling and 

testing. Since USDA cannot develop a 

one size fits all performance-based 

sampling program, all producers 

licensed under the USDA plan must 

comply with the USDA sampling 

guidelines. USDA licensed producers 

are responsible for obtaining the 

services of sampling agents and hemp 

testing laboratories themselves. USDA is 

updating guidance on sampling 

procedures and training for sampling 

agents with this rule. USDA does not 

provide sampling or testing services and 

will not pay for those services. 

State and Tribal hemp regulators have 

successfully developed sampling 

requirements that ensure adherence to 

State and Federal regulations, while 

allowing for flexibilities due to limited 

State resources and State and Tribal 

differences. They explained that, since 

most hemp in a given region is 

harvested at the same time, sampling 

must be completed within a very short 

time frame by only a few individuals. 

Several States also explained that 

perceived risk determines State 

requirements. Some States utilize 

different sampling requirements for 

broad end-use categories like ‘‘fiber/ 

grain’’ hemp versus ‘‘cannabinoid’’ 

hemp, while others base their 

requirements on historical THC 

concentrations of certain varietals or on 

the characteristics and growing history 

of a certain farm or producer. AMS 

agrees that sampling requirements 

should allow States and Indian Tribes 

more flexibility in the management of 

their hemp regulatory programs. 


khammond on DSKJM1Z7X2PROD with RULES6
5610 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

AMS agrees that requiring sampling 

from every lot may be burdensome and 

expensive for State and Tribal 

regulatory entities and producers. 

AMS finds that it makes sense to 

allow States and Indian Tribes to 

consider performance-based alternatives 

when developing sampling plans that 

take into account unique sampling 

protocols for hemp growing facilities 

under their jurisdiction. The sampling 

requirements for State and Tribal plans 

allow for States and Indian Tribes to 

develop unique sampling protocols for 

hemp growing facilities under their 

jurisdiction. Sampling protocols must 

be sufficient at a confidence level of 95 

percent that no more than one percent 

of the plants in each lot would exceed 

the acceptable hemp THC level and 

ensure that a representative sample is 

collected that represents a homogeneous 

composition of the lot. Alternatively, 

States and Indian Tribes may adopt a 

performance-based sampling protocol. A 

performance-based protocol must have 

the potential to ensure, at a confidence 

level of 95 percent, that the cannabis 

plants will not test above the acceptable 

hemp THC level. USDA encourages that 

the alternative protocol consider seed 

certification processes or process that 

identifies varieties that have 

consistently demonstrated to result in 

compliant hemp plants in that State or 

territory of the Indian Tribe, whether 

the producer is conducting research on 

hemp at an institution of higher learning 

or that is funded by a Federal, State, or 

Tribal government, whether a producer 

has consistently produced compliant 

hemp plants over an extended period of 

time, and other similar factors. AMS 

believes this will provide needed 

flexibility to States and Indian Tribes to 

develop logical and enforceable 

sampling requirements that take into 

consideration their unique 

circumstances. AMS will still require 

States and Indian Tribes to submit their 

individual sampling requirements for 

review as a component of the plan 

approval process. If a State or Tribal 

plan lacks a sampling protocol, every 

lot, and thereby every producer must be 

sampled and tested. 

When evaluating sampling protocols 

submitted by States and Indian Tribes, 

USDA will evaluate the risk of 

producing non-compliant material to 

determine approval or disapproval. In 

evaluating the risk, USDA will take into 

consideration whether the performancebased factors the State or Tribe used 

have the potential to ensure compliance 

at a 95 percent confidence level. 

Since USDA cannot develop 

performance metrics that would be 

applicable independently from where 

the producer is located, producers 

licensed under the USDA plan are 

subject to the sampling requirements in 

the rule. USDA guidelines provided on 

the USDA website at https://

www.ams.usda.gov/rules-regulations/ 

hemp/information-sampling describe 

best practices for complying with those 

requirements. However, USDA would 

consider a performance-based sampling 

scheme for producers under the USDA 

plan, and amend the sampling 

requirements accordingly, if information 

collected by USDA in the future is 

sufficient to make this determination. 

Data must be reliable and able to be 

applicable across the production areas 

in the U.S. 

Samples must be collected by a 

USDA-approved sampling agent, or a 

Federal, State, Tribal, or local law 

enforcement agent authorized by USDA 

to collect samples. As explained above, 

USDA is expanding the training 

requirements for sampling agents and 

will provide a list of authorized 

sampling agents on the USDA website. 

It is the responsibility of the licensed 

producer to pay any fees associated with 

sampling and testing. Sampling and 

testing guideline documents are being 

updated as part of this proceeding and 

are available on the USDA website. 

The sampling procedures are 

designed to produce a representative 

sample for testing. They describe 

procedures for entering a growing area 

and collecting the minimum number of 

plant specimens necessary to accurately 

represent the THC content, through 

laboratory testing, of the sample to be 

tested. 

C. Testing Laboratories 

The THC level in representative 

samples must be at or below the 

acceptable hemp THC level. Testing 

must be conducted using postdecarboxylation or other similarly 

reliable methods where the total THC 

concentration level measured includes 

the potential to convert THCA into THC. 

Further, test results should be 

determined and reported on a dry 

weight basis, meaning the percentage of 

THC, by weight, in a cannabis sample, 

after excluding moisture from the 

sample. The moisture content is 

expressed as the ratio of the amount of 

moisture in the sample to the amount of 

dry solid in the sample. 

Based on AMS’s review of scientific 

studies, internal research and 

information gathered from the United 

Nations Office on Drugs and Crime: 

‘‘Recommended Methods for the 

Identification and Analysis of Cannabis 

and Cannabis Products’’ (ISBN 978–92– 

1–148242–3), AMS has determined that 

testing methodologies meeting these 

requirements include gas or liquid 

chromatography with detection. As 

discussed earlier and stated in 

§ 990.25(g), if a testing laboratory 

utilizes alternative testing methods, they 

must be reviewed and approved by 

USDA to assess their reliability, 

accuracy, and compliance with the 

requirements. 

As explained earlier in this document, 

AMS is requiring that all testing of 

samples for THC concentration levels be 

conducted in DEA-registered 

laboratories. Enforcement of this 

requirement has been delayed until 

December 31, 2022. Non-DEA-registered 

labs can continue testing hemp for THC 

concentration until that time. Labs 

testing hemp for THC must meet 

standards of performance described in 

this regulation. Standards of 

performance ensure the validity and 

reliability of test results; that analytical 

method selection, validation, and 

verification are appropriate (fit for 

purpose); and that the laboratory can 

successfully perform the testing. 

Furthermore, the standards ensure 

consistent, accurate, analytical 

performance and that the analytical tests 

performed are sufficiently sensitive for 

the purposes of the detectability 

requirements under this final rule. 

Laboratories conducting THC testing 

must also be registered with DEA to 

handle controlled substances under the 

CSA (21 U.S.C. 822 and 21 U.S.C. 844) 

and DEA regulations (21 CFR part 1301). 

USDA is adopting this requirement 

because of the potential for these 

laboratories to handle cannabis products 

testing above 0.3 percent THC. Such 

products are, by definition, marijuana, 

and a controlled substance. DEA 

registration requirements verify a 

laboratory’s ability to properly handle 

controlled substances. 

As previously explained in the 

requirements for State and Tribal plans, 

AMS is not adopting requirements that 

hemp testing laboratories be approved 

under a USDA Laboratory Approval 

Program or undergo ISO accreditation. 

It is the responsibility of the licensed 

producer to select the DEA-registered 

laboratory that will conduct the testing 

and to pay any fees associated with 

testing. Laboratories performing THC 

testing for hemp produced under this 

program are required to share test 

results with the licensed producer and 

USDA. USDA will provide instructions 

to all approved labs on how to 

electronically submit test results to 

USDA. Laboratories may provide test 

results to licensed producers in 

whatever manner best aligns with their 

business practices, but producers must 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5611 

be able to produce a copy of test results. 

For this reason, providing test results to 

producers through a web portal or 

through electronic mail, so the producer 

will have ready access to print the 

results when needed, is preferred. 

Samples exceeding the acceptable 

hemp THC level are marijuana and will 

be handled in accordance with the 

procedures discussed in section C 

below. 

Any licensee may request that the 

laboratory retest pre-harvest samples, if 

it is believed the original THC 

concentration level test results were in 

error. The licensee requesting the retest 

of the second sample would pay the cost 

of the test. The retest results would be 

issued to the licensee requesting the 

retest, and a copy would be provided to 

USDA or its agent. 

Research Institutions Sampling and 

Testing 

AMS also acknowledges that research 

institutions face special circumstances 

when conducting hemp research. Under 

the IFR, researchers and research 

institutions were required to comply 

with the same production requirements 

as commercial producers. Under this 

final rule, and as described in detail 

below, research institutions and the 

producers working with them are 

afforded greater sampling and testing 

flexibility to facilitate continued hemp 

research. Producers that produce hemp 

for research must obtain a USDA 

license. However, the hemp that is 

produced for research is not subject to 

the same sampling requirements 

provided that the producer adopts and 

carries out an alternative sampling 

method that has the potential to ensure, 

at a confidence level of 95 percent, that 

the cannabis plant species Cannabis 

sativa L. that will be subject to this 

alternative method will not test above 

the acceptable hemp THC level. The 

rule includes a performance-based 

standard for sampling for all licensed 

producers in section 990.24: ‘‘at a 

confidence level of 95 percent that no 

more than one percent (1%) of the 

plants in the lot would exceed the 

acceptable hemp THC level.’’ The 

performance-based standard for research 

is a modification of that standard: ‘‘the 

potential to ensure, at a confidence level 

of 95 percent, that the cannabis plant 

species Cannabis sativa L. that will be 

subject to this alternative method will 

not test above the acceptable hemp THC 

level.’’ We are comfortable with this 

modification to recognize that 

researchers may need flexibility to 

conduct their research and because the 

research hemp cannot enter the stream 

of commerce. USDA will monitor 

researchers’ compliance with this 

standard as part of its normal oversight 

and compliance program. 

USDA licensees shall ensure the 

disposal of all non-compliant plants. 

USDA licensees shall also comply with 

the reporting requirements including 

reporting disposal of non-compliant 

plants. Research institutions that handle 

‘‘hot’’ hemp must follow CSA 

requirements for handling marijuana. 

Performance based plans from 

research institutions where a State or 

Tribal plan is not in place will be 

reviewed by USDA. Notice and 

comment requirements under the PRA 

process will be followed before a final 

determination is made by USDA to 

move forward with approving 

performance-based plans for those 

producers under the USDA plan. 

States and Indian Tribes are allowed 

to develop performance-based 

requirements for these institutions. 

However, the alternative method must 

have the potential to ensure, at a 

confidence level of 95 percent, that the 

cannabis plant species Cannabis sativa 

L. that will be subject to the alternative 

method will not test above the 

acceptable hemp THC level. 

The research institutions must follow 

reporting requirements. AMS believes 

this exception is necessary to help 

support research and development as it 

relates to hemp production. This 

decision allows these types of research 

facilities and institutions to confidently 

oversee the study of hemp plants 

through trialing and genetics research. 

AMS believes this exception to be 

critical to the growth of industry, 

particularly in its infancy. Over time, 

the exception provided by this final rule 

will help to stabilize the industry by 

providing greater understanding of 

hemp genetics and how certain varietals 

respond differently to growing 

conditions in various geographic 

locations. All producers are expected to 

benefit from such knowledge as they 

will be made aware of the more stable 

and consistently reliable hemp varietals. 

Any non-compliant plants produced by 

research institutions as a result of 

research and development will still 

need to be disposed and verified 

through documentation. Research 

institutions must follow licensing and 

reporting requirements. 

D. Disposal of Non-Compliant Product 

Under the IFR, non-compliant 

product was required to be disposed of 

by persons authorized to do so under 

the CSA and had to be destroyed. As 

explained below, under this final rule, 

producers may handle non-compliant 

product disposal on the farm, and they 

have greater flexibility in remediating 

that product. USDA producers are 

required to follow procedures for 

ensuring effective disposal of cannabis 

plants produced in violation of this rule. 

Plants that are removed as a result of 

poor plant health, pests, disease, 

weather events, along with removal of 

male or hermaphrodite plants as part of 

a cross-pollination prevention plans, are 

not subject to the disposal requirements 

herein. This final rule retains the 

disposal requirements explained in the 

IFR, but clarifies what ‘‘disposal’’ means 

and explains how the process must be 

conducted. If a producer grew cannabis 

exceeding the acceptable hemp THC 

level, the IFR required that the material 

be disposed of in accordance with the 

CSA and DEA regulations because such 

material is marijuana, a Schedule I 

controlled substance under the CSA. 

The IFR required that material be 

collected for disposal by a person 

authorized under the CSA to handle 

marijuana, such as a DEA-registered 

reverse distributor, or a duly authorized 

Federal, State, Tribal, or local law 

enforcement officer. 

As explained earlier, AMS is now 

allowing the flexibility to conduct onfarm disposals and also allowing for 

remediation options. 

If the results of a test conclude that 

the THC levels exceed the acceptable 

hemp THC level, the laboratory will 

promptly notify the producer and USDA 

or its authorized agent. If a licensed 

producer is notified that they have 

produced cannabis exceeding the 

acceptable hemp THC level, the 

cannabis must be disposed of in 

accordance with the on-farm disposal 

options described herein. 

Licensed producers notified they have 

produced cannabis plants exceeding the 

acceptable hemp THC level must 

arrange for disposal or remediation of 

the lot represented by the sample in 

accordance with the procedures as 

specified above and described on the 

USDA website at https://

www.ams.usda.gov/rules-regulations/ 

hemp/disposal-activities. 

Producers must document the 

disposal or remediation of all noncompliant cannabis. This can be 

accomplished by providing USDA with 

a copy of the documentation of disposal 

or remediation using the reporting 

requirements established by USDA. 

These reports must be submitted to 

USDA following the completion of the 

disposal or remediation process. 

E. Compliance 

As described below, this final rule 

changes the THC threshold for a 

negligent violation from 0.5 percent 


khammond on DSKJM1Z7X2PROD with RULES6
5612 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

9For a corporation, if a key participant has a 

disqualifying felony conviction, the corporation 

may remove that person from a key participant 

position. Failure to remove that person will result 

in a license revocation. 

under the IFR to 1.0 percent. Further, 

rather than being liable for multiple 

negligent violations in each growing 

season as under the IFR, this final rule 

provides that producers can only incur 

one negligent violation in each growing 

season, which prevents producers from 

accumulating multiple negligent 

violations and losing program eligibility 

after a single growing season. 

USDA will maintain oversight of 

USDA-licensed hemp producers by 

conducting audits of USDA licensees 

and working with licensees with 

negligent violations to establish 

corrective action plans. Negligent 

violations by a producer may lead to 

suspension or revocation of a producer’s 

license. 

While USDA has not yet conducted 

any random audits, the department may 

conduct random audits of licensees to 

verify hemp is being produced in 

accordance with Subtitle G of the AMA 

no more frequently than every three 

years, based on available resources. The 

format of the audit will vary and may 

include a ‘‘desk-audit’’ where USDA 

requests records from a licensee, or the 

audit may be a physical visit to a 

licensee’s facility. When USDA visits a 

licensee’s facility, the licensee must 

provide access to any fields, 

greenhouses, storage facilities, or other 

locations where the licensee produces 

hemp. USDA may also request records 

from the licensee, to include production 

and planting data, testing results, and 

other information as determined by 

USDA. 

USDA will issue a summary of the 

audit to the licensee after the completed 

audit. Licensees who are found to have 

a negligent violation will be subject to 

a corrective action plan. Negligent 

violations include: (1) Failure to provide 

a legal description of the land on which 

the hemp is produced; (2) not obtaining 

a license before engaging in production; 

or (3) producing plants exceeding the 

acceptable hemp THC level. Similar to 

the requirements for State and Tribal 

plans, USDA will not consider hemp 

producers as committing a negligent 

violation if they produce plants 

exceeding the acceptable hemp THC 

level if they use reasonable efforts to 

grow hemp and the cannabis plant does 

not have a THC concentration of more 

than 1.0 percent on a dry weight basis. 

AMS believes that increasing the 

negligence threshold from 0.5 percent to 

1.0 percent will increase flexibility to 

farmers as they learn more about how to 

grow compliant hemp and as the 

availability of stable hemp genetics 

improves. Further, producers may only 

receive one negligent violation per 

growing season, as determined by USDA 

based on a review of producer records. 

USDA will use a calendar year as a 

growing season. 

When USDA determines that a 

negligent violation has occurred, USDA 

will issue a Notice of Violation. This 

Notice of Violation will include a 

corrective action plan. The corrective 

action plan will include a reasonable 

date by which the producer will correct 

the negligent violation or violations and 

will require the producer to periodically 

report to USDA on its compliance with 

the plan for a period of not less than the 

next two calendar years. A producer 

who has negligently violated the 

provisions of this rule three times in a 

five-year period is ineligible to produce 

hemp for a period of five years from the 

date of the third violation. Negligent 

violations are not subject to criminal 

enforcement. 

Hemp found to be produced in 

violation of this regulation, such as 

hemp produced on a property not 

disclosed by the licensed producer or 

without a license, would be subject to 

the same disposal provisions as for 

cannabis testing above the acceptable 

hemp THC level. Further, if it is 

determined a violation was committed 

with a culpable mental state greater than 

negligence, USDA will report the 

violation to law enforcement. 

The 2018 Farm Bill limited the 

participation of certain convicted felons 

in hemp production. A person with a 

State or Federal felony conviction 

relating to a controlled substance is 

subject to a 10-year ineligibility 

restriction on producing hemp under 

the Act. An exception applies to a 

person who was lawfully growing hemp 

under the 2014 Farm Bill before 

December 20, 2018, and whose 

conviction also occurred before that 

date. 

F. Suspension of a USDA License 

There are no changes to the IFR 

provisions related to suspension of 

USDA licenses in this final rule. 

A USDA license may be suspended if 

USDA receives credible information that 

a USDA licensee has either: (1) Engaged 

in conduct violating a provision of this 

regulation; or (2) failed to comply with 

a written order from the AMS 

Administrator related to a negligent 

violation of this regulation. Examples of 

credible information are information 

from local authorities of harvested 

plants without testing or planting of 

hemp in non-licensed locations. 

Any person whose license has been 

suspended shall not produce hemp 

during the period of suspension. A 

suspended license may be restored after 

a waiting period of one year. A producer 

whose license has been suspended may 

be required to comply with a corrective 

action plan to fully restore their license. 

A USDA license shall be immediately 

revoked if the USDA licensee: (1) Pleads 

guilty to, or is convicted of, any felony 

related to a controlled substance; 9 (2) 

made any materially false statement 

with regard to this regulation to USDA 

or its representatives with a culpable 

mental state greater than negligence; or 

(3) was found to be growing cannabis 

exceeding the acceptable hemp THC 

level with a culpable mental state 

greater than negligence or negligently 

violated the provisions of this regulation 

three times in five years. 

If the licensed producer wants to 

appeal any suspension or revocation 

decision made by USDA as described in 

this section, they can do so using the 

appeal process explained in section V of 

this document. 

G. Reporting and Recordkeeping 

The 2018 Farm Bill requires USDA to 

develop a process to maintain relevant 

information regarding the land where 

hemp is produced. Reporting 

requirements under this final rule, 

particularly the requirement to report 

hemp crop acreage to FSA, are 

discussed extensively in Section B of 

the State and Tribal plan requirements 

and the same requirements are 

applicable to USDA licensed producers. 

In general, changes from the IFR allow 

producers more flexibility in defining 

for FSA the areas (instead of ‘‘lots’’) they 

use for hemp production. USDA hemp 

production licensees can apply for 

licenses on a rolling basis under this 

final rule, in contrast to the limited 

period provided under the IFR. 

Reporting requirements under this final 

rule are revised slightly to allow 

producers to account for on-farm 

disposal of non-compliant product. 

USDA’s FSA is well suited to collect 

this information for the domestic hemp 

production program. FSA has staff 

throughout the United States who are 

trained to work with farmers to verify 

land uses. Many hemp producers are 

likely to be familiar with the FSA since 

they already operate traditional farms, 

and therefore already provide data to 

FSA on acres and crops planted. 

Producers may benefit from information 

to participate in other USDA programs 

through FSA offices. Licensed 

producers will be required to report 

their hemp crop acreage with FSA, and 

to provide FSA with specific 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5613 

information regarding field acreage, 

greenhouse, or indoor square footage of 

hemp planted. This information must 

include street address, geospatial 

location or other comparable 

identification method specifying where 

the hemp will be produced, and the 

legal description of the land. Geospatial 

location or other methods of identifying 

the production locations are necessary, 

as not all rural locations have specific 

addresses. This information is required 

for each field, greenhouse, building, or 

site where hemp will be grown. USDA 

will use this information to assemble 

and maintain the data USDA must make 

available in real time to Federal, State, 

Tribal and local law enforcement as 

required by the 2018 Farm Bill and as 

described in section G below. 

Specific procedures for reporting 

hemp acreage to FSA will be posted on 

the USDA Domestic Hemp Production 

Program website. All information will 

be maintained by USDA for at least 

three calendar years. FSA will assist 

producers in identifying the hemp 

growing locations since they have maps 

that allow for better identification. This 

is a procedure that FSA employees are 

very familiar with since it is used for 

other USDA programs. This rule also 

revises the definition of ‘‘lot’’ to include 

other terms used by FSA with the same 

meaning. FSA uses terms like ‘‘farm,’’ 

‘‘tract,’’ ‘‘field,’’ and ‘‘subfield.’’ FSA 

staff will not provide a ‘‘lot number’’ to 

producers as described in the IFR. 

Instead, FSA will assist producers to 

identify the area where hemp is grown. 

More details are provided under the 

States and Tribal plan Section B earlier 

in this final rule. 

Licensed producers are required to 

maintain copies of all records and 

reports necessary to demonstrate 

compliance with the program. These 

records include those that support, 

document, or verify the information 

provided in the forms submitted to 

USDA. Records and reports must be 

kept for a minimum of three years. 

Because the final rule allows producers 

to remediate plants, the final rule also 

requires producers to maintain records 

on all remediated cannabis plants. 

Under the USDA plan, there will be 

additional reporting requirements for 

licensed producers. These include 

information requested in the application 

for a license and the record and 

reporting requirements needed to 

document disposal or remediation of 

cannabis produced in violation of the 

provisions of this rule. Specific 

reporting requirements are detailed in 

§ 990.71. 

H. Information Sharing With Law 

Enforcement 

USDA is working to develop and 

maintain a database of all relevant and 

required information regarding hemp as 

specified by the 2018 Farm Bill. This 

database will be accessible in real time 

to Federal, State, local, and Tribal law 

enforcement officers through a Federal 

government law enforcement system. 

USDA AMS will administer and 

populate this database, which will 

include information submitted by 

States, Tribes, laboratories, and USDA 

licensed producers and information 

submitted to FSA. States and Tribes 

must provide information to USDA in a 

format that is compatible with USDA’s 

information sharing system. USDA will 

work with States and Indian Tribes on 

system format and other information 

necessary to share information. 

USDA will use this information to 

create a comprehensive list of all 

domestic hemp producers. USDA will 

also gather the information related to 

the land used to produce domestic 

hemp. This information will be 

comprehensive and include data from 

both State and Tribal plans and will 

include a legal description of the land 

on which hemp is grown by each hemp 

producer and the corresponding 

geospatial location or other identifiable 

location. Finally, USDA will also gather 

information regarding the status of all 

licenses issued under State and Tribal 

government plans and under the USDA 

plan. 

This information will be made 

available in real time to Federal, State, 

local and Tribal law enforcement as 

required by the 2018 Farm Bill. 

IV. Definitions 

The following terms are integral to 

implementing Subtitle G of the AMA 

and establish the scope and 

applicability of the regulations of this 

final rule. 

The term ‘‘Act’’ refers to the 

Agricultural Marketing Act of 1946. The 

2018 Farm Bill amended the 

Agricultural Marketing Act of 1946 by 

adding Subtitle G, which is a new 

authority for the Secretary of 

Agriculture to administer a national 

hemp production program. Section 

297D of Subtitle G authorizes and 

directs USDA to promulgate regulations 

to implement this program. 

The ‘‘Agricultural Marketing Service’’ 

or ‘‘AMS’’ is the Agricultural Marketing 

Service of the U.S. Department of 

Agriculture is the agency the Secretary 

of Agriculture has been charged with 

the responsibility to oversee the 

administration of this new program. 

The term ‘‘applicant’’ means any State 

or Indian Tribe that has applied for 

USDA approval of a State or Tribal 

hemp production plan for the State or 

Indian Tribe they represent. This term 

also applies to any person or business 

in a State or territory of an Indian Tribe 

not subject to a State or Tribal plan, who 

applies for a hemp production license 

under the USDA plan established under 

this part. 

The term ‘‘cannabis’’ is the Latin 

name of the plant that, depending on its 

THC concentration level, is further 

defined as either ‘‘hemp’’ or 

‘‘marijuana.’’ Cannabis is a genus of 

flowering plants in the family 

Cannabaceae, of which Cannabis sativa 

is a species, and Cannabis indica and 

Cannabis ruderalis are subspecies 

thereof. For the purposes of this part, 

cannabis refers to any form of the plant 

where the delta-9 tetrahydrocannabinol 

concentration on a dry weight basis has 

not yet been determined. This term is 

important in describing regulations that 

apply to plant production, sampling, or 

handling prior to determining its THC 

content. 

The ‘‘Controlled Substances Act’’ is 

the statute, codified in 21 U.S.C. 801– 

971, establishing Federal U.S. drug 

policy under which the manufacture, 

importation, exportation, possession, 

use, and distribution of certain 

substances are regulated. Because 

cannabis with THC content 

concentration levels of higher than 0.3 

percent is deemed to be marijuana, a 

Schedule I controlled substance, its 

regulation falls under the CSA. 

Therefore, for compliance purposes, the 

requirements of the CSA are relied upon 

for the disposal of cannabis that 

contains THC concentrations above the 

stated limit of this final rule. 

The rule includes a definition of 

‘‘conviction’’ to explain what is 

considered a conviction and what is not. 

Specifically, a plea of guilty or nolo 

contendere or any finding of guilt is a 

conviction. However, if the finding of 

guilt is subsequently overturned on 

appeal, pardoned, or expunged, then it 

is not considered a conviction for 

purposes of part 990. This definition of 

‘‘conviction’’ is consistent with how 

some other agencies conducting 

criminal history record searches 

determine disqualifying crimes. 

A ‘‘corrective action plan’’ is a plan 

agreed to by a State, Tribal government, 

or USDA for a licensed hemp producer, 

to correct a negligent violation or noncompliance with a hemp production 

plan, its terms, the applicable law(s) or 

this regulation. Corrective action plans 

may also be a plan set forth by a State 

or Tribal government with an approved 


khammond on DSKJM1Z7X2PROD with RULES6
5614 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

hemp production plan to correct a noncompliance of their program with their 

USDA-approved plan. This term is 

defined in accordance with the 2018 

Farm Bill, which mandates certain noncompliant actions to be addressed 

through corrective action plans. 

‘‘Culpable mental state greater than 

negligence’’ is a term used in the 2018 

Farm Bill to determine when certain 

actions would be subject to specific 

consequences. This term means to act 

intentionally, knowingly, willfully, 

recklessly, or with criminal negligence. 

The term ‘‘decarboxylated’’ refers to 

the completion of the chemical reaction 

that converts THCA into delta-9 THC, 

the intoxicating component of cannabis. 

The decarboxylated value is also 

calculated using a molecular mass 

conversion ratio that sums delta-9 THC 

and eighty-seven and seven tenths (87.7) 

percent of THC-acid ((delta-9 THC) + 

(0.877*THCA)). 

‘‘Delta-9 tetrahydrocannabinol,’’ also 

referred to as ‘‘Delta-9 THC’’ or ‘‘THC’’ 

is the primary psychoactive component 

of cannabis, and its regulation forms the 

basis for the regulatory action of this 

part. As mandated by the Act, legal 

hemp production must be verified as 

having THC concentration levels of 0.3 

percent on a dry weight basis or below. 

For the purposes of this part, delta-9 

THC and THC are interchangeable. 

The term ‘‘disposal’’ means the action 

or process of getting rid of cannabis that 

is non-compliant. 

‘‘DEA’’ is an acronym for the ‘‘Drug 

Enforcement Administration,’’ a United 

States Federal law enforcement agency 

under the United States Department of 

Justice. The DEA is the lead agency for 

domestic enforcement of the Controlled 

Substances Act. The DEA plays an 

important role in the oversight of the 

disposal of marijuana, a Schedule I 

controlled substance, under the 

regulations of this part. The DEA is also 

instrumental in registering laboratories 

to legally handle controlled substances, 

including cannabis samples that test 

above the 0.3 THC concentration level. 

‘‘Dry weight basis’’ refers to a method 

of determining the percentage of a 

chemical in a substance after removing 

the moisture from the substance. 

Percentage of THC on a dry weight basis 

means the percentage of THC, by 

weight, in a cannabis item (plant, 

extract, or other derivative), after 

excluding moisture from the item. 

The ‘‘Farm Service Agency (FSA)’’ is 

an agency of the U.S. Department of 

Agriculture that provides services to 

farm operations including loans, 

commodity price supports, conservation 

payments, and disaster assistance. For 

the purposes of this program, FSA will 

assist in information collection of land 

being used for hemp production. 

‘‘Gas chromatography’’ or GC, is a 

scientific method (specifically, a type of 

chromatography technique) used in 

analytical chemistry to separate, detect, 

and quantify each component in a 

mixture. It relies on the use of heat for 

separating and analyzing compounds 

that can be vaporized without 

decomposition. Under the terms of this 

part, GC is one of the valid methods by 

which laboratories may test for THC 

concentration levels. 

For the purposes of this part, the term 

‘‘geospatial location’’ means a location 

designated through a global system of 

navigational satellites used to determine 

the precise ground position of a place or 

object. 

The term ‘‘handle’’ is commonly 

understood by AMS and used across 

many of its administered programs. For 

the purposes of this part, ‘‘handle’’ 

refers to the actions of cultivating or 

storing hemp plants or hemp plant parts 

prior to the delivery of such plant or 

plant part for further processing. In 

cases where cannabis plants exceed the 

acceptable hemp THC level, handle may 

also refer to the disposal of those plants. 

‘‘Hemp’’ is defined by the 2018 Farm 

Bill as ‘‘the plant species 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 

percent on a dry weight basis.’’ The 

statutory definition is self-explanatory, 

and USDA is adopting the same 

definition without change for part 990. 

‘‘Liquid chromatography (LC)’’ is a 

scientific method (specifically, a type of 

chromatography) used in analytical 

chemistry used to separate, identify, and 

quantify each component in a mixture. 

It relies on pumps to pass a pressurized 

liquid solvent containing the sample 

mixture through a column filled with a 

solid adsorbent material to separate and 

analyze compounds. Under the terms of 

this part, LC is one of the valid methods 

by which laboratories may test for THC 

concentration levels. Ultra-Performance 

Liquid Chromatography (UPLC) is an 

additional method that may also be used 

as well as other liquid or gas 

chromatography with detection. 

‘‘Indian Tribe or Tribe’’ is defined in 

the 2018 Farm Bill by reference to 

section 4 of the Indian SelfDetermination and Education 

Assistance Act (25 U.S.C. 5304). The 

statutory definition is self-explanatory, 

and USDA is adopting the same 

definition without change for part 990. 

A ‘‘key participant’’ is a person or 

persons who have a direct or indirect 

financial interest in the entity producing 

hemp, such as an owner or partner in a 

partnership. A key participant also 

includes persons in a corporate entity, 

including tribally-owned corporation 

individuals, at executive levels, 

including chief executive officer, chief 

operating officer, and chief financial 

officer. This does not include such 

management personnel as farm, field, or 

shift managers. This definition also does 

not include a member of the leadership 

of a Tribal government who is acting in 

their capacity as a Tribal leader except 

when that member exercises executive 

managerial control over hemp 

production. 

‘‘Law enforcement agency’’ refers to 

all Federal, State, Tribal, or local law 

enforcement agencies. Under the 2018 

Farm Bill, State and Tribal submissions 

of proposed hemp production plans to 

USDA must be made in consultation 

with their respective Governors and 

chief law enforcement officers. 

Moreover, the 2018 Farm Bill 

contemplates the involvement of law 

enforcement in compliance actions 

related to offenses identified as being 

made under a ‘‘culpable mental state 

greater than negligence.’’ To assist law 

enforcement in the fulfillment of these 

duties, the 2018 Farm Bill also 

mandates information sharing that 

provides law enforcement with realtime data. 

The term ‘‘lot’’ refers to a contiguous 

area in a field, greenhouse, or indoor 

growing structure containing the same 

variety or strain of cannabis throughout. 

In addition, ‘‘lot’’ is a common term in 

agriculture that refers to the batch or 

contiguous, homogeneous whole of a 

product being sold to a single buyer at 

a single time. Under the terms of this 

part, ‘‘lot’’ is to be defined by the 

producer in terms of farm location, field 

acreage, and variety (i.e., cultivar) and 

to be reported as such to FSA. For FSA 

reporting purposes, FSA staff will 

determine the appropriate designation 

for the specific location(s) where hemp 

is being grown using FSA terminology 

such as ‘‘farm,’’ ‘‘tract,’’ ‘‘field,’’ and 

‘‘subfield’’ to mean ‘‘lot’’ for the purpose 

of this rule. 

‘‘Marijuana,’’ or, as defined in the 

CSA, ‘‘marihuana,’’ means all parts of 

the plant Cannabis sativa L., whether 

growing or not; the seeds thereof; the 

resin extracted from any part of such 

plant; and every compound, 

manufacture, salt, derivative, mixture, 

or preparation of such plant, its seeds, 

or resin. The term ’’marihuana’’ does 

not include hemp, as defined in section 

297A of the Agricultural Marketing Act 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5615 

of 1946, and does not include the 

mature stalks of such plant; fiber 

produced from such stalks; oil or cake 

made from the seeds of such plant; any 

other compound, manufacture, salt, 

derivative, mixture, or preparation of 

such mature stalks (except the resin 

extracted therefrom), fiber, oil, or cake; 

or the sterilized seed of such plant 

which is incapable of germination (7 

U.S.C. 1639o(1)). ‘‘Marihuana’’ also 

means all cannabis that tests as having 

a THC concentration level on a dry 

weight basis of higher than 0.3 percent. 

‘‘Negligence’’ is a term used in the 

2018 Farm Bill to describe when certain 

actions are subject to specific 

compliance actions. For the purposes of 

this rule, the term means failure to 

exercise the level of care that a 

reasonably prudent person would 

exercise in complying with the 

regulations set forth under this final 

rule. 

Used in relation to the other terms 

and regulations in this part, 

‘‘phytocannabinoids’’ are cannabinoid 

chemical compounds found in the 

cannabis plant, two of which are Delta9 tetrahydrocannabinol (delta-9 THC) 

and cannabidiol (CBD). Testing 

methodologies under this part will refer 

to the presence of ‘‘phytocannabinoids’’ 

as either THC or CBD. 

Under the terms of this program, 

‘‘plan’’ refers to a set of criteria or 

regulations under which a State or 

Tribal government, or USDA, monitors 

and regulates the production of hemp. 

‘‘Plan’’ may refer to a State or Tribal 

plan, whether approved by USDA or 

not, or the USDA hemp production 

plan. 

The 2018 Farm Bill mandates that all 

cannabis be tested for THC 

concentration levels using ‘‘postdecarboxylation’’ or similar methods. In 

the context of this part, ‘‘postdecarboxylation’’ means testing 

methodologies for THC concentration 

levels in hemp, where the total potential 

delta-9-tetrahydrocannabinol content, 

derived from the sum of the THC and 

THCA content, is determined and 

reported on a dry weight basis. The 

post-decarboxylation value of THC can 

be calculated by using a chromatograph 

technique using heat, known as gas 

chromatography, through which THCA 

is converted from its acid form to its 

neutral form, THC. The result of this test 

calculates total potential THC. The postdecarboxylation value of THC, or total 

THC, can also be calculated by using a 

liquid chromatograph technique, which 

keeps the THCA intact, and requires a 

conversion calculation of that THCA to 

calculate total potential THC. See also 

the definitions for decarboxylation and 

total THC. 

The term ‘‘produce,’’ when used as a 

verb, is a common agricultural term that 

is often used synonymously with 

‘‘grow,’’ and means to propagate plants 

for market, or for cultivation for market, 

in the United States. In the context of 

this part, ‘‘produce’’ refers to the 

propagation of cannabis to produce 

hemp. 

‘‘Producer’’ means a producer as 

defined in 7 CFR 718.2 specifically of 

hemp. The 2018 Farm Bill mandates 

that USDA maintain a real-time 

informational database that identifies 

registered hemp production sites, 

whether under a State, Tribal, or USDA 

plan, for the purposes of compliance 

and tracking with law enforcement. 

AMS will maintain this system with the 

information collection assistance of 

FSA. In order to maintain consistency 

and uniformity of hemp production 

locations, USDA is using FSA to collect 

this information through their crop 

acreage reporting system. In this 

context, a common use of the term 

‘‘producer’’ is essential to maintaining a 

substantive database. For this reason, 

the definition of ‘‘producer’’ 

incorporates the FSA definition of 

‘‘producer’’ with the additional qualifier 

that they are a producer specifically of 

hemp. All producers are required to be 

licensed or authorized to produce hemp 

under the USDA Domestic Hemp 

Production Program. 

‘‘Remediation’’ refers to techniques 

utilized to transform non-compliant 

cannabis into something useful and 

compliant while disposing of noncompliant parts. Remediation can occur 

by removing and destroying flower 

material, while retaining stalk, stems, 

leaf material, and seeds. Remediation 

can also occur by shredding the entire 

plant into a bio-mass like material, then 

re-testing the shredded biomass material 

for compliance. 

‘‘Secretary’’ means the Secretary of 

Agriculture of the United States 

Department of Agriculture. 

Section 297A of the Act defines 

‘‘State’’ as any of one of the fifty States 

of the United States of America, the 

District of Columbia, the 

Commonwealth of Puerto Rico, and any 

other territory or possession of the 

United States. The statutory definition 

is self-explanatory, and USDA is 

adopting the same definition without 

change for part 990. 

The term ‘‘State department of 

agriculture’’ is defined by the 2018 Farm 

Bill as the agency, commission, or 

department of a State government 

responsible for agriculture in the State. 

The statutory definition is selfexplanatory, and USDA is adopting the 

same definition without change for part 

990. 

The term ‘‘store’’ is related to the term 

‘‘handle’’ under this part and means to 

deposit hemp plants or hemp plant 

product in a storehouse, warehouse, or 

other identified location by a producer 

for safekeeping prior to delivery to a 

recipient for further processing. 

The term ‘‘Territory of the Indian 

Tribe’’ means (a) all land within the 

limits of any Indian reservation under 

the jurisdiction of the United States 

Government, notwithstanding the 

issuance of any patent, including rightsof-way running through the reservation, 

(b) all dependent Indian communities 

within the borders of the United States 

whether within the original or 

subsequently acquired territory thereof, 

and whether within or without the 

limits of a State; (c) all Indian 

allotments, the Indian titles to which 

have not been extinguished, including 

rights-of-way running through the same; 

and (d) any lands title to which is either 

held in trust by the United States for the 

benefit of any Indian Tribe or individual 

or held by any Indian Tribe or 

individual subject to restriction by the 

United States against alienation and 

over which an Indian Tribe exercises 

jurisdiction. 

The IFR defined the Territory of the 

Indian Tribe as ‘‘Indian Country’’ in 18 

U.S.C. 1151 because section 1151 is a 

commonly acceptable approach to 

determine a Tribal government’s 

jurisdiction. The final rule retains the 

language of section 1151, but adds item 

(d) to the definition of ‘‘Territory of the 

Indian Tribe.’’ This addition does not 

significantly expand the definition 

because many of the lands encompassed 

by item (d) were already considered as 

‘‘Territory of the Indian Tribe’’ under 

the IFR. For example, off-reservation 

trust land, if not considered part of a 

reservation under section 1151(a), is 

generally considered within a 

dependent Indian community under 

section 1151(b). See Club One Casino, 

Inc. v. Bernhardt, 959 F.3d 1142, 1149– 

50 (9th Cir. 2020); Felix Cohen, Cohen’s 

Handbook of Federal Indian Law, 

section 3.04 (Nell Jessup Newton ed. 

2012). Also, restricted fee lands outside 

of a reservation are often considered 

part of a dependent Indian community, 

provided the lands satisfy the two 

requirements of a dependent Indian 

community—lands that are (1) set aside 

by the Federal Government for the use 

of the Indians and (2) under federal 

superintendence. Citizens Against 

Casino Gambling in Erie Cty. v. 

Chaudhuri, 802 F.3d 267, 281 (2d Cir. 

2015). 


khammond on DSKJM1Z7X2PROD with RULES6
5616 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

10See section 10114 of the 2018 Farm Bill and the 

USDA General Counsel’s Legal Opinion on the 

Authorities for Hemp Production at https://

www.ams.usda.gov/content/legal-opinionauthorities-hemp-production. 

However, because ‘‘dependent Indian 

communities’’ is an oft-litigated term 

that is interpreted varyingly amongst the 

courts, USDA decided to add item (d) to 

the definition of ‘‘Territory of the Indian 

Tribe’’ to add clarity and ensure 

nationwide consistency regarding the 

jurisdictional boundaries of regulatory 

authority over the production of hemp. 

‘‘Total THC’’ is the postdecarboxylation value of THC, either 

after testing with gas chromatography or 

LC after using a conversion factor. LC 

does not use decarboxylation as part of 

the process and this addition is to 

account for the conversion of THCA into 

THC if decarboxylation was part of the 

process. The addition of 87.7 percent of 

THCA is applicable if the testing 

laboratory uses LC with detection to 

measure the THC. Total THC is the 

measured THC plus 87.7 percent of 

THCA. 

As defined by the 2018 Farm Bill, the 

term ‘‘Tribal government’’ means the 

governing body of an Indian Tribe. The 

statutory definition is self-explanatory, 

and USDA is adopting the same 

definition without change for part 990. 

The ‘‘U.S. Attorney General’’ is the 

Attorney General of the United States. 

‘‘USDA’’ is an acronym that stands for 

the ‘‘United States Department of 

Agriculture.’’ 

V. Appeals 

The following paragraphs explain 

when and how to appeal a USDA 

decision. State or Tribal plans may 

include similar appeal procedures. No 

changes were made to this section based 

on comments. 

An applicant for a USDA hemp 

production program license may appeal 

a license denial to the AMS 

Administrator. USDA licensees can 

appeal denials of license renewals, 

license suspensions, or license 

revocations to the AMS Administrator. 

All appeals must be submitted in 

writing and received within 30 days of 

the denial. Appeals may be submitted 

by mail or electronic form. This 

submission deadline should provide 

adequate time to prepare the necessary 

information required for the appeal. The 

Administrator will take into account the 

applicant or USDA licensee’s 

justification for why the license should 

not be denied, suspended, or revoked, 

and then issue a final determination. 

Determinations made by the 

Administrator under the appeals 

process will be final unless the 

applicant or USDA licensee requests a 

formal adjudicatory proceeding to 

review the decision, which will be 

conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Formal Adjudicatory 

Proceedings, 7 CFR part 1, subpart H, 

which USDA will amend to add the 

Domestic Hemp Production Program. If 

the applicant or USDA licensee does not 

request that the Administrator initiate a 

formal adjudicatory proceeding within 

30 days of the Administrator’s adverse 

ruling, such ruling becomes final. 

Appeals Under a State or Tribal Hemp 

Production Plan 

A State or Tribe can appeal the denial 

of a proposed hemp production plan, or 

the proposed suspension or revocation 

of a plan by USDA. USDA will consult 

with States and Tribes to help ensure 

their draft plans meet statutory 

requirements, and that existing plan 

requirements are monitored and 

enforced by States and Indian Tribes. If, 

however, a proposed State or Tribal 

plan is not approved, or an existing plan 

is suspended or revoked the decision 

may be appealed. 

If the AMS Administrator grants a 

State or Indian Tribe’s appeal of a 

disapproval of its hemp plan, the 

proposed State or Tribal hemp 

production plan shall be approved as 

proposed. If the AMS Administrator 

denies an appeal, prospective producers 

located in the State or Tribal Territory 

can apply directly to USDA for a hemp 

license. Similarly, if an appeal of a 

denied proposed State or Tribal plan is 

denied, producers located in the 

impacted State or Tribal territory may 

apply for licenses under the USDA plan. 

A State or Tribe appealing the 

suspension or revocation of their hemp 

production plan must explain the 

reasoning for the appeal and the appeal 

must be filed within the time-period 

provided in the letter of notification or 

within 30 business days from receipt of 

the notification, whichever occurs later. 

This timeframe should be adequate for 

the assembly of the information 

required to be submitted as part of the 

appeal. 

VI. Interstate Commerce 

Nothing in this rule prohibits the 

interstate commerce of hemp. No State 

or Indian Tribe may prohibit the 

transportation or shipment of hemp 

produced in accordance with this part 

and with section 7606 of the 2014 Farm 

Bill (expires January 1, 2022) through 

the State or the territory of the Indian 

Tribe, as applicable.10

VII. Outreach 

As part of this rulemaking process, 

AMS held numerous meetings with 

State and Tribal governments and their 

representatives, industry organizations, 

groups and individuals with experience 

in the hemp industry, and 

representatives of law enforcement, as 

well as other Federal agencies. 

In addition, USDA also conducted a 

listening session on March 13, 2019, 

that had more than 2,100 participants, 

and included comments from 46 

separate speakers representing States, 

Tribes, producers, end-users, hemp 

organizations, and others. The recording 

of the listening session is available on 

the USDA website at https://

www.ams.usda.gov/rules-regulations/ 

hemp. On May 1 and 2, 2019, USDA 

also participated in Tribal consultation 

meetings for a total of 52 and 38 

participants, respectively. On 

September 24, 2020, AMS conducted 

another Tribal Consultation with 

approximately 90 participants. 

AMS published an interim final rule 

on October 31, 2019 (84 FR 58522), that 

established a temporary hemp 

production program and invited public 

comments on the program’s provisions. 

The initial 60-day comment period was 

extended by 30 days on December 18, 

2019 (84 FR 69295). The comment 

period was reopened for another 30 

days on September 8, 2020 (85 FR 

55363). A total of approximately 5,900 

comments were submitted by States, 

Tribes, farmers, industry associations, 

and other interested groups and 

individuals during the combined 

comment periods expressing their views 

on the provisions of the IFR and 

suggesting modifications, many of 

which have been incorporated into this 

final rule. 

Finally, in November 2019, AMS 

posted an informational webinar about 

the domestic hemp production program 

on its website (in English and Spanish) 

at https://www.ams.usda.gov/rulesregulations/hemp. AMS has also posted 

additional useful information for 

regulated entities and other interested 

persons on its website at https://

www.ams.usda.gov/rules-regulations/ 

hemp. 

As required by the Farm Bill, the 

Secretary developed this final rule and 

related guidelines in consultation with 

the U.S. Attorney General. In addition, 

USDA has submitted information to, 

and consulted with, the Committee on 

Agriculture of the House of 

Representatives and the Committee on 

Agriculture, Nutrition, and Forestry of 

the Senate regarding updates on the 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5617 

11https://www.regulations.gov/searchResults?

rpp=25&po=0&s=AMS-SC-19-0042&

fp=true&ns=true.. 

implementation of the hemp 

requirements in the Farm Bill. 

VIII. Severability 

This final rule includes a severability 

provision. This provision helps address 

the status of the regulations should a 

court vacate a particular provision. This 

section provides that if any provision of 

part 990 is found to be invalid, the 

remainder of the part shall not be 

affected. 

IX. Comment Analysis 

AMS accepted comments during an 

initial comment period from October 31, 

2019 through December 31, 2019. On 

December 18, 2019 (84 FR 69295), this 

initial comment period was extended 

for an additional 30 days, ending 

January 29, 2020. AMS reopened the 

comment period for 30 additional days 

on September 8, 2020 (85 FR 55363), 

ending October 8, 2020. Comments may 

be accessed through Regulations.gov.11

Reopening the comment period gave 

interested persons an additional 

opportunity to comment on the IFR. 

Comments were solicited from all 

stakeholders, notably those who were 

subject to the regulatory requirements of 

the IFR during the 2020 production 

cycle. 

AMS specifically requested comments 

on the 15-day sampling and harvest 

timeline; the possibility of establishing 

a fee-for-service hemp laboratory 

approval process for labs that wish to 

offer THC testing services; the 

possibility of requiring all laboratories 

testing hemp to have ISO 17025 

accreditation; the number of labs 

already ISO 17025 accredited; 

additional examples of reasonable 

efforts to illustrate actions hemp 

producers can take in order to avoid 

committing a negligent violation under 

the program; the sufficiency of the hemp 

license application period; whether the 

information collection for the program 

is necessary for the proper performance 

of the functions of the agency, including 

whether the information will have 

practical utility; the accuracy of the 

agency’s estimate of the burden of the 

proposed collection of information, 

including the validity of the 

methodology and assumptions used; the 

ways to enhance the quality, utility, and 

clarity of the information to be 

collected; the ways to minimize the 

burden of the collection of information 

on those who are to respond, including 

the use of appropriate automated, 

electronic, mechanical, or other 

technological collection techniques or 

other forms of information technology; 

whether there is information or data that 

may inform whether or not the market 

will experience a significant shift, either 

positive or negative, in the developing 

hemp market and on consumers; any 

data or information on what impacts the 

regulation may have on current and 

future innovation in the areas of 

industrial hemp usages and how much 

such impacts on innovation may affect 

rural communities; the potential for 

innovation and the uncertainty and its 

impact on the hemp market vis a vis 

steady State; and additional reliable 

data sources on the annual receipts of 

industrial hemp producers. 

AMS received approximately 5,900 

comments. Comments represented the 

views of States, Indian Tribes, hemp 

farmers and processors, universities, 

laboratories, trade associations, carriers, 

non-profit associations, other Federal 

government agencies, consumers, and 

other interested individuals. A summary 

of the comments and AMS’s analysis 

and response follows. 

Extention of Comment Period 

Several commenters urged AMS to 

extend the public comment period to 

allow for small businesses to 

meaningfully participate in this 

rulemaking process. One reason given 

was that the comment period fell in the 

middle of the harvest season for much 

of the mid-Atlantic and southern hemp 

growers, excluding those who grow 

indoors, and therefore were too busy to 

comment. Other reasons given were the 

ongoing global pandemic as well as 

many other ongoing natural disasters 

nation-wide that have presented 

additional strains and unique challenges 

to agricultural operations. 

AMS Response: AMS provided an 

initial 60-day comment period and a 30- 

day extension and then reopened the 

comment period for 30 additional days 

in order to receive feedback from 

stakeholders thus giving ample time to 

interested parties to submit comments. 

In order to finalize the Domestic Hemp 

Promotion Program before the 2021 

production cycle begins, AMS decided 

not to extend the comment period and 

to finalize this rule. 

Extension of 2014 Pilot Program 

Under the 2014 Farm Bill, State 

departments of agriculture and 

institutions of higher education were 

permitted to produce hemp as part of a 

pilot program for research purposes. 

Congress extended this authority under 

the 2021 Continuing Appropriations Act 

until January 1, 2022. After January 1, 

2022, domestic hemp production must 

comply with Subtitle G of the AMA and 

this final rule. 

Comments: Numerous comments 

praised the hemp production regulatory 

schemes established by States and 

Universities under the 2014 Farm Bill 

authority. Many comments reflected on 

the perceived increase in regulatory 

burden under the IFR, as opposed to the 

regulatory scheme that has been applied 

to domestic hemp production until now. 

Many comments, while making 

recommendations with regards to 

specific aspects of the IFR provisions, 

also encouraged USDA to continue to 

regulate domestic hemp production 

under the 2014 Farm Bill until 

satisfactory resolution of industry 

concerns can be achieved. Further, 

several comments stated that the 

extension of the pilot programs under 

the 2014 Farm Bill for another two to 

three years would give the industry time 

to adjust to the new requirements and 

to develop hemp genetics to more easily 

comply with the regulations. 

A few comments opposed extension 

of the 2014 Farm Bill pilot program, 

asserting that States now operating 

under the more restrictive 2018 Farm 

Bill provisions are placed at a 

disadvantage. 

AMS response: The extension of the 

2014 Farm Bill authority is not within 

the authority of USDA. Congress only 

extended this authority under the 2021 

Continuing Appropriations Act (Pub. L. 

116–260), until January 1, 2022. 

THC Limit 

The IFR adopts the 2018 Farm Bill 

definition of hemp as the plant species 

Cannabis sativa L. and any part of that 

plant with a delta-9 

tetrahydrocannabinol concentration of 

not more than 0.3 percent on a dry 

weight basis. Further, the IFR requires 

that THC levels in representative 

samples test at or below the acceptable 

hemp THC level. Testing must be 

conducted using post-decarboxylation 

or other similarly reliable methods, 

where the total THC concentration level 

measured includes the potential to 

convert THCA into THC. Finally, the 

IFR provides that hemp testing higher 

than the acceptable hemp THC level is 

considered a controlled substance and 

requires disposal. 

Comments: Some comments 

supported the 2018 Farm Bill’s hemp 

THC level of 0.3 percent, and some 

explained that States had successfully 

incorporated that limit into programs 

authorized under the 2014 Farm Bill. 

Some comments thanked USDA for 

clearly defining the delta-9 THC 

standard in the IFR, which commenters 


khammond on DSKJM1Z7X2PROD with RULES6
5618 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

12McCullough, Jolie. ‘‘Marijuana Prosecutions in 

Texas Have Dropped by More than Half Since 

Lawmakers Legalized Hemp.’’ The Texas Tribune, 

3 January 2020; www.texastribune.org/2020/01/03/ 

texas-marijuana-prosecution-drop-testinghemp/. 

13 Johnson, Renee. ‘‘Hemp as an agricultural 

commodity.’’ Congressional Research Service 

(2014). 

14Small, Ernest, and Arthur Cronquist. ‘‘A 

practical and natural taxonomy for Cannabis.’’ 

Taxon (1976): 405–435. 

said would foster uniformity across 

hemp production in all States. 

However, a greater number of 

comments from various stakeholder 

groups, including producers, States, 

Indian Tribes, and hemp organizations, 

asserted that the 0.3 percent threshold is 

too low and impractical in a program 

intended for multiple end uses of hemp. 

Comments argued that individuals 

interested in obtaining cannabis for 

intoxication purposes are unlikely to be 

interested in material containing 1.0 

percent THC—or perhaps higher, and 

that setting the threshold at even 1.0 

percent THC would give farmers, 

breeders, and researchers a lot more 

flexibility and confidence in producing 

compliant crops. One commenter 

reported that their State recognizes 

hemp with THC concentrations of up to 

0.39 percent, with most crops testing 

between 0.31 and 0.39 percent THC, and 

no end products testing higher than 0.3 

percent THC. The comment suggested 

USDA should raise the THC limit to at 

least 0.39, if not up to 0.5 percent. Other 

comments recommended revising the 

threshold to a higher level, asserting 

that there is no scientific evidence that 

supports use of the 0.3 percent level. 

Some comments recommended 

increasing the threshold to 0.8 or 1.0 

percent, while some suggested 2.0 

percent and others as much as 5.0 

percent. Comments explained that a 

THC concentration of 5 percent is not 

viable for recreational marijuana 

markets and that USDA should consider 

the end-use potential when determining 

a threshold. One comment 

recommending a THC threshold of at 

least 2.0 percent included a news story 

reporting that marijuana plants 

confiscated by law enforcement 

routinely have THC concentrations of 12 

percent or higher.12

Several comments suggested that the 

IFR’s level of 0.3 percent delta-9 THC on 

a dry-weight basis is ‘‘more aspirational 

than practical.’’ Comments explained 

that THC levels vary with plant maturity 

and other factors. Comments urged 

USDA to build greater flexibility into 

the rule so producers don’t unwittingly 

become illegal marijuana farmers as a 

result of factors beyond their control. 

One comment suggested USDA establish 

a wider gap between the THC levels that 

define controlled substances and 

agricultural commodities such as hemp 

to create an environment where hemp 

producers are presumed innocent until 

proven guilty of intentionally producing 

a controlled substance. Several 

comments recommended that university 

and other research programs be given 

more leeway as they work toward 

developing more compliant, regionally 

appropriate varieties through breeding. 

Some comments noted that hemp 

containing more than 0.3 percent THC 

is not eligible for crop loss or replant 

payments under USDA Risk 

Management Agency regulations. 

Comments said further that if USDA is 

not certifying seed because of the 

regional effects of growing conditions 

on genetics, farmers are at risk and 

should be able to obtain comprehensive 

insurance coverage for crops with 

negligible overage above the acceptable 

THC level. 

Comments explained that while the 

genetics of most U.S. crops have been 

developed over many years, hemp has 

not enjoyed that history, and it will take 

time to develop compliant but 

commercially viable crops with 

marketable CBD content for different 

regions. Comments asserted farmers will 

have fewer planting options because of 

the lack of a national hemp seed 

certification protocol and limited 

agronomic research on hemp varietals 

and production practices. Comments 

inferred that the 0.3 percent THC 

threshold would effectively demand 

that farmers plant a nationwide 

monoculture with little genetic 

diversity, which they said would leave 

U.S. hemp crops vulnerable to pests and 

diseases. 

Many comments questioned the 

selection by Congress of the 0.3 percent 

THC threshold to legally distinguish 

hemp from marijuana.13 Comments 

frequently referenced a 1976 

publication, A Practical and Natural 

Taxonomy for Cannabis, in which 

horticulturalists Dr. Ernest Small and 

Arthur Cronquist used 0.3 percent THC 

as a threshold to distinguish hemp from 

marijuana in their scientific study on 

cannabis.14 Comments highlighted 

statements made by Small and 

Cronquist, saying the researchers openly 

acknowledged that they ‘‘arbitrarily 

adopt a concentration of 0.3 percent 

delta-9 THC (dry weight basis) in young, 

vigorous leaves of relatively mature 

plants as a guide to discriminating two 

classes of plants,’’ and that the number 

was never intended to define hemp from 

a legal perspective. According to the 

comment, Small and Cronquist made no 

conclusionary statement on the use of 

the 0.3 percent THC threshold. 

Several comments reported that 

countries determined to compete in the 

global marketplace, including 

Switzerland, Australia, Thailand, 

Uruguay, and Ecuador, recognize an 

acceptable hemp THC limit of 1.0 

percent. According to comments, the 

international market settled on the 1.0 

percent THC limit after numerous 

countries tested hemp over many years. 

Comments recommended the IFR 

incorporate the same standard. 

Comments asserted that the rights of 

Indian Tribes and small Tribal farmers 

should be protected by allowing greater 

flexibility in the hemp production 

regulations overall, consistent with 

Tribal self-government. For example, 

comments said that Indian nations 

should be recognized to have authority 

to grow hemp with up to 1.5 percent 

THC and should not be restricted to 0.3 

percent. 

One comment explained that their 

company has focused on breeding 

efforts to develop genetics that produce 

CBD-rich hemp with the lowest possible 

THC concentrations. The commenter 

claimed their company has harvested 

millions of pounds of hemp compliant 

with the 0.3 percent total THC standard 

since 2017. The comment said they 

produced 25 million rooted cuttings this 

spring—enough, according to the 

comment, to produce biomass for the 

entire country, and the commenter 

assumed they were not the only ones 

who had done so. The comment 

asserted further that the global standard 

for THC concentration is 0.2 percent 

and that to be competitive, U.S. 

production must adhere to a similarly 

strict standard. 

Although asserting that the IFR hemp 

THC level of 0.3 percent is not 

commercially reasonable, some 

comments acknowledged that only 

Congress could change the statute to 

allow a higher limit, and some 

commenters offered to serve as 

resources in that effort. Other comments 

urged USDA to work with Congress to 

raise the THC threshold. 

AMS response: Congress defined 

hemp in the 2018 Farm Bill as Cannabis 

sativa L. with a delta-9 

tetrahydrocannabinol concentration of 

not more than 0.3 percent on a dry 

weight basis. Any change to the 

statutorily established threshold of THC 

concentration requires an amendment to 

the statute. The CSA defines marijuana 

as cannabis that is over the 0.3 percent 

THC level. AMS has no discretion to 

change the THC level or to treat States 

and Tribes differently as the 2018 Farm 

Bill applies to all production of hemp in 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5619 

the U.S. Tribes do not have the 

authority to grow hemp with up to 1.5 

percent THC as this would violate the 

2018 Farm Bill and the CSA. Tribes’ 

powers of self-government may be 

constrained by acts of Congress in 

accordance with Congress’ 

constitutional authority to regulate 

commerce with Indian Tribes. 

AMS notes that there seems to be 

confusion amongst some commenters on 

the THC level stated in the 2018 Farm 

Bill and the IFR’s definition of 

acceptable hemp THC level. The 

acceptable hemp THC level in this final 

rule includes the 0.3 percent established 

in the Farm Bill plus any measure of 

uncertainty due to laboratory testing. 

Regarding the comment citing the 

news story, AMS believes the 

commenter misconstrued the article’s 

meaning. The article cited by the 

commenter explained that following 

passage of Texas’s law that legalized 

hemp in early 2019, the number of 

marijuana prosecutions in the State 

plummeted, due in part to the lack of 

adequate and affordable criminal 

laboratory resources. According to the 

article, prosecutors were less likely to 

expend resources on low-level 

marijuana charges where the likelihood 

of conviction is low. The article 

described anticipated release of a new 

lab testing method that only determines 

whether THC concentration is above or 

below 2 percent for criminal testing 

purposes. According to the article, even 

though 2 percent is higher than the 

State’s legal hemp limit of 0.3 percent, 

such testing would nevertheless be 

adequate for Texas law enforcement 

purposes, since nearly all marijuana 

plant prosecutions in the State involve 

THC concentrations of 12 percent or 

more. AMS believes neither the article 

nor the State are advocating legalization 

of hemp THC concentrations of up to 2 

percent, but that Texas law enforcement 

is merely using that limit as a 

convenient way to determine whether to 

pursue criminal prosecution. 

In response to concerns that 

producers could unwittingly become 

illegal marijuana farmers without 

greater flexibility in the rule, AMS has 

modified the negligent violation 

threshold as explained in the section 

responding to comments on the 

negligent violation threshold. AMS also 

notes, however, that it does not have 

any authority over how the DEA 

chooses to enforce compliance with the 

CSA. 

In the final rule, AMS is 

implementing a nation-wide domestic 

hemp production program as 

contemplated by the 2018 Farm Bill. It 

is not amending Risk Management 

Agency’s regulations regarding crop loss 

or repayment payments. Thus, 

comments regarding those regulations 

are outside the scope of this rule. 

Testing for Total THC 

The IFR requires that when hemp 

THC levels are measured using postdecarboxylation or other similarly 

reliable methods, the total THC 

concentration level measured must 

include the potential to convert THCA 

into THC. 

Comments: Some comments agreed 

that the measurement of delta-9 THCA 

should be added to the measurement of 

delta-9 THC and reported as total THC 

used for determining compliance with 

the hemp program requirements, as this 

is what many hemp producing States 

are already doing under State programs. 

A comment from an association of 

Departments of Agriculture reported 

that many States responding to their 

survey supported testing for total THC 

in this manner. 

Other commenters disagreed. 

According to one comment, only 22 of 

47 States with State-level hemp 

programs test for total THC. The 

comment said that 18 States do not 

currently test for total THC, and that 7 

States’ rules are ambiguous on this 

point. Other comments reported that 

State programs currently testing for only 

delta-9 THC are confident that 

producers are not selling ‘‘hot’’ crops. 

One comment said it is irrational to 

subject hemp biomass to 

decarboxylation when most biomass 

harvested for processing into 

increasingly popular consumer goods or 

industrial products will never even be 

decarboxylated. 

Another comment explained how 

USDA cannot alter the definition of 

hemp as set forth in the 2018 Farm Bill. 

The comment said that there should not 

be a ‘‘total’’ THC mandate and, rather, 

the plain reading of the 2018 Farm Bill 

establishes that delta-9 THC is actually 

the determinative factor. The comment 

went on to explain how other State and 

Federal agencies also rely only on delta9 THC when making critical distinctions 

with respect to hemp, such as the DEA 

and the FDA, to determine whether a 

substance is controlled and subject to 

criminal penalties. The comment 

presented an alternative testing 

methodology where testing methods 

must be able to determine the potential 

for THCA to convert into delta-9 THC, 

and the test result must reflect that 

ability as well as the aggregate 

computation, but the controlling factor 

whether a crop meets the definition of 

hemp and is within the ‘‘acceptable 

hemp THC level’’ relies only upon the 

delta-9 THC element. Thus, for 

compliance purposes, delta-9 THC is the 

standard, and the lab report must at 

least reflect THCA, delta-9 THC, and the 

Total THC results, but Total THC should 

not be determinative in whether a 

farmer has to destroy his crop. 

Industry impacts. Commenters 

asserted that testing for THCA 

concentration, a component they argued 

which is not psychoactive, would vastly 

undermine the efficient production of 

hemp and the growth of the industry. 

Some comments supported the 0.3 

percent THC standard, but said 

requiring testing for total THC goes 

beyond what is statutorily required, to 

the detriment of producers. Commenters 

argued that the difference between 

levels of delta-9 THC and total THC in 

hemp is significant, and that crops that 

would otherwise be compliant 

measuring only for delta-9 THC would 

not be compliant when measuring for 

Total THC. Comments asserted that 

testing for total THC with a threshold of 

0.3 percent effectively lowers the 

allowable hemp THC level to an even 

lower limit. 

Comments also described the 

correlation between total CBD and total 

THC production and explained that 

producers trying to maximize CBD 

production will not be able to do so 

successfully if total THC levels are 

restricted to 0.3 percent. One comment 

claimed that a farmer can produce hemp 

plants with up to 25 percent 

cannabinoid content while staying 

under 0.3 percent delta-9 THC limit, but 

that the farmer would have to plant 

twice as many acres of a less potent 

hemp variety to produce the same 

amount of CBD end product and stay 

compliant under the IFR’s Total THC 

limit. 

Several comments reported that some 

CBD hemp processors reject product 

with CBD amounts of less than 8 

percent. According to comments, 

breeders have worked years to develop 

cultivars that meet the 0.3 percent delta9 THC threshold, but many cultivars 

would not be compliant under the total 

THC limit. Comments predicted that 

with a standard of 0.3 percent total 

THC, growers will stop growing hemp 

for CBD because the risk is too high that 

their hemp crops will exceed the limit 

and be destroyed, defeating the purpose 

for growing crops for the potential high 

returns related to CBD production. 

Comments further lamented that the 

industry would lose investments they’ve 

already made. 

According to comments, many States 

that have only been measuring delta-9 

THC under 2014 Farm Bill pilot 

programs have developed companion 


khammond on DSKJM1Z7X2PROD with RULES6
5620 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

15The 2018 Farm Bill explicitly preserved the 

authority of the U.S. Food and Drug Administration 

(FDA) to regulate hemp products under the Federal 

Food, Drug, and Cosmetic Act (FD&C Act) and 

section 351 of the Public Health Service Act (PHS 

Act). 

16https://www.merkley.senate.gov/news/pressreleases/wyden-merkley-to-dea-interim-rule-onhemp-contradicts-congressional-intent-bycriminalizing-intermediate-steps-in-hempprocessing-2020#:∼:text=Authors%20of%20the

%20provision%20in,by%20seriously

%20misunderstanding%20hemp%20processing. 

See https://beta.regulations.gov/comment/AMS-SC19-0042-0884. 

marketing programs that have been 

tailored to complement State hemp 

production programs. Comments 

asserted the total THC limit in the IFR 

would significantly impact these new 

and emerging markets and cripple the 

industry in those States, preventing 

them from selling their product. 

Some comments claimed that 

common industry practice is to measure 

THC and THCA independently. 

Comments recommended USDA treat 

THC and THCA as two separate 

molecules and only be concerned with 

the amount of THC in a sample, rather 

than total available THC. 

One comment recommended that if 

USDA wants to test for total THC, the 

limit should be raised to 0.694 percent, 

with negligence set at 1.094 percent, 

and that growers whose samples 

measure between the two limits should 

be allowed to retest samples with up to 

two certified labs of their choice at a 

cost of $500 each. Another comment 

recommended that samples be tested for 

THC and THCA separately, with limits 

of 0.3 and 1.0 percent, respectively. 

AMS response: The 2018 Farm Bill 

requires that State and Tribal plans 

provide a procedure for testing, using 

post-decarboxylation or other similarly 

reliable methods, delta-9 

tetrahydrocannabinol concentration 

levels of hemp. In order to use postdecarboxylation, the sample must be 

heated or a conversion made to account 

for the lack of heating process. This 

means that the total THC must account 

for THCA and delta-9 THC. 

Currently, some States and Indian 

Tribes use gas chromatography (GC) to 

test hemp. In GC testing, heat is applied 

to the sample which THCA, producing 

delta-9 THC (a psychoactive 

compound), so that the final delta-9 

THC result is actually a total THC result. 

GC is the more traditional technique 

used for THC testing and GC results are 

typically reported as ‘‘delta-9 THC’’ 

without distinguishing that the reported 

delta-9 THC is actually total THC. 

Liquid chromatography (LC) testing 

typically does not involve the use of 

heat, so the THCA in a sample does not 

decarboxylate. In LC, results for THCA 

and delta-9 THC are obtained separately 

and can be reported separately. 

Cannabis naturally contains more THCA 

than delta-9 THC; if the THCA 

concentration is ignored while testing 

by LC, it is improbable to correctly 

distinguish hemp varietals from drug 

varietals. A total THC needs to be 

calculated post-testing in order to 

determine the ‘‘post-decarboxylation’’ 

delta-9 THC value as required by the 

2018 Farm Bill. In this way, all testing 

methodologies report the same 

information. 

AMS acknowledges that some States 

do not currently test for total THC and 

that switching to testing for total THC 

may have a negative impact on those 

State programs. Most laboratories that 

use LC obtain THCA results and delta9 THC results in the same analysis, so 

the information should be readily 

available to incorporate a calculation for 

Total THC. The opposite is also true. If 

USDA was to ignore the statutory 

requirement of using postdecarboxylation or other similarly 

reliable methods and allow for THC 

levels that do not account for 

decarboxylation, States and Tribes that 

currently require testing for total THC 

could experience a negative impact. 

When States or Tribes use different 

methods to measure THC, it impacts 

commerce because producers are not all 

on the same playing field. Also, since 

total THC at 0.3 percent is harder to 

obtain, those States and Tribes currently 

using total THC have been potentially 

selling less or destroying more hemp. 

Further, many in the industry have 

already made the switch to total THC 

since the IFR was published, 

diminishing the impact. 

AMS consulted with the Departments 

of Justice and Health and Human 

Services to develop the IFR. The Drug 

Enforcement Administration’s Analysis 

of Drugs Manual cites GC methodology, 

initially labeling results as delta-9 THC 

and then defining total THC and 

instructing how to determine 

compliance using total THC. 

In order to provide flexibility to States 

and Indian Tribes administering their 

own hemp production programs, 

alternative testing protocols will be 

considered by AMS if they are 

comparable and similarly reliable to the 

baseline mandated by section 

297B(a)(2)(ii) of the AMA and 

established under the USDA plan and 

procedures. Updated USDA procedures 

for sampling and testing will be issued 

concurrently with this rule and will be 

provided on the USDA website. 

This final rule covers hemp 

production. Hemp products are 

regulated under the Food and Drug 

Administration and its various 

statutes.15

Statutory Compliance and 

Congressional Intent: Several comments 

expressed concern about regulatory 

inconsistency between the 2018 Farm 

Bill language testing methods and the 

IFR requirements. Commenters urged 

USDA to reconsider the legislative 

record and Congress’s intent in passing 

the 2014 and 2018 Farm Bills. 

According to numerous comments, the 

plain language of the 2018 Farm Bill 

statute does not support the IFR’s 

requirement to test for total THC. 

Commenters asserted that if Congress 

had intended samples to be tested for 

total THC, they would have so specified, 

rather than making the specific 

reference to delta-9 THC in the statute. 

Comments concluded that 

concentrations of THCA in hemp should 

be irrelevant to its legal status under the 

regulations. One comment characterized 

‘‘decarboxylated value’’ as a new legal 

term and questioned USDA’s authority 

under the 2018 Farm Bill to create such 

a term. One comment went on to say 

that the term ‘‘potential conversion’’ as 

appearing in the IFR is offensive 

because Federal criminal law does not 

convert a legal substance into an illegal 

one simply because the substance has 

the ‘‘potential’’ to be converted. 

Several comments cited a letter from 

Senators Merkley and Wyden,16 authors 

of the Hemp Farming Act of 2018 that 

was included in the 2018 Farm Bill, as 

evidence that the IFR wrongly requires 

testing of Total THC. In that letter, 

Senators Merkley and Wyden asserted 

that requiring hemp samples to be tested 

using methods by which the reported 

THC concentration accounts for the 

conversion of THCA to THC ‘‘is a 

complete reversal of the Congressional 

intent expressed in that law and 

requires testing that Congress 

specifically did not include.’’ Comments 

also asserted that the Farm Bill 

definition of hemp is clear in that ‘‘all 

derivatives, extracts, cannabinoids, 

isomers, acids, salts, and salts of 

isomers, whether growing or not’’ of the 

hemp plant are expressly lawful so long 

as the pant does not contain a delta-9 

THC concentration of above 0.3 percent. 

Thus, according to these comments, the 

IFR required measurement of a lawful 

plant-based acid when distinguishing 

between hemp and marijuana under the 

Controlled Substances Act, and such a 

requirement contradicts the plain 

language of the Farm Bill and the spirit 

of the law. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5621 

One comment asserted that requiring 

test reports of THC concentration to 

account for conversion of THCA into 

THC effectively mandates that only test 

methods relying on postdecarboxylation be used, nullifying 

Congressional intent that other similarly 

reliable methods that don’t require 

conversion of THCA to THC should be 

authorized. The comment recommended 

revising the rule to comply with the 

Congressional mandate to allow testing 

through other similarly reliable 

methods. 

AMS response: AMS is not making a 

determination of Congressional intent 

when passing the 2018 Farm Bill 

provision for hemp. Instead, AMS is 

following the plain statutory language 

that states that a State or Tribal plan 

shall be required to include ‘‘a 

procedure for testing, using postdecarboxylation or other similarly 

reliable methods, delta-9 

tetrahydrocannabinol concentration 

levels of hemp produced in the State or 

territory of the Indian Tribe’’. 

International Impact: Some comments 

asserted that the average global delta-9 

THC limit is 1.0 percent. Others claimed 

that Europe has adopted a 0.3 percent 

THC limit, but that it applies only to 

delta-9 THC and not total THC. 

Comments contend that American hemp 

production required to comply with at 

0.3 percent total THC limit will be 

disadvantaged in the international 

marketplace. Comments proposed that 

matching a global standard by 

establishing a higher delta-9 THC 

threshold or total THC limit would 

strengthen U.S. producers’ market 

competitiveness. Other comments 

warned that reducing the domestic 

hemp supply by imposing the IFR’s 0.3 

percent total THC limit will incentivize 

importation of hemp biomass and hemp 

derivatives produced in countries with 

lower labor costs and less restrictive 

regulatory regimes, and that domestic 

hemp and hemp derivatives will be 

priced out of the market. 

AMS response: The 2018 Farm Bill 

authorizes USDA to issue regulations to 

regulate the production of hemp and 

defines hemp in terms of the 

concentration of THC in a Cannabis 

sativa L. plant. A Cannabis sativa L. 

plant is considered hemp, and therefore 

not a controlled substance, if the THC 

concentration is not more than 0.3 

percent on a dry weight basis. AMS 

does not have the discretion to change 

this threshold in the definition of hemp 

even if this threshold could impact the 

global competitiveness of U.S.-produced 

hemp. 

Calculating Total THC 

The 2018 Farm Bill and IFR identified 

and described the procedure for testing 

THC concentration using postdecarboxylation or other similarly 

reliable methods. The term 

decarboxylated was defined in the IFR 

as the completion of the chemical 

reaction that converts THC-acid (THCA) 

into delta-9 THC, the intoxicating 

component of cannabis. The 

decarboxylated value is also calculated 

using a conversion formula that sums 

delta-9 THC and eighty-seven and seven 

tenths (87.7) percent of THC-acid. The 

term decarboxylated is also commonly 

used in science and is the precursor to 

the term ‘‘post-decarboxylation,’’ which 

appears in the 2018 Farm Bill’s mandate 

on the acceptable cannabis testing 

methodologies for identifying THC 

concentration levels. AMS adopted this 

definition in this final rule. 

Conversion Efficiency: Many 

stakeholders opposed USDA’s 

conversion formula described in the 

IFR. Comments claimed the IFR was 

based on 100 percent conversion 

efficiency, which is only achievable 

under controlled laboratory testing 

conditions and is not possible outside of 

a laboratory environment. One comment 

stated the IFR failed to account for the 

inefficiency of the decarboxylation 

process. Numerous other comments 

characterized the USDA formula as 

theoretical and explained that the 

realistic conversion efficiency is 

between 30 and 75 percent. For 

example, several commenters cited a 

peer reviewed study which found 72 

percent to be a viable efficiency factor 

and provided the calculation formula: 

Total Potential THC = (0.72) × [(0.877 × 

THCA) × delta-9THC)]. Additionally, a 

commenter suggested USDA utilize 

three different conversion factor tiers (0, 

30, or 70 percent) depending on the 

end-use varietal because the THC 

concentration varies by varietal. The 

commenter argued that the conversion 

factors should reflect the different enduses. 

One comment said the calculation for 

‘‘Total Potential THC’’ should be 

defined and incorporated into the final 

rule because the decarboxylation 

percentage definition is critical for 

standardization and uniformity in the 

industry. Otherwise, according to the 

comment, States could adopt different 

decarboxylation percentages in their 

equations, causing confusion for 

growers. The comment gave the 

following formulas as examples: (Total 

potential THC = 0.877 × percent THCA 

+ percent delta-9 THC) as compared to 

(Total Potential THC = 0.877 × 0.70 × 

percent THCA + percent delta-9 THC), 

assuming a 70 percent THCA 

decarboxylation to delta-9 THC rate. 

Another comment explained the need 

to include delta-8 THC into any 

calculation for the future state delta-9 

THC. 

AMS response: Delta-8 THC only 

exists in a trace amount in marijuana 

which has a high Delta-9 THC 

concentration. The Delta-9 THC amount 

is already low in hemp, so the 

concentration of Delta-8 THC would be 

basically undetectable in hemp. A quote 

from the ‘‘WHO Expert Committee on 

Drug Dependence Critical Review— 

Isomers of THC’’ regarding the relative 

amount of Delta-8 THC to Delta-9 THC 

that can be found at https://

www.who.int/medicines/access/ 

controlled-substances/ 

IsomersTHC.pdf?ua=1. 

The above range means that Delta-8 

THC occurs at a level that is roughly 

1000 times less than Delta-9 THC. So, if 

Delta-9 THC was observed at 0.3 percent 

in hemp, then the Delta-8 THC 

concentration would be roughly around 

0.0003 percent. This contribution is 

completely negligible and contributes 

nothing significant to the total THC 

content. The trace amount of Delta-8 

THC is about 100 times less than the 

uncertainty (MU) of the test method, 

further demonstrating that it is 

insignificant and not worthy of 

consideration in the final assessment of 

THC for hemp compliance. 

AMS is adopting the calculation 

provided in the IFR for determining 

total THC. However, the calculation has 

been clarified to explain the use of the 

molar conversion ratio to 

mathematically convert THCA to delta9 THC. As written in the IFR, the 

calculation may have been 

misunderstood as containing a 

conversion efficiency factor, which is 

not the case. THCA cannot be added to 

delta-9 THC without accounting for the 

difference in molecular mass. Using 

stoichiometry, a molar conversion ratio 

(0.877) is used to mathematically 

convert THCA in terms of delta-9 THC. 

The molar mass of THCA is 358.47 g/ 

mol and the molar mass of delta-9 THC 

is 314.45 g/mol. In other words, the 

mass of THCA has to be adjusted or 

multiplied by 0.877 to be comparable to 

the mass of delta-9 THC. 

The 2018 Farm Bill requires that the 

THC content be expressed postdecarboxylation, which means that the 

conversion of THCA into delta-9 THC to 

account for the potential total THC in a 

sample must be taken into account. The 

term ‘‘potential’’ is used because it is 

not possible to readily, consistently, and 

reliably calculate the precise extent of 


khammond on DSKJM1Z7X2PROD with RULES6
5622 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

17 Dussy F.E.; Hamberg, C.; Luginbu ̈hl, M.; 

Schwerzmann, T.; Briellmann, T.A. Isolation of D9 

THCA–A from hemp and analytical aspects 

concerning the determination of D9 THC in 

cannabis products. Forensic Science International, 

149, 3–10, 2005. 

the conversion of THCA to THC under 

any and all circumstances. Therefore, 

the calculation for total THC assumes 

100 percent conversion efficiency and is 

hereby retained in this regulation. The 

calculation for total THC [total THC = 

(0.877 × THCA) + (delta-9 THC)] 

assumes that 100 percent of the THCA 

is decarboxylated, producing to delta-9 

THC, meaning that it gives the 

maximum (or potential, or theoretical) 

total THC. The final rule includes a 

definition for total THC to provide more 

specificity on this issue. This is 

standard procedure for how theoretical 

yield is calculated in chemistry. The 

issue is that theoretical yield does not 

always equal actual yield. Just because 

a maximum total THC can be calculated 

does not mean that the maximum is 

always obtained; however, there is 

potential for this maximum to be 

obtained. The amount of THCA that 

actually decarboxylates, producing 

delta-9 THC, is dependent on multiple 

variables; primarily, the amount of heat 

it is exposed to and the amount of time 

it is exposed to that heat. These 

variables, in turn, depend on what is 

being done to a cannabis sample (tested 

via LC, tested via GC, used for smoking, 

used for extraction, etc.). 

Incorporating the use of a conversion 

efficiency factor into the calculation is 

problematic due to these variables. 

Designating different conversion 

efficiency factors based on intended end 

use is not practical as the factors can 

still vary. For example, if an end-use of 

extraction is intended, there are many 

different types of extraction processes 

and even within one specific process 

there are still many different variables 

that will affect the conversion 

efficiency. Ultimately, there is no way to 

standardize a conversion efficiency 

factor based on end-use, methodology, 

or processing. The infrastructure does 

not currently exist to measure and 

monitor conversion efficiency. 

In terms of conversion during 

instrumental analysis, many 

commenters referenced a study 

conducted by Dussy 17 that determined 

a conversion efficiency factor for a 

specific GC setup. The author of the 

study recommends determining THCA 

and delta-9 THC separately and 

calculating total THC (using the 

equation the IFR stated to use). The 

author says that ‘‘every total D9 THC 

value determined after decarboxylation 

[by using GC] gives a minimal content 

rather than an exact value’’. Therefore, 

the author proposes that labs using GC 

should calculate their own method’s 

conversion efficiency and then apply 

their efficiency to their result to increase 

their total THC value to make it 

comparable to LC. This is the opposite 

of what many commenters are 

proposing in that they wanted LC 

methods to incorporate conversion 

efficiency into their LC results to make 

total THC lower. The further 

complication of this ‘‘opposite’’ 

approach is that it is impossible without 

having a single conversion efficiency 

which, as stated previously, cannot be 

agreed upon and can vary widely. 

Furthermore, no matter how the 

conversion efficiency was to be applied, 

requiring each lab to determine their 

own method’s efficiency would require 

significant effort. 

Delta-8 THC is a cannabinoid that can 

be formed from delta-9 THC. It is 

typically only found in very small 

quantities in plants, if it is found at all, 

and is more often obtained by growing 

a plant with high delta-9 THC and then 

converting the delta-9 THC into delta-8 

THC through an extraction and 

conversion process in a lab to make a 

distillate product. It is rarely included 

in total THC calculations and many labs 

do not test for it. Delta-8 THC is 

unrelated to the 0.3 percent delta-9 THC 

limit or the ‘‘post-decarboxylation delta9 THC’’ that are defined and required in 

this final rule. 

Similarly Reliable Testing Methods 

The 2018 Farm Bill states that State, 

Tribal, or USDA plans shall include ‘‘a 

procedure for testing, using postdecarboxylation or other similarly 

reliable methods, delta-9 

tetrahydrocannabinol concentration 

levels of hemp.’’ 

The IFR included two examples of 

standard industry post-decarboxylation 

testing methods that meet 2018 Farm 

Bill requirements: Gas and liquid 

chromatography with detection. AMS 

selected these standard methods of 

chromatography as the best options for 

testing but also provided flexibility for 

alternative sampling and testing 

protocols if they are comparable and 

similarly reliable to the baseline 

mandated by the 2018 Farm Bill and 

established under the USDA plan and 

procedures. 

Comments: Some comments 

expressed support for the use of postdecarboxylation. One comment 

described liquid chromatography as a 

preferable testing method over gas 

chromatography because there are no 

published methods for gas 

chromatography that show 100 percent 

conversion of THCA to THC. Comments 

suggested liquid chromatography is 

more accurate and representative than 

gas chromatography. USDA received a 

comment that because Tribes often do 

not have ready access to gas 

chromatography and may only be able 

to access liquid chromatography, the 

rules need to allow for a more lenient 

formula. 

Many more comments opposed the 

IFR requirement to use postdecarboxylation testing methods on the 

grounds that the IFR too strictly 

interpreted or unnecessarily developed 

regulatory requirements that are not 

consistent with the statutory language of 

the 2018 Farm Bill. Comments stated 

that USDA should be flexible and allow 

for measuring THC levels with 

‘‘similarly reliable methods,’’ as 

provided in the statute. Comments 

claimed that the IFR’s exclusive 

endorsement of gas or liquid 

chromatography methods ignores this 

statutory flexibility. Comments further 

asserted that these two methods may 

overstate THC levels in hemp samples 

and that USDA should approve 

alternative reliable methods that may 

produce more accurate results. 

According to some comments, reliable 

testing methods have emerged that do 

not necessitate decarboxylation to 

accurately measure THC concentrations. 

For example, comments claimed that 

some States recognize genetic testing 

that measures the ratio of cannabidiol to 

THC in a sample or that confirms a 

stable cultivar’s taxonomic 

determination in lieu of postdecarboxylation testing to verify 

compliance with THC limits. Comments 

explained that genetic testing could 

include testing seed or testing during 

early plant growth stages, instead of 

depending on chemical analyses to 

measure THC levels in mature plants, 

which may be inconsistent under 

unpredictable growing conditions or 

dependent upon the time of sampling or 

the specific part of the plant that is 

sampled. 

Comments advocated removing the 

Total THC testing requirement and 

recommended USDA work with 

scientific and agricultural communities 

to ensure testing standards are 

established and similarly reliable 

methods are developed that will 

accurately identify and measure THC 

without the forced conversion of other 

cannabinoids, isomers, and/or acids. 

States Operating under 2014 Farm 

Bill Authority: Comments said that 

USDA should recognize that States have 

been effectively regulating hemp 

production using approved testing 

methods under 2014 Farm Bill pilot 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5623 

programs. Comments argued that by 

applying the IFR’s new testing standard, 

certain hemp plants that are legally 

grown under one or more of the existing 

pilot programs are converted into plants 

that violate the 2018 Farm Bill. 

Comments contended that while USDA 

will argue that States and Tribes can 

propose a testing method other than 

post decarboxylation, the alternative 

method still has to measure potential 

conversion of THCA into THC. 

Comments said further that the IFR 

must consider that hemp testing is an 

evolving science and that THC testing 

methods are likely to change over time. 

They stated that imposing new testing 

requirements is adding costs for 

growers, marketers, and regulators, and 

is limiting the number of labs that can 

perform these tests, for unnecessary and 

possibly impermissible reasons. Finally, 

comments questioned whether USDA 

has the authority to impose new testing 

requirements when the statute spells out 

the testing standards to be applied in 

granting approval to State and Tribal 

plans. 

A comment cited case law that held 

that under the Administrative Procedure 

Act (APA), agency decisions must be 

reasonable and based on factors and 

evidence that support the decision, 

divergent views notwithstanding. It 

suggested the IFR is arbitrary and 

capricious under the APA because 

USDA (1) ‘‘has relied on factors which 

Congress has not intended it to 

consider, ’’ (2) ‘‘entirely failed to 

consider an important aspect of the 

problem,’’ (3) ‘‘offered an explanation 

for its decision that runs counter to the 

evidence before the agency,’’ and (4) has 

made a decision that ‘‘is so implausible 

that it could not be ascribed to a 

difference in view or the product of 

agency expertise.’’ It further claimed 

that a court must sustain an agency’s 

action unless it determines that the 

agency committed a ‘‘clear error in 

judgment.’’ The commenter asked that 

their comment be considered within the 

context of these legal standards, and 

argued that THCA is not psychoactive; 

but can be converted into delta-9 THC 

through a chemical reaction, and that 

such a reaction may cause otherwise 

lawful hemp plants to test ‘‘hot.’’ The 

comment projected further that such 

‘‘hot’’ plants will require disposal, 

causing a significant and unnecessary 

loss of hemp production, which will in 

turn reduce economic development and 

job growth in many rural communities. 

The comment said postdecarboxylation testing was not 

required under the 2014 Farm Bill pilot 

program and the same plants that are 

legal under 2014 Farm Bill could be 

illegal under the IFR. The comment 

recognized that the pilot program will 

not be authorized after 2021 but said 

current disparate treatment under the 

two laws is problematic. 

AMS response: The 2014 Farm Bill 

included a 0.3 percent THC level but 

did not include the requirement for this 

measurement to account for 

decarboxylation. Thus States have the 

flexibility to determine testing 

methodologies. The 2018 Farm Bill 

states that procedures for testing use 

post-decarboxylation or other similarly 

reliable methods to determine delta-9 

tetrahydrocannabinol concentration 

levels in hemp. AMS stated in the IFR 

and further adopts the language in this 

final rule that at this time two methods 

meet this requirement for 

decarboxylation. The current acceptable 

testing methods include gas and liquid 

chromatography, including LC with UV 

detection. As other testing methods and 

alternatives are developed by industry, 

AMS will review and evaluate their 

compliance with the 2018 Farm Bill. At 

this time, genetic testing has not been 

determined to be a similarly reliable 

testing methodology. 

This final rule provides States and 

Indian Tribes the option to develop 

different sampling methodologies based 

on end use, including grain and fiber, to 

better account for differences in these 

plants. Biomass only needs to be tested 

after remediation to ensure that the 

sample that represented the plant that 

once tested above the acceptable THC 

level did not result in the plant being a 

controlled substance. This final rule 

does not set requirements for testing 

final products—but hemp plants, 

regardless of their end use, must still 

use the same testing procedures. 

Although the USDA plan does not 

allow for sampling based on end use, 

AMS will study the experience of States 

and Tribes that adopt methodologies 

based on end use. If it appears that the 

data and experience of those States and 

Tribe suggest that their methodologies 

may be adaptable to the USDA plan, 

AMS may explore a sampling scheme 

based on end use for producers under 

the USDA plan in the future through 

notice and comment rulemaking. 

License Application Period 

AMS received comments on the 

timeframe established in the IFR for 

submitting applications for a USDA 

license. The application period extends 

between August 1 and October 31. 

Comments: Several comments 

opposed the August-through-October 

window for USDA license applications 

and renewals. They explained that 

many outdoor hemp crops are harvested 

in September and October and that 

farmers are busy with harvest activities 

related to other crops as well during that 

time of year. Comments noted that 

farmers typically finalize decisions 

about the coming crop year during the 

winter, after having time to attend 

industry and trade conferences, enter 

into production contracts, and obtain 

crop loans and insurance. Thus, 

according to comments, a longer 

application window or a later 

application window would give farmers 

time to plan for the coming year and 

submit hemp production license 

applications as appropriate. Comments 

also noted that a longer application 

period would give producers time to 

complete the mandatory background 

check. Some comments recommended 

the application period be extended to 

December 31. Others recommended a 

winter application period of January 1 

to March 15. 

Other comments recommended even 

greater flexibility in application periods. 

Comments explained that harvest cycles 

for hemp growers may vary regionally 

and by operation type. They said a 

significant number of hemp operations 

involve year-round cultivation, 

maintenance of mother clones, clone 

propagation, indoor cultivation, and/or 

tissue culture. Time and resources to 

gather and submit paperwork would not 

coincide with the down-cycles in 

productivity and would strain these 

types of operations. Some recommended 

USDA adopt a year-round, rolling 

application period with different 

deadlines for different operation types 

or sizes. One comment said it was 

unclear in the IFR whether State and 

Tribal plans were required to adhere to 

the same window provided for under 

USDA’s plan. Several comments urged 

USDA to provide greater regulatory 

flexibility at the State and Tribal levels 

to determine the appropriate application 

and renewal timeframes for their 

jurisdictions. An example was given of 

a State’s agriculture department 

transitioned enrollment from a 

restricted to an unrestricted timeframe 

to better manage the logistical 

challenges related to the enrollment 

period. 

AMS response: AMS agrees with the 

commenters opposed to a limited USDA 

license application window and will 

allow for applications to be submitted 

for a USDA license year-round. This 

will provide greater flexibility to hemp 

producers to determine when to apply 

for a license or renew their license. This 

decision recognizes the different 

regional harvest timetables and 

production types used by hemp 

producers, and how flexible timetables 


khammond on DSKJM1Z7X2PROD with RULES6
5624 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

may allow producers to prepare 

applications during lower level periods 

of production activity thereby reducing 

some of producers’ burden on time and 

resources when the producer is 

planning the next planting cycle(s). 

States and Tribes can determine their 

license application window as it best 

meets their programs. 

FSA Reporting and Information 

Sharing 

AMS received comments on the IFR 

requirement that hemp producers report 

acreage and provide licensing 

information to USDA’s Farm Service 

Agency (FSA). Hemp producers must 

provide FSA information about their 

hemp crop acreage, such as its location 

and size, and must provide the producer 

license or authorization number issued 

under the hemp production plan under 

which they operate. States, Indian 

Tribes, and USDA must collect the same 

information, as well as other producer 

information, under their respective 

plans. USDA then assembles and 

maintains FSA and plan information 

and makes it available to law 

enforcement agencies, as required under 

the 2018 Farm Bill. 

Comments: Several comments 

expressed strong support for FSA 

programs generally, acknowledging that 

FSA programs provide farmers valuable 

access to Federal programs and funding, 

and that registering crop acreage with 

FSA would help mainstream hemp 

production within agricultural 

communities. Comments noted that 

requiring hemp growers to register with 

FSA is similar to registration 

requirements for growers of other 

commodities and that FSA already 

compiles reports about other crops. 

However, many commenters opposed 

the requirement to register with FSA 

when they are already required to 

provide the same information to their 

licensing authority. Comments argued 

that the duplicative reporting 

requirement is unnecessarily 

burdensome to farmers, could be 

confusing, and could discourage farmers 

from seeking hemp production licenses 

or from growing hemp. One comment 

speculated that confusion about the 

duplicative requirement could lead to 

unintended violations by growers who 

don’t comply. Other comments 

speculated that lower program 

participation would inhibit industry 

growth and deprive States and Indian 

Tribes of licensing fees that enable them 

to fund their respective production 

plans. 

Comments noted that the statute does 

not specify dual reporting of crop 

acreage to both FSA and the plan 

authorities under which they operate. 

Several comments took exception 

with the IFR’s assumption that most 

hemp farmers are already registered and 

familiar with FSA and its programs. 

Comments from some State agriculture 

departments asserted that within their 

jurisdictions most farmers in general do 

not already work with FSA. 

One comment asserted that 

participation in FSA programs is 

voluntary and that hemp growers 

should not be precluded from 

participating in the commenter’s State 

program because they forego FSA 

registration. Other comments suggested 

that farmers growing hemp for personal 

use and hemp farmers also growing 

medical marijuana may be hesitant to 

register crop acreage with Federal 

agencies. 

One comment expressed concern 

about FSA staffing in rural areas and 

asked USDA to increase funding to 

support additional reporting obligations. 

Another comment suggested USDA 

develop and fund one standardized 

reporting program for all plans and 

growers that would decrease program 

reporting burdens for all entities. Some 

comments encouraged streamlining 

collection of crop acreage information 

by allowing the use of open-source GIS 

mapping instead of FSA data and 

reporting tools. Comments also 

suggested USDA could rely on States 

and Tribes to provide grower crop 

acreage and registration information 

since they already collect it. Several 

comments recommended eliminating 

the FSA registration requirement 

altogether. 

AMS response: AMS acknowledges 

the FSA reporting requirement may 

present a hurdle for certain hemp 

producers, particularly new and 

beginning farmers, farmers in rural 

locations, and farmers located in Tribal 

territories. However, AMS determined 

that the FSA reporting requirement is 

essential for two key reasons: Real-time 

data collection and field-based 

resources. 

First, USDA is required under the 

2018 Farm Bill to provide law 

enforcement with certain ‘‘real-time’’ 

information about who is growing 

hemp, whether their license is in good 

standing with the regulatory body 

issuing the license, and the location(s) 

of where hemp is being grown. The 

daily collection of this information 

through FSA county offices enables 

USDA to easily transmit the required 

information to law enforcement. FSA 

maintains the technology necessary for 

data collection and geographical land 

identification. These tools will provide 

easy access to information needed for 

law enforcement and for other 

agricultural programs. This information 

is compiled in one system, using an 

information sharing mechanisms 

currently used by law enforcement and 

which they are familiar with, and 

transmitted to law enforcement in a safe 

manner, which otherwise would not be 

as readily available through State and 

Tribal reporting. States and Tribes must 

provide information to USDA in a 

format that is compatible with USDA’s 

information sharing system. USDA will 

work with States and Tribes on system 

format and other information necessary 

to share information. 

Secondly, FSA’s county network is 

expansive with over 2,000 field office 

locations. FSA offices provide services 

both in person and virtually to 

accommodate the needs of producers. 

Its mission runs parallel to other 

USDA agencies including Risk 

Management Agency, Natural Resources 

and Conservation Service, and Rural 

Development, each of which provide a 

wide range of benefits and services to 

local communities. AMS noted that in 

many cases, FSA is co-located with 

other Federal, State and county-level 

government offices which means a 

variety of services are provided through 

one central location. These services 

frequently include information on 

insurance and risk management 

programs, conservation and irrigation 

technical expertise, agricultural credit 

for operating or marketing, and rural 

housing loans. As such, the requirement 

is considered by AMS to be particularly 

important to new and beginning farmers 

who traditionally are not familiar with 

the wide range of programs and services 

offered by Farm Service Agency and the 

other USDA agencies. 

Definition of ‘‘Lot’’ 

AMS received comments on the 

definition of ‘‘lot’’ for providing 

geographical determination of hemp 

production and for sampling purposes. 

One comment explained that nursery 

operators and their field operating 

counterparts may need to file hundreds 

of permits for a single greenhouse under 

the IFR. The comment described as an 

example one greenhouse at a nursery, 

which may have upwards of 36 benches, 

in which each bench could have 20 

different hemp varieties growing at any 

one time. The comment said that the 

IFR would require that single 

greenhouse to have 720 ‘‘lots,’’ and 

based on most States’ current rules, 720 

containment plans, destruction plans, 

and transportation notices when any 

plants are moved—all possibly requiring 

agency approval prior to any action 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5625 

being taken. It further explained that the 

growing cycle for nursery stock could be 

as short as five to six weeks, and 

different varieties could take their place. 

The comment said a nursery with five 

or six greenhouses on a relatively small 

acreage may have to register thousands 

of lots and submit thousands of 

associated plans. It recommended that 

such a nursery should only be required 

to designate the actual greenhouse or 

indoor growing structure itself as used 

for the cultivation of hemp generally, 

and the term ‘‘lot’’ should not be 

defined to include any restriction or 

limitation to the same hemp varietal. 

The comment proposed revising the 

definition of ‘‘lot’’ to mean a contiguous 

area in a field, greenhouse, or indoor 

growing structure used for the 

cultivation of hemp. 

AMS response: In this final rule, AMS 

is clarifying that the term ‘‘lot’’ has the 

same meaning as other terms used by 

FSA, as found in 7 CFR 718.2, to mean 

the same production area, such as 

‘‘farm,’’ ‘‘tract,’’ ‘‘field,’’ and ‘‘subfield.’’ 

AMS uses the term ‘‘lot’’ to help 

growers and oversight officials identify 

farm locations, field acreage, and variety 

(i.e., cultivar). Although a hemp 

producer must report their ‘‘lot’’ 

information to FSA, when a producer 

visits the FSA office to report hemp 

crop acreage, FSA staff will determine 

the appropriate designation for the 

specific location(s) where hemp is being 

grown. FSA staff will not provide a ‘‘lot 

number’’ to producers as described in 

the IFR, but instead designate either a 

‘‘field’’ or ‘‘subfield’’ as the unique 

identifying number. This number is 

considered equivalent to a ‘‘lot 

number.’’ 

A lot must always contain the same 

variety or strain of cannabis throughout 

the area because the final rule requires 

lot-based testing. 

Certified Seed 

The IFR explains that under the 2014 

Farm Bill, various States developed seed 

certification programs to help producers 

identify hemp seed that would work 

well in their specific geographic areas. 

Comments: Some comments 

concurred with USDA’s decision not to 

introduce a hemp seed certification 

program with the IFR. Numerous 

commenters said that such a program 

would not be appropriate, that it would 

be too difficult to regulate, or that it 

would be premature now. Other 

comments said a federal hemp seed 

certification program is not necessary 

because some States and Indian Tribes 

had already developed such programs 

for their jurisdictions or are capable of 

doing so. Numerous comments said they 

recognized the difficulty of developing 

a hemp seed certification program but 

nonetheless urged USDA to pursue what 

they characterized as an important effort 

to allow for consistency among hemp 

producers when resources permit. 

One comment asserted that seed 

certification is key to a regulated hemp 

industry and explained that certification 

is a common practice in the 

international seed industry. Several 

comments contended that USDA must 

develop a seed certification program to 

prevent hemp growers from purchasing 

and planting seed of unproven quality— 

or of the wrong varieties for their 

purposes—and risking unnecessary 

financial loss and regulatory violations. 

Comments claimed that hemp farmers 

already have difficulty verifying the 

origin, genetics, and reliability of hemp 

varieties currently on the market, and 

that a seed certification program would 

help farmers know whether seed they 

purchase is appropriate for their 

growing conditions or intended hemp 

product end-use. Numerous comments 

inferred that a seed certification 

program would identify hemp varieties 

that had been tested and proven to 

reliably produce compliant hemp plants 

in specific geographic areas. 

Some comments argued USDA should 

not engage in hemp seed certification 

because plant genetic expression is 

influenced by environmental conditions 

and seed certifiers cannot guarantee 

plants will have THC concentrations 

within the acceptable range. Other 

comments countered that assertion and 

referenced a comment that reported on 

the analysis of cannabis genome trials 

and concluded that cannabinoid 

concentration is 80 percent or more 

controlled by genetics rather than 

environmental conditions. 

Comments claimed that hemp 

varieties developed under proper 

breeding programs and certified in the 

European Union and Canada had been 

proven to have stable cannabinoid 

profiles across multiple regions. They 

suggest that comparable results could be 

achieved under a USDA seed 

certification program. 

A comment claimed that the lists of 

acceptable/approved varieties provided 

by the processor and/or the governing 

authority in the State in which the 

hemp is grown needs to be updated 

soon and regularly. The policy language 

may be acceptable, but these lists need 

attention quickly so that ill-suited 

varieties are not planted and insured 

when planted outside of the area and 

not likely to perform as well. 

Some comments asserted it is not 

necessary for USDA to develop a seed 

certification program now because the 

Association of Official Seed Certifying 

Agencies (AOSCA) has already 

established national standards for hemp 

field crop cultivars and is reviewing 

issues related to the development of 

certification standards for feminized 

seed and clones of CBD hemp. Other 

comments recommended USDA adopt 

AOSCA standards in the development 

of a Federal seed certification system, 

and several comments said that some 

States have already adopted AOSCA 

protocols for production of certified 

seed for commercial sale to farmers. For 

example, a comment stated that a state 

currently recognizes 17 hemp seed 

varieties that have been certified for use 

in that state in accordance with AOSCA 

standards. The comment said the state 

encourages farmers to use certified seed 

when possible and the state intends to 

rely on certified seed to streamline the 

hemp testing program in the future. 

A comment clarified that there is a 

difference between seed that has been 

certified according to AOSCA standards 

(or an international equivalent standard) 

for varietal purity, and seed that has 

been tested for THC or other 

compounds. It asserted that some State 

programs have confused the 

terminology and urged USDA to clarify 

the difference and promote use of 

certified seed for varietal purity. The 

comment said the hemp industry has 

access to numerous proven varieties and 

that plant breeders are making strides to 

develop more varieties with specific 

characteristics. 

Numerous other comments reinforced 

the need for seed certification programs 

that ensure hemp seed meets high 

standards for proper labeling, reliable 

germination rates, purity, and the ability 

to produce healthy plants. Some 

comments supported seed certification 

under State or Tribal programs, claiming 

such localized programs have proven 

successful in areas where they’ve been 

developed and used, and saying that 

such programs promote crop 

predictability and reduce uncertainty 

for farmers. One comment asserted that 

not only seed, but clone certification is 

a must, to ensure that growers are 

getting what they think they are when 

they purchase clones from nurseries. 

Some comments asserted confidence in 

certified seed could be extended to crop 

insurers, who could provide coverage at 

prices that reflect reduced risk. Some 

comments suggested growers using seed 

certified under a Federal certification 

program should be indemnified against 

legal liability or financial losses related 

to production of hemp that tests higher 

than the acceptable THC level. Some 

comments suggested States and Tribes 

that adopt seed certification programs 


khammond on DSKJM1Z7X2PROD with RULES6
5626 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

for cultivars reliably producing 

compliant plants should be authorized 

to exempt such cultivars from hemp 

sampling and testing requirements or to 

employ random, risk-based sampling 

schemes supported by data about those 

cultivars. 

AMS Responses: AMS is not 

establishing a seed certification program 

for hemp. The IFR explained USDA’s 

decision to not establish a seed 

certification program was due to a lack 

of accurate data and the advanced 

technology necessary to develop such a 

program. The term ‘‘certification,’’ as 

used here, means tested or verified and 

does not necessarily mean certified for 

seed varietal purity or genetics. AMS 

understands that some seed 

certification-related studies are already 

under way in different locations and 

that results of these studies are helpful 

in production risk mitigation. AMS 

recommends the use of hemp seed from 

varieties that have undergone a variety 

review, following the process outlined 

in the Federal Seed Act and associated 

regulations, (7 U.S.C. 1551–1611 and 7 

CFR part 201), and produced according 

to AOSCA standards. These types of 

seed have been screened and tested for 

purity and are properly labeled. This 

final rule maintains flexibility for 

stakeholders to continue with trials of 

seed varietals and does not prohibit the 

use of any hemp varietals by industry. 

Updating the varieties list is a State and 

Tribal issue, as they developed them. 

This final rule does not address seed 

certification. However, USDA will 

consider such a program in the future if 

enough information is available. If there 

is sufficient data to support a program, 

USDA will explore adopting one 

through rulemaking under the APA. 

Separately from this hemp production 

regulation, AMS administers the Plant 

Variety Protection Office (PVPO). This 

office actively accepts applications of 

seed-propagated hemp for plant variety 

protection. Under the U.S. Plant Variety 

Protection Act, PVPO examines new 

applications and grants certificates that 

protect varieties for 20 years (25 years 

for vines and trees). PVPO provides 

intellectual property protection to 

breeders of new varieties of seeds and 

tubers. Certificate owners have rights to 

exclude others from marketing and 

selling their varieties, manage the use of 

their varieties by other breeders, and 

enjoy legal protection of their work. 

Regulations for Different Operations 

The 2018 Farm Bill requires any 

producer growing hemp to be licensed 

either by their applicable State or Tribal 

authority or USDA. The IFR further 

required that an authorized sampling 

agent collect samples from floral 

material for THC concentration testing 

in order to determine compliance with 

the Federally established THC 

threshold. Some operations growing 

hemp do not grow to the stage where 

flower material is present and as such 

cannot test the floral material. 

Clones and Cloning: Comments noted 

there are a significant number of grower 

operations that cultivate and produce 

hemp plants year-round. Some of these 

operations grow hemp varietals and 

maintain mother clones and/or grow 

plants for clonal propagation or tissue 

culture propagation purposes. 

Comments explained that hemp 

varietals grown in these types of 

production systems do not usually reach 

full maturity. According to comments, 

before achieving the floral stage of 

development, many of these hemp 

varietals are sold and enter the stream 

of commerce as starter plants that other 

licensed hemp growers may transplant 

to a field or greenhouse to be raised to 

full maturity and harvest. Comments 

questioned how immature or juvenile 

hemp plants with no floral material to 

test can demonstrate regulatory 

compliance under the IFR. 

Microgreens: Comments raised similar 

concerns about hemp raised and 

marketed as microgreens or other types 

of immature plants intended for human 

consumption, noting that these plants 

cannot be tested for regulatory 

compliance because they have no floral 

material to test. Comments encouraged 

USDA to develop a regulatory process in 

which THC concentration testing may 

occur for immature, non-flowering 

hemp varietals so that operations like 

those producing clones or microgreens 

can support the development of the 

hemp industry. 

One comment representing a hemp 

cultivation and distribution corporation 

in several states provided a pre harvest 

test on a microgreen variety grown in 

two different States. One State test 

reported 0.17 percent total cannabinoids 

and the other test reported 0.0193 

percent total cannabinoids. Based on 

these tests, commenter indicated that 

hemp leaf greens/microgreens and 

related crops are not in danger of excess 

THC. 

Hemp Research: Numerous comments 

stated the need for a separate regulatory 

scheme to support hemp research. 

Comments explained that the plant 

breeding process by its nature requires 

breeders to bring multiple varieties of 

plants to maturity in order to evaluate 

their characteristics and potential use in 

ongoing hybridization projects. They 

said, for example, that plants with 

desirable characteristics such as frost 

and drought tolerance or pest resistance 

must be identified and preserved, while 

plants with unwanted genetic traits or 

diseases must be separated and 

destroyed in order to stabilize the 

genetics for THC expression and other 

desirable traits and understand how 

environmental factors, disease, and 

insect pressure affect the expression of 

those traits. According to comments, the 

THC concentration in such plants could 

exceed the acceptable THC level in the 

IFR and plant breeders could find 

themselves in violation of the law. As 

well, they explained that the IFR’s 

disposal requirement could force 

breeders to destroy valuable plant 

material and waste years of work, as 

well as funding. 

Other comments asked USDA to 

support research into hemp pollination 

and drift. Comments reported industry 

concern that cross pollination could 

reduce the value of neighboring CBD 

flower crops. They asked USDA to focus 

on grain producing geographic areas and 

varieties to provide the science to 

support large acreage growers. 

Comments explained that the IFR’s 

THC threshold of 0.3 percent reduces 

the incentive to conduct hemp variety 

research because of the likelihood that 

many plants will exceed that threshold. 

For example, comments suggested the 

THC limit for hemp plants in licensed 

breeding programs could be raised to 0.6 

percent or 1.0 percent or higher. They 

suggested breeders be allowed to raise 

plants to maturity, collect data and save 

seed for further research, and be 

required to destroy noncompliant plant 

material at the end of the growing 

season. Other comments suggested that 

breeders and researchers should not 

have to wait for hemp plants to flower 

and undergo testing before they can 

remove and destroy those plants with 

undesirable traits. 

Comments asserted that hemp strains 

used in genetic studies authorized by 

the 2014 Farm Bill and compliant with 

other program regulations may now be 

in jeopardy due to the uniform 

application of the IFR’s 0.3 percent THC 

threshold and plant disposal 

requirements. They noted how a 

regulation that requires the disposal of 

what was previously compliant hemp 

will undermine the efforts and millions 

of dollars invested by farmers and 

researchers. Other comments indicated 

that not having the ability to replicate 

certain genetic traits from a plant that is 

noncompliant can slow the 

development of industry. 

Comments from and about university 

research programs suggested that USDA 

make land grant universities eligible for 

special research carve-outs or regulatory 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5627 

exemptions to allow them to continue 

research efforts. Other comments 

suggested USDA define criteria under 

which researchers and other plant 

breeders could be eligible for special 

research program exemptions. They 

suggested USDA develop criteria for 

certification or qualification of hemp 

researches and breeders, and some 

suggested those meeting specified 

criteria could be exempt from the IFR’s 

crop destruction and reporting 

requirements, provided they adhere to 

other restrictions, such as prohibiting 

research material from entering the 

chain of commerce, disposing of noncompliant plant material, and limiting 

plot size. Some commenters noted that 

without such allowances their 

university administrators would not 

allow them to continue research with 

any form of cannabis, including hemp, 

due to concerns about Federal grant 

disqualification. 

One commenter requested an 

exemption for Tribal research facilities 

so that they will not have to destroy all 

non-compliant plants. 

Comments noted that USDA’s 

National Institute of Food and 

Agriculture had not issued requests for 

applications on hemp research and that 

hemp was not listed for funding under 

the Specialty Crop Research Initiative. 

Comments suggested more agronomic 

research is needed to address current 

gaps in knowledge related to hemp 

production and management and to 

standardize seed. 

AMS response: Due to the variability 

in immature plants across producers, 

States, and Tribes, and the lack of 

consistency across varietals, USDA is 

unable to establish or standardize an 

approach to dealing with immature 

plants for USDA licensees. However, 

AMS acknowledges operations that 

grow hemp for certain purposes that do 

not bring plants to their flowering stage 

like clones and microgreens, may not 

need to meet the same sampling and 

testing requirements as operations that 

grow flowering hemp. The final rule 

provides States and Tribes the flexibility 

to consider performance-based sampling 

protocols to address these concerns. As 

allowed under the AMA, States and 

Indian Tribes can be more restrictive 

and may impose sampling and testing 

requirements on these producers. 

USDA also acknowledges that 

research institutions face special 

circumstances when conducting hemp 

research. Accordingly, this rule 

provides sampling and testing flexibility 

to these institutions and producers 

working with them to conduct hemp 

research under the USDA plan. 

Producers that produce hemp for 

research must obtain a USDA license or 

a State or Tribal license. However, the 

hemp that is produced for research is 

not subject to the same sampling 

requirements or the requirements 

pertaining to non-compliant plants, 

provided that the producer adopts and 

carries out an alternative sampling 

method that has the potential to ensure, 

at a confidence level of 95 percent, that 

the cannabis plant species Cannabis 

sativa L. that will be subject to this 

alternative method will not test above 

the acceptable hemp THC level. USDA 

licensees will need to submit an 

alternative sampling method to USDA 

for approval and shall ensure the 

disposal of all non-compliant plants. 

USDA licensees shall also comply with 

the reporting requirements including 

reporting disposal of non-compliant 

plants. 

AMS views this flexibility as 

necessary to help support research and 

development as it relates to hemp 

production by industry, particularly in 

its infancy. This decision allows these 

types of research facilities and 

institutions to oversee the study of 

hemp plants through trialing and 

genetics research. Over time, the 

flexibility provided by this final rule 

will help to stabilize industry by 

providing greater understanding of 

hemp genetics and how certain varietals 

respond differently to growing 

conditions in various geographic 

locations. All producers are expected to 

benefit from such knowledge as 

information about more stable and 

consistently reliable hemp varietals 

becomes available. Any non-compliant 

plants produced by research institutions 

as a result of research and development 

will still need to be disposed and 

disposal will need to be verified with 

documentation. Research institutions 

that handle ‘‘hot’’ hemp must follow 

CSA requirements for handling 

marijuana. 

Sampling Agents 

This final rule reiterates that samples 

of hemp collected for purposes of 

testing THC must be collected by 

sampling agents, or by Federal, State, 

Tribal or local law enforcement agents 

authorized by USDA to collect samples. 

Requirements and training materials for 

sampling agents are provided on 

USDA’s website. 

Third-party Sampling Agents: Some 

comments supported the use of thirdparty sampling agents to help offset the 

cyclical demand for hemp sample 

collection and to ensure integrity in the 

sampling process. Comments noted that 

some State agriculture departments have 

relied on in-house personnel to perform 

sampling activities and that these States 

did not use or require third-party 

sampling agents during piloting. 

One comment reported use of thirdparty certified samplers for the 2020 

season, and as of the date of their 

comment, had employed 74 certified 

sampling agents. The commenter said 

the State recommends producers make 

appointments with sampling agents 30 

days in advance prior to intended 

harvests, and that they had not received 

any feedback regarding unavailability of 

sampling agents based on the 15-day 

window. The comment went on to 

report that the State had received 

numerous anecdotes of next-day 

availability for sampling, which the 

comment suggested would not be 

possible without the use of third-party 

sampling agents. 

Resources: Several commenters 

worried that there would be insufficient 

numbers of appropriately trained, 

USDA-approved sampling agents 

available during harvest periods to 

ensure that all crops could be sampled, 

tested, and harvested within the 15-day 

window specified in the IFR. They 

asserted that sampling backlogs and 

delayed testing and harvesting would 

cause crops to mature beyond the 

acceptable hemp THC content 

concentration, resulting in crop 

disposals and financial losses for 

farmers. Several comments said 

producers in rural and remote 

mountainous areas would be 

particularly impacted, since sampling 

agent travel into those areas would 

require extra time and expense. 

Comments described how some States 

developed sustainable hemp oversight 

programs using risk-based sampling 

methodology to support regulatory 

monitoring of hemp growers. They 

asserted these same States would find it 

difficult to meet the IFR’s sampling 

requirement because of a limited budget 

to hire and train additional personnel 

for sampling all hemp production. 

Comments reported having to make 

appointments for sample collection a 

week in advance under risk-based 

sampling plans and predicted it would 

be even harder to arrange for sample 

collection on a timely basis under the 

IFR’s requirement that all hemp lots be 

sampled and tested. 

Commenters presented two proposals 

to alleviate this strain—allowing 

producers to collect their own samples 

and reducing the volume of farms and 

plants from which samples are 

collected. 

Some commenters requested that 

USDA compile a publicly available 

national list of sampling agents. 


khammond on DSKJM1Z7X2PROD with RULES6
5628 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

Sampling Agent Training: Comments 

highlighted the importance of providing 

robust training for sampling agents and 

recommended subsequent annual, 

documented refresher training be 

required. Some comments 

recommended USDA develop and 

implement a sampling agent 

certification scheme, while others 

suggested States and Tribes retain the 

authority to develop sampling agent 

training. Other comments suggested 

including a sampling agent training 

application on the USDA website. 

Other Comments on Sampling Agents: 

Other comments objected to the IFR’s 

provision that sampling agents be given 

unlimited access to all areas listed in 

the producer’s license. Comments 

claimed that this provision, in addition 

to the fact that default sampling agents 

may also be law enforcement 

representatives, seems to associate the 

now legal hemp industry with potential 

illegal activity. Comments stated further 

that while State, Tribal, and USDA 

personnel may require such access for 

audits or other purposes, broad access is 

not necessary for sampling hemp, and 

that sampling access should be limited 

to cannabis plant material being 

cultivated as hemp. 

Other commenters suggested that 

sampling agents should be agricultural 

specialists rather than law enforcement 

specialists in order to alleviate possible 

tension between Indian Tribes and law 

enforcement, and would ensure that the 

sampling agents have an understanding 

of the agricultural product they are 

working with. 

AMS response: AMS agrees with the 

many commenters that sampling agent 

training should be enhanced. 

Standardized training for sampling 

agents will help achieve regulatory 

consistency. As such, AMS will provide 

training documents for sampling 

concurrently with publication of this 

final rule. The revised sampling agent 

training will establish uniform and 

standardized criteria, including 

sampling processes and procedures, to 

ensure the sampling agents understand 

regulatory provisions of this final rule 

and the appropriate processes 

associated with sampling activities. This 

will help ensure that sampling done by 

different agents will be conducted 

similarly. AMS anticipates this will 

minimize variances in sampling 

practices that may affect the samples 

and ultimately the test results. 

Training documents will explain how 

sampling agents can meet the sampling 

requirements of this final rule. States 

and Indian Tribes with an approved 

plan may require the sampling agents 

used by their licensed producers to take 

the USDA training, or they may develop 

their own custom training. This 

decision does not change the 

requirement that designated agents 

collect samples. We are retaining the 

requirement from the IFR that the use of 

third-party agents is acceptable. 

Requiring sample collection by trained 

agents ensures that samples are 

collected consistently throughout the 

industry and no conflict of interest 

exists between the sampler and grower. 

Further, AMS has addressed 

commenters’ concerns about adequate 

resources by allowing for States and 

Indian Tribes to design a sampling plan 

in accordance with the AMA and this 

final rule that suits their needs and 

resources. Additional discussion of 

sampling methodologies and 

flexibilities is included elsewhere in 

this final rule. 

AMS agrees with the concerns that 

sampling agents be given unlimited 

access to all areas listed in the 

producer’s license and is clarifying that 

sampling agents need access only to 

areas where the hemp is grown and 

stored so they can perform their 

sampling work. 

AMS agrees with comments that 

allowing third-party individuals to 

become certified hemp sampling agents 

creates jobs, gives producers greater 

flexibility during the harvest season, 

and allows the States and Tribes to 

reallocate resources. The final rule does 

not limit sampling agents to law 

enforcement officers and does not 

prevent agricultural specialists 

operating as sampling agents. Because 

States and Indian Tribes with approved 

plans may approve their own sampling 

agents, USDA encourages States and 

Tribes to maintain their own lists of 

sampling agents. 

Sampling Methodology 

AMS posted supplemental Sampling 

Guidelines for Hemp Growing Facilities 

on its website. The guidelines describe 

sampling procedures, including the 

number of cuttings to take for sampling 

each lot and how to pace a hemp field 

when sampling. A few comments 

addressed the Sampling Guidelines and 

recommended alternative sample 

volumes and field sampling patterns. 

End-use/risk-based sampling: 

Comments asserted that hemp sampling 

requirements should differ based on the 

crop’s end-use, primarily whether the 

crop is used for grain and fiber 

production or for cannabinoid 

extraction. They contended that the IFR 

requirement to sample every hemp lot, 

regardless of the crop’s end-use, is 

expensive and burdensome for States, 

Indian Tribes, and individual growers. 

Comments generally discouraged 

requiring sampling and testing every lot 

for THC since THC concentration is 

significantly lower in male plants and 

grain/fiber varietals. Comments from 

State agriculture departments that 

administer pilot programs under the 

2014 Farm Bill also explained how riskbased sampling requirements under 

their programs function. Comments 

emphasized that a ‘‘one-size-fits-all’’ 

regulation is inappropriate and 

discourages innovation as there are 

different risk-profiles for hemp based on 

its end-use. 

Comments maintained that grain and 

fiber varietals are less likely than 

cannabinoid crops to exceed the THC 

threshold and argued that assessing all 

hemp by the same standard may result 

in strained oversight resources and 

inefficiencies. One comment asserted 

that THC concentration in varietals 

grown for grain is reduced dramatically 

by the production of seeds in the flower 

and, therefore, hemp grown for grain is 

at lower risk of exceeding the THC limit. 

Comments also noted that the flower 

parts, where a majority of the THC is 

concentrated, do not fairly represent the 

THC content of the entire plant, which 

is used in biomass and fiber production. 

One State agriculture department 

noted that many of the seed and fiber 

varietals being grown in their State were 

originally bred in Canada and have been 

selected for low THC content as part of 

Canada’s hemp program for many years. 

Several trade association comments 

noted that hemp grain/seed is not a 

source of cannabinoids, and that grain 

and fiber varietals are largely developed 

from certified, pedigreed seed that 

meets all THC testing standards. 

Commenters contrasted that with hemp 

crops grown for cannabinoids, and that 

the latter show higher phenotypic 

variability and lack of uniformity in the 

field because they have received less 

focus in breeding programs. One 

comment stated that hemp varietals 

grown for cannabinoid production often 

have questionable origins and are at a 

greater risk of producing higher THC 

than varieties grown for grain or fiber. 

Another comment claimed there are 

currently no certified varieties of hemp 

for CBD production. 

Many comments agreed that hemp 

grown for cannabinoid production is 

more likely to exceed acceptable THC 

limits. Data from 2019 submitted with a 

comment showed that 13 percent of 

hemp samples tested exceeded 0.3 

percent THC, and all were CBD 

varietals. The comment further 

recommends that certified seed varieties 

should be sampled and tested from a 

random selection of hemp grain and 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5629 

18https://farmdoc.illinois.edu/field-cropproduction/hemp/midwestern-hemp-database-anew-tool-for-hemp-growers.html. 

fiber fields 30 days prior to harvest. For 

uncertified varieties, it recommends 

requiring a post-harvest test, as well as 

a pre-harvest test of a random selection 

of fields within 30 days of harvest. 

According to comments, those hemp 

crops being grown for cannabinoids 

should be subject to higher scrutiny and 

more frequent testing. 

Another commenter cited data from 

the Midwestern Hemp Database 18

showing that many publicly available 

varieties are exhibiting a linear (or 

curvilinear) relationship between Total 

CBD (%) and Total THC (%). Given this 

presumed relationship, Total CBD 

percentages are often not able to exceed 

8 percent without exceeding the 

regulatory threshold of 0.3 percent THC. 

The commenter said these moderate 

levels of CBD production can have 

significant impacts on profitability as 

growers and therefore a whole plant 

testing methodology would help to 

mitigate this linear relationship. 

Comments identified States and other 

institutions where they think risk-based 

oversight modeling works to ensure 

hemp is at 0.3% acceptable hemp THC 

level. For example, the Kentucky 

Department of Agriculture publishes a 

‘‘Varieties List’’ to track THC content 

across hemp varieties. Comments 

characterized this as a useful tool for 

hemp farmers when planning 

production cycles and selecting hemp 

varietals. Several comments also 

described how, at the State level, other 

measures support risk-based oversight, 

like randomized sampling crops of a 

percentage of the total grower 

population or the use of risk criteria to 

identify ‘‘high risk’’ growers. 

Commenters credited these types of 

practices and activities with allowing 

states to efficiently oversee hemp 

production under pilot programs. Other 

comments described how financial 

institutions routinely incorporate riskbased modeling into the risk assessment 

of lending decisions, and that similar 

modeling should be adopted by USDA 

for sampling and testing. 

Comments argued that subjecting all 

varietals to the same regulatory 

requirements under the final rule will 

compound logistical challenges to 

oversight bodies, strain resources, and 

increase costs for low-risk farmers. They 

said testing based on hemp’s end-use 

created a more flexible approach to 

oversight while benefiting the farmer. 

Two state department of agriculture 

comments supported end use or riskbased sampling methods in order to 

account for producers using certified 

seed, producing hemp for industrial use 

purposes, fiber, grain, seed, extraction of 

biomass, and indoor producers growing 

plants only in vegetative state for 

research or resale that pose a low risk 

for detectable THC content. 

Several other comments suggested 

ways USDA could incorporate riskbased sampling into the domestic hemp 

production program. Comments 

recommended USDA evaluate and 

consider allowing greater regulatory 

flexibility for States and Tribes to 

develop and use risk-based modeling to 

guide their sampling and testing 

activities. According to comments, this 

approach would help offset the 

anticipated strain on resources during 

peak sampling that would otherwise 

result under the IFR requirements. 

Two State agriculture departments 

recommended that crops produced from 

AOSCA-certified seed, which they said 

currently only include grain and fiber 

varietals, be considered low-risk for 

testing and compliance purposes. 

Comments said that as more CBD hemp 

varietals are developed and certified, 

they could also be subject to less 

stringent testing protocols. 

A few comments suggested the 

adoption of a random risk-based 

sampling and testing scheme to reduce 

grower costs and relieve pressure on 

approved labs by reducing the number 

and volume of required tests. One 

comment indicated State hemp 

regulators have successfully developed 

sampling requirements for end-use that 

ensure adherence to State and Federal 

regulations, while allowing for 

flexibilities around State resources. 

Other comments sought requirements 

establishing a minimum number of 

cuttings per lot (e.g., ‘‘5’’ cuttings per lot 

regardless of size.) For example, one 

comment suggested that when sampling 

lots of less than 1 acre, taking cuttings 

of one plant will not allow for a 

representative sample, so a minimum of 

5 plants be identified for cuttings. 

Another comment said that the 

sampling requirements in the IFR, as 

applied to a 170-acre field, could 

require the sampling of as many as 110 

plants from that field which would be 

impossible for a state department of 

agriculture to meet. As an alternative, 

USDA might provide a fixed sliding 

scale (for example, a lot of less than 10 

acres requires 5 plants; a lot between 10 

acres and 20 acres requires 6 plants; and 

so on) rather than leaving those 

calculations to each state. Alternatively, 

another comment explained how their 

state sampling protocol currently 

utilizes the parameters of a minimum of 

6 cuttings per lot or acre, whichever is 

smaller, with the option for producers to 

increase the quantity of cuttings 

collected as they see fit (up to 150 

cuttings per lot). Another comment 

described how contracted labs for their 

state have requested at least 40 grams of 

wet material and up to 60 grams if the 

licensee is also needing additional 

testing such as heavy metals, pesticides 

and mycotoxins. 

One comment reported the results of 

a 2019 controlled study where the top 

12 inches of the plant and the top 2 

inches of flowering material were 

collected from each of 83 plants, for a 

total of 166 samples. The samples were 

tested using gas chromatography with 

flame ionization detection. Test results 

showing total delta-9 THC of the 2-inch 

cuttings were, on average, 0.0273 

percent higher than results for the 12- 

inch cuttings. The comment interpreted 

the results to suggest that including 

vegetation from the entire plant yields 

lower THC results, and that all parts of 

hemp plants should be sampled because 

producers generally harvest the entire 

plant. 

One comment reported that their State 

requires samples for any size lot to 

include 30 buds (subsamples) to insure 

there is large enough volume of material 

to provide for adequate sample testing. 

Another comment reported that State 

staff are directed to look at a cultivar 

and evaluate it for uniformity with 

respect to maturation, height, color, and 

basic plant architecture. According to 

the comment, uniformity within a 

cultivar results in fewer plants sampled 

than a cultivar exhibiting greater 

phenotypic diversity for the same 

acreage. The comment supported 

providing States with authority to 

establish sampling protocols, given the 

significant variation in plant counts 

between fields (on a per acre basis) and 

phenotypic diversity within and 

between cultivars. The comment also 

recommended that AMS provide 

guidance on a recommended number of 

plants to be sampled per unit area, 

including the plant density for each 

sample number recommendation. 

One comment advocated revisions to 

USDA’s sampling guidelines. The 

commenter said the State has had to 

deviate from USDA’s sampling table, 

specifically for smaller lots. According 

to the comment, taking a sample from 

one plant does not provide enough 

material for lab testing, and the State 

has had to bear the cost of taking a 

second sample. The comment 

mentioned that some of the Statecontracted labs have requested at least 

40 grams of wet material and up to 60 

grams, if the licensee is also requesting 

additional testing, such as for heavy 


khammond on DSKJM1Z7X2PROD with RULES6
5630 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

metals, pesticides, and mycotoxins. The 

comment also explained that to keep 

from delivering excess material from 

large lots to labs, inspectors take the 

required number of cuttings, then 

homogenize the sample, keep the 

required 40 to 60 grams, and leave the 

remaining sample material in the field. 

The comment supported a sampling 

protocol that would provide adequate 

testing material without unnecessarily 

overcutting plants material. 

One comment reported results of a 

poll they conducted among States after 

the end of the 2018 growing season. 

According to the comment, three 

States—New York, Pennsylvania, and 

Minnesota—reported they had analyzed 

the THC content in microgreens, and 

none were found to be above 0.3 percent 

total THC. 

One comment reported that their State 

has tested every hemp lot produced in 

Minnesota in the past five years, and 

that hemp grown for grain and fiber has 

never tested above the 0.3 percent total 

THC limit. According to the comment, 

varieties grown in Minnesota are 

certified varieties found either on the 

Health Canada List of Approved 

Cultivars or the European Union’s 

Organization for Economic Co-operation 

and Development List of Varieties 

Eligible for Seed Certification. 

One comment reported their State has 

implemented a risk-based sampling 

frequency schedule, under authorities 

provided for in the 2014 Farm Bill, 

using end-use and certified seed as 

guidance. According to the comment, 

official total THC results collected from 

regulatory samples and formal research 

samples showed that hemp grown from 

certified seed have a low risk of testing 

above 0.3 percent. Additionally, the 

grain or stalk components of hemp have 

zero to negligible levels of total THC. 

The comment recognizes that more 

research is needed in this area but is 

confident that the utilization of hemp 

variety categories to determine the 

department’s sampling frequency has 

been successful to date. 

AMS response: AMS agrees that States 

and Indian Tribes need more flexibility 

in developing sampling methodologies. 

For States and Indian Tribes with 

primary regulatory authority, USDA is 

altering the sampling requirements in 

this final rule to allow performancebased sampling methodologies. 

Information submitted by States that 

participated in the 2014 pilot program 

show various ways these States are 

already using performance-based 

sampling. Some States are using a list of 

varieties that work in their geographical 

area while others rely on evaluation on 

what they consider high risk producers. 

USDA finds the data submitted by 

commenters to be reliable because these 

States have been growing hemp since 

the 2014 pilot program started and they 

have sufficient data to develop their 

sampling plans. AMS agrees with 

commenters that the performance-based 

concept is the same method that 

financial institutions use. Further, 

performance-based programs are also 

used by other scientific and Federal 

agencies such as USDA’s Food Safety 

and Inspection Service and FDA. 

AMS finds that it makes sense to 

encourage States and Indian Tribes to 

consider performance-based alternatives 

when developing sampling plans. The 

final rule provides the standard; 

however, States and Indian Tribes have 

the flexibility to determine how to 

achieve that standard tailored to their 

specific needs. 

The sampling requirements for State 

and Tribal plans allow for States and 

Indian Tribes to develop unique 

sampling protocols for hemp licensees 

under their jurisdiction. State and Tribal 

plans must include a procedure for 

accurate and effective sampling of hemp 

that meets the requirements of the final 

rule. The method used for sampling 

must be sufficient at a confidence level 

of 95 percent that no more than one 

percent of the plants in each lot would 

exceed the acceptable hemp THC level. 

Alternatively, States and Indian Tribes 

may design a sampling method that is 

performance-based that ensures, at a 

confidence level of 95 percent, that 

plants will not test above the acceptable 

hemp THC level. This plan must be part 

of the State or Tribal plan. A 

performance-based method may 

consider: (1) A seed certification process 

or process that identifies varieties that 

have consistently demonstrated to result 

in compliant hemp plants in that State 

or territory of the Indian Tribe; (2) 

whether a producer is conducting 

research at an institution of higher 

learning or that is funded by a Federal, 

State, or Tribal government; (3) whether 

a producer has consistently produced 

compliant hemp plants over several 

years or several seasons; and other 

similar factors. USDA believes this will 

provide needed flexibility to States and 

Indian Tribes to develop logical and 

enforceable sampling requirements that 

take into consideration their unique 

circumstances. AMS will still require 

States and Indian Tribes to submit their 

individual sampling requirements for 

review as a component of the plan 

approval process. Sampling protocols 

submitted by States and Indian Tribes 

must comply with the thresholds 

established by the 2018 Farm Bill and 

this final rule. If performance-based 

sampling requirements are not included 

in a State or Tribal plan, every lot, and 

thereby every producer must be 

sampled and tested. 

When evaluating sampling protocols 

submitted by States and Indian Tribes, 

USDA will take into consideration 

whether the performance-based factors 

the State or Indian Tribe used have the 

potential to ensure compliance at a 95 

percent confidence level. USDA 

licensed producers are required to 

comply with the sampling requirements 

in this final rule. Additional guidance 

on sampling for USDA licensees or 

States and Indian Tribes that decide to 

use these guidelines is available on the 

USDA website at https://

www.ams.usda.gov/rules-regulations/ 

hemp/information-sampling. USDA 

may develop a performance-based 

sampling in the future if data is 

available and if it deems appropriate. 

Separate rulemaking and comment 

process will be necessary to establish a 

performance-based sampling plan by 

USDA. 

USDA plans to audit State and Tribal 

activities to assess program compliance 

with all Federal requirements, which 

includes review of the performancebased sampling implemented by States 

and Indian Tribes. 

Sampling Guidance: A comment 

noted that although the sampling 

protocol was issued as a guideline, it 

appears to be binding with regard to 

how hemp must be sampled. The 

comment said AMS should clarify that 

there may be other acceptable sampling 

procedures that would meet the IFR’s 

sampling requirement. The comment 

explained further that some States 

operating hemp programs under the 

2014 Farm Bill have established 

detailed hemp sampling protocols that 

producers are used to and should be 

allowed to continue. 

Another comment appreciated the 

IFR’s provision that the AMS Sampling 

Guidelines may need continual 

updating and refinement as industry, 

academia, and government discover 

new evidence, science, products, and 

innovations. 

A comment described the hemp field 

sampling plan they adopted from 

Florida’s nematode sampling plan. The 

plan recognizes that nematodes are 

unlikely to be evenly distributed 

throughout an orchard or field, which 

would also allow for accurate detection 

of THC fluctuation within a hemp field. 

The comment said Florida’s sampling 

plan is accepted by every State and 

country to whom they send citrus plant 

material that has been screened for 

nematodes and recommended AMS 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5631 

revise the hemp Sampling Guidelines to 

incorporate Florida’s sampling plan. 

A comment said Kentucky requires 

cuttings from five plants per lot, 

believing this standard provides a 

reasonably representative sampling of 

the plants in each lot. It opposed the 

sliding scale in AMS’s Sampling 

Guidelines, saying the sliding-scale 

calculation relies upon a decades-old 

pesticide residue sampling regime that 

may or may not be appropriate for 

calculating confidence levels in a hemp 

plant’s THC levels. The comment 

asserted the sliding scale formula, 

which depends on a variable factor 

based on historical data, is likely to 

create state-to-state variations in the 

number of samples that must be 

collected, and would require States with 

historically lower rates of noncompliant THC test results to take more 

samples per lot than those States with 

historically higher rates of noncompliance, which the comment found 

to be illogical. The comment explained 

that applying the Sampling Guidelines’ 

sliding scale calculation to a 170-acre 

field could require the sampling of as 

many as 110 plants from that field. It 

went on to say that sampling a single 

field under that scenario would 

overburden available sampling and 

laboratory staff, make transporting 

sample material difficult, and make 

grinding sample material an impossible 

workload. The comment recommended 

AMS specify a single number of plants 

to be sampled from every lot, regardless 

of the lot’s size, or publish a fixed 

sliding scale for industry-wide use, 

rather than leaving those calculations to 

each State. This comment was 

supported by several state departments 

of agriculture. 

A comment noted the importance of 

moisture content consistency in 

compliance sampling and recommends 

8–12 percent moisture content 

standardization. They also noted the 

need for best practices to be identified 

for drying sample material. 

Several comments said USDA’s 

sliding scale sampling protocol results 

in too little a sample for small acreages 

and too large a sample for large 

acreages. Comments asserted, for 

example, that one cutting for four acres 

or less would not be suitable to collect 

a representative sample and could put 

small acreage farmers at a higher risk of 

being violative or not might be sufficient 

to capture uncertainty related to 

population variability in a newly 

established crop. Another comment said 

that a true representative sample needs 

to entail multiple subsamples collected 

spatially across a field and pooled into 

an average sample. Further, according to 

the comment, since cannabinoids tend 

to increase along the height of the plant, 

floral material should be sampled at 

random heights from plants rather than 

all from the tops of plants to be 

representative. 

Another comment recommended 

revisions to the Sampling Guidelines to 

provide that sampling agents should 

sample fields in a zig-zag pattern. The 

comment further recommended that 

AMS revise the Sampling Guidelines to 

provide that three cuttings should be 

taken from every plant sampled, and 

that the three cuttings should be taken 

of floral, stem, leaf and stalk material at 

three different points on the plant. It 

argued that floral material makes up 

only 25 to 30 percent of hemp plants 

and that, to be truly representative of 

the sampled plant, the sample should 

consist of cuttings of all plant materials 

from throughout the plant. 

One comment recommended 

requiring that samples consist of a 

minimum of 4 ounces of material to 

provide an adequate amount for testing. 

Another comment suggested USDA 

research and review multiple sampling 

protocols and select the best among 

them. 

AMS response: AMS agrees that 

establishing clear and standardized 

Sampling Guidelines is important for all 

hemp producers and States and Indian 

Tribes with primary regulatory authority 

over hemp. AMS issued Sampling 

Guidelines and is updating that 

guidance to reflect the changes from the 

IFR to this final rule. States and Indian 

Tribes with USDA-approved hemp 

production plans may develop their 

own sampling procedures that take into 

account regional and other differences 

and are performance-based, so long as 

those procedures meet the requirements 

in the regulations at § 990.3. The 

entirety of the State or Tribal sampling 

plan, including any guidelines, must be 

included in the State or Tribal plan 

submitted to USDA for approval. When 

developing such plans the State or 

Indian Tribe must follow the 

requirements of this final rule that relate 

to where the cutting takes place 

including only flower material, and the 

number of inches necessary for 

sampling. Specific to sample size or 

weight of a cutting, AMS does not agree 

that establishing a specific volume is 

prudent given the variances in flower 

size and densities, and different scales 

of hemp production. It would be 

difficult to consistently sample at an 

exact weight of plant material across the 

spectrum of producers and therefore is 

not included in this final rule. Rather, 

AMS specifies a length (approximately 

five to eight inches) from the ‘‘main 

stem’’ (that includes the leaves and 

flowers), ‘‘terminal bud’’ (that occurs at 

the end of a stem), or ‘‘central cola’’ (cut 

stem that could develop into a bud) of 

the flowering top of the plant. 

This is considered appropriate and 

fair to balance the collection of 

sufficient plant material necessary for 

compliance laboratory testing while 

avoiding the need to cut excessive and 

unreasonable amounts of plant material. 

Further, AMS determined this final 

rule must provide some additional 

degree of flexibility for States and 

Indian Tribes in the development of 

their sampling plans, which is why as 

an alternative, this final rule allows for 

performance-based sampling 

methodologies in State and Tribal plans. 

Flexibilities afforded to States and 

Indian Tribes developing their own 

hemp production plans will allow them 

to incorporate best practices, as those 

change and develop over time. For 

example, States and Indian Tribes can 

adapt field-walking patterns to various 

sized and shaped hemp grower 

operations. AMS believes that a national 

standard would be difficult to 

consistently apply given the various 

grower operations and that standard 

‘‘zig-zag,’’ or letters ‘‘M’’ or ‘‘Z’’ walk 

patterns may not be feasible for sample 

collection of micro-acreage producers, 

very large scale producers or those with 

polygonal hemp lots. 

As an alternative option, AMS has 

updated the Sampling Guidelines and 

Protocols in conjunction with the 

publication of this final rule. This 

resource document is available online 

and offers guidance States or Indian 

Tribes can adopt and incorporate into 

their own USDA-approved sampling 

procedures. 

Flower Versus Whole Plant Sampling 

The IFR requires the collection of 

samples from the flower material of 

hemp plants for laboratory testing. 

Comments: Several comments 

expressed support for sampling only 

hemp flowers, as provided in the IFR, 

although many recommended changes 

to the overall flower material sampling 

requirements. Those recommendations 

and commenters’ explanations for them 

are addressed in another section of the 

comment analysis. Numerous comments 

opposed the IFR’s floral material 

sampling requirement, preferring 

instead composite sampling of the 

flowers, stems, stalks, and seeds, and 

asserting such samples would be more 

truly representative of the entire plant 

and lot. Numerous comments agreed 

that cannabinoid concentrations are 

higher in the flower than in other parts 

of the plant, and many comments 


khammond on DSKJM1Z7X2PROD with RULES6
5632 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

19 ‘‘THC Distribution in Field Grown Hemp Prior 

to Harvest,’’ J. Scott Lowman, Jack He, Mike Clark, 

and Mark Gignac; The Institute for Advanced 

Learning and Research (IALR), Danville, Virginia. 

argued that sampling only floral 

material would cause more samples to 

inappropriately and unfairly test ‘‘hot’’ 

and lead to unwarranted and costly crop 

disposals. 

Several comments said that sampling 

only the flowering material of the hemp 

plant is inconsistent with the definition 

of industrial hemp, as amended by the 

2018 Farm Bill, which refers to the 

whole hemp plant. Comments asserted 

that the statute did not limit sampling 

to floral material and challenged 

USDA’s interpretation of the statutory 

sampling requirement. As well, 

comments argued that requiring 

sampling of only flowering material 

could lead to legal challenges from 

producers who would be forced to 

destroy hemp that may be statutorily 

compliant, but not compliant with the 

IFR. They recommended that the 

regulations provide for sampling the 

whole plant and that USDA define the 

term ‘‘whole plant’’ to include the 

flower, stalk, and leaves. 

Some comments stated that sampling 

only flower material ignores the hemp 

grown for seed and stalk end-uses, and 

not for cannabinoids. Comments 

claimed that sampling and testing only 

flowering material would limit industry 

diversification in terms of producing 

hemp for biomass intended for uses 

other than THC production. To address 

this, several recommendations for 

revisions to the IFR’s sampling 

requirements were offered. Some 

comments recommended taking larger 

samples from prescribed parts of hemp 

plants that would include other than 

flowering material. For example, both 

State departments of agriculture and 

Indian Tribes recommended taking 

branch samples from two or more 

specified parts of plants that would 

include flowers, stems, stalks, and 

seeds, and proposed a range of sample 

lengths they considered appropriate, 

from 4 to 18 inches. Some 

recommended taking samples of the 

lower part of branches as well as 

flowering tips from the same plant. 

Several comments urged USDA to adopt 

risk-based sampling requirements that 

would better align with the intended 

end-use of hemp crops, like grain and 

fiber. Other comments recommended 

revising the IFR to allow States and 

Indian Tribes to design sampling 

requirements to meet the particular 

needs of producers in their 

jurisdictions, like producers who are 

well experienced with growing hemp 

and understand the potential to grow a 

non-compliant crop. 

Commenters expressed the widely 

shared view that cuttings for hemp 

samples must come from various 

locations on the plant, not just the top 

third as indicated by the Sampling 

Guidelines. They explained that 

marketable hemp product comes from a 

composite of the entire plant, not just 

the top, and asserted that flower 

material samples should likewise come 

from the entire plant to ensure the 

sample accurately reflects the lot from 

which it is taken. Comments also voiced 

the need for greater regulatory clarity on 

the size of the floral cuttings due to 

concerns that no regulatory 

requirements address floral collection 

by authorized sampling agents, and 

variances in types of materials collected 

may affect test results. 

Cannabinoid Concentrations: 

Comments described phytochemical 

characteristics of Cannabis sativa L and 

argued that samples taken from only one 

part of the plant are not representative 

of the whole plant. Some comments 

contended that flowers at the top of the 

plant have higher concentrations of THC 

and other cannabinoids—by as much as 

30 percent, according to some—than 

flowers elsewhere on the plant. One 

comment cited a study 19 that found that 

top-only sampling, as prescribed in 

many State testing programs, leads to an 

overestimation of THC content by nearly 

37 percent. The study stated that to 

better represent total crop THC levels, 

samples should be taken from the top, 

middle, and bottom of plants in equal 

quantities. Commenters asserted that 

sampling flowers from only the top of 

the plant could lead to incorrect 

conclusions about the lot’s compliance 

and lead to inappropriate and costly lot 

disposals. 

Other comments contended that THC 

concentrations are not necessarily 

higher at the top of the hemp plant. One 

comment used data to show that the 

distribution of THC concentrations 

throughout hemp plants is not 

consistent between varieties. It cited a 

2019 comparison study in which 4-inch 

cuttings of floral material from two 

hemp varieties were taken from the top, 

middle, and bottom sections of plants. 

In one variety, total THC was highest in 

samples taken at the top, and lowest in 

samples taken from the bottom of 

plants. In the other variety, total THC 

varied little between samples from plant 

top, middle, and bottom positions. The 

comment said the data refutes the belief 

that THC levels are highest at the top of 

the plant and supports sampling from 

all parts of the plant to obtain an 

accurate representation of each lot’s 

composite marketable hemp product. 

Sampling technique: Some comments 

cautioned that inconsistent potency 

measurements may be the result of 

divergent sampling approaches and 

recommended that USDA provide 

regulatory clarity as to the proper 

sampling process. 

A comment encouraged USDA to 

establish clear numeric designations of 

how much floral material is taken from 

each plant. Comments varied in their 

suggestions on sample cut including: 12 

inches per plant; cuts from the top and 

bottom 18 inches of a terminal branch 

of the plant to achieve a more 

representative sample; cutting from the 

top twenty centimeters from the main 

stem of the female plant; eight to ten 

inches of the plant’s primary stem; 

whole plant sampling whereby the top 

1/3rd, middle 1/3rd and bottom 1/3rd 

are each sampled; and to ground the 

whole plant—not only the top 1/3rd— 

as that is not representative of the delta9 THC level of the plant. 

AMS response: The IFR required the 

collection of samples from the flower 

material of hemp plants for laboratory 

testing. Following the publication of the 

IFR, AMS made available at 

www.ams.usda.gov/rules-regulations/ 

hemp a supplemental document 

addressing Sample Guidelines as a 

reference resource to industry. This 

resource document indicates that hemp 

samples are comprised of cuttings from 

just underneath a flower material 

located at the top one-third of the plant. 

Following review of public comment 

from various stakeholders, AMS 

determined this final rule will allow for 

additional sampling methodologies for 

determining the sample size from the lot 

as described previously under the 

‘‘Sample Size’’ discussion. However, 

since THC is concentrated in the flower 

material of the plant, the flower material 

is more appropriate to test than the 

entire plant. The final rule specified 

pre-harvest samples shall be 

approximately five to eight inches from 

the ‘‘main stem’’ (that includes the 

leaves and flowers), ‘‘terminal bud’’ 

(that occurs at the end of a stem), or 

‘‘central cola’’ (cut stem that could 

develop into a bud) of the flowering top 

of the plant. This aligns provisions of 

this final rule with the common 

practices of several States that 

significantly participated in the 2014 

Farm Bill hemp pilot programs. This 

decision further balances the need to 

collect a sufficiently large portion of the 

plant’s flower, where THC and other 

cannabinoids are at their most 

concentrated, and the need to avoid 

cutting a portion of the hemp plant that 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5633 

poses logistical challenges to shipment, 

drying and preparing for laboratory 

tests. AMS believes this provision will 

help standardize sampling across the 

nation. 

AMS considered the differences of 

pre-harvest vs. post-harvest sampling 

and determined the most practicable 

way to identify THC concentrations of 

the plant is through pre-harvest 

sampling since the floral material is still 

intact. Floral material must be intact to 

assure the material submitted for testing 

is in fact the flower part of a hemp plant 

and it has not been compromised or 

mixed with other plant parts. AMS also 

considered the many commenters who 

endorsed ‘‘whole plant’’ sampling. AMS 

concluded that measuring THC 

concentration through floral material 

testing is more appropriate and 

practicable than testing the entire plant 

because testing the entire plant will 

dilute the THC concentration in the 

sample, except as allowable under 

remediation, as discussed elsewhere in 

this final rule. Further, the study cited 

by a commenter that shows THC 

concentrations throughout hemp plants 

are not consistent between varieties 

does not support the use of whole plant 

sampling because it compares different 

plant varieties, not the THC level on 

different parts of the same plant variety 

where the sample is taken. Accordingly, 

sampling the top part of the plant will 

provide the most accurate results. 

Since THC is concentrated in the 

flower material of the plant, the flower 

material is more appropriate to test than 

the entire plant. AMS will modify the 

sampling requirement to state that the 

sample shall be approximately five to 

eight inches from the ‘‘main stem’’ that 

includes the leaves and flowers, 

‘‘terminal bud’’ that occurs at the end of 

a stem, ’’or ‘‘central cola’’ (cut stem that 

could develop into a bud) of the 

flowering top of the plant. AMS believes 

this consistency will help establish a 

level playing field for all U.S. hemp 

producers. The Sampling Guidelines 

issued concurrently with this rule 

includes additional details. 

AMS also includes additional 

flexibilities for disposal and 

remediation of ‘‘hot’’ hemp that would 

reduce the costs to producers. These are 

discussed later in this final rule and in 

separate guidelines published 

concurrently. 

Measurement of Uncertainty (MU)— 

Field Sampling 

The IFR did not address the subject of 

uncertainty when conducting field 

samples and only speaks to the 

measurement of uncertainty in 

performing laboratory tests for 

regulatory compliance. 

Comments: Several comments noted 

that not accounting for MU in sampling 

is a potential oversight that should be 

addressed in the final rule. Several 

comments note that field sampling is 

the largest source of variability in any 

testing process, due to the choices 

individual sampling agents make and 

field condition variability. Comments 

argued that there is a wide degree of 

variability among individual plants in a 

hemp crop and that this contributes to 

further uncertainty in field sampling. 

Due to this uncertainty in the field 

during sample collection, commenters 

suggested that an MU for field sampling 

be included in the final rule. 

Several State agriculture departments 

argued that the MU value should 

account for variability in the steps that 

occur before a sample reaches the 

laboratory. Comments noted the various 

steps in the field sampling process, such 

as cutting, bagging, sealing, 

transporting, and handling, and 

explained that each increases 

uncertainty in the THC testing results 

before the sample even arrives at the 

laboratory for compliance testing. 

Commenters asserted that uncertainty 

related to each step in the field 

sampling collection process should be 

accounted for in the MU. 

Several comments argued that, 

without a standardized MU for field 

sampling, some hemp crops with 

specific end-uses would be 

disproportionately impacted. According 

to comments, hemp crops grown for 

cannabinoids show the most phenotypic 

variability and lack of uniformity in the 

field. Comments said this variability 

should be accounted for before the 

sample reaches the laboratory. 

One comment suggested following the 

ISO 15189 standards that take into 

account uncertainty sources during the 

analytical phase where the 

measurement actually occurs. Several 

comments requested that USDA 

establish a standardized method of 

calculating uncertainty resulting from 

sample collection procedures and for 

uncertainty in laboratory testing 

methods. One comment noted that 

USDA’s Sampling Guidelines do not 

require the USDA-approved sampling 

agent to communicate to the laboratory 

anything related to crop variations or 

the agent’s sampling methodologies that 

may contribute to uncertainty in testing 

the hemp crop for compliance. 

A comment suggested a method for 

calculating MU that would include preand post-laboratory activities: MU 

would be calculated as the square root 

of the sum of squared values for preand post-laboratory activities, or, (a) 

squared plus (b) squared = (c) squared, 

where (a) is field sampling activities and 

(b) is laboratory MU. The comment 

offered this example: If the in-laboratory 

measurement of uncertainty (b) is 

calculated as 0.0300 percent, and the 

field sampling measurement of 

uncertainty (a) is estimated to be 0.0400 

percent, then the total measurement of 

uncertainty (c) would be 0.0500 percent. 

An institute that commented 

discussed research which found that 

sampling from the whole plant more 

accurately reflected what was observed 

in a field. The comment explained how 

the current USDA method, which 

analyzes only the top 1⁄3 of the plant, 

generates data that is error-prone and 

results that likely do not represent the 

actual THC levels that are present in the 

hemp plants in the field as a whole. It 

said, for example, in one research field, 

THC levels ranged from 0.06 percent to 

2.46 percent in the top 1⁄3 plant samples 

when individual plants were evaluated 

separately. 

The research also found significant 

variation in THC concentration across 

plants, which the commenter attributed 

to the lack of ability of the sampling 

procedure to generate a consistent, 

reproducible sample from any given 

hemp field. The research found if the 

field contains plants that are not 

completely uniform in their THC levels 

relative to each other, it is possible that 

this small subsample in any given 

analysis could over-represent plants that 

have higher levels of THC, thereby 

leading to failure of the field. On the 

other hand, equally possible, that 

analysis could over-represent plants that 

have lower levels of THC, leading to 

passing the field. The research stated 

that the most likely result of a sampling 

test is an inaccurate assessment of the 

total THC levels based on the method 

used to sample the plants in the field 

and then prepare them for extraction. 

A comment from a private laboratory 

noted that when field sampling and preanalysis handling and processing is 

done properly and uniformly, the preanalysis measurement uncertainty can 

be reduced to 5–10 percent. The 

comment suggested that test results 

might be more consistent and uniform 

when collecting samples in a ‘‘W’’ 

pattern with a minimum of 10–15 

individual cuttings taken from the top 

and middle third of the plant. 

Some comments recommended USDA 

conduct or fund a study to determine 

appropriate requirements for calculating 

sampling uncertainty. 

AMS response: AMS appreciates the 

different suggestions submitted by 

commenters on ways to handle potential 


khammond on DSKJM1Z7X2PROD with RULES6
5634 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

20https://beta.regulations.gov/comment/AMS-SC19-0042-5294. 

variability and uncertainty associated 

with sampling. AMS recognizes that a 

variability in sampling may contribute 

to the overall uncertainty of the final 

result. For reasons explained below, 

AMS in unable to adopt a national 

standard for calculating the MU for 

sampling. However, States and Indian 

Tribes, may include one in their State or 

Tribal plan as part of their performancebased alternative method for sampling 

under § 990.3(a)(2)(iii). 

In order to develop a standardized 

approach to sampling MU, a sampling 

plan must first be well-established, 

standardized, and studied to accurately 

account for uncertainty differences in 

sampling methodologies. To measure 

uncertainty of the complete process, 

from primary sampling through 

analytical determination, all steps in the 

process must be included. There are 

many intermediary steps that must be 

measured, such as sampling conditions, 

sample preparation, sample 

preservation, and transportation, all of 

which are not always present and/or 

completed the same each time sampling 

occurs. States producing hemp under 

the 2014 Farm Bill have developed 

sampling plans that vary widely; 

sampling MU is not something that can 

be easily studied, calculated, or broadly 

standardized. Due to the variability in 

sampling across producers, States, and 

Indian Tribes, and the lack of available 

data, USDA is unable to establish or 

standardize a specific MU value or 

boundaries (upper or lower) for general 

use. 

In the future, standards organizations, 

such as ASTM International through 

their Committee (D37) on Cannabis, will 

be establishing sampling standards that 

States, Indian Tribes, and producers 

could use to improve or help control 

sampling uncertainty. USDA also 

recognizes that States and Indian Tribes 

may have or will conduct their own 

study of the sampling uncertainty 

within their States or territories taking 

into account the conditions that may 

affect sampling. Those States and Indian 

Tribes may be able to calculate or 

standardize the MU for sampling within 

their States and territories. For those 

reasons, States and Indian Tribes may 

incorporate a sampling MU as part of an 

alternative method for sampling under 

§ 990.3(a)(2)(iii). 

Post-Sample Harvest Window 

The IFR required testing for total 

delta-9 tetrahydrocannabinol 

concentration levels and sampling for 

such testing was required to occur 

within 15 days prior to the anticipated 

harvest of cannabis plants. The IFR 

required sampling to be conducted by a 

Federal, State, local, or Tribal law 

enforcement agency or their designee. 

Comments: Numerous comments 

expressed opposition to the 15-day postsample harvest window. Comments 

argued that a 15-day window is too 

short and urged AMS to make it longer, 

providing several examples of 

anticipated difficulties with the 15-day 

window. 

According to comments, the 15-day 

sampling window in the IFR did not 

allow enough flexibility to reckon with 

adverse weather conditions that could 

delay or preempt field sampling and 

harvest activities. Comments said that 

isolated producers and others with 

limited access to harvest machinery 

might not be able to complete harvests 

within 15 days of sampling if weather 

prevents them from getting into the 

fields. Comments also noted that in 

some hemp production areas, climate 

changes are trending toward wetter 

harvest seasons, with frequent and 

catastrophic flooding in recent years. 

Other comments provided examples of 

climate variations across the U.S. and 

explained that the 15-day window is not 

uniformly suitable for all regions, some 

of which may be more prone to early 

freezes and other conditions that could 

forestall a timely harvest or force 

producers to harvest before receiving 

test results in order to save their crops. 

Comments also pointed out that a 15- 

day window does not adequately 

accommodate a commonly employed 

two-phase harvest technique, wherein 

farmers first harvest the seeds and 

flowers and then the plant’s stalks. 

Comments additionally stated 

logistical challenges related to sampling 

on larger hemp farms or farms with 

several varietals. They asserted that the 

number of required samples greatly 

increased under the IFR from what was 

required under most State administered 

pilot programs, and that collecting, 

drying, and submitting samples for 

those additional lots will be very 

difficult within the 15-day window. A 

commenter stated that, in 2019, 

Colorado sampled only 23 percent of all 

registered hemp lots within a 30-day 

sampling window under the pilot 

program, while under the IFR 

requirements, they would need to 

collect more than four times as many 

samples in half the time. 

Many commenters—from producers, 

state departments of agriculture, and 

Tribal governments—anticipated 

bottlenecking delays at laboratory 

testing facilities due to the limited 

number of DEA-registered laboratories 

available to provide testing. Comments 

from laboratories agreed that the 

increased demand for hemp testing 

would strain existing resources and 

make it difficult to return results to 

farmers in time to complete harvesting 

within the 15-day window. One 

commenter from a private laboratory 

also noted the strain on human 

resources this would create to oversight 

activities because laboratory employees 

are required to accompany sampling 

agents through the sampling process 

within the window. Other comments 

noted a possible shortage of available 

farm workers during a tight harvest 

window. 

Comments from Indian Tribes stated 

that the requirement to test within 15 

days prior to harvest by DEA registered 

laboratories is not practical for Indian 

Tribes, explaining that many Indian 

Tribes were moved to desolate lands 

where growing crops is hampered by 

location, quality of the land, available 

water and infrastructure, and access to 

ready transportation. Further, Indian 

Tribes said growers are hampered by the 

economies of size. Comments suggested 

that in much of the Indian Tribe 

territories, Tribes will not be able to 

develop large farms that reduce risk. 

Many comments recommended 

increasing the sampling window to 30 

days. Some suggested that producers be 

allowed to harvest before the return of 

laboratory results, but not be allowed to 

release product until test results are 

obtained. One comment added that 

allowing post-harvest testing would 

incentivize farmers to monitor their 

crops prior to harvest in order to 

minimize the need to destroy crops. 

Another comment recommended that all 

hemp testing labs be required to return 

results to growers within 15 days of 

receiving samples. Other comments 

proposed revising the regulations to 

require only that harvest commence, 

rather than be completed, within the 

specified period following sampling. 

Data on compliance testing from 

North Carolina 20 cited a recent study 

showed an average of 12.65 days taken 

to receive test results, with a range of 

between 2 days and 41 days. It estimates 

that 50 percent of growers would begin 

to harvest before receiving the results of 

their THC compliance test and 22.5 

percent would complete their harvest 

without receiving their results. 

Another State department of 

agriculture said it has been operating 

their pilot program utilizing a 25-day 

harvest window but noted that 25 days 

has proved an insufficient amount of 

time in their experience managing their 

pilot program. They recommend the 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5635 

21 Ibid. 

22Pearce, Bob et al. Sequential Sampling of Four 

Hemp Cultivars for Cannabinoids—2020; University 

of Kentucky, College of Agriculture, Food, and 

Environment and Kentucky Department of 

Agriculture. https://beta.regulations.gov/comment/ 

AMS-SC-19-0042-5762. 

final rule utilize, at minimum, a 30-day 

sampling window. 

A State extension service cited data 

from the Midwestern Hemp Database 

and reports from Rock River Laboratory 

which shows that 68 percent of the 

requests for THC compliance testing 

were submitted during the period of 

September 8th–October 1st and note 

this will create a tight peak window 

during which samples will be 

submitted. Due to this peak timeframe 

of compliance testing needs, several 

State departments of agriculture note 

that during these peak times there will 

be staffing shortages, delays in 

sampling, delays in analyzing material, 

delays in the reporting of results and 

delays due to unsuitable harvest 

conditions. 

Another State department of 

agriculture recommends that certified 

seed varieties should be sampled and 

tested from a random selection of hemp 

grain and fiber fields 30 days prior to 

harvest. For uncertified varieties, it 

recommends requiring a post-harvest 

test, as well as a pre-harvest test of a 

random selection of fields within 30 

days of harvest. 

One commenter discussed data 

showing that different cultivars 

accumulate cannabinoids at different 

rates and at different times. Given the 

rapid changes in cannabinoid levels, the 

comment said its data highlights the 

challenges of scheduling pre-harvest 

regulatory samples and harvest dates. 

Finally, a few comments asked for 

clarification about the 15-day window. 

Some said it was unclear whether 

harvest must commence or be 

completed within the window. Others 

asked whether a producer is prohibited 

from harvesting before testing is 

completed. One comment stated that the 

2018 Farm Bill does not contain a 

timing requirement. 

One comment reported that their 

current sample-to-harvest window is 25 

days, and that it does not appear to be 

long enough to sample all the State’s 

outdoor hemp crops maturing 

concurrently. 

One comment reported that the IFR’s 

15-day harvest window is not feasible to 

implement and puts incredible stress on 

the developing State’s hemp industry. 

According to the comment, the State 

applied a 30-day sample-to-harvest 

window during the four years it 

participated under the 2014 pilot 

program. During the 2020 growing 

season, the State reported it has 

struggled to sample and test the 5,809 

acres and 1.46 million indoor square 

feet that comprise the fields and 

facilities of the State’s 700 licensed 

growers within 20 days. The comment 

claims that the State does not have the 

financial capability or staff resources to 

ensure sampling can be achieved at 

every field within the optimal and 

correct time. 

Data analysis provided by North 

Carolina State University 21 evaluated 

the 2018–2020 turnaround times for labs 

reporting THC test results to growers on 

3,317 lots. The analysis found that in 

22.5 percent of cases, growers would 

have had to commence harvest with no 

knowledge of their test results to meet 

the 15-day harvest window requirement 

in the IFR. The comment asserted that 

in reality, growers would need lab 

results in 10 days or less in order to 

make informed harvest decisions, in 

which case they assumed approximately 

50 percent of the state growers would 

have had to start harvesting without 

knowing their test results. The comment 

referenced NCSU farm cost studies that 

showed farmers with some equipment at 

their disposal will spend approximately 

$14,000 per acre on hemp cultivation. 

Noting that of those costs, seed/plant 

acquisition and labor are the greatest 

expenses, the comment asserted that 

harvest is the most labor-intensive 

activity, and that requiring farmers to 

harvest without knowing whether their 

hemp crop is compliant or marketable 

puts them at great financial risk. The 

comment recommended extending the 

post sampling harvest window to 30 

days to reduce financial risk for farmers. 

A comment from another state noted 

that given the State’s size and 

geography, distances between hemp 

production sites could be greater than 

2000 miles, making the 15-day sampleto-harvest window impractical for them. 

The comment recommended allowing 

States and Tribes, who are better aware 

of their geographies and resources, to 

determine their own windows, up to 30 

days. 

One comment reported the State has 

three inspectors geographically 

dispersed throughout the State, 

servicing approximately 200 farms 

harvesting within the same 8-week time 

period. The comment advocated 

extending the harvest window to 30 

days to cope with unforeseen weather 

events, extended travel, lab turnaround, 

resampling and testing, and other 

delays. 

One comment contained preliminary 

findings from an ongoing 2020 study 22

conducted by a state and a state 

university that showed different 

cultivars of hemp accumulate 

cannabinoids at different rates and at 

different times in plant maturity. Study 

data showed that some cultivars can 

rapidly accumulate THC and CBD, with 

weekly changes of as much as 0.1 

percent THC and 1.5 percent CBD in 

some cases. The study found that the 

rates of THC and CBD accumulation 

were parallel in the four cultivars 

studied, with the CBD:THC ratio staying 

consistent around 24:1. The study 

concluded that given the rapid rate of 

change in cannabinoid levels, samples 

taken 2, 3, or 4 weeks prior to harvest 

may not accurately reflect the 

cannabinoid profile of the harvested 

material. The study further concluded 

that a larger harvest window increases 

the likelihood that non-compliant plant 

material will be harvested and 

potentially rejected at market, costing 

the grower the additional expense of 

harvesting. 

AMS response: AMS recognizes 

weather and climate-related factors 

affect all cycles of agricultural 

production including pre-planting, 

planting, management, and harvest. 

AMS also understands these factors may 

vary by region from year to year, and 

that certain conditions might cause 

some farmers to alter their normal 

harvest timeframe as a result of factors 

beyond their control as mentioned in 

several comments. It is common 

agricultural practice to harvest crops 

taking into consideration weather 

patterns such as rain, wind or freezes. 

Producers also harvest crops based on 

the availability of labor and 

transportation, crop rotation and market 

demand among many factors. A 15-day 

harvest window may not allow 

producers the flexibility needed to take 

all these factors into consideration. 

AMS considered the impact of the 15- 

day window on resources needed for 

sampling and testing activities. We 

acknowledge that sample collection may 

require an authorized sampling agent to 

visit multiple farms of varying sizes 

over a very short period of time. AMS 

further understands that in some places, 

the sampling agent may visit a farm on 

multiple occasions due to the size and 

harvest cycle of the farm. AMS also 

considered the turnround time for 

producers to receive results from 

laboratory testing. 

This final rule allows farmers to 

commence harvests before receiving test 

results, as did the IFR. However, crops 

may not be released in commerce or 

further processed until tests confirm 

that the lots in question are compliant 

with the regulations. Harvests must be 

completed within the 30-day timeframe 


khammond on DSKJM1Z7X2PROD with RULES6
5636 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

provided by the final rule. AMS does 

not believe harvests should occur after 

that time because, generally, total THC 

levels continue to increase with time 

and there is too great a risk that the 

levels would increase after 30 days and 

thus the sample that was tested would 

not be an accurate reflection of the total 

THC of the harvested crop. 

Regarding comments on laboratory 

resources, AMS considered input from 

our Science and Technology Program, 

which conducts laboratory testing for 

numerous agricultural commodities and 

oversees our third-party laboratory 

approval program. AMS assessed testing 

activities, which include the receiving, 

selection, drying, processing (through 

liquid or gas chromatography), analysis, 

storage, and reporting of hemp test 

results. AMS considered the time 

necessary to ship samples to the 

laboratory and to issue test results back 

to the grower, recognizing that not all 

farms have readily available internet to 

expedite receipt of electronic laboratory 

notifications. Standard mail may be the 

primary means of communication for 

rural populations in certain regions and 

Tribal lands. AMS also considered the 

level of routine work at testing facilities 

across the nation and their capacity to 

efficiently process hemp samples while 

continuing unrelated, non-hemp 

laboratory activities. AMS agrees that it 

may be difficult at the peak of the 

season for high-volume laboratories to 

consistently issue timely results to 

growers, as producers experienced and 

DEA acknowledged, impacting growers’ 

ability to make harvest decisions. 

Based on comments received and 

knowledge of agricultural practices, 

AMS determined that the post-sampling 

harvest window should be extended to 

allow hemp harvests to be completed 

within 30 days after sampling. AMS 

believes allowing the additional time 

will provide flexibility for dealing with 

unforeseen weather events and other 

agricultural factors, and better 

accommodate complicated harvest 

processes. AMS also believes this will 

reduce strain on testing resources and 

ensure test results can be returned to 

growers on a timely basis. 

Laboratory Accreditation—Laboratory 

Approval Program (LAP) and 

International Standards Organization 

(ISO) 

The IFR required hemp growers to 

obtain testing from DEA-registered 

laboratories to ensure proper handling, 

disposal, and reporting of samples that 

exceed allowable THC limits for hemp 

and may therefore be controlled 

substances. As part of the IFR, AMS 

asked stakeholders whether laboratory 

accreditation should also be required for 

hemp testing labs. Specifically, AMS 

asked about accreditation through 

AMS’s LAP, through the ISO standards 

(ISO 17025), or through both, and if so, 

which would be preferable. 

Comment: Comments reflected a 

range of views across the industry, both 

in support of and opposition to 

additional laboratory certification 

requirements. In general, commenters 

preferred more regulatory flexibility to 

address the widespread concern of 

insufficient laboratory capacity as a 

result of laboratory certification/ 

registration/accreditation requirements 

imposed by USDA regulation. 

Supportive of LAP and ISO: Some 

comments supported requiring 

additional accreditation through both 

LAP and ISO. Comments explained that 

LAP accreditation imposes analytical 

standards and limits that ensure reliable 

and consistent results across hemp labs, 

while ISO 17025 accreditation ensures 

that labs adhere to their own established 

protocols. Comments asserted that 

additional accreditation is essential to 

ensure that laboratories, government 

entities, and farmers comply with 

regulations. One comment that 

supported requiring both accreditations 

said the scope of the ISO 17025 

standards should include hemp testing 

methods. 

One comment said requiring LAP 

and/or ISO accreditation in conjunction 

with DEA registration is a step in the 

right direction because current 

standards are subpar and do the 

industry a disservice, while adding LAP 

and/or ISO accreditation would provide 

a baseline standard that benefits all 

stakeholders, including consumers. 

Either LAP or ISO: Other comments 

advocated requiring additional 

accreditation through either LAP or ISO, 

but not both. Comments said that 

requiring one or the other would be 

adequate to provide testing integrity, but 

that requiring both would unnecessarily 

overburden labs and create a testing 

bottleneck as labs worked toward 

accreditation. One comment said that 

since hemp products are consumable, 

public health and safety should be of 

paramount concern when choosing a lab 

accreditation program. 

Comments supporting LAP 

accreditation specifically said such 

accreditation would improve grower 

access to qualified labs and would 

improve the efficiencies and protect the 

competitive interests of non-DEA labs. 

Comments favoring LAP accreditation 

pointed out that LAP already 

incorporates ISO 17025 standards and 

includes regular audits and records 

management requirements. Comments 

added that incorporating ISO standards 

into LAP accreditation lends confidence 

in testing procedures and results, which 

in turn creates a fair marketplace for 

hemp. They asserted that the benefits of 

LAP accreditation outweigh the costs 

because they emphasize quality controls 

and accurate analytical performance by 

knowledgeable and trained staff. One 

comment suggested that using LAPapproved labs would facilitate USDA’s 

hemp program oversight and the 

development of an evidence-based data 

tracking system. Another comment 

pointed out that LAP offers growers a 

complete online listing of qualified labs 

from which to choose. 

Some comments argued against 

adopting LAP accreditation, saying the 

accreditation process is expensive and 

burdensome for laboratories, and that 

the user-fee program benefits only 

USDA. One comment said that it is 

unclear from the IFR how LAP differs 

from ISO and whether LAP 

accreditation offers more confidence in 

test results than ISO accreditation. 

Another comment said that LAP 

accreditation would be redundant to 

ISO accreditation and is not necessary. 

Some comments favored the use of 

laboratories with ISO 17025 

accreditation in addition to or instead of 

DEA-registration. Comments noted that 

hemp laboratories in many States 

already have ISO accreditation, 

although some are not DEA-registered. 

They suggested use of those labs should 

be grandfathered into approved hemp 

production plans. Some comments 

asserted that between LAP- and ISOaccreditation, ISO is the best alternative 

for the hemp industry because it meets 

the needs of the hemp industry, and at 

a reported cost of $25,000, it reduces 

unnecessary expense and regulatory 

burden for labs and growers. One 

comment recommended that USDA 

specify that the most current ISO 17025 

standard be required for accreditation— 

the 2017 version. 

Neither LAP nor ISO: Several 

comments opposed requiring additional 

laboratory accreditation on top of DEAregistration. Some comments called it 

‘‘overkill,’’ and said requiring additional 

accreditation would put an undue strain 

on laboratories and delay testing and 

reporting results for growers. 

None of the Above: Several comments 

opposed specifying any particular 

laboratory registration or accreditation 

and recommended instead that States 

and Indian Tribes be authorized to 

determine appropriate standards for 

hemp testing laboratories under their 

respective production plans. Comments 

said that allowing States and Indian 

Tribes to determine their own lab 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5637 

certification schemes would allow them 

to maintain appropriate testing 

capability while finding the best fit for 

the economic profile of their regulated 

jurisdictions. One comment suggested 

USDA encourage laboratories to 

participate in the Hemp Proficiency 

Testing Program established by the 

University of Kentucky, rather than 

building an accreditation program from 

scratch through LAP. 

Other Alternatives: One comment 

asked USDA to clarify why any 

additional accreditation should be 

required. Another comment suggested 

that if laboratory accreditation is 

necessary, AMS should explore the 

most cost-effective choice from among 

LAP, ISO, or other commercial 

accreditations to minimize costs for 

growers. A comment suggested that 

DEA-registered labs not be required by 

the rule but be allowed as backups for 

labs with other accreditations. Another 

comment speculated that if only LAP or 

ISO accreditation were required, and 

DEA registration was not, growers 

would test their crops more frequently. 

Some comments recommended that no 

specific accreditation be required 

because the process is too costly and 

time consuming and would discourage 

labs from participating in the program. 

One comment suggested that USDA 

encourage labs to adhere to ISO 17025 

standards, but not require accreditation. 

Some comments suggested that LAP 

accreditation would be beneficial to the 

industry, but that such a program 

should be developed incorporating the 

expertise of former DEA or other 

chemists with experience testing 

cannabis. Other comments supported 

using ISO-accredited labs until LAP 

accreditation can be fully developed 

and used on a trial basis to gather 

adequate experience and data. One 

comment suggested allowing States, 

Tribes, and USDA to contract with 

commercial labs or use private labs that 

adhere to ISO standards. 

AMS response: AMS noted that 

commenters generally preferred more 

regulatory flexibility to address the 

widespread concern of insufficient 

laboratory capacity as a result of 

laboratory registration requirements 

outlined in DEA regulations. Adding 

ISO 17025 or other accreditation 

requirement to laboratories would 

decrease the number of laboratories 

available to perform hemp tests. AMS 

also noted some commenters opposed 

accreditation requirements due to cost 

implications and additional burden. 

While we strongly encourage 

laboratories to be accredited to ISO/IEC 

17025 (by an International Laboratory 

Accreditation Cooperation Mutual 

Recognition Agreement (ILAC MRA) 

signatory accreditation body), because it 

will help ensure lab results are more 

accurate, ISO 17025 accreditation 

requires significant time and financial 

commitment to pursue and maintain. 

This it is most challenging for smaller 

and start-up labs. The initial 

accreditation can cost $5,000–$10,000 

(and in some case more) and yearly 

ongoing costs are $3,000–$8,000. 

Smaller labs may not have the resources 

to pursue accreditation in a timely 

manner or they may have to spend more 

time and money for consultants to assist 

them in setting up a quality 

management system and to navigate the 

application and audit processes. 

Based on this input, AMS will not 

require USDA administered lab 

approval program or require ISO 17025 

accreditation because doing so would 

increase the financial burden on 

producers and reduce the availability of 

laboratories that can test for THC level 

in hemp. AMS is committed to continue 

looking into this option. 

DEA Laboratory Registration 

Requirement 

The IFR required that laboratory 

testing of hemp for the purpose of 

determining compliance under the 

program be conducted by laboratories 

appropriately registered with DEA. 

However, on February 27, 2020, USDA 

announced guidance delaying the 

requirement to use laboratories 

registered with DEA for testing. Under 

this guidance, testing can be conducted 

by labs that are not yet DEA-registered 

until the final rule is published, or Oct. 

31, 2021, whichever comes first. This 

deadline was later extended to 

December 31, 2022. This change was 

intended to allow additional time to 

increase DEA-registered analytical lab 

capacity. 

Comments: A few comments 

supported the DEA-registration 

requirement. Some comments favored 

dual laboratory accreditation (e.g., DEA 

and ISO 17025 accreditation or DEA and 

AMS LAP accreditation) saying that 

such combinations would assure 

technically competent, unbiased testing 

and results reporting. One comment 

agreed with DEA lab registration but 

said that labs that have applied for DEA 

registration by Nov 1, 2020, should be 

allowed to continue testing (as under 

pilot programs) as the certification 

process takes so long. It further observed 

that while the IFR seemed settled on 

HPCL as the testing method, the rule 

does not specify the detection method 

as it should. The comment 

recommended mass spectrometry as the 

most accurate. 

Another comment agreed with DEA 

lab registration, saying that otherwise, 

any lab could be handling controlled 

substances without observing stringent 

DEA requirements. The comment 

argued that allowing any lab to test 

hemp creates an unfair business 

advantage for non-DEA labs that do not 

have to pay high costs of maintaining 

DEA registrations. Further, those nonDEA labs would be handling controlled 

substances inconsistent with Federal 

law. 

More commonly, comments opposed 

the DEA-registration requirement for 

hemp testing laboratories. Commenter 

concerns were as follows: 

Logistics: Numerous comments stated 

there are not enough DEA-registered 

labs to handle the volume of samples 

required under the IFR’s sampling and 

testing regulations. Comments predicted 

that such limited capacity would 

exacerbate existing bottlenecks, greatly 

increasing the likelihood that THC 

levels in sampled crops would continue 

to rise while farmers wait for test 

results. Several comments noted that the 

IFR allowed farmers to harvest sampled 

crops before receiving test results, 

however many prefer not to expend 

time and money harvesting a crop that 

might not be marketable. Comments also 

anticipated growers’ testing fees would 

increase to cover the addition of testing 

resources at existing DEA-registered 

labs. 

Some comments noted that not all 

States or Tribal lands have DEAregistered labs within or near their 

boundaries. According to comments, 

where DEA labs do exist, they are 

generally located in urban areas at some 

distance from rural farms. They 

explained that the scarcity of DEAregistered labs in reasonable proximity 

to farms will increase costs for 

transporting samples and increase the 

turnaround time for obtaining test 

results. Some comments submitted by 

Indian Tribes also asserted that the DEA 

had failed to consult with Tribes about 

its accreditation process and that it 

failed to timely respond to Tribes’ 

requests for lab results. 

Accreditation: Comments said that 

DEA-registration is costly and time 

consuming for laboratories and that 

such expenses would discourage 

existing labs from seeking DEA 

registration. One comment said that 

DEA accreditation is too expensive to be 

required for ‘‘low-level THC testing.’’ 

Comments suggested alternatives, 

including: 

• Allow testing by labs accredited 

under ISO 17025 

• Allow testing by labs approved under 

AMS’s LAP 


khammond on DSKJM1Z7X2PROD with RULES6
5638 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

• Allow testing by labs accredited by 

States or Tribes 

• Allow testing by labs accredited 

under other accreditation programs 

• Allow testing by labs with dual 

accreditation (e.g. DEA and ISO, or 

DEA and LAP) 

• Allow continued testing by labs 

approved to do so under the 2014 

Farm Bill 

• Allow for a transition period to allow 

labs time to work toward registration 

One comment suggested that allowing 

for alternative laboratory accreditation 

would increase competition between 

labs, reduce costs for growers, and 

reduce the potential bottleneck created 

by allowing for only DEA-registered lab 

testing. 

Another comment argued that 

although accreditation is costly, relying 

on it could help enforce strict standards 

and ensure less variability between 

testing labs. Some comments suggested 

USDA fund accreditation of private labs 

to help offset the cost of expensive 

accreditations and encourage more labs 

to seek necessary accreditation. 

Other comments suggested DEA 

expedite its lab approval process and 

make it easier for existing labs to obtain 

DEA registration. 

Other commenters stated that the DEA 

lab accreditation process requires State 

approval and not Tribe approval and 

that this is unworkable because of 

occasionally difficult relationships 

between some Tribes and States and 

because hemp is prohibited in a couple 

of States. 

Finally, several comments 

recommended AMS provide a phase-in 

period of as much as two years to allow 

existing labs to continue hemp testing 

while they work toward DEA 

registration so the industry will have 

access to adequate testing options 

during its development. 

DEA and Controlled Substances: 

Comments expressed concern about 

many aspects of DEA’s involvement 

with the hemp program. Comments 

argued that hemp is a legal agricultural 

commodity under the 2018 Farm Bill 

and requiring testing by DEA labs 

insinuates hemp is a controlled 

substance regulated under the 

Controlled Substance Act. Commenters 

asserted that treating hemp as a 

controlled substance exceeds the intent 

of the 2018 Farm Bill. Comments also 

suggested USDA’s IFR impeded 

Congressional intent to foster the 

development of a new agricultural 

sector. 

One commenter representing a 

processor of hemp, specifically for CBD 

products, said they were concerned 

about an IFR published by DEA and that 

the rule by DEA could inadvertently 

criminalize hemp at various stages of its 

production process. They encouraged 

USDA to eliminate DEA’s involvement. 

Comments also said DEA involvement 

in USDA’s program discourages 

participation by laboratories and by 

growers, neither of whom may care to 

risk prosecution for inadvertent 

criminal acts if a test result indicates 

they raised or possess a controlled 

substance. Some comments said private 

labs with ISO or other accreditation 

don’t want to obtain DEA accreditation, 

fearing the tension it will cause between 

themselves and their grower customers 

because of the requirement to report 

potential criminal activity. Other 

comments said growers fear 

repercussions related to possible felony 

prosecution for growing crops 

considered illegal, including loss of 

chemical application permits that allow 

them to manage other crops. One 

comment argued that it isn’t necessary 

to involve DEA in hemp testing, that it 

distracts that agency from other vital 

Federal work. 

According to some comments, most 

DEA-registered laboratories are crime 

labs that do not offer commercial testing 

services. As reported by a State, the 

DEA may be reluctant to even visit—let 

alone approve—certain laboratories 

because of the handling and testing of 

marijuana, although considered legal by 

the State. Other States with legal 

medical and/or recreational marijuana 

provisions commented that their labs 

may not want to seek DEA registration 

because they choose to focus on 

marijuana testing. Some comments said 

labs that handle marijuana may not in 

fact obtain DEA registration, thus 

laboratory capacity to process hemp 

samples at the volume and speed 

required by the IFR may not materialize. 

One comment assumed DEAregistered labs might test only for 

cannabinoids, while other commercial 

labs would be able to perform additional 

testing, for instance for microbes, heavy 

metals, and pesticide residues, saving 

growers the additional expense of 

multiple tests. 

Some comments recommended USDA 

waive the requirement to use DEAregistered labs in States where 

recreational marijuana is legal, thus 

increasing the number of labs available 

for hemp testing. Other comments 

recommended DEA change its standards 

to allow labs that handle legal marijuana 

to also handle hemp. 

Cost Management: A few comments 

suggested that restricting hemp testing 

to DEA-registered labs creates a 

monopoly among labs that already have 

such accreditation or have the financial 

backing of large, vertically integrated 

companies to enable them to do so. 

Comments recommended that existing 

State, Indian Tribe, university, or other 

Federal labs with demonstrated ability 

to perform testing according to USDA 

standards be allowed to do so, thus 

providing opportunities for more 

interested participants and keeping 

testing costs down for growers. Some 

comments suggested USDA contract 

with State, Tribe, or Federal labs to 

provide required testing. Other 

comments recommended capping costs 

for DEA-registered lab testing at $25– 

$50 per test. 

Alternatives: One comment asked 

USDA to clarify whether all 

independent labs must be DEAregistered to test hemp or whether only 

State labs needed to obtain that 

accreditation. 

AMS response: In consultation with 

the Department of Justice, AMS 

determined it must retain the 

provisional requirement that 

laboratories testing hemp for the 

purposes of regulatory compliance be 

registered with DEA. This requirement 

further extends to any laboratory testing 

hemp throughout the growing season to 

informally monitor THC concentration. 

The basis for this determination is 

rooted to the statutory requirements of 

the Controlled Substances Act (CSA), 

which requires any laboratory that 

might potentially handle a controlled 

substance to undergo the DEA 

registration process. The CSA states that 

it is unlawful to possess a controlled 

substance (21 U.S.C 844) and requires 

any laboratory that might potentially 

handle a controlled substance to 

undergo the DEA registration process 

(21 U.S.C. 822) with a few specific 

exemptions. Further, 21 CFR 1301.13 

includes categories that require 

registration with DEA, including 

chemical analysis where laboratories 

fall. 

AMS is aware through stakeholder 

comment that many stakeholders 

oppose the DEA registration 

requirement. AMS is also aware of 

widely held concern among 

stakeholders, especially Indian Tribes, 

that an insufficient number of DEAregistered laboratories exist and have 

limited accessibility to those in rural or 

regional locations away from 

metropolitan areas. AMS understands 

how this combination of variables leads 

to delays in sample processing by DEAregistered laboratories and how this 

affects producers’ harvest timetables. 

AMS also knows that since the IFR was 

published, numerous laboratories have 

applied for registration and DEA is 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5639 

23Evaluation of methods used to sample hemp for 

regulatory compliance testing;’’ Gang, David R. and 

Anna Berim; Washington State University, Pullman, 

WA; 2020. 

working diligently to process these 

requests. For this reason, DEA is 

delaying enforcement of this 

requirement until December 31, 2022. 

AMS anticipates this delay will provide 

adequate time for testing facilities to 

obtain DEA registration. 

While we understand the 

commenters’ concern about DEA 

involvement, the 2018 Farm Bill 

distinguishes hemp from marijuana, a 

controlled substance under DEA’s 

regulatory authority, based on the THC 

concentration level in the cannabis 

plant. Although a producer may have 

intended to cultivate hemp, it is 

possible that the plant is marijuana 

because of the THC concentration level. 

If that is the case, the producer would 

then be subject to DEA regulations and 

jurisdiction. USDA coordinated with 

DEA so that producers that 

inadvertently produce marijuana may be 

able to take remediation steps consistent 

with DEA’s regulations to avoid 

potential criminal liability. 

Additionally, the 2018 Farm Bill makes 

clear that negligent production of hemp 

will not subject the producer to criminal 

enforcement activity. See 7 U.S.C. 

1639p(e)(2)(C). 

AMS also acknowledges that some 

laboratories believe the DEA-registered 

laboratories are crime labs that do not 

offer commercial testing services and 

DEA may be reluctant to approve 

laboratories because of the handling and 

testing of marijuana, although 

considered legal by the State. However, 

AMS does not have any information that 

would support this belief. AMS is aware 

that DEA continues to add laboratories 

to their approved list. 

Accordingly, any laboratory testing 

hemp for purposes of regulatory 

compliance must be registered by DEA 

to conduct chemical analysis of 

controlled substances (in accordance 

with 21 CFR 1301.13). Registration is 

necessary because laboratories could 

potentially handle cannabis that tests 

above the 0.3 percent concentration of 

THC on a dry weight basis, which is, by 

definition, marijuana and a Schedule 1 

controlled substance. Instructions for 

laboratories to obtain DEA registration, 

along with a list of approved 

laboratories, are available on the USDA 

Domestic Hemp Production Program 

website. 

Laboratory accreditation options are 

discussed earlier in this rule. USDA 

does not have any authority over the 

DEA’s laboratory accreditation process. 

DEA’s IFR published August 21, 2020, 

(85 FR 51639) is out of the scope of this 

final rule. 

Measurement of Uncertainty (MU)— 

Laboratory Testing 

The IFR required that laboratories 

calculate and include the measurement 

of uncertainty (MU) when they report 

THC test results. 

Comments: Several comments 

expressed support for requiring that the 

MU be accounted for when testing the 

THC concentration of hemp due to the 

variability in laboratory testing 

equipment and complex mathematical 

principles involved. Comments 

generally emphasized that the inclusion 

of a standardized MU was needed for 

the industry to develop, as hemp 

farmers should not be exposed to risks 

of economic loss that are created by 

mathematical inconsistencies within an 

individual laboratory’s computations. 

Several comments emphasized the 

importance of USDA clarifying the 

method for MU calculation in the rule 

because it is part of what determines 

whether hemp must be disposed. 

One commenter cited a study 23 that 

found that test results on samples from 

each field sent to five different labs 

deviated significantly, ranging from a 

low of 22 percent deviation to a high of 

41 percent depending on the field. 

Some comments expressed the need 

for a standard, specific MU in the final 

rule to prevent licensees from 

‘‘shopping around’’ for laboratories with 

the most lenient testing. Comments 

noted there is no universally accepted 

way to calculate MU, so differences in 

MU values used by various laboratories 

are just as likely to result from 

differences in calculation method as 

they are from differences in instrument 

quality or use. Several comments 

explained that the lack of a standardized 

MU in the rule incentivizes inaccuracy 

by potentially driving customers to 

laboratories willing to use MUs with 

greater ranges. 

Many comments advocated specifying 

an MU to create uniformity in testing 

across the nation. One comment noted 

that variation in MU values could be 

problematic for interstate commerce and 

result in a hemp crop that is compliant 

in one state being shipped to another 

state where it would be considered 

noncompliant. Other comments argued 

that it may be too soon in the scientific 

process for USDA to include a standard 

MU because laboratories, particularly in 

States that didn’t previously have 

cannabis programs, haven’t had time to 

do the research necessary to determine 

an appropriate MU. 

Comments from States that 

administered pilot programs under the 

2014 Farm Bill offered several 

suggestions on approaches to MU 

calculations. A comment recommended 

using laboratories participating in the 

University of Kentucky—Division of 

Regulatory Services’ Hemp Proficiency 

Testing Program to establish an MU 

through a set of guidelines rather than 

in the rule. The commenter concluded 

that the Hemp Proficiency Testing 

Program could be tasked with 

calculating and announcing an MU that 

would be used for compliance testing 

purposes on a nationwide basis. The 

comment added that including the MU 

in the guidelines rather in the rule 

would allow it to be refined over time 

as instrumentation and calculations 

develop, rather than having to modify 

the hemp regulation. 

Some comments advocated having 

multiple testing methodologies to 

choose from and including requirements 

for calculating MU for each method. 

Other comments recommended that 

instead of requiring a specific MU, 

USDA should determine a maximum 

threshold for allowable MU value. 

Comments argued that a maximum 

threshold would prevent forum 

shopping by consumers looking for 

laboratories with the most lenient MU 

ranges, but still allow laboratories to use 

their own calculations. One comment 

recommended revising the MU 

provision of the IFR to include a 

maximum uncertainty level that 

laboratories cannot exceed and 

suggested the maximum uncertainty 

value should be one-third or less of the 

target uncertainty. Another comment 

suggested USDA use guidelines from the 

United States Pharmacopeia for 

determining THC concentration, which 

include calculations for significant 

figures such as MU. 

A comment asked USDA to clarify the 

role of significant figures in using MU 

to determine total THC concentration 

because, they argued, in both of the 

IFR’s examples for determining 

compliance, the lower end of the range 

can be written as 0.3 percent, if 

rounding to match significant figures. It 

suggested requiring the lower value of 

the THC calculation distribution range, 

which accounts for uncertainty, to be 

less than or equal to 0.30 percent rather 

than 0.3 percent. 

One commenter stated that for the 

cannabis plants exceeding the 

acceptable THC levels, USDA should 

incorporate a MU for laboratory 

deviation of .0500 percent for the many 

different variable ways that a sample 

arriving at a laboratory could result in 

an inaccurate test. This includes cutting, 


khammond on DSKJM1Z7X2PROD with RULES6
5640 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

bagging, sealings, transporting, 

handling, and other pre-laboratory 

activities. 

One comment cited guidance from the 

National Institute of Standards and 

Technology providing that assigned 

uncertainty should be small relative to 

the total uncertainty targeted for test 

samples. The comment asserted that, as 

a rule of thumb, assigned uncertainties 

should be about one-third or less of the 

target uncertainty to ensure that 

uncertainty in the certified value will 

have negligible influence on the results 

of measurements. According to the 

comment, laboratories with welldeveloped processes will provide the 

most accurate and precise results and 

their uncertainty will be very small. The 

comment advocated that USDA provide 

an uncertainty range that cannot be 

exceeded by participating laboratories, 

thereby reducing the risk that producers 

will shop for laboratories with the 

widest uncertainty. The comment 

asserted that such a provision would 

also improve data comparability across 

the hemp industry. 

AMS response: AMS appreciates the 

different suggestions submitted by 

commenters on ways to improve the 

calculation of MU and also 

acknowledges the variability in 

laboratory testing equipment that may 

exist. However, based on the input 

received and limited data available at 

the time of its review, AMS will only 

require that hemp testing laboratories 

complete a MU calculation as part of the 

mathematical test result for THC 

concentration. This final rule does not 

establish or standardize an upper or 

lower boundary for general use by 

laboratories to calculate a measurement 

of uncertainty. MU is typically not 

standardized, but rather is controlled 

using test methods controlled by 

performance standards (e.g., AOAC 

Standard Method Performance 

Requirements 2019.003 that can be 

found at https://www.aoac.org/ 

resources/smpr-2019003/). 

USDA does not recommend 

establishing a MU upper limit 

(maximum) because (1) MU is typically 

not standardized, but is controlled using 

standard test methods, and (2) USDA 

does not have the data to set an upper 

limit, so setting it would be arbitrary, 

not scientific. The hemp and scientific 

industries are just beginning to discuss 

standard test methods, and the final rule 

does not establish an explicit test 

method. Setting an upper limit or 

maximum MU does not resolve the core 

issue and would not encourage or drive 

labs to improve accuracy and precision. 

Setting an upper limit would in effect 

be setting a maximum or absolute MU. 

This may encourage labs to adopt the 

maximum MU as their MU, rather than 

drive for a smaller uncertainty. USDA 

may allow for establishing limits in the 

future, if needed, once methods are 

established and USDA has access to 

Proficiency Testing results and the 

reported MUs. 

Additionally, this rule retains the 

flexibility for State and Tribal 

Departments of Agriculture to include 

specific requirements regarding MU for 

laboratories conducting hemp regulatory 

testing under their specific state or 

Tribal hemp programs if they meet the 

minimum standard set in this final rule. 

AMS encourages State and Tribal 

regulatory agencies to coordinate in 

developing proficiency and testing 

methods, similar to the program 

administered by the University of 

Kentucky, but participation in these 

types of programs is not required by this 

regulation. 

Disposal 

The IFR stipulated that cannabis 

exceeding an acceptable THC level must 

be disposed of in accordance with the 

CSA and DEA regulations because such 

material constitutes marijuana, a 

Schedule I controlled substance under 

the CSA, rather than hemp. 

Destruction vs. Disposal: Several 

comments noted that the 2018 Farm Bill 

specifies only ‘‘disposal,’’ of hemp 

testing above the acceptable THC level, 

yet the IFR required ‘‘destruction’’ of 

such material. Comments argued that 

the IFR’s destruction requirement is an 

overreach. Comments asked USDA to 

revise the regulations to require only 

disposal of non-compliant plants or 

plant parts, and to provide either 

general parameters or specific 

provisions regarding acceptable 

methods of disposal. Several comments 

asked AMS to provide or expand the 

requirements for disposal of noncompliant material. 

Although a few comments supported 

destroying non-compliant hemp crops, 

most comments that addressed the topic 

argued against total crop destruction if 

alternative disposal methods are 

available and practical. Comments 

explained that crop loss is financially 

devastating to growers—and doubly 

punitive if the grower must pay to 

destroy the crop—as well as a waste of 

valuable resources that could be 

repurposed and provide at least some 

return to growers. Comments explained 

that crop destruction can be a drain on 

limited official resources, depending on 

the availability of law enforcement 

personnel and equipment for the 

potential need to collect, transport, and 

oversee the destruction of noncompliant plant material. Further, a 

comment from an Indian Tribe noted 

that requiring crop destruction is 

culturally offensive to indigenous 

people that traditionally use every part 

of every animal and plant that can be 

utilized. 

Disposal Methods: Several comments 

asserted that the only disposal methods 

available under DEA regulations are 

incineration or chemical digestion and 

argued that the current rules under the 

CSA are designed for disposal of 

pharmaceuticals and chemical-based 

illegal drugs, not for the disposal of 

agricultural crops. Comments asserted 

that incineration by DEA is not efficient 

or environmentally sound, and in some 

places may not be allowed. They noted 

that burning crops releases harmful 

carbon dioxide and other pollutants into 

the air, contributes to the risk of 

wildfires, and wastes valuable plant 

nutrients that could be used elsewhere. 

Numerous comments stated that the 

rule should provide alternative methods 

of disposal for non-complaint hemp 

plants to protect growers against total 

crop loss and preserve valuable 

resources. Several comments 

recommended USDA adopt disposal 

rules established under their various 

State and Tribal regulations. Comments 

suggested growers be allowed to mulch 

or disc the non-compliant crop into the 

soil at the farm, which would build up 

soil nutrients, improve soil water 

holding capacity, and improve soil tilth. 

Other comments suggested growers 

could recuperate some of their 

investment by marketing non-compliant 

crops for other non-ingestible or nonconsumable products like fiber, building 

materials, biofuel, biochar, bioplastics, 

and animal bedding. A few comments 

suggested growers should be permitted 

to export or ship non-compliant hemp 

to countries or States that have legalized 

recreational or medical marijuana. 

Numerous comments recommended a 

surgical approach to disposing of noncompliant plants by allowing for the 

removal and disposal of only the plant 

parts testing over the acceptable THC 

level, while allowing growers to market 

the remaining parts. One comment 

suggested the Federal Government 

could buy non-compliant crops for no 

less than 50 percent of the market value 

and use them to manufacture paper, 

plastics, and fuel for government and 

military uses. Other comments proposed 

remediation as an alternative to crop 

destruction; comments on remediation 

are discussed in another section of this 

comment analysis. One comment 

suggested further research be conducted 

to identify appropriate alternatives for 

crop disposal, and one comment 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5641 

24Polis, Jared; Phillip J. Weiser; and Kate 

Greenwood: State of Colorado Comments in 

Response to USDA Establishment of a Domestic 

Hemp Production Program; https://

beta.regulations.gov/comment/AMS-SC-19-0042- 

3358. 

suggested that industry stakeholders, 

governments, regulators, and law 

enforcement officials work together to 

develop disposal options under the 

program. 

Disposal Oversight: Several comments 

recommended that States, Indian Tribes, 

or local authorities be allowed to 

determine appropriate crop disposal 

methods for their jurisdictions. 

Comments further recommended that 

State, Tribal, or local regulatory officials 

be authorized to oversee disposal of 

non-compliant hemp, as several have 

done prior to the establishment of the 

Domestic Hemp Production Program. 

One comment recommended further 

that hemp disposals handled by the 

State should not imply criminal intent 

on the part of growers. Comments said 

that allowing for local oversight would 

reduce strain on DEA and other law 

enforcement resources and ensure 

disposals can be handled on a timely 

basis. One comment from a State 

agriculture department said that when 

law enforcement officers have been 

invited to attend crop disposals in their 

jurisdiction, officers are typically 

unavailable. Other comments argued 

that growers should automatically 

become DEA-registered reverse 

distributors if their test results exceed 

acceptable hemp THC levels so they can 

dispose of the non-compliant crops 

themselves and provide acceptable 

evidence (e.g., photo or video) that they 

have done so, or so they can do so in 

the presence of regulatory officials. 

Some said USDA should pay for official 

oversight of crop disposal or there 

should be no charge for that service. 

Comments noted that AMS had not 

yet posted disposal guidelines on its 

website at the time those comments 

were submitted, although the IFR had 

committed AMS to doing so. Some 

comments said interested entities were 

unable to complete applications for 

program participation because AMS had 

not yet provided disposal requirements. 

Several comments asserted that DEA 

regulations do not mandate specific 

disposal methods, so long as the 

‘‘desired result’’ is achieved. Comments 

asked for more specifics on DEA 

disposal procedures, including what 

disposal methods or processes were 

allowed under the IFR, what the 

timeline is for disposal, and what 

results are desired. 

One comment asked whether all of a 

grower’s crops would be disposed if one 

of the lots tested above the acceptable 

hemp THC level. Others asked whether 

marketing non-compliant crops for noningestible and non-consumable products 

would be considered a form of disposal. 

One comment asked whether USDA 

would consider providing crop 

insurance for losses due to disposal of 

‘‘hot’’ crops. One comment asked 

whether stored hemp product produced 

under previous programs that allowed 

for higher THC levels would be 

disposed under the new program, or 

could be ‘‘grandfathered’’ in. 

One comment contended that certain 

language in the IFR was inconsistent, 

and as a result, the IFR could be 

interpreted to require disposal of hemp 

that does not meet the IFR’s definition 

of hemp, rather than the disposal of 

hemp that does not meet the acceptable 

hemp THC level. 

AMS response: AMS received 

significant comments on this 

requirement from State and Tribal 

regulatory agencies, producers, and 

other hemp industry stakeholders and 

based on this input, AMS determined it 

necessary to include specific on-farm 

hemp disposal activities and to provide 

oversight flexibilities. 

As explained in the IFR, State and 

Tribal plans are required to include 

procedures for ensuring effective 

disposal of plants produced in violation 

of this Part. As part of its review, AMS 

noted the cultural implication of the use 

of the term ‘destruction’ and 

accordingly amended the regulatory 

provision to clarify the disposal 

activities required of growers in cases 

when a sample tests above the 

acceptable total THC level. 

AMS also determined that producers 

benefit from greater regulatory 

flexibility to control on-farm disposal 

activities according to production 

schedules that are not dictated by the 

availability of reverse distributors to 

physically witness disposal activity. 

State and Tribal plans must still include 

procedures to verify disposal. This may 

come in the form of in-person 

verification by State or Tribal 

representatives, or alternative 

requirements the direct growers to 

provide pictures, videos, or other proof 

that disposal occurred successfully. 

State and Tribal plans must also include 

requirements to submit to AMS the 

monthly disposal report documenting 

any on-farm disposals that occurred 

during the prior month. Additional 

information on specific disposal 

methods is available to producers, State, 

and Tribal oversight agencies is 

available on the AMS website. 

Disposal through the agricultural 

practices appearing in this final rule 

reflected those allowable under the IFR, 

and previously published to the AMS 

web page in February 2020. These 

included plowing under, mulching/ 

composting, disking, bush mower/ 

chopper, deep burial, and burning. 

These activities align with normal and 

routine production actions by farmers. 

AMS believes specifying these activities 

help hemp growers determine which 

activity best supports their operation to 

transition non-compliant crop into a 

non-retrievable or non-ingestible form. 

These methods also allow recycling 

non-compliant plant materials back into 

the earth, a viewpoint AMS learned 

through public comment to be 

especially relevant for producers 

practicing cultural conservation 

practices. AMS recognized that 

controlled burning is the closest farm 

practice to incineration but controlled 

burns may not be a viable option for 

producers in some places due to 

wildfire risk or state prohibition against 

using controlled burns. 

Remediation 

The IFR stipulated that cannabis 

exceeding the acceptable THC level 

must be disposed of in accordance with 

the CSA and DEA regulations because 

such material constitutes marijuana, a 

Schedule I controlled substance under 

CSA, rather than hemp. In addition, the 

IFR stated that noncompliant plants 

may not be further handled, processed, 

or enter the stream of commerce, and 

that the licensee shall ensure the lot is 

disposed. The IFR did not stipulate any 

provisions to allow for remediation 

activities that reduce the THC 

concentration to levels within the 

acceptable limit. 

Remediation of non-compliant crops 

into compliant plant biomass: 

Numerous comments expressed support 

for remediation of non-compliant plants 

to help farmers mitigate against 

financial loss. Comments claimed that 

not having remediation options would 

be a barrier to industry growth because 

farmers would be unable to bear the 

financial risk of losing crops. One 

commenter used 2019 production and 

economic data to project that applying 

the IFR to 2019 statewide noncompliant test rates (17 percent), 

farmgate losses due to crop destruction 

could have totaled $842.6 million in 

Colorado.24 According to the comment, 

adding losses related to lost processing 

and manufacturing due to the same crop 

destruction could have brought the 

economic cost to approximately $1.2 

billion. It suggested that allowing for 

remediation of non-compliant crops 

testing between 0.3 and 1.0 percent THC 

in the same scenario would preserve 


khammond on DSKJM1Z7X2PROD with RULES6
5642 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

25Caravetta, John: Arizona Department of 

Agriculture Additional Comments on USDA Interim 

Final Rules on Domestic Hemp Production; https:// 

beta.regulations.gov/comment/AMS-SC-19-0042- 

5645. 

26Petersen, Thom: Minnesota Department of 

Agriculture Comments on USDA Interim Rule: 

Establishment of a Domestic Hemp Production 

Program; https://beta.regulations.gov/comment/ 

AMS-SC-19-0042-5548. 

about $798 million in direct farmgate 

value, or $1.1 billion of total economic 

value for the State. 

Numerous comments explained that 

non-compliant plants can be remediated 

by chemical processes that either 

remove and destroy THC or dilute THC 

concentrations, thereby transitioning the 

remaining material into biomass blends 

which then test at or below the 

Federally allowable THC threshold of 

0.3 percent. Thus, according to 

comments, crop remediation through 

one of these processes is a viable 

alternative to total crop loss. Some 

comments suggested processors could 

be registered with DEA to handle such 

remediation processes to ensure THC is 

extracted, handled, and disposed or 

marketed legally. Other comments 

suggested that USDA could issue 

processor permits to allow them to 

handle hot crops to bridge the perceived 

legal gap between farmer and consumer. 

Some comments further suggested 

growers could bear processing costs 

then retake possession of the remaining 

biomass for use or sale elsewhere. 

Several comments suggested growers 

themselves could be allowed to merge 

‘‘hot’’ lots with lots testing below 

allowable hemp THC limits to create a 

compliant, homogenized blend. 

Some comments suggested noncompliant crops could be remediated by 

removing the only flowers and retaining 

the seeds and stalks for other use. Other 

comments argued that the IFR testing 

provisions conflict with CSA provisions 

that exempt seeds and stalks of plant 

material from the definition of 

marijuana, and several comments urged 

USDA to modify the IFR to require only 

that the parts of the plant exceeding the 

THC limit be destroyed. 

One comment advocated that States 

be allowed to remediate non-compliant 

crops through milling and blending the 

harvest lot to include the entire plant to 

a homogenized state, then retesting the 

lot. The comment included the results 

of a comparative analysis based on 

crops that initially tested over the legal 

threshold of 0.3 percent total THC 

during Arizona’s 2019–2020 growing 

season.25 According to the comment, 

producers opted to attempt remediation 

as described for a total of 25 lots 

representing 568.6 acres of hemp. Of the 

25, 19 lots representing 507 acres 

successfully reduced the total THC 

amount to be compliant, for an 89.71 

percent recovery of acres that would 

otherwise have required disposal. The 

comment reported that the average 

amount of THC was reduced by 31.61 

percent, and suggested that while this 

remediation process might not be 

successful for crops that are 

significantly over the legal threshold, 

and while the market value of the 

resulting biomass may be reduced, the 

process may allow growers to recover 

some of their losses. 

One comment 26 reported on a survey 

of all Minnesota hemp growers who had 

experienced lot failures since the 

beginning of their pilot program in 

2016. According to the comment, 

reported losses varied greatly, ranging 

between $22,000 and $70,000 per year. 

The comment further described the 

State’s analysis of 1,492 hemp lot 

samples from 2016 through September 

2020, which showed that 10.3 percent 

tested at or above 4.0 percent total delta9 THC, although there was no indication 

of non-compliance with program rules 

or of illegal drug activity on the part of 

growers. The comment recommended 

that States and Tribes be allowed to 

develop remediation plans to salvage 

non-compliant crops. 

Post-harvest sampling and retesting: 

Several comments suggested retesting 

post-harvest samples to confirm THC 

levels. Comments provided examples of 

some State agriculture departments that 

implemented post-harvest sampling and 

testing processes under the 2014 Pilot 

Programs. For instance, one comment 

cited results from the 2018 season in 

which they allowed post-harvest 

retesting of hemp plots that originally 

tested between 0.4 and 1.0 percent THC. 

The comment said under Kentucky 

rules, farmers were allowed to choose 

between immediate destruction of the 

leaf and floral material of the crop, 

without additional testing, or paying the 

$250 fee for a post-harvest retest of 

harvested and ground up hemp 

material, in which the THC 

concentration was diluted. It stated that 

of 29 growers whose lots tested between 

0.4 and 1.0 percent THC, 22 chose 

retesting and none of those returned a 

second measurement above 0.3999 

percent THC. Thus, those growers were 

able to realize a return on their 

investment. The remaining seven cases 

did not elect to retest—five elected to 

destroy the entire plant and 2 destroyed 

only floral and leaf materials, salvaging 

the stalks. The data showed the acreage 

destroyed represented approximately 

one percent of total acreage. The 

comment concluded that post-harvest 

grinding and retesting offers a viable 

economic solution for farmers seeking to 

recuperate their investment on crops 

that initially test non-compliant. Other 

comments urged USDA to provide for 

retesting provisions, including 

remediation activities, that more 

favorably support farmers who seek to 

salvage crop value. Some of these 

comments requested that USDA clarify 

retesting procedures if a harvest has 

already occurred. 

Statutory implications: Comments 

from Tribes and other stakeholders 

expressed concern that the 2018 Farm 

Bill only requires ‘‘procedure for 

effective disposal,’’ and urged USDA to 

allow producers greater regulatory 

leniency as they become familiar with 

growing a new crop by permitting 

alternative remediation methods that do 

not require crop destruction. 

AMS Response: This final rule covers 

testing of the hemp plant to determine 

acceptable THC levels as required by the 

2018 Farm Bill. This final rule does not 

cover testing for seeds and stalks 

individually nor does it cover 

processing or the licensing of 

processors. 

As described in the IFR, hemp 

exceeding the acceptable THC level may 

not be further handled, processed, or 

enter the stream of commerce. The 

licensee shall ensure the disposal of the 

noncompliant crop. Before such 

disposal occurs, AMS believes it 

important and necessary that hemp 

growers be provided the opportunity to 

remediate THC from non-compliant 

crops in order to stave off financial risk 

associated with the loss of investment in 

their hemp crop. 

AMS agrees with comments that 

consider remediation as a viable activity 

for farmers to minimize crop loss and to 

salvage the value of remaining 

compliant plant material. For this 

reason, the final rule provides 

regulatory flexibility that allows 

remediation activities—either disposing 

of flower materials and salvaging the 

remainder of the plant or blending the 

entire plant into biomass plant material. 

Through both forms of remediation, the 

farmer may be able to minimize losses 

and, in some case, produce a return on 

investment. A guidance document will 

be published with this rule to illustrate 

approved remediation techniques. 

USDA will also finalize the guidance 

document on disposal techniques. 

Additionally, AMS determined that 

pre-harvest sampling and testing yield 

the truest measurement of THC 

concentration at the point of harvest. 

AMS further maintains this position in 

this final rule. AMS notes that if the test 

results show the original THC 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5643 

concentration exceeded the Federally 

allowable limit, the licensee may 

request the laboratory retest the preharvest sample. This retest would not 

entail the use of post-harvest plant 

material. However, if the farmer elects 

to perform remediation activities under 

a USDA, State or Tribal plan, an 

additional sampling and testing of the 

remediated crop must occur to 

determine THC concentration levels. 

Only those crops testing below the 

acceptable hemp THC level limit will be 

considered successfully remediated and 

thus allowed to enter the stream of 

commerce. All other remaining noncompliant crops must then be properly 

disposed. 

AMS believes the inclusion in the 

final rule of remediation and postharvest sampling after remediation 

provides the additional flexibility 

requested by commenters that expressed 

the need for farmers to have greater 

opportunity of success entering the 

hemp production industry. 

Reverse Distributors 

The IFR requires the collection and 

destruction of noncompliant material by 

a person authorized under the CSA to 

handle marijuana, such as a DEAregistered reverse distributor, or a duly 

authorized Federal, State, or local law 

enforcement officer or their designee. 

Comments: Comments largely 

opposed the use of DEA-registered 

reverse distributors to dispose of 

noncompliant material. Comments 

asserted that many States and producers 

operating under the 2014 Farm Bill have 

implemented policies related to 

disposal of non-compliant material that 

do not require DEA involvement. 

Comments argued there are relatively 

few registered reverse distributors on 

DEA’s 2019 list and pointed out that 

some of the major hemp production 

States have very few or no registered 

reverse distributors. Comments claimed 

existing DEA-registered reverse 

distributors haven’t the resources or 

training to oversee destruction of large 

plots of agricultural crops in remote 

areas, and that such limitations would 

create a compliance bottleneck. 

Comments asked USDA to clarify who 

would be responsible for paying DEA 

reverse distributors for crop disposal 

services. 

One comment asserted that DEA 

regulations prohibit reverse distributors 

from accepting controlled substances 

from other than DEA registrants, making 

it impossible for hemp farmers to 

release non-compliant hemp directly to 

DEA reverse distributors. One comment 

suggested that hemp growers could 

automatically become reverse 

distributors if their hemp samples test 

above acceptable THC levels so growers 

could legally manage crop destruction 

on their own. Another comment asked 

whether DEA would allow for a waiver 

from the current limitation on reverse 

distributors to allow reverse distributors 

to accept cannabis material for disposal 

from individuals or entities who 

cultivate hemp in accordance with their 

state’s approved plan, but who do not 

hold a Schedule I DEA registration. 

Numerous other comments expressed 

concern that alternative law 

enforcement agencies (non-DEA) will 

face the same resource constraints as the 

DEA. Comments described how State 

law enforcement officials are typically 

unwilling or unavailable to participate 

in the disposal of noncompliant crops 

and suggested this is due to the lower 

prioritization of hemp compliance 

oversight in light of more pressing 

public safety and crime intervention 

responsibilities. For example, a 

comment representing rural counties 

said this conflict in priorities is 

particularly acute in rural areas where 

resources are already stretched too thin. 

The comment asserted that while 

preventing serious violations of 

controlled substances laws is a priority 

for law enforcement agencies, hemp 

with slightly elevated THC levels is 

unlikely to be sold as marijuana. The 

comment advocated formulating hemp 

disposal procedures entirely outside the 

scope of law enforcement. One 

comment worried about the stress and 

stigma on growers having law 

enforcement personnel descend upon 

their farms in connection with hemp 

disposals. Other comments supported 

allowing State regulatory authorities to 

oversee or authorize disposal of noncompliant material, asserting that States 

can safely and efficiently complete the 

process at a much lower cost to 

producers and States. 

Some comments supported disposal 

of non-compliant material by law 

enforcement. Some suggested that 

States, rather than Federal agencies, 

work with State and local law 

enforcement to handle disposals. One 

comment suggested that the definition 

of ‘‘duly authorized Federal, State, or 

local law enforcement officer’’ be 

modified to include disposal under the 

authority of State or local law 

enforcement in order to address the 

anticipated increase in required 

disposals. Finally, comments from 

Indian Tribes urged USDA to expand 

the definition of law enforcement in the 

final rule to include Tribal law 

enforcement. 

AMS response: AMS acknowledges 

the many stakeholders who expressed 

through comment concerns about the 

collection of non-compliant plants by 

DEA-registered reverse distributors, or 

duly authorized Federal, State, or local 

law enforcement. AMS notes that law 

enforcement policies and priorities are 

not set by USDA and the 2018 Farm Bill 

does not provide this authority. To 

address public comment, this final rule 

will retain disposal requirements stated 

in the IFR but will further clarify what 

‘‘disposal’’ means relative to the role of 

reverse distributors. 

AMS relaxed the disposal 

requirements enacted under the IFR in 

February 2020. This decision followed 

consultation with DEA. This provided 

growers the added flexibility to conduct 

on-farm disposal activities themselves, 

without required onsite lawenforcement supervision. Based on 

positive feedback received from State 

and Tribal oversight agencies and 

producers following the relaxation of 

disposal requirements, AMS is 

permanently allowing for on-farm 

disposal flexibility in the final rule. 

Under this final rule producers do not 

need to use a DEA-registered reverse 

distributor or law enforcement to 

dispose of non-compliant plants (7 CFR 

990.3(a)(3)(iii)(E) and 990.27) if the 

producer disposes of the plants using 

one or more of the means described by 

USDA at https://www.ams.usda.gov/ 

rules-regulations/hemp/disposalactivities. It is the agency’s intent that 

these methods allow producers to apply 

common on-farm practices as a means of 

disposal while rendering the controlled 

substance non-retrievable or noningestible. Producers must document 

the disposal of all non-compliant plants 

in accordance with § 990.27. Reporting 

can be accomplished by providing 

USDA with a completed: ‘‘USDA Hemp 

Plan Producer Disposal Form.’’ 

Cannabis with a THC level of over 0.3 

percent on a dry weight basis is a 

controlled substance, that must be 

disposed of onsite according to the 

disposal methods approved by USDA. 

The State, Indian Tribe or the state’s 

department of agriculture wishing to 

have primary regulatory responsibility 

have the responsibility for establishing 

protocols and procedures to ensure noncompliant plants are appropriately 

disposed of in compliance with 

applicable State, Tribal, and Federal 

law. States and Indian Tribes operating 

under approved hemp production plans 

must notify USDA of any occurrence of 

non-conforming plants or plant material 

and provide the disposal record of those 

plants and materials monthly. There is 

a similar requirement for producers 

operating under the USDA plan. 

Additionally, USDA will conduct 


khammond on DSKJM1Z7X2PROD with RULES6
5644 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

random audits of licensees to verify 

hemp is being produced in accordance 

with the provisions of the rule. 

State and Tribal plans must still 

include procedures to verify disposal 

but would have the additional flexibility 

to use in-person verification where 

deemed necessary or, when practicable, 

require producers provide pictures, 

videos, or other proof of disposal. AMS 

believes this decision will further 

alleviate the strain to oversight 

resources and allow State and Tribal 

authorities to more efficiently and 

autonomously monitor hemp 

production in their jurisdictions. 

Additionally, the final rule expands 

the definition of ‘‘law enforcement’’ to 

include Tribal law enforcement. 

Negligent Violation Threshold 

The IFR specified that a producer 

commits a negligent violation when a 

reasonable effort to grow hemp is made 

and the total THC dry weight 

concentration exceeds 0.5 percent. 

Supporting an increase of negligent 

violation threshold: Most comments that 

addressed negligent violations opposed 

the 0.5 percent total THC threshold in 

the IFR, and many advocated raising the 

threshold to 1.0 percent or higher, 

offering suggestions ranging between 

0.99 and 5.0 percent total THC. 

Comments said the 0.5 percent 

threshold can be too easily breached by 

prudent farmers for any number of 

environmental or genetic factors that are 

beyond grower control. One comment 

supported the 0.5 percent negligence 

threshold, and others noted it but 

signaled neither support for nor 

opposition to the threshold particularly. 

Some comments suggested that a 1.0 

percent threshold would provide a safe 

environment in which both new and 

veteran farmers can operate 

comfortably. Comments in favor of a 1.0 

percent negligence threshold noted that 

several States and other countries have 

established a 1.0 percent threshold for 

their jurisdictions that seems reasonable 

and achievable in most situations. A few 

comments pointed out that a 1.0 percent 

threshold is relatively low compared to 

the THC levels in marijuana, which 

commenters said typically range from 

10 to 15 percent. Other comments 

advocated higher thresholds that they 

claim would give farmers the peace of 

mind to continue building an industry 

that is just taking off. Finally, one 

comment asked whether an MU was 

figured into the IFR’s negligent violation 

threshold and advocated setting the 

threshold at 1.5 percent THC and 

specifying that that threshold includes 

the MU. 

A state department of agriculture 

estimates that 42 licenses would need to 

be revoked at 0.5 percent stated in the 

IFR. They further estimate that this 

number would shrink to only about 12 

licenses were the threshold increased to 

1.0 percent under the final rule. 

A state hemp steering committee 

commented that a 0.5 percent threshold 

will deter the experimentation of 

different varietals and that this research 

is essential to discovering which 

varietals work best in different climate 

zones and soil types as well as for the 

development of better genetics. 

Another state department of 

agriculture explained that 13 percent of 

the hemp samples taken in 2019 tested 

over the THC limit. The average THC 

level in those failures was 1.07 percent 

Delta-9 THC post-decarboxylation. A 

hemp association within the state 

agreed with the commenter’s 

recommendation that the level defined 

for negligence should be increased to 1 

percent THC. 

One comment reported that more than 

5.5 percent of the pre-harvest samples 

collected under the State’s plan in 2019 

were found to have a THC concentration 

of greater than 0.5 percent. Another 

comment reported that 13 percent of 

hemp samples taken in 2019 tested over 

the THC limit. According to the 

comment, data for all years through 

September 2020 show that most hemp 

lot failures occur between 0.4 percent 

and 1.0 percent THC. 

Data submitted with a comment from 

a State University researcher showed 

that 8.5 percent of 3,508 samples tested 

during 2018–2020 exceeded the IFR’s 

negligent violation threshold of 0.5 

percent THC. The comment said that 65 

percent of those would not be 

considered negligent violations if the 

threshold were raised to 1.0 percent. 

Framing study results another way, the 

comment explained that at a negligence 

threshold of 0.5 percent, the State 

would have revoked 42 producer 

licenses, whereas at a 1.0 percent 

threshold, the State would have revoked 

only 12 licenses, given three negligent 

violations in a five-year period, a 

reduction of 72 percent in revocations 

by changing the threshold to 1.0 

percent. 

One comment reported that based on 

test results they’d seen this year, 1.0 or 

1.5 percent would be a more appropriate 

threshold for negligence, due to the 

heterogeneity of the plant and the 

awareness of the industry. 

Implementation timeframe: Some 

comments suggested that it is too early 

in the industry’s development to 

determine a realistic numeric threshold, 

and they recommended USDA delay 

fixing a uniform standard until the 

industry has more experience and better 

understanding of the relationship 

between all the hemp production 

factors. Still other comments asserted 

that negligence should not be 

determined numerically at all, but by a 

determination about the farmer’s intent. 

Several comments said that ‘‘negligence 

is a state of mind, not a number.’’ 

General comments on 0.5 percent 

threshold: Several comments argued 

USDA arbitrarily determined the 0.5 

percent negligence threshold. One 

comment asked USDA to provide the 

research reports used to inform the 

selection of the 0.5 percent negligence 

threshold. Another questioned whether 

USDA used test results based on the 

total THC standard established in the 

IFR to set the negligence threshold, 

since it was the commenter’s experience 

that producers routinely report 

difficulty meeting that standard. One 

comment reported anecdotally that its 

farm sends three samples from the same 

composite lot sample to three testing 

laboratories and gets three different 

results, which the comment ascribes to 

the variation in lab procedures. Another 

comment said that there are no 

established uniform standards for 

cannabinoid testing, such that even 

from reputable labs it will not be 

entirely clear what the results mean. 

The impact of the 0.5 percent 

threshold on production: Several 

comments said the 0.5 percent 

negligence threshold in the IFR 

provided very little buffer (at 0.2 

percent) between the 0.3 percent THC 

allowed under the program and the 0.5 

percent threshold for determining a 

negligible violation. What several 

comments called a ‘‘safe harbor’’ for 

growers was nevertheless considered 

too narrow by many, saying that it left 

virtually no room for error. Comments 

argued that requiring growers to both 

exercise reasonable care and produce 

crops with only 0.5 percent THC or less 

is too stringent a standard and does not 

really offer the ‘‘safe harbor’’ intended. 

One comment argued that USDA cannot 

provide a ‘‘safe harbor’’ for violations of 

the 0.3 percent THC cap because that 

cap is enforced by other Federal and 

State agencies. A few comments said 

that the THC levels in 2014 DEA 

confiscations averaged 11.84 percent 

THC and argued that the negligence 

level under USDA hemp program rules 

should be closer to the average DEA 

culpability level. 

A comment from a state department of 

agriculture used 2019 production and 

testing data to demonstrate that raising 

the IFR’s threshold from 0.5 percent to 

1.0 percent could theoretically reduce 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5645 

the number of its farmers exceeding the 

negligent violation threshold by more 

than 75 percent. Several comments 

advocated a 2.0 percent threshold, while 

others suggested the elimination of the 

negligence threshold altogether. 

Comments highlighted uncertainty in 

the genetic variation of hemp varietals 

and other factors like weather 

conditions, soil type, plant disease, and 

pest pressures that may further 

exacerbate the risk of exceeding the 0.5 

percent threshold. As well, comments 

explained that hemp plants mature 

rapidly just before harvest. One 

commenter described seeing plants go 

from 0.18 to 0.62 percent total THC in 

one week. Comments suggested that 

enforcing the 0.5 percent negligence 

threshold on growers who truly do not 

intend to grow marijuana is excessive 

penalization when THC levels can 

change that rapidly. Comments argued 

that it is not appropriate to add further 

penalties to hot crop destruction. Other 

comments suggested that administrative 

and logistical factors beyond the 

grower’s control, such as bottlenecks in 

sampling and testing, can likewise 

create compliance risks for growers 

under the 0.5 percent threshold. 

AMS response: Based on these 

comments, AMS is increasing the 

negligent violation to a 1.0 percent 

threshold. AMS acknowledges that a 

lower total THC threshold will result in 

a higher number of negligent violations. 

AMS also understands that factors 

beyond the control of farmers may cause 

an increase in total THC-levels, such as 

seed genetic, weather and climate, and 

may contribute to crops exceeding the 

negligent violation threshold. AMS 

believes that the data provided in the 

comments clearly showed that 

increasing the negligent violation 

threshold to 1.0 percent would diminish 

the risk that producers would incur 

negligent violations without adding a 

greater risk of non-compliant material 

reaching channels of commerce. 

AMS also reviewed the test results of 

certified hemp varieties planted in 

Kentucky in 2017 and 2018 under its 

2014 Farm Bill program. Kentucky has 

a certified seed program that it believes 

will yield hemp. The plants from the 

certified varieties tested below 0.8 

percent THC concentration level. 

Additionally, AMS reviewed the test 

results of varieties that were eligible to 

be cultivated under the Nevada 2014 

Farm Bill program in 2018. The plants 

from those varieties tested below 0.9 

percent THC concentration level. Given 

those test results based on varieties that 

those two states believed would yield 

hemp, AMS determined that a 1 percent 

THC concentration level for negligence 

would account for the fact that a 

reasonable reliance on certified or 

eligible varieties may still yield a plant 

that tests above the acceptable hemp 

THC level. 

The impact of the 0.5 percent 

threshold on crop research: Comments 

described the IFR’s 0.5 percent negligent 

violation threshold as a rate limiting 

factor to industry innovation and hemp 

research. One comment said that hemp 

farmers, growing under pilot 

authorization of the 2014 Farm Bill, 

routinely planted multiple varieties of 

hemp to see which performed best. 

According to the comment, the low 

negligence threshold in the IFR 

discourages such hemp trialing and 

innovation because farmers face greater 

risk of receiving three negligent 

violations in one or two seasons and 

losing eligibility to grow hemp for 

another five years. Comments from 

research universities found the IFR’s 

negligent violation provisions 

unworkable for institutions testing 

numerous varieties and production 

variables each season for the same 

reason. Comments suggested a higher 

threshold for negligent violation would 

give industry the regulatory flexibility to 

conduct research with reduced risk of 

violating regulatory requirements. 

AMS response: AMS recognizes the 

violation threshold may incentivize (or 

disincentivize) innovation by research 

institutions and producers. AMS 

acknowledges more innovation and 

research across industry will bring more 

stability to stakeholders. The 1.0 percent 

negligent violation threshold provides 

new and existing producers across 

States and Indian Tribes additional 

flexibility to innovate and research with 

reduced risk for noncompliance. AMS 

believes the 1.0 percent threshold 

incentivizes innovation across industry 

more so than a 0.5 percent violation 

threshold. 

Statutory implications: Some 

comments argued that establishment of 

the 0.5 percent negligence threshold in 

the IFR was arbitrary and capricious 

under the APA and asked USDA to 

provide more information about how 

the threshold for negligence was 

determined. Some comments asserted 

that negligence is a well-established 

legal doctrine, and they argued that 

USDA cannot artificially and arbitrarily 

declare a threshold for negligence. A 

couple of comments suggested that 

putting farmers on probation, 

suspending them from program 

participation, and requiring them to 

destroy their crops based on an arbitrary 

number rather than on court findings is 

a violation of due process under the 

U.S. Constitution’s Fifth Amendment. 

AMS response: Congress established 

the definition of hemp and defined the 

threshold of THC concentration at 0.3 

percent dry weight. The statute did not 

define negligent violation. USDA 

derived the definition of negligence 

from the definition of negligence in 

Black’s Law Dictionary (10th ed. 2014). 

USDA set the level of total THC 

concentration at 0.5 percent for a 

negligent violation to establish a clear 

buffer so that any crop testing out of 

compliance would not automatically 

trigger a violation. The 0.5 percent was 

based on data from three states 

participating in the 2014 Farm Bill pilot 

program. AMS believes raising the 

negligent violation threshold from 0.5 

percent to 1.0 percent in the final rule 

provides a greater buffer and reduces 

farmers’ exposure to risk of violation 

accrual and license suspension. 

Oversight Authority: Several 

comments suggested the government 

should have the ability to determine 

negligence and culpability based on 

facts and circumstances surrounding 

violations and not solely on a numeric 

threshold. Other comments asserted that 

the 2018 Farm Bill’s language leaves 

room for an Indian Tribe to apply its 

own negligence standard. Similarly, 

other comments from the industry said 

that States should be allowed to 

evaluate potentially negligent violations 

of State plans. 

AMS response: With regard to 

violations and culpability 

determination, AMS seeks to establish a 

regulatory framework that ensures 

consistency in oversight activities of 

hemp production. Variations of criteria 

or the use of subjectivity in oversight 

could result in bias against or leniency 

to some hemp farmers simply based on 

location. Leaving the decision of what 

constitutes a negligent violation to 

abstract factors rather than objective 

metrics may result in differences 

between States and Indian Tribes. 

Because farmers may grow hemp in 

different locations, and in some cases 

are subject to multiple oversight 

authorities, it is important the 

thresholds for violations are consistent 

across oversight authority jurisdictions 

to which the grower is responsible. 

Having a threshold that is well 

established and transparent provides a 

minimum framework to producers. 

In developing the compliance 

requirements for State and Tribal plans, 

USDA recognizes that there may be 

significant differences across States and 

Indian Tribes in how they will 

administer their respective hemp 

programs. Accordingly, if, at a 

minimum, the requirements of the 2018 

Farm Bill and applicable parts of this 


khammond on DSKJM1Z7X2PROD with RULES6
5646 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

regulation are met, States and Indian 

Tribes are free to determine whether or 

not a licensee under their applicable 

plan has taken reasonable steps to 

comply with plan requirements. As 

previously stated, this final rule 

provides that a producer shall not be 

subject to more than one negligent 

violation per calendar year. State and 

Tribal plans may tailor the timing 

around this requirement to align with 

their growing season or other applicable 

dates. 

Financial and business risk: Several 

comments linked the 0.5 percent THC 

threshold with a greater likelihood of 

producers committing negligent 

violations, receiving corrective action 

plans, and even committing culpable 

negligent violations. Comments stressed 

that a low negligence threshold puts 

farmers at higher risk of accumulating 

negligent violations, even when growers 

take reasonably prudent steps to 

mitigate against the production of 

noncompliant plants. According to 

comments, this, in addition to the loss 

of the crop, jeopardizes farmers’ access 

to crop insurance and business loans. 

Comments addressed the negative 

impact of the accrual of negligent 

violations on the financial stability of 

the individual business. They described 

how a hemp grower’s access to credit 

and insurance is jeopardized when 

negligent violations accumulate and 

lead to a determination of culpable 

negligence. Comments explained that 

lending institutions and insurance 

providers look for risk factors. They also 

raised questions about how the accrual 

of negligent violations may be 

interpreted by lender or providers. 

Comments said that many insurers will 

not cover crop losses if losses are due 

to the growers’ negligence. Commenters 

implored USDA to explain how 

violations can lead to determinations of 

culpable negligence and to provide 

guidance about how a reasonable farmer 

can avoid growing noncompliant hemp. 

AMS response: AMS acknowledges 

institutional lenders view violations as 

risk factors in decision making. AMS 

also notes that not all culpable 

violations are derived from the accrual 

of negligent violations. Culpable 

violations may be the result of 

producers violating other parts of the 

2018 Farm Bill. However, the 2018 Farm 

Bill explicitly considers certain actions 

as constituting negligent violations. 

AMS’s intention is to provide a 

threshold between 0.3 percent THC 

level and what would be considered a 

negligent violation so not all hemp that 

tests over the 0.3 percent be considered 

a negligent violation. Because a 

producer will not have committed a 

negligent violation every time he or she 

grows hemp with a concentration of 

hemp above the 0.3 percent level, this 

will assist producers when requesting 

loans or other financial assistance. AMS 

will provide risk mitigation activities 

such as remediation and disposal 

provisions as well as increasing the 

negligent violation threshold to 1.0 

percent to diminish the number of 

violations that are considered negligent. 

Some producers have more than one 

field or farm in a state or across state 

boundaries. Assigning more than one 

negligent violation might be detrimental 

to these producers. For example, if a 

producer uses the same seed in multiple 

locations, and that seed results in a THC 

level over 0.3 percent, all of that 

production must be disposed or 

remediated. All of these locations could 

be determined a separate violation. 

However, AMS wants to clarify that a 

producer may not be found to have 

committed more than one negligent 

violation per year. 

Barriers to entry: Several comments 

suggested that a 0.5 percent negligence 

threshold threatens the survival of 

farmers in an emerging industry. 

Comments suggested that the low 

threshold is a barrier to entry for new 

farmers or farmers with no experience 

growing hemp, who risk high initial 

capital investments to establish 

operations. Comments argued that the 

low threshold favors larger farms using 

industrialized hemp varieties and 

production practices, and that the low 

negligence threshold in the IFR would 

unnecessarily criminalize farmers 

working with a legal agricultural 

commodity. 

AMS response: All persons interested 

in growing hemp must meet the 

eligibility criteria established in the 

2018 Farm Bill and this final rule. 

Negligent violations document instances 

when the statue or rule are violated 

such as when a grower fails to report a 

legal description of land on which hemp 

is grown or fails to dispose of a 

noncompliant crop. All farmers, 

regardless of the size of their operations, 

face the same set of requirements. Even 

though the 2018 Farm Bill sets the THC 

concentration level at 0.3 percent, it 

does not define what THC level in 

cannabis will give rise to a negligent 

violation. Left undefined, this lack of 

definition is troublesome as it could 

make enforcement uneven among States 

and Indian Tribes. The IFR provided 

that hemp producers do not commit a 

negligent violation if they make 

reasonable efforts to grow hemp and the 

marijuana does not have a THC 

concentration of more than 0.5 percent. 

Increasing this threshold to 1.0 percent 

benefits producers, including small and 

new farmers, that intended to grow 

hemp but whose crops tested ‘‘hot’’ 

even though they made reasonable 

efforts to grow hemp. 

Resources and enforcement: One State 

commented that it currently enforces a 

1.0 percent negligence threshold. 

According to the comment, lowering the 

threshold to 0.5 percent would 

significantly increase the rate of 

negligent violations in that State, 

require more State and Federal 

resources to enforce the regulation, and 

be financially burdensome to novice 

farmers. It stated that the 0.5 percent 

negligence threshold is lower than the 

threshold DEA designates as the upper 

THC limit for ‘‘inconclusive marijuana/ 

hemp.’’ The comment found the IFR’s 

0.5 percent threshold inconsistent with 

some laboratories’ testing capabilities 

and suggests raising the rule’s threshold 

to 1.0 percent. 

AMS response: AMS anticipates that 

the closer the negligent violation 

threshold is to 0.3 percent total THC, 

the greater the likelihood that oversight 

authorities issue more negligent 

violations. Moreover, whenever a 

producer commits a negligent violation, 

the oversight authorities must also 

establish a corrective action plan as 

required by regulation. AMS believes 

that increasing the negligent violation 

threshold to 1.0 percent would therefore 

reduce some burden to oversight 

authorities by reducing the number of 

negligent violations and corrective 

action plans that oversight authorities 

must issue and administer. AMS notes 

that regardless of the negligent violation 

threshold, any crop exceeding the 

Federal allowable total THC 

concentration must be disposed of 

according to regulatory requirements. 

AMS disagrees that the DEA’s 

enforcement program for marijuana 

should affect how AMS manages its 

compliance program for hemp. 

State and Tribal Resources 

The IFR required States and Tribal 

governments to certify they have the 

resources and personnel to carry out the 

practices and procedures of their 

respective plans. Further, the IFR 

provided for audits of State and Tribal 

plans to include review of the resources 

and personnel employed to administer 

and oversee its approved plan. Finally, 

the IFR specified audit reporting 

requirements and remediation steps for 

States and Tribal governments found to 

be non-compliant with USDA 

requirements. 

Comments: Comments from many 

States expressed enthusiasm for 

partnering with USDA in the regulation 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5647 

27https://www.ams.usda.gov/rules-regulations/ 

hemp/enforcement. 

of domestic hemp production. The 

comments were supportive of 

establishing a national regulatory 

framework that would bring clarity and 

consistency to the regulation of hemp 

production across the U.S. They 

emphasized that many States have 

enacted legislation to facilitate the 

regulation of hemp production. No 

comments received from the States 

demonstrated a reluctance to work with 

USDA in establishing regulations. 

The requirement for States and Indian 

Tribes to certify to USDA that they have 

the capacity to administer a domestic 

hemp program was not addressed 

explicitly in any of States’ comments. 

However, many of the comments from 

the States and Indian Tribes registered 

concerns with some aspects of the IFR. 

Most of the comments from States and 

Indian Tribes delineated areas where 

the burden of regulatory oversight might 

be reduced, or efficiencies realized, by 

revisions to the regulations. 

Several comments expressed concern 

that State and Tribal governments 

would not be able to perform their 

responsibilities under the program as 

currently established. One comment 

said the lack of appropriate personnel, 

training, and protocol would lead to an 

untenable backlog in the collection and 

testing of samples. Many comments 

focused on the sheer number of samples 

that must be collected, processed, and 

tested under the program. The shortage 

of DEA-registered labs in the States and 

the new sample collection protocols 

were also areas of concern, although 

that was addressed shortly after the IFR 

went into effect with the announcement 

of enforcement discretion.27 Points of 

potential weakness in the States’ and 

Tribal governments’ implementation of 

the IFR were raised by many 

commenters, both explicitly and in 

implied remarks. Many of the comments 

referenced State and Tribal government 

infrastructures being strained under the 

new regulatory requirements, especially 

during peak harvest intervals, and that 

those factors could contribute to the 

failure of the States and Indian Tribes to 

fulfill their oversight obligations. A 

number of comments alluded to the 

burden of any breakdown in the 

regulatory scheme being borne by hemp 

producers directly, as with samples that 

are not timely collected by State 

inspectors and the samples then testing 

‘‘hot’’ without any remediation options, 

or labs that are not able to process 

samples due to capacity issues. 

Numerous comments made 

recommendations to address the 

increased regulatory burden on States 

and Tribal governments. Many 

recommended changing the 15-day postsample harvest period to 30 days to 

allow more time for States and Tribal 

governments to collect and process 

samples, balance workloads, and 

alleviate potential backlogs. In addition, 

several comments contended that the 

increased sampling requirements in the 

proposal (i.e. requiring sampling of 

every lot) would burden the process and 

contribute to delays in growers 

receiving results. Those comments 

recommended revising the sampling 

protocol (reducing number of samples 

required per producer) to help relieve 

the strain on government resources. 

Lastly, comments suggested that 

allowing labs that are ISO 17025 

accredited to process samples, as 

opposed to only allowing labs with DEA 

registration, would enhance the State’s 

ability to provide validated, accurate, 

and timely testing. 

One commenter said they had talked 

with a number of States that expressed 

strong concerns over the additional 

burdens as a result of the IFR. The 

commenter further stated that some 

states they are considering whether to 

‘‘opt-out’’ of administering a hemp 

production plan themselves in favor of 

USDA administering a plan. 

Lastly, one comment stated that if 

there was a bureaucratic slow down or 

insufficient resources on the part of 

USDA, a farm should be allowed to have 

some recourse to be able to harvest. That 

comment, and others that were similar 

in spirit, effectively questioned what 

mitigation efforts would be undertaken 

for producers in the short run if a State 

or Indian Tribe ultimately lacks the 

necessary resources and personnel to 

administer its plan and fails to perform 

the obligations it certified it could 

undertake. 

AMS Response: The issues raised in 

these comments are mostly addressed 

under other sections in this rule (e.g., 

15-day harvest window, laboratory 

accreditation). AMS agrees that there are 

regulatory burdens of this program, 

which are discussed in this rule. States 

and Indian Tribes have multiple options 

that would allow producers in their 

States or territories to grow hemp. States 

and Indian Tribes can develop their 

own plan, send their producers to grow 

under the USDA plan, or States can 

continue under the 2014 Farm Bill pilot 

program. Many States and Indian Tribes 

assess fees on producers to cover their 

expenses for sampling, oversight and 

other costs of this program. These 

options provide producers different 

alternatives to grow hemp under 

different regulatory schemes. 

Additionally, USDA has decreased the 

risk of the regulatory burden on States 

and Indian Tribes being borne by hemp 

producers by addressing various issues 

commenters identified that could cause 

States and Indian Tribes to be unable to 

timely fulfill their responsibilities such 

as by modifying the sampling protocol 

and changing the 15-day post-sample 

harvest period to 30 days. Other 

burdens associated with this final rule 

that the producer must cover should be 

considered by producers, as in any 

agricultural business, before a decision 

to grow hemp is made. 

Appeals—Denial of Application and 

Appeal of Test Results 

The IFR addressed the denial of 

applications to grow hemp in Part V. 

APPEALS. The IFR also provided an 

option to appeal test results in which 

producers can request that a second test 

be performed if they disagree with the 

first test results. 

Comments: A comment recommended 

that USDA establish a clear deadline for 

applicants who wish to appeal the 

denial of their grower applications. The 

comment noted that the IFR already 

required a State or Indian Tribe 

appealing the suspension or revocation 

of a hemp production plan to file an 

appeal ‘‘within the time-period 

provided in the letter of notification or 

within 30 business days from receipt of 

the notification, whichever occurs 

later.’’ The commenter noted that no 

such similar deadline is identified for 

applicants who have been denied USDA 

hemp grower licenses. 

One comment asserted that denials of 

‘‘licensure’’ may occur for ‘‘whatever 

reason.’’ Two other commenters 

submitted examples of State regulatory 

language from California and Ohio, each 

of which include provisions for the 

denial of applications for license. 

Several comments suggested USDA 

establish an appeals process through 

which someone with a felony 

conviction may demonstrate completion 

of appropriate steps to become eligible 

hemp producers. 

AMS response: This rule retains the 

IFR provision that an applicant for a 

USDA hemp production program 

license may appeal a license denial to 

the AMS Administrator. USDA 

licensees may appeal denials of a 

license, renewals, license suspensions, 

or license revocations to the AMS 

Administrator must be submitted in 

writing and received within 30 days of 

the receipt of notification of the denial 

or within the time-period provided in 

the letter of notification, whichever 

occurs later. State and Tribal plans 

reviewed and approved by USDA are 


khammond on DSKJM1Z7X2PROD with RULES6
5648 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

required to include an appeal process 

for producers to appeal licensure 

decisions. In response to the comment 

that USDA should establish an appeals 

process through which someone with a 

relevant felony conviction may 

demonstrate completion of appropriate 

steps to become eligible hemp 

producers, it is important to note that 

limitations as a result of relevant 

felonies are set in the 2018 Farm Bill. 

Appeals—Technical 

The IFR stated that producers can 

request a second test be performed if 

they disagree or have doubts about the 

original test results. 

Comments: One comment indicated 

that if there is a discrepancy between 

compliance testing for THC 

concentration, there needs to be a 

process for farmers to appeal. Another 

comment noted that no administrative 

appeal process exists for producers who 

wish to challenge a decision they 

believe adversely affects them, such as 

test result. Another commenter cited 

personal experience with one State 

agriculture department and described as 

‘‘unfair’’ a regulatory system that does 

not allow for an appeal process through 

which a farmer may contest test results. 

AMS response: USDA is maintaining 

its position that producers under a 

USDA plan are able to request a second 

test be conducted when they do not 

agree or have questions about a test 

result. This rule provides flexibility to 

allow States and Indian Tribes to 

provide for retesting if the State or 

Indian Tribe chooses to do so. 

Transportation and Shipping 

Documents 

Under the 2018 Farm Bill and the IFR, 

neither States nor Indian Tribes may 

interfere with the transportation of 

lawfully produced hemp through States 

or Tribal territories, even if hemp 

production is prohibited within a 

particular State or Tribal territory. 

Public comments related to transporting 

hemp focused primarily on facilitating 

the interstate transportation of hemp. 

Interstate commerce: Many comments 

applauded the IFR’s reiteration of the 

statutory provision that allows for 

interstate shipments of lawfully 

produced hemp and hemp products 

without interference by State or Tribal 

law enforcement. Some asked USDA to 

clarify that prohibited interference 

includes that from State, Tribal, or 

Federal law enforcement, including 

DEA. Other comments wanted 

confirmation that interstate commerce 

includes entry into and egress from 

Tribal territories and that Tribal hemp 

production licenses be honored for 

purposes of interstate commerce 

transport and commerce. 

Commenters stated they had already 

encountered situations where States 

passed temporary regulations 

conflicting with the 2018 Farm Bill and 

impeding interstate commerce. For 

example, comments noted an Idaho 

Executive Order—Transportation of 

Hemp—issued in 2019, that they 

claimed would ‘‘excessively frustrate 

interstate hemp transportation and 

growth of the hemp industry.’’ One 

airline carrier comment explained that 

under this Order, ‘‘transporters may 

have to stop, get inspected, and be 

subject to detention each time they cross 

jurisdictional boundaries’’ and that 

airlines would avoid carrying hemp if 

this issue is not remedied. 

Comments from Indian Tribes 

expressed concern that despite the 2018 

Farm Bill, Tribes transporting hemp 

through States have a bias against Tribal 

hemp production. There were 

suggestions of the use of a USDA form 

or stamp authorizing transportation to 

address these obstacles. One commenter 

also requested that USDA provide for 

recourse for Indian Tribes that are 

prohibited from moving hemp through 

neighboring States. 

AMS Response: At this time, USDA 

recommends that transporters carry a 

copy of the producer’s license or 

authorization, as well as any other 

information the governing State or 

Indian Tribe recommends or requires 

that will validate that the transporter is 

transporting legally-grown hemp. As 

allowed under the 2018 Farm Bill, 

States and Indian Tribes can be more 

restrictive, which includes possible 

transportation paperwork requirements 

by States or Indian Tribes. USDA is not 

adding transportation paperwork 

requirements to this rule because it does 

not have jurisdiction over common 

carriers or other types of transporters. 

Comment: A comment asserted that 

intrastate commerce of hemp that does 

not meet all the requirements of the IFR 

should remain under the State’s 

authority, and farmers producing hemp 

compliant with the 2018 Farm Bill but 

not the IFR should be allowed to do so, 

as long as that hemp is not transported 

across State lines. The comment 

advocated for no Federal preemption, 

citing to section 297B(a) of the 2018 

Farm Bill, which provides that ‘‘nothing 

in this subsection preempts or limits 

any law of a State or Indian Tribe that 

(i) regulates the production of hemp; 

and (ii) is more stringent than this 

subtitle.’’ 

AMS Response: The 2018 Farm Bill 

does not preempt State law provided 

that the State adopts a plan that is 

approved by USDA and the plan may 

provide for more stringent requirements. 

A State has the responsibility for 

enforcing the requirements of its plan. 

Thus, hemp that is produced under a 

State’s plan should meet the 

requirements of the final rule. 

Shipping Documentation: Several 

comments encouraged USDA to 

facilitate the unimpeded flow of hemp 

in interstate commerce by implementing 

identity preservation or tracking 

systems or requiring the use of 

standardized shipping labels, packaging, 

or other documentation to certify to 

stakeholders and law enforcement 

authorities that the cargo in transport is 

Federally legal hemp. Comments 

suggested the use of USDA-issued 

stamps or forms that are recognizable, 

understood, and accepted by all law 

enforcement authorities. Several Indian 

Tribes made this suggestion because 

they are concerned about law 

enforcement transportation issues, 

particularly in Idaho, South Dakota, 

Maine, New York and Wisconsin. 

According to comments, such forms 

could verify that cargo hemp is 

compliant with USDA-approved 

production plans. Other comments 

suggested the use of a standardized bill 

of lading across the industry that sets 

out essential information about the 

shipment for easy reference by 

transporters, regulators, processors, and 

law enforcement officials to ensure all 

loads have been lawfully produced in 

accordance with Federal, State, or Tribal 

law. A comment from an association of 

county agriculture commissioners and 

sealers suggested USDA require the 

officially certified lab report to 

accompany shipments of hemp product 

during interstate shipment. 

Comments suggested various 

commercial systems for recognizing 

legally produced hemp in transport. 

Other comments asked USDA to devise 

a standard documentation system for 

hemp carriers that would more easily 

absolve them of legal liability related to 

transporting hemp. Comments 

recommended that USDA coordinate 

with the hemp industry; Federal 

agencies such as DEA, the Department 

of Transportation, and the Department 

of Justice; and State agencies, including 

law enforcement and transportation 

departments, to develop such 

documentation. 

Some comments additionally 

recommended adopting specific hemp 

packaging and labeling requirements on 

the basis that they would support 

compliance and enforcement tasks. 

Some comments advised USDA to 

provide specific regulations for testing 

hemp in transit so that such testing, if 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5649 

28Memorandum from Stephen Vaden, Office of 

General Counsel to Sonny Perdue, Secretary of 

Agriculture, Legal Opinion on Certain Provisions of 

the Agriculture Improvement Act of 2018 Relating 

to Hemp (May 29, 2019). 

29https://www.govinfo.gov/content/pkg/FR-2020- 

08-21/pdf/2020-17356.pdf. 

necessary, be conducted in a standard 

manner, consistent with the 

requirement that all pre-harvest Total 

THC testing be conducted by DEAregistered laboratories. Other comments 

recommended that hemp loads be 

sealed to ensure their integrity and 

mitigate the interference of illicit 

products. 

Comments advocated that USDA host 

a central hemp database for reporting 

data applicable to all phases of hemp 

production that would be ‘‘read only’’ to 

law enforcement, saying such a system 

would be particularly beneficial in 

resolving questions related to interstate 

commerce. One comment advocated for 

the use of a centralized hemp 

clearinghouse to capture hemp flower 

transfer to processors or manufacturers 

for CBD extraction, including 

information on the licensed producers 

and receivers of raw materials, the total 

weight of materials being transferred, 

testing certificates indicating THC levels 

of the materials being transferred, and 

other State-mandated criteria, as well as 

information on the vehicles being used 

to transport the materials. It further 

recommended USDA evaluate methods 

to physically identify and segregate 

products containing hemp-derived CBD 

to differentiate legitimate from 

potentially illicit products. 

AMS response: AMS understands the 

importance of ensuring safe passage of 

hemp across states and Tribal 

jurisdictions. Section 10114 of the 2018 

Farm Bill specifically states that 

‘‘Nothing in this title or an amendment 

made by this title prohibits the 

interstate commerce of hemp.’’ USDA 

issued a memorandum addressing this 

issue.28 Several States already identified 

documents to facilitate transportation of 

hemp across states. AMS strongly 

encourages producers of hemp and 

carriers providing transportation 

services to provide the following 

documentation accompanying the hemp 

cargo: Copies of the laboratory testing 

report(s), hemp grower license, invoice/ 

bill of lading, and contact information of 

buyer and seller. The 2018 Farm Bill 

does not provide specific authority to 

USDA to This final rule does not adopt 

any requirement for interstate 

transportation of hemp. As required by 

the 2018 Farm Bill, USDA is developing 

a database that will share information 

about hemp production with law 

enforcement. The database will identify 

the contact information for the 

producer, a legal description of the land 

on which hemp is produced, and status 

of the producer’s license or other 

required authorization from the State or 

Indian Tribe. 

‘‘In-Process’’ Material 

Comments: Several comments 

mentioned ‘‘in-process material,’’ 

described as material made from 

otherwise qualifying hemp plant 

material, such as crude CBD oil and 

distillate, or as any hemp material that 

is compounded, blended, ground, 

extracted, sifted, sterilized, derived by 

chemical reaction, or processed in any 

way for use in the manufacture of hemp 

products. Commenters asked USDA to 

clarify that once hemp has been tested 

and allowed to enter commerce, it 

should be considered legal material 

thereafter. One comment suggested the 

establishment of specifications or 

guidance for any part in the ‘‘in-process 

material’’ manufacturing record where 

control is necessary to help ensure that 

specifications are met for the identity, 

purity, strength, and composition of the 

hemp products and, as necessary, for 

limits on those types of contamination 

that may adulterate or may lead to 

adulteration of the finished batch of the 

hemp product. 

One comment explained the 

perception that in-process materials are 

not allowed to transfer freely between 

processors, causing bottlenecks in 

product processing. According to the 

comment, some hemp processors may 

be limited to performing only one step 

of a multi-step process to derive hemp 

products, such as distilling CBD oil and 

isolating the CBD molecule. It said 

processor-to-processor transfers of inprocess hemp materials should be 

authorized between U.S. States with 

valid hemp programs, which would 

open a processing bottleneck and allow 

both hemp materials and cash to flow 

more freely. The comment asserted such 

authorization would improve prices for 

CBD end-products, which would trickle 

down to hemp growers. 

Some commenters stated that it is 

commonly known that THC levels in 

initially compliant hemp may rise above 

the 0.3 percent delta-9 THC limit during 

subsequent processing. Commenters 

expressed concern that some 

jurisdictions believe the ‘‘in-process 

material’’ should be diluted to always 

maintain the level below 0.3 percent 

delta-9 THC, even during transportation 

to another processor. However, several 

comments argued that ‘‘in-process 

material’’ is neither consumer ready nor 

a ‘‘finished’’ product and that dryweight measurements related to hemp 

THC levels are calculated on the initial 

plant material and not the finished 

product to ensure compliance with the 

threshold. 

AMS response: The 2018 Farm Bill 

directed USDA to establish a national 

regulatory framework for hemp 

production in the U.S., and the final 

rule outlines provisions for this 

mandate. The IFR and this final rule do 

not cover hemp or its products beyond 

production. Further, DEA has issued 

regulations covering some of these 

products or ‘‘in-process materials’’.29

Accordingly, this final rule does not 

address ‘‘in-process materials,’’ 

processors, end-products, processing of 

CBD or other cannabinoids or anything 

that may contain hemp or hemp 

byproducts. 

Equal Treatment for Tribes 

Comments: Some commenters said 

that final rule should provide Indian 

Tribes at least as many opportunities 

regarding hemp production and 

regulation as those granted to States and 

that the final rule should allow Indian 

Tribes to catch up quickly with States 

that have been allowed to develop 

production methods and markets under 

the 2014 Farm Bill provisions. 

AMS Response: This final rule does 

not distinguish between States and 

Indian Tribes. USDA recognizes that 

both State and Tribal governments have 

the ability to authorize and to regulate 

the production of hemp within their 

States or territories consistent with the 

2018 Farm Bill and the final rule. 

Psychoactive Effects of Cannabinoids 

Delta 9 THC or THC is the primary 

psychoactive component of cannabis. 

As mandated by the 2018 Farm Bill, 

hemp must be verified as having THC 

concentration levels of 0.3 percent or 

below on a dry weight basis. 

Comments: Several comments 

referenced different studies to support 

conflicting positions regarding the 

psychoactive effects of THC and used 

study findings to argue that the IFR’s 

THC limit should be revised. Many 

comments cited the ‘‘Defining Hemp: A 

Fact Sheet’’ from the Congressional 

Research Service, updated March 22, 

2019, that said a level of about 1 percent 

THC is considered the threshold for 

cannabis to have a psychotropic effect 

or an intoxicating potential. Other 

commenters argued THC levels of 5 

percent or more are necessary for 

marijuana to have a psychoactive 

impact or commercial value. Comments 

noted that hemp is generally 

characterized as plants that are low in 

delta-9 THC and high in levels of CBD, 


khammond on DSKJM1Z7X2PROD with RULES6
5650 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

the primary non-psychotropic 

compound. Many comments stated that 

research shows that CBD affects the 

ability of THC to bind to CB1 receptor 

in cells, thus blocking the psychoactive 

effects of THC. 

Other comments representing health 

organizations stated that research is 

challenging the widely accepted 

premise that CBD is not intoxicating. 

They further stated that the THC found 

in CBD products can be intoxicating and 

has caused significant and serious 

consequences in terms of job loss, 

health, and exposure to pediatric 

populations. Some comments provided 

personal testimony that while using 

CBD for health benefits they had not 

experienced psychoactive or 

intoxicating effects. 

Other comments reported that the 

United Nations standard STR/NAR/40 

uses a ratio of ([THC] + [CBN])/[CBD] to 

determine whether a plant is likely to 

have a psychoactive effect. 

AMS response: AMS appreciates 

understanding different views on the 

psychoactive effects of THC. However, 

this topic is outside the scope of the 

final rule, and AMS made no revisions 

to the program based on these 

comments. The 2018 Farm Bill defined 

hemp as having a THC concentration of 

0.3 percent or less. Medicinal use of 

hemp or CBD is covered under the 

Federal Food, Drug, and Cosmetic Act, 

21 U.S.C. ch. 9, sec. 301, et seq. and 

under the FDA’s jurisdiction. 

Miscellaneous Comments 

Comments: One comment pointed out 

that the IFR’s hemp definition did not 

include the application of an MU, but 

that the definition of acceptable hemp 

THC level does. The comment said 

references to the definition of hemp 

should be changed to refer to acceptable 

hemp THC level so there is uniformity 

across the final rule. 

AMS Response: USDA has made 

references to acceptable hemp levels 

when appropriate. The acceptable hemp 

levels include the MU to account for 

differences in laboratory conditions or 

environments. There is no intention to 

change the definition of hemp that is 

stated by the 2018 Farm Bill. 

Comments: Another comment 

recommended improving the clarity of 

the final rule by deleting the words ‘‘or 

THC’’ from the definition of delta-9 

THC, as well as deleting the sentence 

‘‘For the purposes of this part, delta-9 

THC and THC are interchangeable.’’ The 

comment further recommended that the 

definition of Total delta-9 THC be 

expanded to clarify that it includes 

delta-9 THC combined with delta-9 

THCA to account for the conversion of 

delta-9 THCA into delta-9 THC when 

the plant material is dried. Finally, the 

comment recommended that in all cases 

where ‘‘THC’’ is referenced throughout 

the final rule document with no further 

clarification, ‘‘THC’’ should be changed 

to ‘‘delta-9 THC.’’ The comment said 

these clarifications will be helpful in 

administration of the rule. 

AMS Response: AMS is adding a 

definition of ‘‘Total THC’’ to clarify the 

use of the term in this rule. Total THC 

accounts for the conversion of THCA 

into THC. We believe using THC and 

delta-9 THC interchangeably is 

appropriate. 

Comment: One comment claimed that 

making the IFR effective immediately 

gave farmers preparing for imminent 

harvest no time to comply with the new 

testing and threshold requirements, 

increasing their risk of producing plants 

that were legal under the 2014 and 2018 

Farm Bill statutes but potentially illegal 

under the IFR. 

AMS response: USDA’s decision to 

make the IFR effective immediately was 

to provide a framework for the 2020 

growing season. However, States had 

the option to continue operating under 

the 2014 Farm Bill. States and Indian 

Tribes were provided time to develop 

plans on time for their planting and 

harvest season. 

Comment: USDA should work with 

other agencies, including DEA and DOJ, 

to develop cohesive information and 

guidance regarding enforcement related 

to hemp. 

AMS response: AMS has worked with 

DEA and other agencies in developing 

these regulations to assure that the 

intent of the 2018 Farm Bill provisions 

for hemp are met. USDA is responsible 

for the regulatory oversight of hemp 

production and DEA and other law 

enforcement agencies are responsible for 

enforcing the law regarding marijuana. 

Miscellaneous Comments—Out of 

Scope 

In addition to addressing specific 

provisions of the IFR, comments also 

addressed other topics related to the 

hemp industry. 

Comments: One comment advocated 

the creation of a USDA commodity 

checkoff program for one or more 

categories of hemp (e.g. grain, fiber, 

CBD) and recommended that USDA 

work with hemp industry trade 

organizations and stakeholders to 

administer checkoff funds to support 

hemp agronomic and market 

development. Another comment 

included a newsletter item quoting 

USDA as saying that such a program 

could be developed. 

One comment asked USDA to support 

the hemp industry by adding hemp seed 

foods to those offered through school 

lunch and other government feeding 

programs. 

One comment said that hemp extracts 

and concentrates and byproducts from 

hemp should be afforded the same legal 

status and protections as the hemp from 

which they originated. 

One comment suggested that the IFR 

did not consider compliant hemp 

topical products that make up a large 

portion of the market or other 

applications that cannot be inhaled or 

ingested. 

One comment advocated that hemp 

and CBD should be covered and 

protected under the Perishable 

Agricultural Commodities Act (7 U.S.C. 

499 et seq.). 

Some comments said farmers should 

only be allowed to sell hemp to licensed 

brokers, handlers, and processors, and 

not directly to the public. They further 

advocated requiring license information 

to be part of the documentation that 

accompanies hemp shipments. 

A couple of comments urged USDA to 

establish good manufacturing practices 

for CBD manufacture. 

One comment claimed that chemical 

and seed providers have developed 

aggressive tactics which may be used to 

hamper hemp producers. 

One comment requested updating 

banking regulations to allow banks to do 

business with entities whose income is 

derived from hemp and/or legal 

cannabis. Another comment requested 

an examination on how bonding could 

protect hemp farmers against companies 

and contracts that have not been 

honored, causing financial harm to the 

grower. 

One commenter suggested to 

discontinue the program totally or at 

least discontinue the CBD portion 

because there is too much potential for 

abuse and waste of taxpayer dollars. The 

commenter stated that it could be okay 

to continue the coverage for the seed 

and fiber. They also stated that USDA 

should not be in the marijuana business. 

AMS received comments on the 

impact of the current statutory and 

regulatory structure on banking and 

insurance related to hemp production. 

Commenters expressed concern that the 

0.3 percent THC ceiling and the 

required disposal of cannabis testing 

above 0.3 percent THC would hinder 

the ability of hemp producers to obtain 

insurance, loans, or other financial 

services. One commenter also urged 

AMS to clarify if the preemption 

language in section 10114(a) of the 2018 

Farm Bill encompasses interstate 

banking, financial services, and 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5651 

insurance transactions and if USDA 

intends to supersede, coordinate, or 

adopt guidance issued by other Federal 

agencies related to hemp production. 

A comment suggested banks could 

offer insurance for crop losses if the 

hemp had a THC concentration that was 

greater than 0.3 percent but less than or 

equal to 0.5 percent, similar to offering 

coverage for losses due to factors 

beyond the grower’s control, depending 

on various USDA culpability findings. 

Another comment advocated that crop 

insurance be available for hot hemp. 

A comment stated that Non-Irrigated 

(NI) acreage should be uninsurable 

because good producers who are serious 

about growing the crop would not 

bother with NI acreage. Another 

comment discussed establishment of 

‘‘Earliest Plant Dates’’ (EPD), Late Plant 

Period (LPP), and Final Plant Date 

(FPD), and references sections of what 

may be a State or Tribe plan and the 

difficulty of finding farmers growing 

hemp in comparable environments for 

determining such dates and insurance 

coverage. It also recommended 

developing a Replant Endorsement 

(with premium associated) to insure 50 

to 75 percent of seed costs for replant. 

Finally, a commenter stated that 

germination tests should be required 

before the crop is planted and set a 

minimum standard of 85 percent 

germination—and those under that 

standard would be uninsurable. Several 

commenters argued that USDA should 

(1) ban hemp and hemp related 

products imported into the United 

States; (2) establish import limits on the 

number of clone material; (3) eliminate 

all imported hemp and concentrates 

into the U.S. for the next 2 years, except 

for trades to the Canadian marketplace, 

but exportation must still be open for 

our country and product markets 

outside the United States; and (4) 

establish clear rules on how imported 

hemp and hemp products will be 

regulated. 

One commenter expressed concern 

about the current regulation of CBD as 

a prescription drug arguing that the 

prescription-only status for CBD is 

unwarranted and will facilitate the 

illegal market that continues to exist for 

these products. One commenter noted 

that the regulatory ambiguity resulting 

from the FDA’s lack of guidance on CBD 

negatively impacts hemp producers and 

requires greater clarity. 

One commenter raised concerns about 

the ability of farm workers seeing U.S. 

naturalization to be able to participate 

in hemp production based on a fear that 

U.S. Immigration and Customs 

Enforcement will view work in hemp 

production as an ‘‘exclusionary 

activity’’ that would be a barrier to 

naturalization. 

Several commenters expressed 

concern regarding hemp production in 

close proximity to other agricultural 

crops. Commenters also expressed 

concern regarding drying and 

processing of hemp near other crops and 

residential areas. One commenter 

suggested that AMS support research on 

pollination and drift related to hemp 

production. 

One comment asked USDA to clarify 

whether section 10114(a) of the 2018 

Farm Bill extends to interstate banking, 

insurance, or financial services 

involving hemp and hemp products. 

According to the comment, it is not 

clear whether interstate commerce in 

hemp and hemp products necessarily 

includes the payment for any hemp and 

hemp products through various 

methods, such as wires, checks, 

automated clearinghouse transactions, 

credit card or other financial 

transactions, including loan proceeds. 

One comment advocated the use of 

their company’s blockchain technology 

to address industry and law 

enforcement concerns about chain-ofcustody in sampling, transporting, and 

testing hemp. 

One comment requested that a clear 

statement be included in the final rule 

that USDA concurs that the exportation 

of hemp and hemp products is legal. It 

noted that the 2018 Farm Bill does not 

prohibit exports, and stated, without 

providing any empirical evidence, that 

there is sufficient interest in exporting 

hemp and hemp products from the U.S. 

It also suggested that a dedicated tariff 

code for hemp and hemp-derived 

products be established to facilitate 

export trade. 

AMS Response: These comments all 

address issues that are beyond the scope 

of the rule. This rule only covers the 

production of hemp. Issues such as 

promotion of hemp under a research 

and promotion program; adding this 

product to other programs including 

feeding programs or PACA; importing or 

exporting of hemp; who can produce 

hemp in the U.S.; processing the 

commodity; insurance and banking; 

research or setting production 

boundaries; requirements on further 

products such as CBD; or other subjects 

mentioned above, are not the subject of 

this rulemaking or within other USDA 

or federal, State, Tribal, or private 

industry responsibilities and 

authorities. 

Comments on the IFR’s Regulatory 

Analyses 

Civil Rights Review 

The IFR included a Civil Rights 

review that found the rule would not 

have adverse effects on protected 

persons or groups, deny them program 

benefits, or subject them to 

discrimination. 

Comments: One comment indicated 

that small farmers face challenges 

related to costs of seed. Another 

commenter associated the destruction of 

non-compliant hemp as posing a great 

risk of economic hardship on hemp 

farmers, especially the small minority 

farmers. 

Several comments from Indian Tribes 

explained that certain provisions of the 

IFR, for example laboratory DEAregistration requirements, the definition 

of key participants, and Tribal law 

enforcement availability, did not 

sufficiently account for the specific 

circumstances and challenges facing 

Indian Tribes across the nation such as 

the remote location of many Indian 

Tribes, the limited economic resources 

of Indian Tribes, and Tribal decisionmaking structures. Comments pointed 

out that this final rule must ensure 

Tribal civil regulatory authority to help 

Tribal nations build and implement 

successful plans. Other Tribal 

comments identified the requirements 

for the complete destruction of the plant 

as, ‘‘disproportionately economically 

disastrous for our small Native 

American farmers,’’ explaining that 

Native American farmers tend to be 

significantly smaller and operate on 

very small margins. 

One commenter suggested that AMS 

reconsider the potential civil rights 

implications of this rule on the 

convicted felons because the IFR, if 

unchanged, will have a disproportionate 

negative impact on both Black and 

Latino Americans, who according to 

DOJ data, represent 38.8 percent and 

37.2 percent (respectively) of the total 

population of Federally sentenced drug 

offenders. The commenter compares 

this data to the data from U.S. 

Department of Health and Human 

Services’ rates of illicit drug use among 

White Americans (9.5%), Black 

Americans (10.5%,) and Latino 

American (8.8%). 

Another commenter claimed that 

using ‘‘flawed/inaccurate science with 

lower standards is a direct example of 

failing to preserve the protection of the 

public at large,’’ and ‘‘USDA cannot 

legally implement their proposed rules 

without violating the mission statement 

of the agency.’’ 


khammond on DSKJM1Z7X2PROD with RULES6
5652 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

30https://www.ocio.usda.gov/sites/default/files/ 

docs/2012/CRIA%20DR%204300-004-final.pdf. 

31https://beta.regulations.gov/comment/AMS-SC19-0042-1490. 

AMS response: AMS considered the 

potential civil rights implications of this 

rule on minorities, women, and persons 

with disabilities to ensure that no 

person or group shall be discriminated 

against on the basis of race, color, 

national origin, gender, religion, age, 

disability, sexual orientation, marital or 

family status, political beliefs, parental 

status, or protected genetic information. 

Additionally, this rule would not deny 

any persons or groups the benefits of the 

program or subject any persons or 

groups to discrimination. This rule is 

neutral and of general applicability. 

We also note that some of the burdens 

or hardship described in the comments 

are required by the 2018 Farm Bill. 

First, the 10-year ineligibility restriction 

applicable to persons convicted of a 

State or Federal felony is a requirement 

of the 2018 Farm Bill. Also, as stated 

previously the basis for the DEA lab 

registration is rooted to the statutory 

requirements of the Controlled 

Substances Act, that requires any 

laboratory that might potentially handle 

a controlled substance to undergo the 

DEA registration process and thus 

cannot be eliminated. Additionally, the 

2018 Farm requires effective disposal of 

non-compliant plants. 

Moreover, AMS conducted a Civil 

Rights Impact Analysis in accordance 

with USDA’s Departmental Regulation 

4300–004: Civil Rights Impact 

Analysis.30 AMS’s analysis did not find 

any evidence that the final rule would 

adversely or disproportionality impact 

hemp producers in protected groups, 

regions or Tribes as compared to the 

general population of hemp producers 

or State Departments of Agriculture. 

Regulatory Impact Analysis 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives when an action is deemed 

to have significant impacts. If regulation 

is necessary, then agencies must select 

the action that maximizes net benefits, 

including potential economic, 

environmental, public health and safety 

effects, and equity. Executive Order 

13771 mandates that agencies provide 

the best approximation of total costs 

associated with a new or repealed 

regulation. AMS prepared a Regulatory 

Impact Analysis (RIA) with the purpose 

of accomplishing these objectives. 

Comments: Very few comments 

addressed the RIA specifically, but we 

received many comments with 

information related to assumptions that 

fed into the RIA such as percent of hot 

hemp, testing burdens, lab registration 

burdens. AMS addressed these 

comments in the general comment 

section and took into consideration 

information provided for the RIA. 

One comment acknowledged that 

USDA’s economic analysis was based 

on sound and reasonable methodology 

but said that its expectations were not 

confirmed by actual market events in 

2019. The commenter compiled 

production data provided in other 

comments in an effort to present a more 

current analysis of the hemp market. 

The comment pointed out that the RIA 

underestimated the number of hemp 

production licenses that would be 

issued and hemp acres that would be 

planted in the 2019 growing season. 

According to the comment, while the 

RIA called only for a doubling of 

licenses beyond the 2018 benchmark, 

the actual rate of licenses increased by 

476 percent in 2019. Similarly, the 

comment reported actual planted hemp 

acreage in 2019 to be close to 230,000 

acres, well over the 155,000 acres 

assumed by the RIA. The comment went 

on to say that the rate of growth for new 

licenses outpaced the rate of growth for 

consumer sales by 3:1, while the RIA 

had assumed a 1:1 rate over the next 

four years. The comment explained that 

supply growth has outstripped demand 

and created significant market 

imbalance and, as a result, market prices 

have dropped and driven down 

revenues to hemp producers. 

The comment cited the gross revenue 

for floral material estimated in Table 1 

of the RIA, which ranges from $2,333 to 

$24,000 per acre under the assumption 

that two-thirds of an acre is planted for 

floral material. Based on market data 

published in November 2019, after the 

IFR’s publication, the comment 

suggested that the actual range of gross 

revenue for floral material per twothirds of an acre was $2,728 to $17,261. 

The comment then applied the variable 

cost of planting one full acre of floral 

material estimated in the RIA, $28,638 

per acre, to this range of gross revenue. 

This calculation resulted in a loss of 

$11,377 to $25,910 per acre, which the 

comment said is incorrect given that the 

variable cost per acre of floral material 

was deducted from the gross revenue 

per two-thirds of an acre. For an 

accurate estimate of net revenue, it 

stated that gross revenue and costs must 

be represented in terms of the same unit 

of measurement. 

The comment suggested that the 

downstream effects of an unbalanced 

economic supply equation would 

further disrupt the profitability of 

sectors that are intended to support the 

transportation, processing, and retail 

sales of the product. It cited sales data 

reporting a 50 percent decline in the 

price of CBD extracts and concentrates 

from April 2019, stating that the 

oversupply of hemp has affected the 

entire commercial supply chain. 

The commenter disagreed with the 

methodology used to project the net 

social benefit of hemp per acre in the 

IFR, saying that methodology assumed 

social benefit is a static figure. The 

commenter asserted instead that social 

benefit is ‘‘a fluid figure that is heavily 

influenced by time and supply and 

demand economics’’ and that it will 

likely fall over time.31

Further, it argued that the estimated 

2019 societal willingness to pay of 

$2,650 per acre, which was calculated 

in the RIA using Kentucky grower sales 

and planted acreage, is not 

representative of the rest of the United 

States. Based on the hemp product sales 

in Chart 1 of the RIA, the estimated 

return to producers of processor sales of 

31 percent, which was calculated in the 

RIA by comparing Kentucky grower and 

processor sales, and total U.S. planted 

acres estimated in Table 3 of the RIA, 

the comment calculates a 2019 national 

societal willingness to pay of $2,325 per 

acre. This result indicates that the 

societal willingness to pay based on 

Kentucky data is 14 percent higher than 

the estimate for the United States as a 

whole. The comment also calculates a 

national societal willingness to pay for 

2018 of $4,047, which illustrates that a 

decline in societal willingness to pay of 

42.5 percent occurred in 2019. 

The comment cautioned that the net 

social benefit calculated in the IFR was 

over inflated because it represents a 

point in time during the industry’s 

infancy. The comment argued that the 

industry faces a market depression and 

recommended a quota system for 

licensing classified by intended use. In 

this recommendation, the comment 

offered a detailed approach to 

estimating acreage required to meet 

demand for hemp grown for use in the 

CBD market. The analysis resulted in an 

estimated 44,509 acres required to meet 

demand in 2020, 83,336 acres for 2021, 

188,558 acres for 2022, 255,899 acres for 

2023, and 309,773 acres for 2024. The 

comment expanded upon its 

recommendation of a quota licensing 

system, suggesting that a number of 

licenses be granted by range of acreage, 

thereby ensuring that a share of licenses 

is reserved for small farmers. 

Another comment asserted that unless 

the IFR definition of hemp is revised to 

include cannabis with a total THC level 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5653 

of not more than 1.0 percent on a dry 

weight basis, it will not be economically 

viable to grow hemp for flower in the 

U.S. According to the comment, if the 

THC limits of the IFR are maintained in 

the final rule, the RIA should be revised 

to reflect the impact of the rule on total 

yield and CBD concentration of 

harvestable flowers, reduced value of 

CBD hemp seed, and the unknowable 

market value of CBD. The comment 

predicted that although the value of 

hemp seed for flower might be reduced 

marginally, other input costs would 

remain very high. 

One comment recommended 

differentiation between hemp biomass 

and hemp flowers in the IFR’s analysis 

of market prices for floral material. The 

comment said that hemp biomass refers 

to full plant material, including stems, 

leaves, and flowers, while hemp flower 

refers to the part of the plant that 

contains trichomes which houses richly 

and densely populated cannabinoid 

content. The comment said the prices in 

the RIA are consistent with prices for 

hemp biomass, and suggested prices for 

hemp flowers ranging from $25 to $800 

per pound, depending on the percentage 

of CBD present. 

Two comments asserted that USDA 

grossly underestimated the sampling 

time and cost in the IFR. Comments 

were concerned that readers might 

assume hemp sampling and testing costs 

fees are preset. The comments suggested 

that hemp sampling is a more complex 

logistical problem than contemplated in 

the IFR because of the geography and 

scope of sampling on farms. The 

comments encouraged USDA to 

calculate anticipated sampling costs to 

include a minimum number of hours for 

each step in the sampling process, and 

to consider factors such as travel time 

and coordination of supplies and 

personnel for the sampling effort. 

One comment disagreed with the IFR 

statement that the new hemp 

production program would expand 

production and sales of domestic hemp, 

benefitting U.S. growers and consumers. 

The commenter said that production 

costs for his CBD hemp farm were 

approximately $16,000 per acre, but 

because of the IFR’s restrictiveness and 

his resulting inability to bring the crop 

to full maturity, the crop would likely 

only return $9,000 per acre. The 

commenter said they were unwilling to 

make that kind of risky investment and 

was unwilling to decide whether to plan 

for future crops until USDA finalizes its 

rule. 

AMS response: AMS is aware that the 

number of licenses and amount of 

acreage that were estimated in the RIA 

of the IFR were underestimated. 

Entrance of producers into the market 

spiked at an unexpected rate in 2019, 

driving up acreage along with licenses. 

AMS utilized the most current data 

available to it in its analysis of the hemp 

market in the IFR and the final rule. 

Regarding the estimate in one 

comment of net loss ranging from 

$11,377 to $25,910 per acre, it is 

important for gross revenue and costs to 

be represented in the same unit of 

measure for an accurate net revenue 

calculation, which, in this case, they are 

not. The variable cost per one acre of 

floral material was deducted from the 

gross revenue per two-thirds of one acre 

of floral material, resulting in a larger 

loss than if calculated using the same 

unit of measurement. AMS has adjusted 

the calculation of net revenue in the 

table below using the market price data 

cited by the comment. AMS appreciates 

the comment’s citation of its sources 

and utilized similar sources in the RIA 

of this final rule. 

Planted acres Yield Price Gross 

revenue 

Variable 

cost 

Net 

revenue 

Low estimate 

2/3 ........................................................................................ 1,000 $4.09 $2,727 $19,092 $(16,365)

1 ........................................................................................... 1,000 4.09 4,090 28,638 (24,548) 

High estimate 

2/3 ........................................................................................ 1,200 21.58 17,264 19,092 (1,828) 

1 ........................................................................................... 1,200 21.58 25,896 28,638 (2,742) 

Furthermore, AMS understands and 

appreciates the commenter’s argument 

that net social benefit andsocietal 

willingness to pay are over inflated in 

the IFR. Due to the relative scarcity of 

industry data, AMS made many 

assumptions in its analysis in the IFR, 

some of which were not realized. In 

order to caution industry stakeholders 

of the volatility of the hemp market, 

however, AMS used variable cost 

estimates to calculate net returns to 

producers, which ranged from a loss of 

nearly $17,000 to a gain of $6,240. In the 

single year since publication of the IFR, 

a greater amount of data has become 

available to AMS, which allows the 

analysis in the final rule to rely less on 

assumptions that may not be actualized. 

AMS only has the authority regarding 

hemp regulation granted to it by the 

2018 Farm Bill. The recommendations 

to establish a quota system for issuing 

licenses based on intended use and to 

revise the definition of hemp such that 

it includes cannabis with up to 1.0 

percent total THC on a dry weight basis 

are outside of the authority of USDA. 

The 2018 Farm Bill provided USDA no 

authority to regulate production 

volume. Additionally, USDA cannot 

adjust the statutory definition of hemp. 

AMS has also reviewed the sampling 

procedures and costs characterized in 

approved state and Tribal plans to better 

estimate the time and resultant fees that 

will be charged to producers for 

sampling in the hemp program. 

Small Business Impacts 

AMS performed a Regulatory 

Flexibility Analysis (RFA) in 

conjunction with the IFR that 

considered the effects of the rule on 

small businesses particularly. 

Comments: One organization that 

represents the views of small entities 

stated that small hemp producers have 

significant startup costs that affect their 

ability to be competitive in the hemp 

industry. The comment notes that hemp 

production is labor-intensive and has 

licensing and regulatory costs that are 

not typically incurred by producers of 

other agricultural crops. Small entities 

indicated that only those businesses 

with adequate capital and large-scale 

operations would be able to survive and 

comply with the requirements of this 

rule. Further, comments conveyed that 

this rule will raise real barriers to entry 

for small and disadvantaged producers 

and could prevent these critically 

important producer groups from even 

entering the hemp industry. 

Other comments stated that the 

negative effects of the regulatory 

incongruence in the IFR 


khammond on DSKJM1Z7X2PROD with RULES6
5654 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

disproportionately affect farmers, in 

particular new and small farmers—and 

small or already disadvantaged hemp 

farmers will face additional risks if the 

IFR is not changed. 

One comment claimed the 2014 and 

2018 Farm Bills presented an innate 

prejudice for institutional research, 

including State departments of 

agriculture and institutions of higher 

education and this prejudice continued 

in the IFR. The commenter says this is 

similar to the bias of California’s draft 

State plan, where individuals permitted 

to be grower or breeders, but the 

program’s compliance burdens are 

effectively beyond the reach of most 

individuals. 

Commenters stated that this rule will 

disrupt small producers who were 

successfully producing hemp under 

prior pilot programs. One organization 

reported that hemp producers have 

stopped growing hemp altogether until 

they can be certain about what the 

requirements for producing hemp. 

Comments also reported that some 

hemp buyers have not renewed their 

contracts. Comments stated that several 

of the provisions of this rule impose 

unnecessary burdens on small entities. 

Comments suggested that many of the 

sampling and testing requirements 

should be revisited and alternatives 

should be considered and analyzed to 

minimize the burden to small 

producers. In addition, comments said 

that small business are very concerned 

about the risk of losing their economic 

investment due to mandatory disposal, 

the lack of control over growing 

conditions, genetics of neighboring 

crops, and timing and precision of the 

testing. 

Comments from State departments of 

agriculture expressed strong concern as 

to the additional burdens they would 

incur as a result of the rule. These 

burdens may be directly passed to small 

producers in the form of delayed 

responses to license applications, 

renewals, and appeals; testing backlogs; 

duplicative reporting requirements; new 

license fees; and other programmatic 

issues. 

One comment claimed that, based on 

six years of administering their hemp 

program, many of the most rigid 

requirements of the IFR are not only 

unnecessary, but also likely to have a 

disproportionately adverse impact on 

new farmers and farmers with smaller 

operations. According to the comment, 

these farmers already face great risk in 

the current marketplace, and need 

regulatory help, rather than 

impediments, in order to grow and 

thrive. The comment urged AMS to 

provide a more sensible, flexible, and 

practical regulatory scheme to 

encourage industry growth. 

AMS response: AMS understands that 

there is a great deal of uncertainty in the 

hemp industry currently and has made 

efforts to minimize any burden which 

may befall producers as a result of this 

rule. To that end, USDA is not charging 

producers any fees for licensing or 

collecting any fees from producers to 

support AMS’ administration of the 

hemp program. The fee structure 

developed by States and Indian Tribes 

to administer their hemp programs lies 

outside of the purview of USDA. On 

average, AMS anticipates total fees paid 

by producers under a State or Tribal 

Plan to amount to $800 per grower. This 

amount includes licensing and other 

fees intended to generally fund the 

operations of States or Tribal Programs. 

Fees for sampling and testing, on 

average, amount to about $300 per lot. 

The cost for an annual background 

check for three key participants is $54. 

AMS estimates an annual reporting and 

recordkeeping burden of $129 per 

grower. Altogether, these costs total 

$1,283 per grower, assuming one lot 

requires sampling and testing. This total 

cost is 0.1 percent of $1 million, which 

is the largest amount in annual receipts 

that a grower may receive to be 

considered to be a ‘‘small business’’ 

under the Small Business Size 

Standards of the U.S. Small Business 

Administration (SBA). 

In response to comments, AMS has 

revised its sampling and testing 

methodology to allow for performancebased sampling, which should reduce 

the burden on all producers, large and 

small. Section 990.3 details this revised 

methodology. In addition, AMS has 

modified its disposal requirements, and 

allows for remediation of noncompliant 

crops. These remediation options are 

described in § 990.27. 

AMS understands the concerns raised 

by state departments of agriculture 

regarding the requirements of 

administering a commercial hemp 

program. For this reason, AMS has 

made every effort to provide States and 

Indian Tribes flexibility to administer 

their hemp programs, including whether 

they charge for fees or other costs or 

cover those expenses from other State or 

Tribal resources. If the burden for a 

State or Indian Tribe to administer its 

own hemp program remains too great, 

however, the State or Indian Tribe may 

elect to participate in the Federal plan 

and allow AMS to administer the 

program. By providing this flexibility, 

USDA believes it is less likely that the 

burdens on State and Tribal resources 

will be passed on to small businesses. 

Tribal Matters 

The IFR provided that States and 

Indian Tribes may submit hemp 

production plans to USDA for approval. 

Individual producers from States or 

Tribal territories that do not have 

USDA-approved plans may file separate 

applications for hemp production 

licenses under the general USDA hemp 

production plan. Below are several 

comments and AMS’s responses 

regarding matters of particular concern 

to Indian Tribes and Tribal members. 

Comments: Comments said the 

regulations fail to treat Indian Tribes on 

an equal basis with States by repeatedly 

failing to include the term ‘‘Tribe’’ when 

referring to the State and local 

jurisdictions. According to comments, 

by doing so, the regulations fail to 

respect Tribal sovereignty and selfgovernment. 

AMS response: USDA agrees that 

Indian Tribes must be treated the same 

as States under the regulations. There 

were a few occasions where USDA 

mistakenly left out ‘‘Tribe’’ from the 

language in the regulation. USDA is 

correcting these mistakes in the IFR by 

revising the language of the final rule to 

insert ‘‘Tribe’’ after ‘‘State’’ in the 

definition of Law Enforcement Agency 

in § 990.1; insert ‘‘Tribe’’ after ‘‘State’’ in 

§ 990.24(a); and revise § 990.40(d), 

which incorrectly referred to ‘‘States 

and territories of Indian Tribes,’’ to refer 

to ‘‘States and Indian Tribes’’. 

Comments: Several comments 

asserted that USDA should not define 

‘‘territory of an Indian Tribe’’ and 

claimed that by doing so, USDA violates 

Tribal treaty rights to farm on Tribal 

territories. Comments argued that such 

a definition should be left up to each 

Indian Tribe. Further, comments 

contended that the definition of 

‘‘territory of an Indian Tribe’’ at § 990.1 

inappropriately refers to a criminal 

statute, 18 U.S.C. 1151, to define an 

Indian Tribe’s territory and regulatory 

jurisdiction. Other comments supported 

the use of the Indian country definition, 

but asked for the removal of the 

requirement that the lands must be 

within the Indian Tribe’s jurisdiction, 

primarily because it causes uncertainty 

as to whether Indian Tribes may 

regulate hemp production on nonIndian owned fee lands within a Tribe’s 

territorial boundaries. Comments also 

asked that AMS clarify that States 

cannot interfere with hemp production 

within the territory of an Indian Tribe. 

AMS Response: If an Indian Tribe 

does not assume primary jurisdiction 

over the Tribe’s Indian territory, USDA 

has jurisdiction over the hemp 

production on an Indian Tribe’s 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5655 

territory pursuant to the 2018 Farm Bill. 

USDA, therefore, must know the limits 

of its jurisdiction over such Indian 

territory, just as it must know its 

jurisdiction over lands ordinarily within 

State jurisdiction. 

The IFR defined ‘‘territory of the 

Indian Tribe’’ at 7 CFR 990.1 as having 

the same meaning as ‘‘Indian Country’’ 

in 18 U.S.C. 1151. Upon consideration 

of comments submitted by Indian 

Tribes, USDA concurs that reference to 

the criminal law definition of Indian 

country could be confusing. 

Therefore, in the final rule USDA 

revised the definition of ‘‘territory of the 

Indian Tribe’’ to incorporate language 

from other Federal statutes, but without 

explicitly cross-referencing such 

statutes. Specifically, the final rule 

defines ‘‘territory of the Indian Tribe’’ to 

mean (a) all land within the limits of 

any Indian reservation under the 

jurisdiction of the United States 

Government, notwithstanding the 

issuance of any patent, including rightsof-way running through the reservation; 

(b) all dependent Indian communities 

within the borders of the United States 

whether within the original or 

subsequently acquired territory thereof, 

and whether within or without the 

limits of a state; (c) all Indian 

allotments, the Indian titles to which 

have not been extinguished, including 

rights-of-way running through the same; 

and (d) any lands title to which is either 

held in trust by the United States for the 

benefit of any Indian Tribe or individual 

or held by any Indian Tribe or 

individual subject to restriction by the 

United States against alienation and 

over which an Indian Tribe exercises 

jurisdiction. 

In the 2018 Farm Bill, Congress 

provided authority for any Indian Tribe 

to seek USDA approval to become the 

primary regulator of hemp production 

within the ‘‘territory of the Indian 

Tribe.’’ The 2018 Farm Bill did not 

provide a definition of the term territory 

of the Indian Tribe, and there is no 

universally accepted definition of that 

term, or similar terms, within the field 

of Federal Indian law. In describing 

jurisdictional boundaries associated 

with Indian Tribes, various Federal 

statutes use several terms, including 

Indian country, Indian lands, Federal 

Indian reservations, and areas within 

the Indian Tribe’s jurisdiction, among 

others. 

Thus, by its very nature and history, 

the statutory term ‘‘territory of the 

Indian Tribe’’ is ambiguous. According 

to the Indian canon of construction, 

‘‘statutes are to be construed liberally in 

favor of the Indians, with ambiguous 

provisions interpreted to their 

benefit. . . .’’ Montana v. Blackfeet 

Tribe of Indians, 471 U.S. 759, 766 

(1985) (citations omitted). In addition, 

USDA may address ambiguities in a 

statute that it administers, with any 

reasonable interpretation of the 

ambiguous term entitled to judicial 

deference. Chevron U.S.A. Inc. v. Nat. 

Res. Defense Council, Inc., 467 U.S. 837, 

842–43 (1984). In this case, Congress 

provided no indication that the term 

‘‘territory of the Indian Tribe’’ should 

apply more narrowly than similar terms 

that have been defined and interpreted 

in other Federal statutes and programs. 

Moreover, a narrow interpretation that 

excluded nontribal fee lands within 

reservations would perpetuate the 

problem of checkerboard jurisdiction 

over lands within Indian reservations, 

adding unnecessary confusion and 

uncertainty to the challenges of 

implementing the hemp program in 

Indian country. Therefore, the USDA 

includes a regulatory definition of the 

term ‘‘territory of the Indian Tribe’’ that 

is based on the definition of Indian 

country in 18 U.S.C. 1151 and the 

definition of Indian lands in the Indian 

Gaming Regulatory Act, 25 U.S.C. 

2703(4). 

The definition includes all lands 

within the limits of any Indian 

reservation under the jurisdiction of the 

United States Government, 

notwithstanding the issuance of any 

patent, which encompasses onreservation parcels held in fee simple by 

non-members of the Indian Tribe. 

Similar provisions are found in the 

criminal jurisdiction definition of 

Indian country, 18 U.S.C. 1151; in the 

Clean Water Act, 33 U.S.C. 1377(h); the 

Clean Air Act, 42 U.S.C. 7601(d)(2)(B). 

The U.S. Environmental Protection 

Agency (‘‘EPA’’) interpreted the statutes 

that it administers as providing 

authority to Indian Tribes over nonTribal fee lands within Indian 

reservations. EPA Final Rule: Indian 

Tribes—Air Quality Planning and 

Management, 63 FR 7254 (Feb. 12, 

1998); EPA Interpretive Rule: Revised 

Interpretation of Clean Water Act Tribal 

Provision, 81 FR 30,183 (May 16, 2016). 

EPA found that the Clean Water Act and 

Clean Air Act provided a delegation of 

authority to Indian Tribes over nonTribal fee land within reservations. See 

Arizona Public Serv. Co. v. EPA, 211 

F.3d 1280 (D.C. Cir. 2000). The agency 

found legislative intent and a commonsense reasoning to treat Indian 

reservations holistically for purposes of 

environmental regulation. 

Similarly, USDA interprets the 2018 

Farm Bill as authorizing Indian Tribes 

to become—with USDA’s approval of a 

hemp plan—the primary regulators of 

hemp production within their 

territories, including on nontribal fee 

lands within reservations. This 

authority applies without regard to the 

Indian Tribe’s ability to demonstrate 

inherent regulatory authority over nonIndians under the factors set forth in 

Montana v. United States, 450 U.S. 544 

(1981). Additionally, this definition will 

make clear the area over which USDA 

will have regulatory authority including 

licensing if the Indian Tribe does not 

have an approved plan or a plan 

submitted to USDA for approval. 

Comment: Some comments said 

Indian Tribes did not have the benefit 

of operating under the 2014 Farm Bill 

and, consequently, have not developed 

the farming techniques and regulatory 

systems that States have. Therefore, 

according to comments, Indian Tribes 

should be given a grace period while 

they develop best practices. 

AMS response: Not all States operated 

under the 2014 Farm Bill, and some 

Indian Tribes did enter into Tribal— 

State agreements under the 2014 Farm 

Bill. Therefore, establishing a regulatory 

grace period for Indian Tribes only is 

not workable. Indian Tribes may take 

advantage of training and technical 

assistance offered by the USDA and 

other entities to ensure that they 

implement the best systems possible. 

Comments: Some comments claimed 

that negligent violations by Indian 

Tribes under § 990.6 may cause Indian 

Tribes to be ineligible for other 

programs. 

AMS response: The 2018 Farm Bill 

describes three types of negligent 

violations under State and Tribal plans. 

The negligent violations detailed in 

§ 990.6 are required to be included in 

State and Tribal plans pursuant to the 

2018 Farm Bill. 

Comment: A comment contended that 

the requirement for a geospatial site 

identification at § 990.3(a)(1)(ii) is too 

expensive for Indian Tribes, 

unnecessary, and not readily available. 

Comments said the Department of the 

Interior has land records that could be 

used to obtain necessary information. 

AMS response: A legal description of 

the land where hemp is grown is 

required by the 2018 Farm Bill. 

Geospatial location is one form of 

meeting such requirement. Producers 

are required to provide information to 

FSA on the geographical location of 

hemp production. FSA offices will 

provide assistance in identifying such 

location at no cost to producers. 

Comments: Some comments said 

USDA should conduct more Tribal 

consultations and provide USDA and 

DEA training for hemp producers. One 

Indian Tribe requested more time to 


khammond on DSKJM1Z7X2PROD with RULES6
5656 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

allow Indian Tribes to organize a Tribal 

Advisory Council of Tribal Leaders to 

continue with the development and 

implementation of federal hemp policy. 

AMS Response: In addition to 

previous Tribal consultations and 

extending and reopening the IFR’s 

comment period, USDA added a 

September 2020 Tribal consultation to 

receive additional information, 

particularly from 2020 growing season 

producers. See the section on E.O. 

13175 Consultation and Coordination 

with Indian Tribal Governments in this 

document for further discussion about 

the consultations. If Indian Tribes 

organize a Tribal Advisory Council of 

Tribal Leaders, USDA would appreciate 

any future feedback. Additionally, 

USDA is available to provide technical 

assistance when requested, including 

training. USDA is adding training for 

sampling to its website. 

Comments: Comments said that 

Indian Tribes and individuals within 

the territory of the Indian Tribe should 

not have to be regulated by States, but 

should be able to go directly to USDA 

for licensing if the Indian Tribe opts out 

of developing its own Tribal plan and 

the Indian Tribe does not otherwise 

prohibit hemp production. 

AMS Response: Subpart C, the USDA 

Hemp Production Plan, governs hemp 

producers in the absence of a Tribal 

plan. Therefore, any Indian Tribes or 

individuals wishing to produce hemp 

must comply with those regulations if 

not covered under a State or Tribal plan. 

If an Indian Tribe decides not to 

develop its own hemp plan, a producer 

may directly apply for a USDA license. 

States were not delegated authority 

under the 2018 Farm Bill to regulate 

hemp production within the territory of 

an Indian Tribe. 

Comment: Indian Tribes should be 

allowed to implement their Tribal 

preference laws. 

AMS Response: Nothing in the IFR or 

the final rule prevents Indian Tribes 

from implementing their Tribal 

preference laws. 

Comment: A comment said that Tribal 

ordinances and interstate commerce 

regulations need to address price 

gouging in seeds and input. 

AMS Response: This comment is 

outside the scope of this rule. 

Comment: A comment said the 

Bureau of Indian Affairs and USDA 

should review 25 CFR part 162 

governing agriculture and business 

leases to ensure that the hemp 

regulations here do not conflict with 

that part or cause additional regulatory 

hurdles. 

AMS response: 25 CFR part 162 

establishes certain requirements for 

leasing trust or restricted Indian lands. 

USDA conferred with the Department of 

the Interior, the agency regulating 

Indian land, and did not identify any 

conflicts between the two sets of 

regulations. 

Comment: A comment suggested 

USDA hire an Indian law expert to 

assist with development of the final 

rule. 

AMS response: USDA agreed and 

hired a consultant with 40 yearsexperience as an Indian law attorney to 

assist with the development of the final 

regulations and the review of Tribal 

plans. 

Comment: Comments said the 

criminal history checks required by the 

IFR should be expanded to include the 

Department of Justice Tribal Access 

Program (TAP). According to comments, 

those using TAP would then be able to 

directly access criminal history checks. 

Comments also said the regulations 

need to clarify whether the criminal 

history check can be a name check or a 

finger-print check. 

AMS Response: USDA conferred with 

the DOJ Office of Tribal Justice and was 

informed that Indian Tribes can use the 

TAP program to access the FBI Identity 

History Summaries. The FBI Identity 

History Summaries may be based on 

name check or a finger-print check. 

Comment: Comments noted that the 

term ‘‘key participant’’ is defined at 

§ 990.1 in a manner that is not 

necessarily consistent with an Indian 

Tribe’s unique organization and 

methods of doing business. Comments 

explained, for example, that an Indian 

Tribe may be the owner of a hemp farm. 

Comments asserted that although the 

Indian Tribe’s governing council may be 

the ultimate decision-maker as the 

owner, it would not be appropriate to 

include them in the felony and 

background investigations. Therefore, 

comments said Indian Tribes should be 

permitted to identify their own ‘‘key 

participants’’ if they are operating under 

a USDA plan and the requirements of 

§ 990.22. 

AMS Response: USDA understands 

the concerns raised by Indian Tribes 

regarding the application of the criminal 

history report requirement and the 

felony conviction restriction on Tribal 

leaders. However, USDA must ensure 

that entities operating under a USDA 

plan comply with the felony conviction 

restriction in the AMA. For reasons 

explained in the IFR, USDA believes 

that the appropriate approach in 

determining who participates in the 

program, and therefore subject to the 

felony conviction restriction, is to focus 

on those who exercise executive 

managerial control over hemp 

production. USDA also believes that 

this focus should be consistent across 

the USDA plan regardless of the person 

who is applying for a license. For the 

foregoing reasons, USDA has clarified 

the definition of key participants in the 

final rule to provide that the definition 

‘‘does not include a member of the 

leadership of a Tribal government who 

is acting in their capacity as a Tribal 

leader except when that member 

exercises executive managerial control 

over hemp production.’’ AMS notes that 

an Indian Tribe may adopt its own 

hemp plans subject to USDA approval. 

When adopting a hemp plan, the Indian 

Tribe can determine who participates in 

its plan and will be subject to a criminal 

history check. 

Comment: USDA received a comment 

that it should affirm Tribal sovereignty 

by not allowing other federal agencies, 

such as the DEA, to interfere with Tribal 

hemp remediation. 

AMS Response: USDA does not have 

the authority to control the actions of 

other federal agencies acting properly 

within their authority. 

Comment: USDA received comments 

that USDA owes a trust responsibility to 

Indian Tribes. According to 

commenters, that trust responsibility 

requires acknowledging the unique 

challenges that Indian Tribes face 

including that (1) most tillable land was 

taken from Indian Tribes during 

homesteading; (2) Tribes’ participation 

in the farm program results in only a 60 

percent yield of their non-Indian 

counterparts; (3) the finance system is 

usurious as financiers discount the 

value of Tribal assets or refuse to 

consider them at all; and (4) American 

Indian producers will be 

disproportionately disadvantaged 

because their farms are significantly 

smaller and are generally run with only 

one crop by families with small 

margins. 

AMS Response: USDA acknowledges 

that it has a special government-togovernment relationship with Indian 

Tribes, and believes that, in preparing 

and issuing this final rule it has acted 

in accordance with that relationship. In 

response to concerns regarding the 

unique challenges Indian Tribes face, as 

explained in the Civil Rights Review of 

this final rule, AMS conducted a ‘‘Civil 

Rights Impact Analysis’’ and did not 

find any evidence that the final rule 

would adversely or disproportionality 

impact Indian Tribes or Tribal members 

producing hemp as compared to the 

general population of hemp producers 

or State Departments of Agriculture. 

Indian Tribes may take advantage of 

training and technical assistance offered 

by the USDA to ensure that they 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5657 

implement the best systems possible. 

Additionally, USDA is available to 

provide technical assistance when 

requested. 

State and Tribal vs. Federal Regulation 

The preamble of the IFR stated that 

‘‘[n]othing preempts or limits any law of 

a State or Indian Tribe that regulates the 

production of hemp and is more 

stringent than the provisions in the 2018 

Farm Bill.’’ Further, Section 297B of the 

AMA expressly states that it does not 

preempt a State or Indian Tribe’s ability 

to adopt more stringent requirements or 

to prohibit the production of hemp. This 

was codified in the IFR in § 990.3(b)(1), 

which provides that nothing in the part 

preempts or limits any law of a State or 

Indian Tribe that regulates the 

production of hemp and is more 

stringent than this part or Subtitle G of 

the Act. 

Comments: Many of the comments 

received stated that the provisions of the 

IFR were more stringent than the 

regulations of pilot programs 

established by States under the 

authority of the 2014 Farm Bill. In fact, 

the majority of all comments received 

either took exception to the perceived 

increase in regulatory requirements for 

hemp production under the IFR, or 

presented recommendations for 

alternative requirements under the final 

rule that would not be as restrictive or 

burdensome as the provisions in the 

IFR. 

No comments were received that 

either affirmed or opposed the rights of 

States and Indian Tribes to promulgate 

more stringent regulations for their 

jurisdictions. However, one comment 

said rather than using the flexibility 

allowed in the law to let states develop 

sensitive state plans, the IFR had rigid 

controls not required by law or 

correlated to the relatively low-level risk 

of non-compliant hemp. The comment 

further said USDA should establish 

baseline requirements but provide 

States flexibility to consider the 

dynamics of agricultural production that 

depend on farm and field conditions, 

weather, and the timing appropriate for 

planting, harvesting, the varieties being 

cultivated and the marketing of crops. 

Other comments agreed with 

recommendations to allow States and 

Indian Tribes to determine certain 

provisions that are not central to the 

minimum regulatory requirements of 

the IFR, such as application windows 

and reporting. 

AMS response: The 2018 Farm Bill 

expressly preserved the ability for State 

and Tribal hemp production plans to 

establish additional provisions stricter 

than the baseline regulations required 

by the 2018 Farm Bill. These baseline 

regulations require all State and Tribal 

plans to include certain minimum 

requirements for licensing, sampling, 

testing, disposal, and information 

collection. These requirements could 

certainly be considered ‘‘more 

burdensome’’ than certain State hemp 

production plans operated under 2014 

Farm Bill pilot program provisions, but 

they are intended to provide 

consistency and transparency among the 

U.S. hemp industry as it matures. Prior 

to the passage of the 2018 Farm Bill, 

States operating hemp pilot programs 

could administer these programs with 

minimal Federal oversight, and without 

baseline requirements around sampling, 

testing, and other program requirements 

because the 2014 Farm Bill programs are 

for research. The 2018 Farm Bill 

established baseline requirements for 

hemp production for hemp production 

across the U.S. regardless of the purpose 

of the production. 

Preemption 

Comment: AMS received comments 

asserting that the IFR did not abide by 

the mandate of the 2018 Farm Bill that 

there be no preemption of state or Tribal 

laws that regulate the production of 

hemp and are more stringent than the 

hemp provisions in the federal statute. 

AMS response: Section 297B(a)(3) of 

the AMA provides that for States and 

Indian Tribes with primary regulatory 

jurisdiction over the production of 

hemp, there is no preemption if that 

State or Indian Tribe both regulates the 

production of hemp and that regulation 

is more stringent than the 2018 Farm 

Bill or the implementing regulations. 

Thus, the no preemption provision of 

the 2018 Farm Bill is to make clear that 

more stringent requirements are not 

preempted. AMS finds that the 2018 

Farm Bill requires the implementation 

of federally mandated minimum 

standards, which all jurisdictions must 

follow, allowing for certain further 

restrictions by States and Indian Tribes. 

Recordkeeping Requirement 

Comment: One commenter argued 

that the recordkeeping requirements of 

the IFR violated the 4th Amendment’s 

prohibition against unreasonable search 

and seizure and was ‘‘arbitrary and 

capricious’’ and a violation of the APA. 

AMS Response: The 2018 Farm Bill 

established a hemp production program 

in the U.S. subject to oversight from the 

Secretary of Agriculture. Part of that 

congressional mandate is for the 

Department of Agriculture to establish a 

plan by which it collects information 

from producers to ensure compliance. 

While hemp is no longer a Schedule 1 

drug, USDA can only make the 

determination of whether the crop is 

legal hemp (which it regulates) or illegal 

marihuana (which it does not regulate) 

through the mechanisms Congress has 

authorized. Recordkeeping requirements 

are paramount to that determination, 

which is required by Congress. AMS is 

retaining the recordkeeping 

requirements of the IFR. 

APA Notice and Comment Concerns 

Comment: Some commenters claimed 

that in issuing an IFR, AMS acted 

arbitrarily and capriciously in violation 

of the APA. Commenters argued that the 

good cause statement included in the 

IFR was not adequate to support its 

issuance rather than going through 

notice and comment rulemaking. 

AMS Response: AMS does not agree 

with these comments and believes that 

there was good cause to issue the IFR. 

AMS has encouraged public input on 

the IFR since its issuance and has 

provided many opportunities for public 

comment. 

Criminal Background Checks and 

Definition of Key Participants 

Comment: Several commenters argued 

that the restrictions on participation in 

hemp production for people with 

criminal convictions related to a 

violation of a state or Federal controlled 

substance law are not necessary and that 

hemp should be treated the same as all 

other commodities, which do not have 

similar restrictions. Commenters argued 

that there should be an exception for 

people with disqualifying criminal 

convictions who could demonstrate 

rehabilitation and that this restriction 

conflicts with state statutory 

requirements in some states. One 

commenter argued that USDA should 

conduct all criminal background checks 

rather than States or Indian Tribes. 

AMS Response: AMS acknowledges 

various stakeholders’ advocacy for 

reduced restrictions to entry in hemp 

production. However, the restriction on 

participation-based on a criminal 

conviction for violation of a state or 

Federal law related to controlled 

substances is a requirement established 

by statute and AMS does not have the 

authority to change to waive this 

restriction. 

Definition of Key Participants 

Comment: Some commenters 

requested that AMS change the 

definition of key participants to more 

clearly state which individuals within a 

business entity would be required to 

submit a criminal history report. One 

commenter requested that AMS align 

the definition of key participant with 


khammond on DSKJM1Z7X2PROD with RULES6
5658 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

32https://www.bls.gov/oes/home.htm. 

the definitions of ‘‘legal entities’’ and 

‘‘beneficial owners’’ in Department of 

Treasury regulations. Another 

commenter suggested that AMS define 

who must submit a criminal history 

report in States and Indian Tribes that 

have an approved plan for primary 

regulatory authority over hemp in their 

jurisdiction. 

AMS Response: AMS acknowledges 

various stakeholders’ advocacy for a 

single definition of ‘‘key participants’’ 

for all hemp producers. However, AMS 

will not require that States or Indian 

Tribes with an approved plan for 

primary regulatory authority over the 

production of hemp in their jurisdiction 

adopt the USDA definition of ‘‘key 

participants.’’ States and Indian Tribes 

are free to incorporate the AMS 

definition of key participants into their 

plan but they are not required to do so. 

They must, however, define who 

participates in their plan and, for each 

license or authorization they issue, must 

identify at least one individual who will 

be subject to a criminal history check. 

The Department of Treasury definitions 

of ‘‘legal entities’’ and ‘‘beneficial 

owners,’’ while similar to the definition 

of ‘‘key participants’’ adopted herein 

apply broadly to the corporate structure 

of a business entity. USDA finds the 

‘‘key participant’’ definition to best 

describe those individuals responsible 

for compliance with this program or 

‘‘leadership structure of a business 

entity.’’ 

X. Regulatory Analyses 

Paperwork Reduction Act 

In accordance with section 3507(d) of 

the Paperwork Reduction Act of 1995 

(44 U.S.C. 3501 et seq.), the Domestic 

Hemp Production Program’s 

information collection requirements 

have been previously approved by 

Office of Management and Budget 

(OMB) and assigned OMB No. 0581– 

0318. The 60-day public comment 

period was imbedded in the interim 

final rule (IFR) which was published on 

October 31, 2019, and ended on 

December 30, 2019. Because of the very 

tight timeline for publishing the IFR, 

OMB granted conditional emergency 

approval of these seven forms on 

December 3, 2019. The USDA Office of 

Chief Information Officer (OCIO) 

published the 30-day Notice for the 

three-year renewal at 85 FR 36828 on 

Thursday, June 18, 2020. 

While writing the IFR there was very 

limited data available to make the initial 

burden calculations under the 

Paperwork Reduction Act (PRA). Since 

the IFR was published, USDA has been 

able to gather much more accurate data 

on the number of producers, disposal 

rates, and time burdens for completing 

the forms. Because of this new 

information, AMS is updating the 

burden calculations currently approved 

by OMB. AMS will submit an updated 

Information Collection to align the new 

calculations in the FR with the 0581– 

0318 package. 

AMS received over 4,600 comments 

in the first public comment period and 

1,100 during the second comment 

period on the overall regulation. A 

specific analysis of each topic area in 

the comment analysis section of the 

final rule. AMS did not receive public 

comments specifically on the PRA nor 

on the time burden hour calculations to 

complete any of the forms. One 

comment from the Alabama Department 

of Agriculture wrote that 10 minutes for 

a State or Tribal producer license 

application was too low, so that has 

been increased to 20 minutes. 

AMS used an initial estimate of 9,000 

total producers for the IFR. This was 

based on the limited data from State 

Departments of Agriculture and the 

hemp advocacy group, Vote Hemp. 

Based on a review of hemp production 

data from State Departments of 

Agriculture, and the data reporting 

services from Hemp Benchmarks and 

Vote Hemp, AMS now estimates 20,000 

producers as a yearly average to use for 

the purposes of reporting calculations. 

These numbers will be updated every 

three years. While the current percent of 

hemp growers licensed under USDA is 

drastically smaller than this, AMS 

assumes approximately 20 percent or 

4,000 producers will be licensed under 

the USDA plan, and the other 80 

percent or 16,000 producers licensed 

under State and Tribal USDA-approved 

programs. 

The description and function of the 

seven reporting forms remains the same 

from the IFR and initial OMB approval. 

These forms require specific 

information be submitted by States and 

Tribes operating their own domestic 

hemp plans, from producers 

participating in the USDA Plan, and 

from laboratories testing for THC 

content. Reporting and recordkeeping 

burdens reflecting revised reporting 

hours and the projected additional 

producers are described in the following 

sections. All time and cost figures have 

been approximated to the nearest whole 

number. The table below explains these 

changes numerically. 

Costs of Reporting and Recordkeeping 

The initial estimate of 100 State and 

Tribal plans remains accurate since the 

majority of States and Indian Tribes will 

have their own programs. As of the Fall 

of 2020, USDA has already approved 65 

individual State and Tribal programs, 

with more to come. The amount of State 

approved programs will also increase 

once the 2014 Farm Bill pilot authority 

expires and those additional States 

submit plans. States and Indian Tribes 

with approved plans are required to 

report certain information to USDA 

through three Forms: The ‘‘State and 

Tribal Hemp Producer Report’’, the 

‘‘State and Tribal Hemp Disposal 

Report’’, and the ‘‘State and Tribal 

Hemp Annual Report’’. USDA collects 

information from all hemp producers 

under a State, Tribal or USDA program 

through the FSA report form ‘‘Report of 

Acreage’’. USDA collects information 

from USDA producers through the 

‘‘USDA Producer Application’’, the 

‘‘USDA Annual Report’’ and the ‘‘USDA 

Disposal Report’’. Laboratories provide 

information on the ‘‘Laboratory Test 

Report’’. 

AMS has updated PRA calculations 

using the Occupational Employment 

Statistics Survey of the Bureau of Labor 

and Statistics 32 using the 2019 data. 

The mean hourly wage of a compliance 

officer, as reported in May 2019, was 

$35 per hour. This is the same 

numerical value as the May 2018 report. 

Assuming 39 percent of total 

compensation accounts for benefits, the 

total compensation of a compliance 

officer is $57 per hour. This $57 per 

hour will be used throughout the PRA 

section. 

Respondents: States or Tribes With 

Approved Plans 

AMS initially estimated that the time 

required for States and Indian Tribes to 

fill in the information for each of these 

forms will be 20 minutes or 0.33 hours 

with a 5 minute or 0.08 hours record 

keeping burden. This estimate has been 

updated from 20 minutes to 60 minutes 

or one hour. The ‘‘State and Tribal 

Hemp Producer Report’’ and the ‘‘State 

and Tribal Hemp Disposal Report’’ are 

due to USDA every month. The ‘‘State 

and Tribal Hemp Annual Report’’ form 

must be submitted to USDA once per 

year. Similar to the other two State and 

Tribal forms, the annual time burden 

was initially 20 minutes but has been 

updated to 60 minutes. The time burden 

for each State and Indian Tribe to 

complete and maintain these three 

forms is now 12 hours for each monthly 

form and 1 hour for the annual report, 

for a total of 25 hours per State and 

Tribe with an approved plan. Given the 

estimated number of approved State and 

Tribal plans is 100, the total cost is 250 

hours and $14,250. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5659 

Respondents: Producers Under State or 

Tribal Plans (Information Only, Not 

Completing the Forms) 

The time required of producers to 

supply the information for the ‘‘State 

and Tribal Hemp Disposal Report’’ and 

the ‘‘State and Tribal Hemp Annual 

Report’’ will stay the same at 10 minutes 

for reporting and 5 minutes for 

recordkeeping burden for each producer 

for these two forms. The ‘‘State and 

Tribal Hemp Producer Report’’ time 

estimate is now increased to 20 minutes 

with a 5 minute record keeping burden 

for each producer, per the suggestion 

from the Alabama Department of 

Agriculture. 

In the IFR, AMS originally estimated 

that the majority of States and Indian 

Tribes would have three-year producer 

licenses, and producers would only 

submit this information once every 

three years. Since approving 60 State 

and Tribal plans, the majority of State 

and Tribal licenses are issued on a 

yearly basis instead. AMS estimates that 

the 16,000 State and Tribal producers 

will submit license information each 

year for State and Tribal programs. In 

addition to obtaining a license, all hemp 

producers are required to prove that 

they do not have prior drug related 

convictions that would disqualify them 

from participation in the program. 

States have some flexibility in what they 

require of applicants to make this 

demonstration. However, for purposes 

of this analysis, AMS will use the cost 

of the FBI Identify Summary, $18, as a 

proxy cost for all background reports, 

and 3 key participants for each license 

each year, although if we were to take 

into account comments, it is likely there 

will be more than 3 key participants 

each year. In the chart below is a cost 

breakdown of the application and 

background check for producers under a 

State or Tribal program. 

FBI Identity Summary Number of 

respondents 

Number of 

responses 

Total annual 

resposes 

* 3 Key 

participants 

Cost of 

background 

check 

($18) 

Plus burden 

cost of 

application 

Total cost 

Cost for State and Tribal producers (3 key 

participants every 

year) ......................... 16,000 1.0000 16,000.00 48,000.00 $864,000.00 $379,666.00 $1,243,666.00 

In the IFR, AMS estimated that 20 

percent of lots will need to be disposed 

even though the current rate of disposal 

is closer to 12%. This assumption is 

based on the increased number of new 

entrants to the market who may not be 

successful in their first year or two. 

AMS is introducing a new performancebased method to sampling, which will 

decrease the amount of testing and 

noncompliant tests. Therefore, AMS 

estimates that 1,600 lots will be 

disposed under State and Tribal 

programs. The producers under a State 

or Tribal program will provide their 

disposal information to their individual 

regulatory body. The States and Indian 

Tribes will then use that information to 

complete the monthly ‘‘State and Tribal 

Hemp Disposal Report’’. 

These are just the costs and burden of 

collecting and maintain the information 

associated with the disposal, not the 

actual disposal. The actual cost of 

disposing of the non-compliant ‘‘hot’’ 

hemp is discussed in the RIA. 

In total, producers under a State or 

Tribal program provide information and 

hold records for three forms. The total 

time burden for these producers 

providing and maintaining this 

information is estimated at 11,061 total 

hours and $630,466. 

Respondents: Producers Participating 

in the USDA Plan 

To produce hemp under the USDA 

Plan, a producer, which may be an 

individual producer or a business, 

completes the ‘‘USDA Hemp Plan 

Producer Licensing Application’’ and an 

FBI Identity Summary. If all parts of the 

application and summary are valid, 

AMS issues a license. The total burden 

per respondent of this form will 

maintain the same as in the IFR; 10 

minutes for the time and 5 minutes for 

record keeping for a total of 15 minutes, 

or .25 hours. Licenses under the USDA 

Plan must be renewed every three years, 

so each producer only submits this 

information once every three years. In 

the IFR, AMS initially estimated that 

there will be 1,000 participants in the 

USDA Plan. AMS has now updated this 

estimate to be 20 percent of the total 

hemp producers, or 4,000 producers 

each year. Because the USDA license is 

valid for three years, approximately 

1,332 producers will complete this form 

each year. The total annual burden for 

this form is 544 hours and $31,603. 

In addition to the ‘‘USDA Hemp Plan 

Producer Licensing Application’’ 

submitted once every three years, 

producers must submit criminal history 

reports for each of their key 

participants. AMS estimates each 

producer to have three key participants 

submit criminal history reports to 

USDA. The cost of a criminal history 

report is $18 apiece, so three key 

participates would cost $54 per 

participant. As stated previously, AMS 

estimates that it will receive 1,332 

license renewals in each year. Each of 

these 1,332 renewals will include a 

background summary for three key 

participates. Adding the cost of 1,332 

renewals at $71,928 with the cost of the 

background check is $31,603 for the 

renewals and means there is an annual 

cost of $103,531. 

FBI Identity Summary Number of 

respondents 

Number of 

responses per 

respondents 

Total annual 

resposes 

* 3 Key 

participants 

Cost of 

background 

check 

($18) 

Plus burden 

cost of 

application 

Total cost 

Cost for USDA producers (3 key participants every three 

years) ........................ 4,000 0.3330 1,332.00 3,996.00 $71,928.00 $31,603.00 $103,531.00 


khammond on DSKJM1Z7X2PROD with RULES6
5660 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

Similar to the required annual report 

submitted by States and Indian Tribes to 

USDA, producers operating under the 

USDA Plan must submit the ‘‘USDA 

Hemp Plan Producer Annual Report’’ to 

USDA each year. AMS estimates the 

time burden of submitting this form will 

maintain the same, at 25 minutes, or 

0.42 hours, per respondent. AMS has 

updated the initial estimate of 1,000 

participants in the USDA Plan, to 4,000 

producers. Therefore, the total burden of 

this form has increased from 416 hours 

to 1,665 hours, costing $94,916 

annually. 

When a hemp sample tests above the 

acceptable hemp THC level, the material 

from the specific lot must be disposed. 

The producer and disposal agent must 

complete the ‘‘USDA Hemp Plan 

Producer Disposal Form’’. The burden 

for this form will stay at 25 minutes, or 

0.42 hours, per respondent. 

Using the same assumptions regarding 

the prevalence of non-compliant crops 

and the costs of disposal that were used 

in generating the estimates of hemp 

disposal reporting (and disposal) for 

State and Tribal programs, the 4,000 

producers that will participate in the 

USDA Plan will generate 400 samples 

that test high for THC content. The total 

reporting burden of this form will 

amount to 167 hours and cost $9,492 

annually. 

Altogether, the annual burden for the 

USDA producers completing and 

maintain the three USDA forms ‘‘USDA 

Hemp Plan Producer Licensing 

Application’’, the ‘‘USDA Hemp Plan 

Producer Disposal Form’’, and the 

‘‘USDA Hemp Plan Producer Annual 

Report’’ amounts to an annual total of 

2,386 hours and a cost of $136,011. 

Respondents: Laboratories 

The 2018 Farm Bill requires that all 

domestically produced hemp be tested 

for total THC content on a dry-weight 

basis, whether produced under a State 

or Tribal Plan or the USDA Plan. Using 

data from FSA the initial estimate of 

two lots of hemp per producer remains 

accurate. However, the new 

performance-based sampling process 

will decrease the number of total 

samples that are collected and tested. 

AMS requires all laboratories testing 

hemp for THC to submit all test results, 

whether passing or failing, via the 

‘‘Laboratory Test Results Report’’. AMS 

maintains the estimated reporting and 

recordkeeping burden for this form at 35 

minutes, or .58 hours. AMS originally 

estimated that 7,700 total hemp 

producers would submit 15,400 samples 

to test. AMS has updated this estimate 

to 8,000 total tests annually. Therefore, 

the total annual burden of these tests 

and the accompanying ‘‘Laboratory Test 

Results Report’’ form decreased from 

8,399 hours to 4,664 hours, and costs 

$265,848. 

Respondents: All Producers 

The FSA collects information on crop 

acreage through the ‘‘Report of Acreage’’ 

form. Hemp producers under all plans 

are required to fill in the information for 

this form once they receive their license 

or authorization from USDA, a State, or 

Indian Tribe and have planted the crop. 

AMS will keep the initial reporting 

burden and record keeping burden at 35 

minutes, or 0.58 hours. AMS has added 

60 minutes or one hour for the travel 

time to and from the FSA office, for a 

total of 90 minutes. With the increased 

number of producers and the addition of 

travel time, AMS estimates the burden 

for the 20,000 producers will be 31,660 

hours and cost $1,804,620. 

Total Reporting and Recordkeeping 

Costs for All Respondents 

Altogether, the annual burden for 

reporting and recordkeeping for all 

respondents is 52,296 hours, costing a 

total of $2,980,864 per year. This is the 

sum of the annual burden of reporting 

and recordkeeping to States and Indian 

Tribes operating their own plans, to 

producers participating in the State and 

Tribal Plans, to producers participating 

in the USDA Plan, including the cost of 

a criminal history report for three key 

participants, and to laboratories testing 

samples for THC content. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5661 

TABLE

Name Form Number of respondents Number of responses per respondent Total annual responses Hours per response Total reporting hours Number of record keepers Annual hours per record keeper Total record keeping hours Total hours × $57 

State and tribal forms 

State and Tribal Hemp 

Producer Report (Old).

AMS–23 ............ 100 12.0000 1,200.00 0.3333 399.96 100 0.083 8.30 408.26 $23,270.82 

State and Tribal Hemp 

Producer Report (Update).

AMS–23 ............ 100 12.0000 1,200.00 1.0000 1,200.00 100 0.083 8.30 1,208.30 68,873.10 

State and Tribal Producer Responses 

(Old).

information only 8,000 0.3330 2,664.00 0.1670 444.89 2,664.00 0.083 221.11 666.00 37,962.00 

State and Tribal Producer Responses 

(Update).

information only 16,000 1.0000 16,000.00 0.3333 5,332.80 16,000 0.083 1,328.00 6,660.80 379,665.60 

State and Tribal Hemp 

Disposal Report (Old).

AMS–24 ............ 100 12.0000 1,200.00 0.3333 399.96 100 0.083 8.30 408.26 23,270.82 

State and Tribal Hemp 

Disposal Report (Update).

AMS–24 ............ 100 12.0000 1,200.00 1.0000 1,200.00 100 0.083 8.30 1,208.30 68,873.10 

State and Tribal Producer Disposal Responses (20% then x 

2 for 2 lots/producer) (Old).

information only 2,680 1.0000 2,680.00 0.1670 447.56 2,680 0.083 222.44 670.00 38,190.00 

State and Tribal Producer Disposal Responses (25% of lot 

from 80% of producers) (Update).

information only 1,600 1.0000 1,600.00 0.1670 267.20 1,600 0.083 132.80 400.00 22,800.00 

State and Tribal Hemp 

Annual Report (Old).

AMS–25 ............ 100 1.0000 100.00 0.3333 33.33 100 0.083 8.30 41.63 2,372.91 

State and Tribal Hemp 

Annual Report (Update).

AMS–25 ............. 100 1.0000 100.00 1.0000 100.00 100 0.083 8.30 108.30 6,173.10 

State and Tribal Hemp 

Annual Report Response (Old).

information only 6,700 1.0000 6,700.00 0.1670 1,118.90 6,700 0.083 556.10 1,675.00 95,475.00 

State and Tribal Hemp 

Annual Report Response (Update).

information only 16,000 1.0000 16,000.00 0.1670 2,672.00 16,000 0.083 1,328.00 4,000.00 228,000.00 

USDA Producer Forms 

USDA Hemp Plan Producer Licensing Application (Old). AMS–26 ............. 1,000 0.3330 333.00 0.1670 55.61 333 0.083 27.64 83.25 4,745.25 USDA Hemp Plan Producer Licensing Application (Update). AMS–26 ............. 4,000 0.3330 1,332.00 0.1670 222.44 4,000.00 0.083 332.00 554.44 31,603.31 USDA Hemp Plan Producer Disposal Form 

(20% x 2 lots for 2 lots/producer) (Old).

AMS–27 ............. 400 1.0000 400.00 0.3333 133.32 400 0.083 33.20 166.52 9,491.64 

USDA Hemp Plan Producer Disposal Form 

(25% x lots from 20% of all producers) (Update).

AMS–27 ............. 400 1.0000 400.00 0.3333 133.32 400 0.083 33.20 166.52 9,491.64 


khammond on DSKJM1Z7X2PROD with RULES6
5662 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

TABLE—Continued 

Name Form Number of respondents Number of responses per respondent Total annual responses Hours per response Total reporting hours Number of record keepers Annual hours per record keeper Total record keeping hours Total hours × $57 

USDA Hemp Plan Producer Annual Report 

(Old).

AMS–28 ............. 1,000 1.0000 1,000.00 0.3333 333.30 1,000 0.083 83.00 416.30 23,729.10 

USDA Hemp Plan Producer Annual Report 

(Update).

AMS–28 ............. 4,000 1.0000 4,000.00 0.3333 1,333.20 4,000 0.083 332.00 1,665.20 94,916.40 

All Producer Forms 

Report of Acreage 

(Old).

FSA–578 ........... 7,700 1.0000 7,700.00 0.5000 3,850.00 7,700 0.083 639.10 4,489.10 255,878.70 

Report of Acreage (Update + 60 min travel 

time).

FSA–578 ........... 20,000 1.0000 20,000.00 1.5000 30,000.00 20,000 0.083 1,660.00 31,660.00 1,804,620.00 

Laboratory Test Results Report (2 lots/ 

all producers) (Old).

AMS–22 ............ 7,700 2.0000 15,400.00 0.5000 7,700.00 7,700 0.083 639.10 8,339.10 475,328.70 

Laboratory Test Results Report (100% 

of CBD; 50% of fiber; 50% of grain) (Update).

AMS–22 ............ 8,000 1.0000 8,000.00 0.5000 4,000.00 8,000 0.083 664.00 4,664.00 265,848.00 

Total for Updates ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ 52,295.86 2,980,864.25 

Each column is a section of the burden estimate, with the cost of $57 per hour calculated in the last column. Each row represents the old or the new reporting calculations. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5663 

E-Government Act 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. We 

recognize using an electronic system 

will promote efficiencies in developing 

and implementing the new USDA 

Domestic Hemp Production Program. 

Since this is a new program, AMS is 

working to make this process as 

effective and user-friendly as possible. 

Civil Rights Review 

AMS has considered the potential 

civil rights implications of this rule on 

minorities, women, and persons with 

disabilities to ensure that no person or 

group shall be discriminated against on 

the basis of race, color, national origin, 

gender, religion, age, disability, sexual 

orientation, marital or family status, 

political beliefs, parental status, or 

protected genetic information. This 

review included persons that are 

employees of the entities who are 

subject to these regulations. This final 

rule does not require affected entities to 

relocate or alter their operations in ways 

that could adversely affect such persons 

or groups. Further, this rule does not 

deny any persons or groups the benefits 

of the program or subject any persons or 

groups to discrimination. 

This final rule reflects AMS’s 

response to public comment and input 

provided by stakeholders. The final rule 

provides States and Indian Tribes the 

regulatory authority over hemp 

production in their jurisdictions. It also 

establishes a Federal plan for hemp 

producers located in States or territories 

of Indian Tribes that do not have their 

own USDA-approved hemp oversight 

plan. There is no evidence that the final 

rule will potentially adversely or 

disproportionality impact hemp 

producers in protected groups, regions 

or Indian Tribes differently than the 

general population of hemp producers 

or State Departments of Agriculture. 

Executive Order 13132—Federalism 

AMS has examined the effects of 

provisions in this final rule on the 

relationship between the Federal 

Government and the States, as required 

by Executive Order 13132 on 

‘‘Federalism.’’ Our conclusion is that 

this rule does have federalism 

implications because the rule has 

substantial and direct effects on States, 

on the relationship between the 

National Government and States, and on 

the distribution of power and 

responsibilities among the various 

levels of government. The federalism 

implications of the rule, however, flow 

from and are consistent with the 

underlying statute. Section 297B of the 

AMA, 7 U.S.C. 1639p, directs USDA to 

review and approve State plans that 

meet statutory requirements and to 

audit a State’s compliance with its State 

plans. Overall, the final rule attempts to 

balance both the autonomy of the States 

with the necessity to create a Federal 

framework for the regulation of hemp 

production. 

Section 3(b) of E.O. 13132 recognizes 

that national action limiting the 

policymaking discretion of States will 

be imposed ‘‘. . . only where there is 

constitutional and statutory authority 

for the action and the national activity 

is appropriate in light of the presence of 

a problem of national significance.’’ 

Section 297B of the AMA is the 

statutory authority underlying the rules 

for USDA to review, approve, 

disapprove, or revoke State plans for 

hemp production. Until the passage of 

the 2018 Farm Bill, hemp was a 

Schedule I controlled substance as it fell 

within the CSA definition of marijuana. 

When hemp was exempted from the 

definition of marijuana as part of the 

2018 Farm Bill, in connection with 

removing it from that list, Congress 

established a national regulatory 

framework for the production of hemp. 

Because cannabis plants with a THC 

level higher than 0.3 are marijuana and 

on the Federal controlled substances 

list, ensuring that hemp produced under 

this program is not marijuana is of 

national significance. 

In addition to establishing a national 

regulatory framework for hemp 

production, Congress expressly 

preempted State law with regard to the 

interstate transportation of hemp. 

Section 10114 of the 2018 Farm Bill 

States that ‘‘[n]o State or Indian Tribe 

shall prohibit the transportation or 

shipment of hemp or hemp products 

produced in accordance with subtitle G 

of the Agricultural Marketing Act of 

1946 (as added by section 10113) 

through the State or the territory of the 

Indian Tribe, as applicable.’’ Thus, 

States and Indian Tribes may not 

prevent the movement of hemp through 

their States or territories even if they 

prohibit its production. Congress also 

expressly preempted a State’s ability to 

prosecute negligent violations of its plan 

as a criminal act in section 

297B(e)(2)(c). That preemption is 

incorporated into this rule. 

Section 3(d)(2) of the E.O. 13132 

requires the Federal Government to 

defer to the States to establish standards 

where possible. Section 4(a), however, 

expressly contemplates preemption 

when there is a conflict between 

exercising State and Federal authority 

under Federal statute. Section 297B of 

the AMA requires State plans to include 

six practice and procedures and a 

certification. It also expressly states that 

it does not preempt a State’s ability to 

adopt more stringent requirements or to 

prohibit the production of hemp. 

Section 297D of the AMA requires 

USDA to promulgate regulations to 

implement subtitle G of the AMA, 

which includes section 297B. Subpart B 

of the final rule repeats those 

requirements, providing more detail 

where necessary. States have wide 

latitude to develop the required practice 

and procedures. Subpart B includes 

more details on the testing and sampling 

of hemp plants to establish a national 

standard to determine whether the 

plants meet the statutory definition of 

hemp. Likewise, the final rule requires 

States to follow DEA requirements for 

disposal of marijuana for cannabis 

plants exceeding the acceptable hemp 

THC level. Finally, the final rule also 

reaffirms that States may adopt more 

stringent standards and prohibit hemp 

production within their jurisdiction. 

Section 6 of E.O. 13132 requires 

consultation with State officials in 

development of the regulations. AMS 

conducted significant outreach with 

State officials including individual 

meetings, participation in conferences 

with State officials, and listening 

sessions where State officials from all 

States were invited. During our 

consultation with the States, 

representatives from various State 

agencies and offices expressed the 

following concerns about sampling and 

testing procedures. Most requested that 

USDA adopt uniform, national 

requirements to facilitate the marketing 

of hemp. Some States advocated that 

USDA defer to each State to determine 

the appropriate procedures for its plan. 

USDA recognizes the value of a national 

standard to promote consistency while 

allowing States the flexibility to adopt 

procedures that fit their circumstances. 

As explained above, USDA is adopting 

performance standards for sampling and 

testing. As long as the procedures in the 

State plans meet those standards, AMS 

will find those procedures acceptable. 

As AMS implements this new 

program, we will continue to consult 

with State officials to obtain their 

feedback on implementation. 

Finally, we have considered the cost 

burden that this rule would impose on 

States as discussed in the Regulatory 

Impact Analysis of this document. 

AMS has assessed this final rule in 

light of the principles, criteria, and 


khammond on DSKJM1Z7X2PROD with RULES6
5664 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

requirements in Executive Order 13132. 

We conclude that this final rule: Is not 

inconsistent with that E.O.; will not 

impose significant additional costs and 

burdens on the States; and will not 

affect the ability of the States to 

discharge traditional State governmental 

functions. 

Executive Order 13175 Consultation 

and Coordination With Indian Tribal 

Governments 

AMS examined the effects of 

provisions in the final rule on the 

relationship between the Federal 

Government and Tribal governments, as 

required by E.O. 13175 on 

‘‘Consultation and Coordination with 

Indian Tribal Governments.’’ We 

concluded that the final rule does have 

substantial direct effects on Tribal 

governments, on the relationship 

between the National Government and 

Tribal governments, and on the 

distribution of power and 

responsibilities among the various 

levels of government. The effects of the 

rule, however, flow from and are 

consistent with the underlying statute. 

Section 297B of the AMA, 7 U.S.C. 

1639p, directs USDA to review and 

approve Tribal plans that meet statutory 

requirements and to audit a Tribal 

government’s compliance with its Tribal 

plans. Overall, the final rule attempts to 

balance both the autonomy of the Tribal 

governments with the necessity to create 

a Federal framework for the regulation 

of hemp production. 

As with States, Tribal governments 

will have wide latitude in adopting 

procedures including adopting 

requirements that are more stringent 

than the statutory ones. For reasons 

stated in the federalism analysis, AMS 

is adopting national standards for 

sampling, testing, and disposal of noncompliant plants that Tribal plans must 

also incorporate. 

AMS conducted extensive outreach to 

Tribal governments through individual 

discussions with Tribal representatives, 

by extending the regulatory comment 

periods and through the following more 

formal consultations. 

Tribal Consultation May 2019: On 

May 1 and 2, 2019, USDA held a formal 

Tribal consultation on the 2018 Farm 

Bill including a session on hemp 

production. This consultation occurred 

at the National Museum of the 

American Indian located in Washington 

DC. In addition to listening sessions for 

the general public, USDA hosted a 

listening session for Tribal governments 

following the formal Tribal consultation 

on May 2, 2019. USDA officials 

attended meetings with representatives 

of Tribal governments. On December 11, 

2019, roughly 41 days after the 

publication of the domestic hemp 

production program interim final rule, 

USDA held a second formal Tribal 

consultation. This consultation 

provided information on the interim 

final rule. This consultation occurred in 

Las Vegas, Nevada, and attendees 

included USDA officials, Tribal leaders, 

Tribal proxies, non-consulting Tribal 

members, non-profit representatives, 

businesses, law firms, private 

individuals, and other government 

employees. On September 24, 2020, 

USDA held a third formal Tribal 

consultation and provided information 

on the interim final rule. This 

consultation occurred virtually and 

attendees included USDA officials, 

Tribal leaders, Tribal proxies, nonconsulting Tribal members, non-profits 

representatives, Businesses, law firms, 

private individuals, and other 

government employees. 

During the May 2019 consultation, 

Tribal representatives from several 

Tribal Governments expressed their 

opinions that the 2018 Farm Bill 

permitted the USDA Secretary to allow 

AMS to approve Tribal plans ahead of 

issuing regulations of the USDA plan. 

Indian Tribes stated that approving 

hemp plans immediately would allow 

those Indian Tribes (and States) with a 

plan to begin planting for the 

commercial production of hemp in 

2019. The USDA Secretary released a 

Notice to Trade (NTT) on February 27, 

2019, to explain that Tribal and State 

plans would not be reviewed or 

approved until AMS finalized 

regulations ahead of the 2020 planting 

season. Additionally, the NTT stated 

that until regulations were in place, 

States, Indian Tribes, and institutions of 

higher education could continue 

operating under authorities of the 2014 

Farm Bill. The 2018 Farm Bill extension 

of the 2014 authority expired 12 months 

after USDA had established the plan 

and regulations required under the 2018 

Farm Bill. Congress extended this 

expiration until January 1, 2022. After 

the May Tribal consultation, USDA 

issued a second NTT on May 27, 2019, 

to clarify that Tribal governments 

through the authorities in the 2014 Farm 

Bill are permitted to grow industrial 

hemp for research purposes during the 

2019 growing season. USDA appreciates 

the urgency in which the Indian Tribes 

wish to engage in this new economic 

opportunity. We worked expeditiously 

to develop and promulgate the IFR so 

that States and Indian Tribes could 

submit their plans in time for the 2020 

season. 

Tribal Consultation December 2019: 

During this consultation Indian Tribes 

expressed how some provisions of the 

interim final rule are too rigid and that 

USDA did not consider practical 

problems and potential economic harm 

faced by Indian Tribes under the 

program. 

Indian Tribes requested more 

extensive Tribal consultation and the 

inclusion of other agencies involved in 

hemp production and enforcement. In 

response, USDA extended the public 

comment date by thirty additional days 

to January 29, 2020 and agreed to 

conduct an additional consultation after 

the first growing season. AMS also 

reopened the public comment period for 

thirty days in the Fall of 2020. 

Tribal Consultation September 2020: 

Consultation also occurred on 

September 24, 2020. 

Based on the comments and 

consultations received, we made 

changes to the final regulations. 

Although Indian Tribes will still incur 

costs in complying with final rule, those 

costs should be outweighed by the 

benefits that the Indian Tribes realize in 

commercial hemp production occurring 

within their territories. 

Executive Order 13175 

This rule has been reviewed in 

accordance with the requirements of 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments. Executive Order 13175 

requires Federal agencies to consult and 

coordinate with tribes on a governmentto-government basis on policies that 

have tribal implications, including 

regulations, legislative comments or 

proposed legislation, and other policy 

statements or actions that have 

substantial direct effects on one or more 

Indian tribes, on the relationship 

between the Federal Government and 

Indian tribes or on the distribution of 

power and responsibilities between the 

Federal Government and Indian tribes. 

The USDA’s Office of Tribal Relations 

(OTR) has assessed the impact of this 

rule on Indian tribes and determined, in 

agreement with AMS, that this rule has 

substantial direct tribal implications 

that require continued outreach efforts 

to determine if tribal consultation under 

E.O. 13175 is required. Based on AMS 

outreach efforts to date, OTR does not 

believe that tribal consultation is 

necessary at this time. If a tribe requests 

consultation AMS will work with the 

OTR to ensure meaningful consultation 

is provided where changes, additions, 

and modifications identified herein are 

not expressly mandated by Congress. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5665 

Executive Orders 12866, 13563, and 

13771 

Executive Orders 12866 and 13563 

direct agencies to assess all costs and 

benefits of available regulatory 

alternatives when an action is deemed 

to have significant impacts. If regulation 

is necessary, then agencies must select 

the action that maximizes net benefits, 

including potential economic, 

environmental, public health and safety 

effects, and equity. This rule meets the 

definition of an economically significant 

regulatory action under Executive Order 

12866, as it is likely to result in an 

annual effect on the economy of $100 

million or more. USDA considers this to 

be a deregulatory action as it allows the 

development of a niche market that 

cannot exist under the state pilot 

programs authorized under the 

Agricultural Act of 2014 (2014 Farm 

Bill). This action finalizes the interim 

final rule published on October 31, 

2019, that expanded production options 

and enabled interested farmers to grow 

hemp. 

Executive Order 13771 mandates that 

agencies provide the best approximation 

of total costs associated with a new or 

repealed regulation. AMS has prepared 

this Regulatory Impact Analysis with 

the purpose of accomplishing these 

objectives. USDA considers this to be a 

deregulatory action under Executive 

Order 13771 as it allows for the 

development of a niche market that 

cannot exist under current regulation. 

This rule removes barriers to entry and 

enables domestic farmers to grow hemp. 

Regulatory Impact Analysis 

Regulations must be designed in the 

most cost-effective manner possible to 

obtain the regulatory objective while 

imposing the least burden on society. 

This rule finalizes and updates the 

interim final rule that established a 

national regulatory oversight program 

for the production of hemp. This 

program is necessary to effectuate the 

mandate in the Agriculture 

Improvement Act of 2018, known as the 

2018 Farm Bill, to coordinate State and 

Tribal government hemp production 

regulations with the newly established 

federal regulations for hemp production 

in States and Indian Tribes not 

regulated by State or Tribal plans. This 

program is intended to provide 

consistency in production, sampling 

and testing of hemp product to ensure 

compliance with the acceptable hemp 

THC level. 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform, and is not intended to have 

retroactive effect. The discussions on 

Executive Orders 13132 (Federalism) 

and 13179 (Consultation and 

Coordination with Tribal Governments), 

above, address the extent to which the 

rule preempts State law, and the 

impacts of the rule to Tribal 

governments. The discussion above 

regarding appeals under new part 990, 

subpart D, describes the administrative 

procedures that must be exhausted prior 

to a judicial challenge. 

Introduction 

On October 31, 2019, USDA 

promulgated an interim final rule 

establishing a national program for the 

production of industrial hemp. A 

regulatory analysis was performed in 

support of that regulation and published 

as part of the preamble to that rule. This 

analysis is intended to update the 

previous analysis to reflect additional 

information gained through the first 

year of operation of that program and to 

assess whether any of the modifications 

to the program made in response to 

public comment have significant 

impacts on the estimated costs or 

benefits of the final program. 

In the IFR, AMS estimated lower and 

upper bounds to calculate the total net 

benefits of the rule to society at large. 

These net benefits were calculated for 

2020 through 2022 only due to lack of 

data for future years. In the IFR, 2020 

estimated net benefits ranged from a 

loss of nearly $4 million to a gain of 

$17.6 million; for 2021, a net benefit of 

$23 million to $46 million; and, for 

2022, a net benefit of nearly $49 million 

to $74 million. In this final rule, the 

estimated net benefits, as shown in 

Table 12, are $46 million in 2020; $87 

million in 2021; $135 million in 2022; 

$190 million in 2023; $226 million in 

2024; and, $351 million in 2025. 

The estimates of net benefits resulting 

from this final rule differ from those in 

the IFR due to a variety of factors. First 

of these is the large increase in planted 

acreage and market entrants in 2019, the 

scale of which was unexpected. (There 

may be other unexpected changes due to 

the pandemic, but we cannot estimate 

those at this time.) Changes in other 

variables, as well, contributed to the 

increase in net benefits in the final rule 

over the IFR. A comparison of the 

variables that are assumed constant 

(across years 2020 through 2025) in the 

IFR and the final rule is shown in Table 

1 below. In the year between 

publication of the IFR and this final 

rule, additional information regarding 

the hemp industry has emerged to the 

benefit of this analysis. AMS believes 

that the modifications to the analysis 

from the IFR to the final rule represent 

the state of the hemp industry to the 

greatest extent practicable. The 

modifications in this final rule are 

intended to further support the hemp 

marketplace and provide the greatest 

flexibility possible while still ensuring 

the program complies with the 2018 

Farm Bill. 

AMS suspects that this rule, 

compared to the IFR, will incentivize 

participation in the market and allow 

for more farmers to be successful. In 

particular, AMS attributes this to two 

policies. First, AMS anticipates that the 

flexibilities in disposal and remediation 

of non-compliant hemp will help 

minimize the risk to farmers, therefore 

increasing participation in the industry. 

Second, AMS anticipates that the 

increased threshold for negligent hemp 

(from 0.5 percent to 1.0 percent) will 

also reduce risk to farmers and allow for 

more innovation. 

AMS received numerous comments 

providing data on the different aspects 

of the hemp industry, that while 

informative, could not be incorporated 

in the RIA due to such factors as they 

were too regionally focused, small in 

sample size, or lacked the depth of data 

points to be representative of the 

national hemp market. An example of 

this is the portion of retests performed 

on hemp samples that initially tested 

higher than 0.3 percent THC. 


khammond on DSKJM1Z7X2PROD with RULES6
5666 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

33 Kentucky Department of Agriculture. 

The 2014 Farm Bill defined hemp as 

the plant Cannabis sativa L. and any 

part of that plant with concentrations of 

THC no greater than 0.3 percent on a 

dry weight basis. While belonging to the 

same species as the plant that produces 

marijuana, hemp is distinctive from 

marijuana in its chemical makeup. The 

marijuana plant contains high levels of 

the cannabinoid delta-9 

tetrahydrocannabinol (THC), which is 

the chemical that produces 

psychoactive effects. Hemp may contain 

no greater than 0.3 percent THC on a 

dry weight basis. 

Prior to the 2014 Farm Bill, hemp had 

never been designated in a Federal law 

as different from cannabis generally. 

The first regulation of hemp occurred in 

1937 with the Marihuana Tax Act, 

which required all producers of the 

species Cannabis sativa to register with 

and apply for a license from the Federal 

government. The ‘‘Hemp for Victory’’ 

Campaign during World War II 

promoted production of hemp for rope 

to be used by U.S. military forces. At the 

end of the war, however, the 

requirements in the Marihuana Tax Act 

resumed. In 1970, Congress passed the 

Controlled Substances Act, granting the 

Attorney General the authority to 

regulate production of cannabis, 

including hemp. 

The 2014 Farm Bill authorized pilot 

programs, as permitted by State law, for 

hemp cultivation for research purposes 

to be administered by academic 

institutions and State departments of 

agriculture. By 2019 approximately half 

of the states had developed such a pilot 

program. The research under these pilot 

programs included market research, 

which allowed cultivated hemp to enter 

the stream of commerce as inputs into 

various consumer products. For 

example, in Kentucky, one of the first 

states to enact a pilot program, producer 

sales to processors totaled $1.6 million 

in 2016, $7.5 million in 2017, $17.7 

million in 2018, and $51.3 million in 

2019.33 Hemp biomass contains 

concentrations of the cannabinoid 

cannabidiol, known as CBD. High prices 

for hemp harvested for cannabinoids, 

relative to those of other agricultural 

commodities, have fueled producer 

interest in hemp production since 2014. 

2018 Farm Bill 

The 2018 Farm Bill allowed the 

production and sale of industrial hemp 

either under a State or Tribal program 

approved by the USDA or under a 

Federal license for producers in areas 

with no approved plan and no explicit 

State or Tribal statute prohibiting the 

production of hemp. The 2018 Farm Bill 

explicitly preserved the authority of the 

U.S. Food and Drug Administration 

(FDA) to regulate hemp products under 

the Federal Food, Drug, and Cosmetic 

Act (FD&C Act) and section 351 of the 

Public Health Service Act (PHS Act). 

Accordingly, products containing 

cannabis and cannabis-derived 

compounds are subject to the same 

authorities and requirements as FDAregulated products containing any other 

substance. The 2018 Farm Bill removed 

hemp from the list of controlled 

substances, decontrolling hemp 

production in all U.S. States, territories, 

and lands belonging to Indian Tribes, 

unless prohibited by State or Tribal 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.031</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5667 

34Sources include the following: State 

Departments of Agriculture; Vote Hemp. 2016–2019 

Crop Reports; and, Mark, Tyler, Jonathan Shepherd, 

David Olson, William Snell, Susan Proper, and 

Suzanne Thornsbury. February 2020. Economic 

Viability of Industrial Hemp in the United States: 

A Review of State Pilot Programs, EIB–217, U.S. 

Department of Agriculture, Economic Research 

Service. 

Law. This action eliminates the 

uncertain legal status at the Federal 

level of hemp production and allows the 

U.S. Department of Agriculture (USDA) 

to provide hemp producers with crop 

insurance programs, potentially 

reducing risk to producers and 

providing easier access to capital. The 

statute also prohibits interference in the 

interstate transport of hemp by States, 

including those States that prohibit 

hemp production and sales. As a result, 

hemp producers will have access to 

nationwide markets. 

Need for Regulation 

The rule is necessary to facilitate the 

domestic cultivation of hemp for sale 

into the market for hemp products by 

creating a set of minimum standards to 

ensure that hemp being produced under 

this program meets all statutory 

requirements. The rule establishes 

minimum requirements for States and 

Indian Tribes to obtain program 

approval and, for producers operating 

under the Federal program to obtain a 

license and meet operating requirements 

under that license. Without these 

provisions, it would not be possible to 

grow hemp legally. 

Both the declassification of hemp, and 

the prohibition on interference with 

interstate transportation apply to hemp 

that is grown under an approved State 

or Tribal plan, or under a Federal 

license. As a result, this regulation 

facilitates provisions of the 2018 Farm 

Bill that would otherwise be selfimplementing. 

Overview of the Action 

The 2018 Farm Bill granted regulatory 

authority of domestic hemp production 

to the State departments of agriculture, 

Tribal governments, and USDA. States 

and Indian Tribes wishing to operate 

their own programs must submit to 

USDA plans that include provisions for 

maintaining information regarding the 

land on which hemp is produced, for 

testing the levels of THC, for disposal of 

plants that do not meet necessary 

requirements, and for procedures to 

ensure compliance with the 

requirements of the new part, including 

background checks of all key 

participants. State and Tribal Plans 

must be approved by USDA. This rule 

outlines requirements by which the 

USDA would approve plans submitted 

by States and Tribal governments for 

oversight of hemp production. The 2018 

Farm Bill also directs USDA to develop 

a plan for use by hemp producers in 

States or Indian Tribes where no State 

or Tribal Plan has been approved and 

that do not prohibit the cultivation of 

hemp. These actions will promote 

consistency in regulations governing the 

legal production of hemp across the 

country. 

Baseline Definition 

The 2014 Farm Bill authorized hemp 

research pilot programs to be 

administered by states and universities. 

The 2018 Farm Bill repealed these pilot 

programs beginning one year from the 

publication of a USDA rule; however, 

the 2021 Continuing Appropriations Act 

extended the authorization of the 2014 

pilot programs until January 1, 2022. 

From 2014 to 2018, planted acreage 

tripled in every year, reaching nearly 

63,500 acres in 2018. In the year 

following the signing of the 2018 Farm 

Bill, planted acreage increased by more 

than 400 percent to 327,600 acres in 

2019.34 The surge of entrants into the 

hemp market in 2019 left many 

producers with unsold inventory. In 

Kentucky alone, more than $100 million 

of hemp material went unsold due to 

lack of buyers in 2019. The large 

number of entrants into the market in 

2019 caused a surplus of hemp 

production, which in turn caused prices 

to fall and revenue losses to producers. 

Despite the producer excitement that 

ensued in 2019 following the signing of 

the 2018 Farm Bill, only 17 states opted 

to participate in the new hemp 

programs in time for the 2020 growing 

season. These 17 states accounted for 

about 20 percent of the total estimated 

planted acreage in 2020. Given the 

apparent affinity by states for the 2014 

pilot programs, AMS assumes that in 

the absence of the 2018 Farm Bill, the 

2014 Farm Bill pilot programs would 

have continued indefinitely. Indeed, the 

2014 Farm Bill offered no sunset date 

for these programs. In order to capture 

the impacts of this rule on affected 

entities, AMS attributes 20 percent of 

the estimated planted acreage from 2020 

through 2025 to the 2018 Farm Bill and 

this rule which enables its 

prescriptions. This 20 percent reflects 

the amount of planted acreage in the 17 

states that opted to participate in the 

2018 Farm Bill hemp programs for the 

2020 growing season. The 2020 growing 

season was the final opportunity for 

producers to cultivate hemp under the 

2014 pilot programs until the 2021 

Continuing Appropriations Act 

extended the authorization of the 2014 

pilot programs to January 1, 2022. By 

enrolling in the new hemp programs, 

these 17 states expressed a preference 

for the hemp programs authorized by 

the 2018 Farm Bill over the 2014 Farm 

Bill pilot programs. The remaining 80 

percent of planted acreage estimated 

from 2020 through 2025 will be treated 

as attributable to the 2014 pilot 

programs under the assumption that 

they would have continued in the 

absence of the 2018 Farm Bill which 

terminated them. 

In the interim final rule (IFR), AMS 

attributed 50 percent of the growth in 

producer sales from 2020 through 2022 

to the 2018 Farm Bill and this enabling 

rule. In deriving this assumption, AMS 

considered the rate at which hemp 

acreage had increased in recent years, 

the number of States whose hemp pilot 

programs produced a crop in recent 

years, and the number of States that 

passed legislation following the signing 

of the 2018 Farm Bill in anticipation of 

this rule’s enactment in time for the 

2020 growing season. In the time 

between publication of the IFR on 

October 31, 2019, and the beginning of 

the 2020 growing season, 17 states 

representing 20 percent of planted 

acreage opted to participate in the hemp 

programs mandated by the 2018 Farm 

Bill. This portion of enrollment is less 

than AMS anticipated in the IFR. 

Affected Entities 

As of July 2020, States, Indian Tribes, 

and USDA had issued 19,121 producer 

licenses. This figure represents licenses 

issued in 44 States and one Tribe. About 

70 percent of states reported at the time 

that they were still accepting 

applications, which indicates that the 

number of 2020 producer licenses 

issued is likely to grow. For this reason, 

AMS estimates that up to 20,000 

producer licenses will be issued in 

2020. Based on the slowed pace in 

growth of producer licenses from 2019 

to 2020, AMS assumes an annual 

growth rate in producer licenses of 10 

percent from 2020 through 2025, for the 

purposes of this analysis. The result is 

shown in Table 2. AMS is unaware of 

any estimates that exist regarding the 

number of producer licenses that will be 

issued in the coming years; however, 

the novelty of hemp as a commercial 

agricultural commodity, the resolutions 

of uncertainty surrounding regulations, 

the expected growth in demand for 

existing and new hemp products, and 

the effective establishments of State, 

Tribal, and Federal hemp programs may 


khammond on DSKJM1Z7X2PROD with RULES6
5668 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

35ERS. Price Spreads from Farm to Consumer. 

September 2020. 

continue to draw producers into the 

market. 

TABLE 2—ESTIMATED PROJECTION OF NUMBER OF PRODUCER LICENSES ISSUED

Year 2020 2021 2022 2023 2024 2025 

Growers .................................................... 20,000 22,000 24,200 26,620 29,282 32,210 

Sources and notes: 

2020 figure based on July 2020 National Industrial Hemp Regulators conference call. 

2021–2025 figures based on assumed annual growth rate of 10% in producer licenses. 

As of the writing of this analysis, 

three states had opted to participate in 

the USDA Federal Plan authorizing 

producers to cultivate hemp. These 

states are Hawaii, Mississippi, and New 

Hampshire. Together, they represent 

more than 300 producers in 2020. The 

number of licensed producers 

participating in the Federal Plan is 

likely to grow over time due to both 

greater entrance of producers into the 

market in these three states and 

additional states, Indian Tribes, and 

territories opting to participate in the 

USDA Plan. At the end of 2020, less 

than 2 percent of the total number of 

producers were licensed by USDA. The 

extension of the 2014 pilot programs to 

2022, which was included in the 2021 

Continuing Appropriations Act 

published October 1, 2020, resulted in 

fewer producers participating in the 

USDA Plan. Prior to the extension of the 

2014 pilot programs, the portion of 

participants under the USDA Plan was 

about 10 percent of the total number of 

2020 producers, with the expectation for 

further enrollment. For the purposes of 

this analysis, therefore, AMS assumes 

that 20 percent of the total number of 

licensed producers will be participants 

of the USDA Plan, and the remaining 80 

percent will be participants of a State or 

Tribal Plan. 

In addition to hemp producers, this 

rule will impact state departments of 

agriculture, Tribal governments, and 

USDA as these entities will bear the 

responsibility to ensure that hemp 

producers abide by the State and Tribal 

Plans and the USDA Plan for regulating 

hemp. At the time this document was 

written, more than 40 Indian Tribes, at 

least 40 states, and two U.S. territories 

had plans approved by USDA or were 

in the process of submitting plans for 

USDA approval. At least three states 

have opted to participate in the USDA 

plan, and one state and one territory 

await legislation authorizing hemp 

production. AMS anticipates receiving 

further interest in both the Federal Plan 

and the plans administered by states, 

Indian Tribes, and territories in the 

coming months when the provisions of 

the 2014 Farm Bill expire and States 

and Tribes start implementing their 

programs. For the purposes of this 

analysis, AMS assumes that 100 states, 

Indian Tribes, and territories will 

administer their own plans in every year 

from 2020 through 2025. AMS 

acknowledges that this number is likely 

to change from year to year, depending 

on market conditions, which affect the 

ability of a state, tribe, or territory to 

manage its own hemp program. Because 

AMS has no way to predict future 

market or state political conditions, for 

simplicity, it assumes a constant of 100 

states, Indian Tribes, and territories 

administering their own plans from 

2020 through 2025. 

Finally, this rule will impact 

laboratories that will provide testing 

services to producers and program 

administrators. As of the writing of this 

analysis, there were 67 laboratories that 

test hemp that are registered with the 

DEA. USDA is requiring that all samples 

tested for THC concentration levels be 

conducted in DEA-registered 

laboratories; however, enforcement of 

this requirement has been delayed until 

December 31, 2022. 

Expected Costs and Benefits of the Rule 

The 2018 Farm Bill grants 

authorization for production of hemp to 

all states and Indian Tribes, unless 

prohibited by State or Tribal Law. This 

rule enables states, Indian Tribes, and 

USDA to regulate this authorization. 

This rule is expected to generate 

benefits and costs to hemp producers, 

state departments of agriculture, Tribal 

governments, USDA, and laboratories. 

The benefits of this rule are expected to 

outweigh the costs, however, and the 

burden on the impacted entities is 

anticipated to be minimal. 

Producers 

Using figures from Hemp Industry 

Daily and the Brightfield Group, AMS 

estimates retailer sales of hemp 

products to range from $2.5 billion in 

2020 to nearly $17 billion in 2025. 

Based on price spreads from farm to 

consumer, published by the Economic 

Research Service (ERS), AMS assumes a 

pass-through rate of 20 percent from 

retailer to producer.35 AMS also 

assumes that import values account for 

15 percent of the producer share of 

retail sales. This estimate was derived 

using 2019 and 2020 import data from 

the Foreign Agricultural Service (FAS) 

of USDA. At the time of this analysis, 

import data for 2020 was only available 

for the months of January through 

August. In order to gauge what total 

2020 imports might be, AMS applied to 

the figure of total imports for January 

through August 2020 ($55 million) the 

average percentage change that occurred 

in the four months from August through 

December of recent years (40 percent). 

Applying the assumptions of 20 percent 

price pass-through from retailer to 

producer and import values of 15 

percent of the producer share of retail 

sales to the estimates of retailer sales 

results in estimated total producer sales 

of $432 million in 2020 to $2.9 billion 

in 2025, shown in Table 3. 

TABLE 3—ESTIMATED RETAILER AND PRODUCER HEMP PRODUCT SALES

[Millions] 

Year 2020 2021 2022 2023 2024 2025 

Total retailer sales 1 ................................. $2,540 $4,485 $6,740 $9,310 $10,995 $16,800 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5669 

TABLE 3—ESTIMATED RETAILER AND PRODUCER HEMP PRODUCT SALES—Continued 

[Millions] 

Year 2020 2021 2022 2023 2024 2025 

Producer share of retail sales 2 ............... 508 897 1,348 1,862 2,199 3,360 

Imports 3 ................................................... 76 135 202 279 330 504 

Total producer sales 4 .............................. 432 762 1,146 1,583 1,869 2,856 

1 Retailer sales estimates based on the following stores: 2020–2024 estimates from Hemp & CBD Industry Facebook 2019, Hemp Industry 

Daily, ‘‘Annual U.S. Hemp-Derived CBD Retail Sales Estimates.’’ Published October 16, 2019. 2025 estimate from Brightfield Group. ‘‘US CBD 

Market Forecast Reduced Due to Health Consolidation.’’ Published July 31, 2020. 2Product of total retailer sales and 20% share of retail sales passed to producers; estimate of 20% share of retailer prices based on Economic 

Research Service publications of ‘‘Price Spreads from Farm to Consumer’’. 3Assumes imports account for 15% sales at the producer level; source for assumption is FAS 2015–2019 import data, HTS codes 

1207990320 and 5302100000. 4 Difference of producer share of retail sales and imports. 

The estimates in Table 3 reflect total 

producer sales in aggregate. AMS is 

unaware of any data that currently 

exists that would indicate sales by 

individual producer. Given the varied 

nature of the hemp industry, producer 

sizes are anything but uniform; 

therefore, AMS has not attempted to 

project sales by individual producer as 

it would likely result in false 

conclusions and misleading 

information. Similarly, data comparing 

sales by producers under the 2018 Farm 

Bill and what sales under the 2014 Farm 

Bill may have been in the absence of the 

2018 Farm Bill does not currently exist. 

Further, AMS believes that this estimate 

would not differ greatly given the 

greater access to nationwide markets 

and flexibilities provided to producers 

under the 2018 Farm Bill. 

In addition, AMS acknowledges that 

raw harvested hemp product may take 

years to enter the retail market after it 

passes through the supply chain. For 

instance, product sold at the retail level 

in 2021 may include hemp that was 

harvested in 2019. In acknowledging 

this, AMS understands that the 

estimated producer sales for a given 

year in Table 3 may not represent actual 

producer sales for that year, but rather, 

sales from prior years. AMS is unaware 

of any data that exists that would 

identify when a harvested hemp crop is 

sold into the retail market. For the 

purposes of this analysis, therefore, and 

for simplicity, AMS assumes that the 

producer sales estimated in Table 2 

represent sales at the producer level for 

the same year as the retail sales from 

which they are derived. 

As discussed in the ‘‘Baseline 

Definition’’ section of this analysis, 

AMS estimates that 20 percent of the 

producer planted acreage from 2020 

through 2025 will be attributable to the 

2018 Farm Bill and this rule which 

enables its prescriptions. This 20 

percent reflects the amount of planted 

acreage in the 17 states that opted to 

participate in the 2018 Farm Bill hemp 

programs in time for the 2020 growing 

season. The 2020 growing season was 

the final opportunity for producers to 

cultivate hemp under the 2014 pilot 

programs. By enrolling in the new hemp 

programs, these 17 states expressed a 

preference for the hemp programs 

authorized by the 2018 Farm Bill over 

the 2014 Farm Bill pilot programs. The 

remaining 80 percent of producer 

planted acreage estimated from 2020 

through 2025 will be treated as 

attributable to the 2014 pilot programs 

under the assumption that they would 

have continued in the absence of the 

2018 Farm Bill which terminated them. 

In Table 4, AMS has calculated total 

planted acreage inclusive of all 

domestic producers, using the estimates 

of total producer sales in Table 3 and 

assumptions that are stated and cited in 

the table. From the estimates of total 

planted acreage in Table 4, AMS 

calculated the planted acreage due to 

the rule in Table 5, along with the 

estimate of sales attributable to the rule. 

These estimates of sales due to the rule 

will be referenced as the benefits of the 

rule to producers in the calculation of 

net benefits in Table 10. 

BILLING CODE P 


khammond on DSKJM1Z7X2PROD with RULES6
5670 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

36The Kentucky Department of Agriculture is 

widely recognized as a reliable source for hemp 

market data as it has collected data from its 

producers since the inception of its hemp program 

in 2014. Much of this data is publicly available and 

was cited by many commenters. 

BILLING CODE C 

To calculate total planted acreage 

nationwide in Table 4, from which 

planted acreage due to this rule will be 

estimated in Table 5, AMS assumed the 

following to remain constant in each 

year from 2020 through 2025: Portion of 

total sales by intended use; yields by 

intended use; prices per pound by 

intended use; portions of harvested 

volume sold by intended use; and the 

portion of planted acreage that is 

typically harvested. Using 2019 

producer data from the Kentucky 

Department of Agriculture, AMS 

estimates that of total sales of hemp 

products, cannabinoids accounts for 99 

percent, and fiber and grain each 

account for 0.5 percent. Also based on 

data from the Kentucky Department of 

Agriculture, AMS estimates that 65 

percent of the harvested volume of 

hemp for cannabinoids is sold, 90 

percent of hemp harvested for fiber is 

sold, and 95 percent of hemp harvested 

for grain is sold.36 This assumption is 

also referenced in Table 5. AMS 

compared the hemp enterprise budgets 

published by seven different academic 

institutions for yield estimates which 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.032</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5671 

37The Jacobsen Publishing Company. Weekly 

hemp prices from July 2019 through August 2020. 

represent the growing conditions across 

the country. Aside from these seven, 

AMS is unaware of any other hemp 

enterprise budgets published by an 

academic institution. 

Based on 2019 and 2020 prices 

published by the Jacobsen, AMS 

assumes constant per-pound prices for 

cannabinoids, fiber, and grain of $3.90, 

$0.09, and $0.53, respectively.37 AMS 

acknowledges that prices are unlikely to 

remain constant from year to year, 

particularly for cannabinoids; however, 

AMS has considered 68 weeks of 

cannabinoids prices in determining its 

estimate of $3.90 per pound. This price 

assumes 6 percent CBD at $0.65 per 

CBD percentage per pound. Using these 

prices and yield estimates, AMS 

calculated a price per acre for each 

intended use of hemp. Finally, the 

assumption that 75 percent of planted 

acreage is harvested was estimated 

using data from multiple state 

departments of agriculture. The 

assumed constants of the portion of 

planted acreage that is harvested, yield 

by intended use, portion of harvested 

volume that is sold, and prices by 

intended use are also utilized in Table 

5. 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.033</GPH>
5672 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

38NASS. Quick Stats. Variable ‘‘Corn, grain— 

production, measured in $’’ divided by variable 

‘‘Corn, grain—acres harvested’’. 

In addition to the assumptions 

already identified in reference to Table 

4, AMS assumes constant the portion of 

planted acreage due to the rule and 

portions of planted acreage by intended 

use. As described in the ‘‘Baseline 

Definition’’ section, AMS assumes that 

20 percent of total planted acreage can 

be considered as attributable to the rule. 

This proportion represents the amount 

of planted acreage of the states that had 

plans approved by USDA for a hemp 

production program, as authorized by 

the 2018 Farm Bill, in time for the 2020 

growing season. The 2020 growing 

season was the final opportunity for 

producers to cultivate hemp under the 

2014 pilot programs. By enrolling in the 

new hemp programs, these states 

expressed a preference for the hemp 

programs authorized by the 2018 Farm 

Bill over the 2014 Farm Bill pilot 

programs. 

The Jacobsen estimated that of total 

planted acreage in 2020, 80 percent was 

for cannabinoids, 3 percent was for 

fiber, and 17 percent was for grain. AMS 

acknowledges that planted acreage by 

intended use is likely to change from 

year to year as a result of market 

conditions. The portion of acreage 

intended for cannabinoids has, indeed, 

decreased from its levels in 2019, with 

grain and fiber gaining greater consumer 

attention. AMS is unaware of any data 

that forecasts planted acreage by 

intended use in years beyond 2020. For 

the purposes of this analysis, and for 

simplicity, therefore, AMS assumes 

constant the portions of planted acreage 

by intended use as reported for 2020. 

To reiterate, AMS is aware that raw 

hemp product at the producer level may 

take years to enter the retail market. The 

analysis in Tables 4 and 5 is meant to 

show potential consumer demand for 

hemp products at the producer level in 

years 2020 through 2025, and not 

necessarily the producer sales of hemp 

cultivated in these specific years. These 

estimates are sensitive to changes in 

price. Because planted acreage is 

derived from total sales, a change in 

price causes an inverse change in the 

estimate of planted acreage; however, 

the relationship between price and sales 

is, of course, positive. 

Many states reported to AMS that the 

land on which hemp is currently grown 

was previously utilized for cultivation 

of corn. Using data from the National 

Agricultural Statistics Service (NASS) 

on the production value of corn for 

grain and acres harvested, AMS 

determines a value per harvested acre of 

corn of $630. This value is a national 

average of the three-year period of 2017 

through 2019, which are the most recent 

years for which data is available.38 For 

the purposes of this analysis, this value 

of $630 per acre will serve as the 

opportunity cost to hemp producers. 

The opportunity cost is the potential 

returns that are foregone in pursuit of an 

alternative. The potential foregone 

returns, in this case, are $630 per acre 

for corn cultivation; and, the alternative 

is hemp cultivation. Applying this value 

to the estimates of acreage required to 

meet estimated producer sales as 

calculated in Table 5 results in the total 

opportunity cost to producers in years 

2020 through 2025 as shown in Table 6. 

TABLE 6—CALCULATION OF OPPORTUNITY COST OF HEMP CULTIVATION UNDER RULE

2017–2019 average returns per acre of corn for grain 1 ..................................................................................................................... $630 

Year 2020 2021 2022 2023 2024 2025 

Planted acres due to rule 2 ...................... 31,820 56,187 84,437 116,633 137,742 210,465 

Opportunity cost (millions) 3 ..................... $20 $35 $53 $73 $87 $133 

Sources and notes: 

1 National Agriculural Statistics Service (NASS). 

2See Table 5 estimate calculation. 

3Product of 2017–2019 average retunns per acre of corn for grain and acres worth of hemp sold. 

In the IFR, AMS calculated an 

opportunity cost of $591 per acre, using 

an average of returns per acre for all 

cropland, weighted by area planted or 

bearing. This estimate utilized NASS 

crop totals for fruits, vegetables, and 

traditional field crops. At the time of the 

writing of the IFR, AMS had little 

information as to the prior uses of land 

currently being cultivated for hemp. To 

address this in the final rule, AMS 

sought input from state departments of 

agriculture, most of which reported that 

the land on which hemp is currently 

grown was previously utilized for 

cultivation of corn. 

AMS has modified its sampling and 

testing requirements, which are 

described in the section in this rule 

titled ‘‘Sampling for total THC’’, to 

allow for ‘‘performance-based 

sampling’’. A performance-based 

protocol must have the potential to 

ensure at a confidence level of 95 

percent that no more than one percent 

of the plants in each lot would exceed 

the acceptable hemp THC level. 

Performance-based sampling achieves 

defined objectives and focuses on 

results. It differs significantly from a 

prescriptive action in which licensees 

are provided detailed direction on how 

those results are to be obtained. A 

performance-based approach would 

simply set a performance objective (e.g., 

reliability of 95 percent) and allow the 

States and Indian Tribes considerable 

freedom in how to achieve that 

reliability objective with their sampling 

methodology. 

To estimate the number of lots to be 

sampled in each year, AMS employs the 

Cochran Formula: 

where n0 is the sample size, Z is the zvalue associated with a confidence 

interval, p is the estimated proportion of 

the population that has the attribute in 

question, and e is the margin of error or 

the desired level of precision. 

Inserting the z-value that corresponds 

to a 95 percent confidence interval, 

assuming maximum variability for p at 

50 percent, and applying the margin of 

error of one percent results in the 

following sample size: 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.034</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5673 

The Cochran Formula assumes an 

unlimited population size; however, the 

formula can be modified to return a 

smaller sample size for a finite 

population: 

where n is the modified sample size, n0

is the Cochran Formula sample size, and 

N is the population size. 

Table 7 shows the number of sampled 

lots, n, required for a 95 percent 

confidence interval and one percent 

margin of error for each year’s total 

number of lots, N. The total annual cost 

of sampling and testing borne by 

producers is calculated using a cost per 

lot of $565, which was estimated using 

hourly rates for inspectors and for 

laboratory services of $75 and $98, 

respectively; two hours, apiece, spent 

sampling, driving, and testing; 120 

miles driven; and, $0.58 per mile 

compensation. In its calculation of total 

number of lots from total planted 

acreage, AMS utilized the portions of 

planted acreage by intended use, 

introduced in Table 5, and data from the 

Farm Service Agency (FSA) from which 

average lot sizes for hemp by intended 

use were derived. 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.035</GPH> ER19JA21.036</GPH>
5674 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

Some portion of tested lots are likely 

to return results with THC 

concentrations greater than 0.3 percent. 

To estimate this percentage, AMS 

utilized data, specific to this very 

question, collected by the National 

Industrial Hemp Regulators during a 

November 2019 meeting. The average 

portion of tests that would return results 

of THC concentrations greater than 0.3 

percent, weighted by the number of tests 

administered in each state, was 25 

percent. In Table 8, AMS applies this 

percentage to estimate total 

noncompliant lots in each year and the 

cost to dispose of noncompliant acreage. 

AMS is aware of other estimates of THC 

concentration failure rates. As of 

November 2020, States and Tribes 

operating under the 2018 Farm Bill 

reported 4,192 licensed producers 

representing 6,166 acres planted. Of 

these acres planted, approximately 12 

percent were destroyed due to THC 

levels exceeding 0.3 percent. This data, 

however, is limited because many 

approved plans have not all been fully 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.037</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5675 

implemented. USDA expects more data 

will be available as the 2021 season 

begins and States and Tribes implement 

their programs. 

AMS has issued guidance on 

approved methods for disposal of 

noncompliant hemp material, including 

plowing under, mulching or 

composting, disking, bush mowing or 

chopping, deep burial, and burning. 

AMS requires disposal of noncompliant 

hemp using one of these methods. 

Discussion with state departments of 

agriculture and producers led AMS to 

estimate an average of 15 minutes per 

acre required to dispose of 

noncompliant material. This 15-minute 

estimate is an average across all disposal 

methods. According to the May 2019 

Occupational Employment Statistics 

Survey of the Bureau of Labor and 

Statistics, the mean hourly wage of a 

compliance officer is $35. Assuming 39 

percent of total compensation accounts 

for benefits, then total compensation of 

a compliance officer is $57 per hour. 

This is described in the Paperwork 

Reduction Act (PRA) section of this 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.038</GPH>
5676 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

rule. Applying the total hourly salary of 

a compliance officer to the disposal time 

per acre of hemp results in a per acre 

cost of $14.25 for disposal of 

noncompliant hemp acreage. 

The PRA section details the burdens 

of reporting and recordkeeping and their 

associated costs. Table 9 shows the 

calculations of the reporting and 

recordkeeping costs to producers that 

will be imposed by this rule. All 

assumptions in this table have been 

previously introduced. The PRA section 

describes how each estimate of time was 

calculated per required form. 

In order to obtain a producer license, 

AMS requires that each producer, or key 

participant of a business entity, submit 

to a background check, or criminal 

history report, at least every three years. 

A key participant is a person with a 

direct or indirect financial interest in 

the hemp-producing entity, including a 

chief executive officer, a chief operating 

officer, and a chief financial officer. The 

cost of a criminal history report 

conducted by the Federal Bureau of 

Investigation (FBI) is $18 per record. For 

the purposes of this analysis, AMS 

assumes each producer license to 

represent three key participants. The 

total annual cost of a background check 

for three key participants every three 

years at minimum is $18 per producer. 

The producer net benefits of this rule 

to society are shown in Table 10. 

Subtracted from producer sales due to 

the rule are the opportunity costs of the 

land on which hemp is currently grown; 

sampling and testing costs; disposal of 

noncompliant acreage; reporting and 

recordkeeping burdens; and, annual 

background checks. The producer net 

benefits of this rule to society range 

from $49 million in 2020 to $357 

million in 2025. 

TABLE 10—PRODUCER NET BENEFITS TO SOCIETY

[Millions] 

2020 2021 2022 2023 2024 2025 

Grower sales due to rule ......................... $75.51 $133.34 $200.38 $276.78 $326.88 $499.46 

Opportunity cost ....................................... (20.05) (35.40) (53.20) (73.48) (86.78) (132.59) 

Sampling & testing ................................... (3.20) (3.89) (4.30) (4.56) (4.67) (4.91) 

Disposal of noncompliant material ........... (0.30) (0.36) (0.40) (0.42) (0.43) (0.46) 

Reporting & recordkeeping ...................... (2.56) (2.82) (3.10) (3.41) (3.75) (4.12) 

Background checks .................................. (0.36) (0.40) (0.44) (0.48) (0.53) (0.58) 

Net benefits ....................................... 49.05 90.47 138.95 194.43 230.72 356.80 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.039</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5677 

States, Indian Tribes, and USDA 

States and Indian Tribes have the 

authority to establish fee structures to 

fund their hemp programs. As of the 

writing of this analysis, about half of the 

states with plans approved by USDA 

reported their programs as being full 

funded through user-fees. To estimate 

the cost of administering a hemp 

program, AMS calculated an average of 

the total fees charged to producers by 

these states, which reported as fully 

user-fee funded, to use as a proxy for the 

per producer cost of hemp program 

administration. The fees used to 

calculate this average included those 

with such designations as application 

fee, site registration fee, licensing fee, 

and others. The average did not include 

fees associated with sampling and 

testing as these were calculated 

separately in Table 7. AMS estimates an 

average cost per producer of hemp 

program administration of $800 

annually. AMS has no reason to believe 

that Indian Tribes or USDA will be any 

more or any less efficient than states in 

program administration. AMS believes, 

therefore, that this figure is a suitable 

proxy for the cost of program 

administration to states, Indian Tribes, 

and USDA per producer who cultivates 

hemp as a result of this rule. 

As discussed in the ‘‘Baseline 

Definition’’ section, 17 states opted to 

participate in the new hemp programs 

authorized by the 2018 Farm Bill in 

time for the 2020 growing season. These 

states represented 20 percent of both 

planted acreage nationwide and the 

number of producers nationwide. By 

applying this percentage to the total 

number of producers in each year, as 

shown in Table 2, AMS estimates the 

number of producers that will cultivate 

hemp due to this rule. The product of 

the number of producers due to this rule 

and the $800 per grower proxy for 

administration costs results in program 

administration costs to States, Indian 

Tribes, and USDA of $3 million in 2020 

to $5 million in 2025. 

This rule places a reporting and 

recordkeeping burden on states and 

Indian Tribes as detailed in the PRA 

section of this rule. The total time 

required per state or tribe for reporting 

and recordkeeping is 25.25 hours 

annually. AMS assumes constant the 

number of states and Indian Tribes that 

will operate their own hemp programs 

at 100 in total from 2020 through 2025. 

In total, the time required of 100 states 

and Indian Tribes for 25.25 hours of 

reporting and recordkeeping is 2,525 

hours. Applying the hourly salary of a 

compliance officer of $57 to this total 

results in an annual cost to all states and 

Indian Tribes of reporting and 

recordkeeping of $143,919, or $1,439 

per state or tribe. 

The total administration costs to 

states, Indian Tribes, and USDA are 

calculated in Table 11. They include the 

costs to all three entities of program 

administration, and the costs of 

reporting and recordkeeping to states 

and Indian Tribes. Total administration 

costs to states, Indian Tribes, and USDA 

range from $3 million in 2020 to $5 

million in 2025. 

TABLE 11—TOTAL COSTS TO STATES, INDIAN TRIBES, AND USDA 

[Millions] 

2020 2021 2022 2023 2024 2025 

Program administration ............................ $(3.20) $(3.52) $(3.87) $(4.26) $(4.69) $(5.15) 

Reporting & recordkeeping ...................... (0.14) (0.14) (0.14) (0.14) (0.14) (0.14) 

Total costs ........................................ (3.34) (3.66) (4.02) (4.40) (4.83) (5.30) 

Laboratories 

This rule also places a reporting and 

recordkeeping burden on laboratories as 

they will be required to report on the 

results of samples tested for THC 

content to the entities administering the 

hemp programs. The PRA section of this 

rule estimates an annual reporting and 

recordkeeping requirement for 

laboratories of 0.58 hours per sampled 

and tested lot. As calculated in Table 7, 

the total number of lots to be sampled 

and tested in each year is 5,659 in 2020; 

6,886 in 2021; 7,606 in 2022; 8,069 in 

2023; 8,272 in 2024; and, 8,688 in 2025. 

Multiplying the total number of lots to 

be sampled and tested in each year by 

the annual reporting and recordkeeping 

requirement of 0.58 hours per sampled 

and tested lot and by the hourly salary 

of a compliance officer of $57 results in 

the total annual costs to laboratories as 

shown in Table 12. 

TABLE 12—TOTAL COSTS TO LABORATORIES

[Millions] 

2020 2021 2022 2023 2024 2025 

Reporting & recordkeeping ...................... $(0.19) $(0.23) $(0.25) $(0.27) $0.27) $(0.29) 

Total Net Benefit 

Producers, states, Indian Tribes, and 

USDA, and laboratories are the entities 

most likely to be impacted by this rule. 

For this reason, the net benefits or costs 

of this rule to these entities have been 

evaluated in this analysis. The total net 

benefits to society as a whole and their 

present values by year are shown in 

Table 13. The rule has a positive net 

benefit in every year, ranging from $46 

million in 2020 to $351 million in 2025. 

TABLE 13—TOTAL NET BENEFITS TO SOCIETY

[Millions] 

Entity 2020 2021 2022 2023 2024 2025 

Producers ................................................. $49.05 $90.47 $138.95 $194.43 $230.72 $356.80 

States, Tribes & USDA ............................ (3.34) (3.66) (4.02) (4.40) (4.83) (5.30) 


khammond on DSKJM1Z7X2PROD with RULES6
5678 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

TABLE 13—TOTAL NET BENEFITS TO SOCIETY—Continued 

[Millions] 

Entity 2020 2021 2022 2023 2024 2025 

Laboratories ............................................. (0.19) (0.23) (0.25) (0.27) (0.27) (0.29) 

Total .................................................. 45.52 86.58 134.68 189.76 225.61 351.21 

Present values of net benefits annualized at the given discount rates 

Discount rates 2020 2021 2022 2023 2024 2024 

3% ............................................................ $45.52 $84.06 $126.95 $173.66 $200.45 $302.96 

7% ............................................................ 45.52 80.92 117.63 154.90 172.12 250.41 

Alternatives 

In developing this final rule, AMS 

considered several alternatives to the 

policies that were adopted. The first of 

these was related to methodologies for 

sampling. The methodologies 

considered include sampling and testing 

of all lots, as mandated in the IFR, 

sampling and testing based on risk, and 

sampling and testing based on 

performance. The latter of these was the 

sampling methodology that was chosen 

for the final rule as it results in the 

lowest total cost to producers. 

Performance-based sampling also grants 

flexibility to States and Indian Tribes in 

the development of sampling 

methodologies. In the IFR, AMS 

required sampling of every hemp lot, 

regardless of intended use; however, 

AMS has determined that compliance to 

this method would too greatly burden 

producers as well as program 

administrators, whose responsibility it 

would be to enforce it. AMS also 

considered requiring risk-based 

sampling, which would mandate 

minimum portions of sampling of lots 

by intended use. The portions of lots to 

be sampled by intended use that were 

considered were 50 percent of lots for 

cannabinoids, 10 percent of lots for 

fiber, and 10 percent of lots for grain. 

AMS currently lacks sufficient data to 

successfully carry out a risk-based 

sampling methodology that would be 

applicable to the varying growing 

regions nationwide; therefore, the riskbased sampling methodology was not 

chosen for this final rule. An analysis of 

these sampling methodologies is 

illustrated in Table 14. 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.040</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5679 

Secondly, AMS considered retaining 

at 0.5 percent the limit for total THC 

content that would result in a negligent 

violation, as required in the IFR. Based 

on comments, however, AMS has 

determined this requirement to too 

greatly burden producers as factors 

beyond the control of the producer, 

such as seed genetics, weather and 

climate, may cause an increase in total 

THC-levels. By increasing the negligent 

violation threshold to 1.0 percent, AMS 

diminishes the risk to producers of 

incurring a negligent violation, which 

results in time and cost savings to 

producers and to program-administering 

entities. 

Finally, AMS considered mandating a 

post-sample harvest window of 15 days, 

as required in the IFR. Based on 

comments and in consideration of the 

time required to complete sampling and 

testing activities, AMS has determined 

that requiring a 15-day post-sample 

harvest window would place undue 

strain on resources. AMS believes that 

the extension of the post-sample harvest 

window to 30 days will provide 

producers with a beneficial flexibility to 

adjust to unforeseen weather events and 

will accommodate complicated harvest 

processes. 

Regulatory Flexibility Analysis 

Pursuant to the requirements set forth 

in the Regulatory Flexibility Act (5 

U.S.C. 601–612), AMS has considered 

the economic impact of this action on 

small entities. AMS prepared an initial 

regulatory flexibility act analysis 

presented with the interim final rule, 

and has now prepared this Final 

Regulatory Flexibility Act Analysis. 

AMS has determined that this rule will 

have a significant economic impact on 

a substantial number of small 

businesses because many small 

businesses will not be able to participate 

in the hemp market without this rule. 

Need for Regulation 

The rule is necessary to facilitate the 

domestic cultivation of hemp for sale 

into the market for hemp products by 

creating a set of minimum standards to 

ensure that hemp being produced under 

this program meets all statutory 

requirements. The rule establishes 

minimum requirements for States and 

Indian Tribes to obtain program 

approval and, for producers operating 

under the Federal program to obtain a 

license and meet operating requirements 

under that license. Without these 

provisions, it would not be possible to 

grow hemp legally. 

Both the declassification of hemp, and 

the prohibition on interference with 

interstate transportation apply to hemp 

that is grown under an approved State 

or Tribal plan, or under a Federal 

license. As a result, this regulation 

facilitates provisions of the 2018 Farm 

Bill that would otherwise be selfimplementing. 

Overview of the Action 

The 2018 Farm Bill granted regulatory 

authority of domestic hemp production 

to the State departments of agriculture, 

Tribal governments, and USDA. States 

and Indian Tribes wishing to operate 

their own programs must submit to 

USDA plans that include provisions for 

maintaining information regarding the 

land on which hemp is produced, for 

testing the levels of THC, for disposal of 

plants that do not meet necessary 

requirements, and for procedures to 

ensure compliance with the 

requirements of the new part, including 

background checks of all key 

participants. State and Tribal Plans 

must be approved by USDA. This rule 

outlines requirements by which the 

USDA would approve plans submitted 

by States and Tribal governments for 

oversight of hemp production. The 2018 

Farm Bill also directs USDA to develop 

a plan for use by hemp producers in 

States or Indian Tribes where no State 

or Tribal Plan has been approved and 

that do not prohibit the cultivation of 

hemp. These actions will promote 

consistency in regulations governing the 

legal production of hemp across the 

country. 

Potentially Affected Small Entities 

The Small Business Administration 

(SBA) defines, in 13 CFR part 121, small 

agricultural producers as those having 

annual receipts of no more than $1 

million. Unfortunately, very little data 

exists on hemp grower sales receipts. To 

conduct this analysis, however, AMS 

estimated prices per acre by intended 

use of hemp to find the acreage 

equivalent of $1 million per intended 

use. AMS encountered data limitations 

due to the lack of reporting by States 

and Tribes that have not started 

implementing the 2018 Farm Bill 

provisions and the extension of the 2014 

Farm Bill provisions which do not 

require reporting from States. 

To this end, AMS utilized data on 

acreage by intended use from the 

Kentucky Department of Agriculture 

and the Montana Department of 

Agriculture. Together, Kentucky and 

Montana make up a large amount of 

domestic acreage and represent 

diversity in hemp planted by intended 

use. For the purpose of this analysis, 

therefore, AMS assumes that the 

combined planted acreage by intended 

use in Kentucky and Montana 

adequately represent the planted 

acreage by intended use across the 

United States. 

For yield estimates, AMS compared 

the hemp enterprise budgets published 

by seven different academic institutions 

that represent the growing conditions 

across the country. Aside from these 

seven, AMS is unaware of any other 

hemp enterprise budgets published by 

an academic institution. AMS sourced 

2019 and 2020 prices from the Jacobsen 

to estimate per-pound prices for 

cannabinoids, fiber, and grain of $3.90, 

$0.09, and $0.53, respectively. The price 

for cannabinoids assumes 6 percent 

CBD content at $0.65 per CBD 

percentage per pound. 

Using these prices and yield 

estimates, AMS calculated a price per 

acre for each intended use of hemp, as 

shown in Table 15. From the estimates 

of price per acre by intended use, AMS 

calculated the equivalent of $1 million 

in acres of hemp product per intended 

use. Of the 922 unique producers in the 

combined data from the Kentucky and 

Montana Departments of Agriculture, 97 

percent reported acreage no greater than 

the amounts necessary to reach $1 

million, based on the estimated prices 

per acre. Assuming that these data are 

representative of the U.S. as a whole, 

then 97 percent of domestic producers 

of hemp would meet the SBA size 

standard of a small business of annual 

receipts of no greater than $1 million. 


khammond on DSKJM1Z7X2PROD with RULES6
5680 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

Alternatives Considered To Minimize 

Impacts of the Rule 

In developing this final rule, due to 

comments received and experiences 

from the 2020 season, AMS considered 

several alternatives to the policies that 

were adopted. The first of these was 

related to methodologies for sampling. 

The methodologies considered include 

sampling and testing of all lots, as 

mandated in the IFR, sampling and 

testing based on risk, and sampling and 

testing based on performance. The latter 

of these was the sampling methodology 

that was chosen for the final rule as it 

results in the lowest total cost to 

producers. Performance-based sampling 

also grants flexibility to States and 

Indian Tribes in the development of 

sampling methodologies. Some States 

currently have considered performancebased sampling under the 2014 Farm 

Bill. However, this information is not 

available and will need to be evaluated 

and approved by USDA as part of State 

and Tribal plans before it can be 

implemented under the 2018 Farm Bill 

program if States and Tribes decide to 

utilize this option. In the IFR, AMS 

required sampling of every hemp lot, 

regardless of intended use; however, 

AMS has determined that compliance to 

this method would too greatly burden 

producers as well as program 

administrators, whose responsibility it 

would be to enforce it. AMS also 

considered requiring risk-based 

sampling, which would mandate 

minimum portions of sampling of lots 

by intended use. The portions of lots to 

be sampled by intended use that were 

considered were 50 percent of lots for 

cannabinoids, 10 percent of lots for 

fiber, and 10 percent of lots for grain. 

AMS currently lacks sufficient data to 

successfully carry out a risk-based 

sampling methodology that would be 

applicable to the varying growing 

regions nationwide; therefore, the riskbased sampling methodology was not 

chosen for this final rule. 

Secondly, AMS considered retaining 

at 0.5 percent the limit for total THC 

content that would result in a negligent 

violation, as required in the IFR. Based 

on comments, however, AMS has 

determined this requirement to too 

greatly burden producers as factors 

beyond the control of the producer, 

such as seed genetics, weather and 

climate, may cause an increase in total 

THC-levels. By increasing the negligent 

violation threshold to 1.0 percent, AMS 

diminishes the risk to producers of 

incurring a negligent violation, which 

results in time and cost savings to 

producers and to program-administering 

entities. 

Finally, AMS considered mandating a 

post-sample harvest window of 15 days, 

as required in the IFR. Based on 

comments and in consideration of the 

time required to complete sampling and 

testing activities, AMS has determined 

that requiring a 15-day post-sample 

harvest window would place undue 

strain on resources. AMS believes that 

the extension of the post-sample harvest 

window to 30 days will provide 

producers with a beneficial flexibility to 

adjust to unforeseen weather events and 

will accommodate complicated harvest 

processes. 

Pursuant to the Congressional Review 

Act (5 U.S.C. 801 et seq.), the Office of 

Information and Regulatory Affairs 

designated this rule as ‘‘major,’’ as 

defined by 5 U.S.C. 804(2). 

List of Subjects in 7 CFR Part 990 

Acceptable hemp THC level, 

Agricultural commodities, Cannabis, 

Corrective action plan, Delta-9 

tetrahydrocannabinol, Drugs, Dry 

weight basis, Hemp, Liquid 

chromatography, Laboratories, 

Marijuana. 

■ For the reasons stated in the preamble, 

AMS revises 7 CFR part 990 to read as 

follows: 


khammond on DSKJM1Z7X2PROD with RULES6ER19JA21.041</GPH>
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5681 

PART 990—DOMESTIC HEMP 

PRODUCTION PROGRAM 

Subpart A—Definitions 

Sec. 

990.1 Meaning of terms. 

Subpart B—State and Tribal Hemp 

Production Plans 

990.2 State and Tribal plans; General 

authority. 

990.3 State and Tribal plans; Plan 

requirements. 

990.4 USDA approval of State and Tribal 

plans. 

990.5 Audit of State or Tribal plan 

compliance. 

990.6 Violations of State and Tribal plans. 

990.7 Establishing records with USDA Farm 

Service Agency. 

990.8 Production under Federal law. 

Subpart C—USDA Hemp Production Plan 

990.20 USDA requirements for the 

production of hemp. 

990.21 USDA hemp producer license. 

990.22 USDA hemp producer license 

approval. 

990.23 Reporting hemp crop acreage with 

USDA Farm Service Agency. 

990.24 Responsibility of a USDA licensee 

prior to harvest. 

990.25 Standards of performance for 

detecting total delta-9 

tetrahydrocannabinol (THC) 

concentration levels. 

990.26 Responsibility of a USDA producer 

after laboratory testing is performed. 

990.27 Non-compliant cannabis plants. 

990.28 Compliance. 

990.29 Violations. 

990.30 USDA producers; License 

suspension. 

990.31 USDA licensees; Revocation. 

990.32 Recordkeeping requirements. 

Subpart D—Appeals 

990.40 General adverse action appeal 

process. 

990.41 Appeals under the USDA hemp 

production plan. 

990.42 Appeals under a State or Tribal 

hemp production plan. 

Subpart E—Administrative Provisions 

990.60 Agents. 

990.61 Severability. 

990.62 [Reserved] 

990.63 Interstate transportation of hemp. 

Subpart F—Reporting Requirements 

990.70 State and Tribal hemp reporting 

requirements. 

990.71 USDA plan reporting requirements. 

Authority: 7 U.S.C. 1639o note, 1639p, 

1639q, 1639r. 

Subpart A—Definitions 

§ 990.1 Meaning of terms. 

Words used in this subpart in the 

singular form shall be deemed to impart 

the plural, and vice versa, as the case 

may demand. For the purposes of 

provisions and regulations of this part, 

unless the context otherwise requires, 

the following terms shall be construed, 

respectively, to mean: 

Acceptable hemp THC level. When a 

laboratory tests a sample, it must report 

the total delta-9 tetrahydrocannabinol 

content concentration level on a dry 

weight basis and the measurement of 

uncertainty. The acceptable hemp THC 

level for the purpose of compliance with 

the requirements of State or Tribal hemp 

plans or the USDA hemp plan is when 

the application of the measurement of 

uncertainty to the reported total delta-9 

tetrahydrocannabinol content 

concentration level on a dry weight 

basis produces a distribution or range 

that includes 0.3 percent or less. For 

example, if the reported total delta-9 

tetrahydrocannabinol content 

concentration level on a dry weight 

basis is 0.35 percent and the 

measurement of uncertainty is ±0.06 

percent, the measured total delta-9 

tetrahydrocannabinol content 

concentration level on a dry weight 

basis for this sample ranges from 0.29 

percent to 0.41 percent. Because 0.3 

percent is within the distribution or 

range, the sample is within the 

acceptable hemp THC level for the 

purpose of plan compliance. This 

definition of ‘‘acceptable hemp THC 

level’’ affects neither the statutory 

definition of hemp, 7 U.S.C. 1639o(1), in 

the 2018 Farm Bill nor the definition of 

‘‘marihuana,’’ 21 U.S.C. 802(16), in the 

CSA. 

Act. Agricultural Marketing Act of 

1946. 

Agricultural Marketing Service or 

AMS. The Agricultural Marketing 

Service of the U.S. Department of 

Agriculture. 

Applicant. (1) A State or Indian Tribe 

that has submitted a State or Tribal 

hemp production plan to USDA for 

approval under this part; or 

(2) A producer in a State or territory 

of an Indian Tribe that is not subject to 

a State or Tribal hemp production plan 

and who has submitted an application 

to USDA for a license under the USDA 

hemp production plan under this part. 

Audit. An official inspection of an 

individual’s or organization’s accounts 

and paperwork or documentation by an 

independent body. An audit also refers 

to a compliance audit of States and 

Indian Tribes with approved hemp 

production plans by USDA to determine 

compliance with their approved plan, 

the regulations in this part, and the Act. 

For this part, audit relates to 

documentation related to authorities 

under the 2018 Farm Bill to produce 

hemp. 

Cannabis. A genus of flowering plants 

in the family Cannabaceae of which 

Cannabis sativa is a species, and 

Cannabis indica and Cannabis ruderalis 

are subspecies thereof. Cannabis refers 

to any form of the plant in which the 

total delta-9 tetrahydrocannabinol 

concentration on a dry weight basis has 

not yet been determined. 

Controlled Substances Act (CSA). The 

Controlled Substances Act as codified in 

21 U.S.C. 801 et seq. 

Conviction. Means any plea of guilty 

or nolo contendere, or any finding of 

guilt, except when the finding of guilt 

is subsequently overturned on appeal, 

pardoned, or expunged. For purposes of 

this part, a conviction is expunged 

when the conviction is removed from 

the individual’s criminal history record 

and there are no legal disabilities or 

restrictions associated with the 

expunged conviction, other than the fact 

that the conviction may be used for 

sentencing purposes for subsequent 

convictions. In addition, where an 

individual is allowed to withdraw an 

original plea of guilty or nolo 

contendere and enter a plea of not guilty 

and the case is subsequently dismissed, 

the individual is no longer considered 

to have a conviction for purposes of this 

part. 

Corrective action plan. A plan 

proposed by a licensed hemp producer 

and approved by the governing entity 

for correcting a negligent violation or 

non-compliance with the applicable 

State, Tribal, or USDA hemp production 

plan, its terms, the applicable law(s), 

and/or this part. Also, a plan proposed 

by a State or Tribal government for 

correcting violations or noncompliances with USDA-approved State 

or Tribal hemp programs. 

Criminal history report. The Federal 

Bureau of Investigation’s Identity 

History Summary. 

Culpable mental state greater than 

negligence. To act intentionally, 

knowingly, willfully, or recklessly. 

Decarboxylated. The completion of 

the chemical reaction that converts 

THC-acid (THCA) into delta-9 THC, the 

intoxicating component of cannabis. 

The decarboxylated value is also 

calculated using a molecular mass 

conversion ratio that sums delta-9 THC 

and eighty-seven and seven tenths (87.7) 

percent of THC-acid ((delta-9 THC) + 

(0.877 * THCA)). 

Decarboxylation. The removal or 

elimination of carboxyl group from a 

molecule or organic compound. 

Disposal. An activity that transitions 

the non-compliant product into a nonretrievable or non-ingestible form. Such 

activities include plowing, tilling, or 

disking plant material into the soil; 

mulching, composting, chopping, or 

bush mowing plant material into green 


khammond on DSKJM1Z7X2PROD with RULES6
5682 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

manure; burning plant material; burying 

plant material into the earth and 

covering with soil. 

Delta-9 tetrahydrocannabinol or THC. 

Delta-9 THC is the primary psychoactive 

component of cannabis. For the 

purposes of this part, delta-9 THC and 

THC are interchangeable. 

Drug Enforcement Administration or 

DEA. The United States Drug 

Enforcement Administration. 

Dry weight basis. The ratio of the 

amount of moisture in a sample to the 

amount of dry solid in a sample. A basis 

for expressing the percentage of a 

chemical in a substance after removing 

the moisture from the substance. 

Percentage of THC on a dry weight basis 

means the percentage of THC, by 

weight, in a cannabis item (plant, 

extract, or other derivative), after 

excluding moisture from the item. 

Entity. A corporation, joint stock 

company, association, limited 

partnership, limited liability 

partnership, limited liability company, 

irrevocable trust, estate, charitable 

organization, or other similar 

organization, including any such 

organization participating in the hemp 

production as a partner in a general 

partnership, a participant in a joint 

venture, or a participant in a similar 

organization. 

Farm Service Agency or FSA. An 

agency of the United States Department 

of Agriculture. 

Gas chromatography or GC. A type of 

chromatography in analytical chemistry 

used to separate, identify, and quantify 

each component in a mixture. GC relies 

on heat for separating and analyzing 

compounds that can be vaporized 

without decomposition. 

Geospatial location. A location 

designated through a global system of 

navigational satellites used to determine 

the precise ground position of a place or 

object. 

Handle. To harvest or store hemp 

plants or hemp plant parts prior to the 

delivery of such plants or plant parts for 

further processing. ‘‘Handle’’ also 

includes the disposal of cannabis plants 

that are not hemp for purposes of 

chemical analysis and disposal of such 

plants. 

Hemp. The plant species 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 

total delta-9 tetrahydrocannabinol 

concentration of not more than 0.3 

percent on a dry weight basis. 

Immature plants. A cannabis plant 

that is not flowering. 

Indian Tribe or Tribe. As defined in 

section 4 of the Indian SelfDetermination and Education 

Assistance Act (25 U.S.C. 5304). 

Information sharing system. The 

database that allows USDA to share 

information collected under State, 

Tribal, and USDA plans with Federal, 

State, Tribal, and local law enforcement. 

Key participants. A sole proprietor, a 

partner in partnership, or a person with 

executive managerial control in a 

corporation. A person with executive 

managerial control includes persons 

such as a chief executive officer, chief 

operating officer, and chief financial 

officer. This definition does not include 

non-executive managers such as farm, 

field, or shift managers. This definition 

also does not include a member of the 

leadership of a Tribal government who 

is acting in their capacity as a Tribal 

leader except when that member 

exercises executive managerial control 

over hemp production. 

Law enforcement agency. Any 

Federal, State, Tribal, or local law 

enforcement agency. 

Liquid chromatography or LC. A type 

of chromatography technique in 

analytical chemistry used to separate, 

identify, and quantify each component 

in a mixture. LC relies on pumps to pass 

a pressurized liquid solvent containing 

the sample mixture through a column 

filled with a solid absorbent material to 

separate and analyze compounds. 

Lot. A contiguous area in a field, 

greenhouse, or indoor growing structure 

containing the same variety or strain of 

cannabis throughout the area. The term 

lot also means the terms ‘‘farm,’’ ‘‘tract,’’ 

‘‘field,’’ and ‘‘subfield’’ as these are 

terms used by FSA in 7 CFR 718.2 to 

define lot. 

Marijuana. Or ‘‘marihuana’’, as 

defined in the CSA, means all parts of 

the plant Cannabis sativa L., whether 

growing or not; the seeds thereof; the 

resin extracted from any part of such 

plant; and every compound, 

manufacture, salt, derivative, mixture, 

or preparation of such plant, its seeds or 

resin. The term ‘‘marihuana’’ does not 

include hemp, as defined in section 

297A of the Agricultural Marketing Act 

of 1946, and does not include the 

mature stalks of such plant, fiber 

produced from such stalks, oil or cake 

made from the seeds of such plant, any 

other compound, manufacture, salt, 

derivative, mixture, or preparation of 

such mature stalks (except the resin 

extracted therefrom), fiber, oil, or cake, 

or the sterilized seed of such plant 

which is incapable of germination (7 

U.S.C. 1639o). ‘‘Marihuana’’ means all 

cannabis that tests as having a THC 

concentration level of higher than 0.3 

percent on a dry weight basis. 

Measurement of Uncertainty (MU). 

The parameter, associated with the 

result of a measurement, that 

characterizes the dispersion of the 

values that could reasonably be 

attributed to the particular quantity 

subject to measurement. 

Negligence. Failure to exercise the 

level of care that a reasonably prudent 

person would exercise in complying 

with the regulations set forth under this 

part. 

Phytocannabinoid. Cannabinoid 

chemical compounds found in the 

cannabis plant, two of which are delta9 tetrahydrocannabinol (delta-9 THC) 

and cannabidiol (CBD). 

Plan. A set of criteria or regulations 

under which a State or Tribal 

government, or USDA, monitors and 

regulates the production of hemp. 

Post-decarboxylation. In the context 

of testing methodologies for THC 

concentration levels in hemp, means a 

value determined after the process of 

decarboxylation that determines the 

potential total delta-9 

tetrahydrocannabinol content derived 

from the sum of the THC and THCA 

content and reported on a dry weight 

basis. The post-decarboxylation value of 

THC can be calculated by using a 

chromatograph technique using heat, 

gas chromatography, through which 

THCA is converted from its acid form to 

its neutral form, THC. Thus, this test 

calculates the total potential THC in a 

given sample. The post-decarboxylation 

value of THC can also be calculated by 

using a liquid chromatograph technique, 

which keeps the THCA intact. This 

technique requires the use of the 

following conversion: [Total THC = 

(0.877 x THCA) + THC] which 

calculates the potential total THC in a 

given sample. See the definition for 

decarboxylation. 

Produce. To grow hemp plants for 

market, or for cultivation for market, in 

the United States. 

Producer. A producer as defined in 7 

CFR 718.2 specifically of hemp. 

Remediation. Remediation refers to 

the process of rendering non-compliant 

cannabis, compliant. Remediation can 

occur by removing and destroying 

flower material, while retaining stalk, 

stems, leaf material, and seeds. 

Remediation can also occur by 

shredding the entire plant into a 

biomass like material, then re-testing the 

shredded biomass material for 

compliance. 

Reverse distributor. A person who is 

registered with the DEA in accordance 

with 21 CFR 1317.15 to dispose of 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5683 

marijuana under the Controlled 

Substances Act. 

Secretary. The Secretary of 

Agriculture of the United States 

Department of Agriculture. 

State. Any one of the fifty States of 

the United States of America, the 

District of Columbia, the 

Commonwealth of Puerto Rico, and any 

other territory or possession of the 

United States. 

State department of agriculture. The 

agency, commission, or department of a 

State government responsible for 

agriculture in the State. 

Territory of the Indian Tribe. (1) All 

land within the limits of any Indian 

reservation under the jurisdiction of the 

United States Government, 

notwithstanding the issuance of any 

patent, including rights-of-way running 

through the reservation; 

(2) All dependent Indian communities 

within the borders of the United States 

whether within the original or 

subsequently acquired territory thereof, 

and whether within or without the 

limits of a State; 

(3) All Indian allotments, the Indian 

titles to which have not been 

extinguished, including rights-of-way 

running through the same; and 

(4) Any lands title to which is either 

held in trust by the United States for the 

benefit of any Indian Tribe or individual 

or held by any Indian Tribe or 

individual subject to restriction by the 

United States against alienation and 

over which an Indian Tribe exercises 

jurisdiction. 

Total THC. Total THC is the value 

determined after the process of 

decarboxylation, or the application of a 

conversion factor if the testing 

methodology does not include 

decarboxylation, that expresses the 

potential total delta-9 

tetrahydrocannabinol content derived 

from the sum of the THC and THCA 

content and reported on a dry weight 

basis. This post-decarboxylation value 

of THC can be calculated by using a 

chromatograph technique using heat, 

such as gas chromatography, through 

which THCA is converted from its acid 

form to its neutral form, THC. Thus, this 

test calculates the total potential THC in 

a given sample. The total THC can also 

be calculated by using a liquid 

chromatograph technique, which keeps 

the THCA intact. This technique 

requires the use of the following 

conversion: [Total THC = (0.877 x 

THCA) + THC] which calculates the 

potential total THC in a given sample. 

Tribal government. The governing 

body of an Indian Tribe. 

USDA licensee. A person, 

partnership, or corporation licensed 

under the USDA planto grow hemp 

under the terms established in this part 

and who produces hemp. 

Subpart B—State and Tribal Hemp 

Production Plans 

§ 990.2 State and Tribal plans; General 

authority. 

States or Indian Tribes desiring to 

have primary regulatory authority over 

the production of hemp in the State or 

territory of the Indian Tribe shall submit 

to the Secretary for approval, through 

the State department of agriculture (in 

consultation with the Governor and 

chief law enforcement officer of the 

State) or the Tribal government, as 

applicable, a plan under which the State 

or Indian Tribe monitors and regulates 

that production. 

§ 990.3 State and Tribal plans; Plan 

requirements. 

(a) General requirements. A State or 

Tribal plan submitted to the Secretary 

for approval must include the practice 

and procedures described in this 

paragraph (a). 

(1) A State or Tribal plan must 

include a practice to collect, maintain, 

and report to the Secretary relevant, 

real-time information for each producer 

licensed or authorized to produce hemp 

under the State or Tribal plan regarding: 

(i) Contact information as described in 

§ 990.70(a)(1); 

(ii) A legal description of the land on 

which the producer will produce hemp 

in the State or territory of the Indian 

Tribe including, to the extent 

practicable, its geospatial location; and 

(iii) The status and number of the 

producer’s license or authorization in a 

format prescribed by USDA. 

(2) A State or Tribal plan must 

include a procedure for accurate and 

effective sampling of hemp that 

includes the requirements in this 

paragraph (a)(2). 

(i) Samples from cannabis plants must 

be collected within 30 days prior to the 

anticipated harvest, for total delta-9 

tetrahydrocannabinol concentration 

level testing. Samples must be collected 

by a sampling agent. Producers may not 

collect samples from their own growing 

facilities. 

(ii) Samples shall be obtained from 

the flowering tops of plants when 

flowering tops are present, and shall be 

approximately five to eight inches in 

length from the ‘‘main stem’’ (that 

includes the leaves and flowers), 

‘‘terminal bud’’ (that occurs at the end 

of a stem), or ‘‘central cola’’ (cut stem 

that could develop into a bud) of the 

flowering top of the plant. 

(iii) The method used for sampling 

must be sufficient at a confidence level 

of 95 percent that no more than one 

percent of the plants in each lot would 

exceed the acceptable hemp THC level 

and ensure that a representative sample 

is collected that represents a 

homogeneous composition of the lot. 

Alternatively, States and Tribes may 

adopt a performance-based method that 

meets the requirements in paragraphs 

(a)(2)(iii)(A) and (B) of this section. 

(A) The alternative method must be 

part of the State or Tribe’s hemp plan 

and is subject to USDA approval. 

(B) The alternative method must have 

the potential to ensure, at a confidence 

level of 95 percent, that the 

cannabisplant species Cannabis sativa 

L. that will be subject to the alternative 

method will not test above the 

acceptable hemp THC level. The 

alternative method may consider one or 

more of the following factors: 

(1) Seed certification process or 

process that identifies varieties that 

have consistently demonstrated to result 

in compliant hemp plants in that State 

or territory of the Indian Tribe; 

(2) Whether the producer is 

conducting research on hemp; 

(3) Whether a producer has 

consistently produced compliant hemp 

plants over an extended period of time; 

and 

(4) Factors similar to those in this 

paragraph (a)(2)(iii)(B). 

(iv) During a scheduled sample 

collection, the producer or an 

authorized representative of the 

producer shall be present at the growing 

site if possible. 

(v) Sampling agents shall be provided 

with complete and unrestricted access 

during business hours to all hemp and 

other cannabis plants (whether growing 

or harvested), to areas where hemp is 

grown and stored, and to all land, 

buildings, and other structures used for 

the cultivation, handling, and storage of 

all hemp and other cannabis plants, and 

all locations listed in the producer 

license. 

(vi) A producer shall not harvest the 

cannabis crop prior to samples being 

taken. 

(vii) Sampling agents must be trained 

using USDA, State, or Tribal training 

procedures. States and Indian Tribes 

must maintain information, available to 

producers, about trained sampling 

agents. 

(3) A State or Tribal plan must 

include a procedure for testing that is 

able to accurately identify whether the 

sample contains a total delta-9 

tetrahydrocannabinol content 

concentration level that exceeds the 

acceptable hemp THC level. The 

procedure must include a validated 

testing methodology that uses postVerDate Sep<11>2014 22:26 Jan 17, 2021 Jkt 253001 PO 00000 Frm 00089 Fmt 4701 Sfmt 4700 E:\FR\FM\19JAR6.SGM 19JAR6

khammond on DSKJM1Z7X2PROD with RULES6
5684 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

decarboxylation or other similarly 

reliable methods. The testing 

methodology must consider the 

potential conversion of THCA in hemp 

into THC and the test result must report 

the total available THC derived from the 

sum of the THC and THCA content. 

Testing methodologies meeting the 

requirements of this paragraph (a)(3) 

include, but are not limited to, gas or 

liquid chromatography with detection. 

The total THC concentration level shall 

be determined and reported on a dry 

weight basis. 

(i) Any test of a representative sample 

resulting in higher than the acceptable 

hemp THC level shall be conclusive 

evidence that the lot represented by the 

sample is not in compliance with this 

part and shall be disposed of or 

remediated in accordance with § 990.27. 

(ii) Samples of hemp plant material 

from one lot shall not be commingled 

with hemp plant material from other 

lots. 

(iii) Laboratories conducting 

analytical testing for purposes of 

detecting the concentration levels of 

Total THC shall meet the following 

requirements: 

(A) Laboratory quality assurance must 

ensure the validity and reliability of test 

results; 

(B) Analytical method selection, 

validation, and verification must ensure 

that the testing method used is 

appropriate (fit for purpose), and that 

the laboratory can successfully perform 

the testing; 

(C) The demonstration of testing 

validity must ensure consistent, 

accurate analytical performance; 

(D) Method performance 

specifications must ensure analytical 

tests are sufficiently sensitive for the 

purposes of the detectability 

requirements of this part; and 

(E) Effective disposal procedures for 

non-compliant samples that do not meet 

the requirements of this part. 

(F) Measurement of uncertainty (MU) 

must be estimated and reported with 

test results. Laboratories shall use 

appropriate, validated methods and 

procedures for all testing activities and 

evaluate measurement of uncertainty. 

(G) Sample preparation of pre- or 

post-harvest samples shall require 

grinding of sample to ensure 

homogeneity of plant material prior to 

testing. Sample preparation may follow 

a procedure described by USDA. 

(H) After December 31, 2022, States 

and Indian Tribes shall require that only 

laboratories registered with the DEA 

may conduct testing under this section. 

(4) A State or Indian Tribe shall 

require testing laboratories to comply 

with USDA reporting requirements in 

subpart F of this part. Laboratories shall 

only submit test results used to 

determine compliance with this part. 

Test results from informal testing 

conducted throughout the growing 

season shall not be reported to USDA. 

(5) A State or Tribal plan must 

include a procedure to comply with the 

enforcement procedures in § 990.6. 

(6) A State or Tribal plan must 

include a procedure for the disposal or 

remediation of cannabis plants if the 

sample representing that plant tests 

above the acceptable hemp THC level. 

(i) The disposal must be conducted 

either by using a DEA-registered reverse 

distributor or law enforcement; or on 

site at the farm or hemp production 

facility. 

(ii) The State or Tribal plan must 

include procedures to verify the 

disposal or remediation of the cannabis 

plant. This may come in the form of inperson verification by State or Tribal 

representatives, or alternative 

requirements that direct growers to 

provide pictures, videos, or other proof 

that disposal or remediation occurred 

successfully. Disposal and remediation 

means are described at AMS’s website. 

(iii) If a producer elects to perform 

remediation activities, an additional 

sampling and testing of the postremediated crop must occur to 

determine THC concentration levels. 

(7) A State or Tribal plan must 

include a procedure for conducting 

annual inspections of, at a minimum, a 

random group of producers to verify 

that hemp is not produced in violation 

of this part. 

(8) A State or Tribal plan must 

include a procedure for submitting the 

report described in § 990.70 to the 

Secretary by the first of each month. If 

the first of the month falls on a weekend 

or holiday, the report is due by the first 

business day following the due date. All 

such information must be submitted to 

the USDA in a format that is compatible 

with USDA’s information sharing 

system. 

(9) The State or Tribal government 

must certify that the State or Indian 

Tribe has the resources and personnel to 

carry out the practices and procedures 

described in paragraphs (a)(1) through 

(9) of this section. 

(10) The State or Tribal plan must 

include a procedure to collect and share 

information with USDA to support the 

information sharing requirements in 7 

U.S.C. 1639q(d). The State or Tribal 

government is responsible for reporting 

the information identified in paragraphs 

(a)(10)(i) through (iii) of this section 

with AMS. The State or Tribal hemp 

production plan must include the 

following: 

(i) A requirement that producers 

report their hemp crop acreage to the 

FSA, consistent with the requirement in 

§ 990.7. 

(ii) Assignment of a license or 

authorization identifier for each 

producer in a format prescribed by 

USDA. 

(iii) A requirement that producers 

report the total acreage of hemp planted, 

harvested, and, if applicable, disposed 

or remediated. The State or Tribal 

government shall collect this 

information and report it to AMS. 

(b) Relation to State and Tribal law. 

A State or Tribal plan may include any 

other practice or procedure established 

by a State or Indian Tribe, as applicable; 

Provided, That the practice or procedure 

is consistent with this part and Subtitle 

G of the Act. 

(1) No preemption. Nothing in this 

part preempts or limits any law of a 

State or Indian Tribe that: 

(i) Regulates the production of hemp; 

and 

(ii) Is more stringent than this part or 

Subtitle G of the Act. 

(2) References in plans. A State or 

Tribal plan may include a reference to 

a law of the State or Indian Tribe 

regulating the production of hemp, to 

the extent that the law is consistent with 

this part. 

§ 990.4 USDA approval of State and Tribal 

plans. 

(a) General authority. No later than 60 

calendar days after the receipt of a State 

or Tribal plan for a State or Tribal 

territory in which production of hemp 

is legal, the Secretary shall: 

(1) Approve the State or Tribal plan 

only if the State or Tribal plan complies 

with this part; or 

(2) Disapprove the State or Tribal plan 

if the plan does not comply with this 

part. USDA shall provide the State or 

Tribe with written notification of the 

disapproval and the cause for the 

disapproval. 

(b) Amended plans. A State or Tribal 

government, as applicable, must submit 

to the Secretary an amended plan if: 

(1) The Secretary disapproves a State 

or Tribal plan and the State or Indian 

Tribe wishes to have primary regulatory 

authority over hemp production within 

its State or territory of the Indian Tribe; 

or 

(2) The State or Indian Tribe makes 

substantive revisions to its plan or its 

laws which alter the way the plan meets 

the requirements of this part. If this 

occurs, the State or Tribal government 

must re-submit the revised plan for 

USDA approval. Such re-submissions 

should be provided to USDA within 60 

days from the date that the State or 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5685 

Tribal laws and regulations are effective. 

Producers shall continue to comply 

with the requirements of the existing 

plan while such modifications are under 

consideration by USDA. If State or 

Tribal government laws or regulations 

in effect under the USDA-approved plan 

change but the State or Tribal 

government does not submit a revised 

plan within 60 days from the effective 

date of the new law or regulation, the 

existing plan is revoked. 

(3) USDA approval of State or Tribal 

government plan shall remain in effect 

unless an amended plan must be 

submitted to USDA because of a 

substantive revision to a State’s or 

Tribe’s plan, a relevant change in State 

or Tribal laws or regulations, or 

approval of the plan is revoked by 

USDA. 

(4) Upon USDA approval of a Tribal 

plan, an Indian Tribe may exercise 

jurisdiction and therefore primary 

regulatory authority over all production 

of hemp in its Territory regardless of the 

extent of its inherent regulatory 

authority. 

(c) Technical assistance. The 

Secretary may provide technical 

assistance to help a State or Indian Tribe 

develop or amend a plan. This may 

include the review of draft plans or 

other informal consultation as 

necessary. 

(d) Approved State or Tribal plans. If 

the Secretary approves a State or Tribal 

plan, the Secretary shall notify the State 

or Indian Tribe by letter or email. 

(1) In addition to the approval letter, 

the State or Indian Tribe shall receive 

their plan approval certificate either as 

an attachment or via website link. 

(2) The USDA shall post information 

regarding approved plans on its website. 

(3) USDA approval of State or Tribal 

government plans shall remain in effect 

unless: 

(i) The State or Tribal government’s 

laws and regulations in effect under the 

USDA-approved plan change, thus 

requiring such plan to be revised and resubmitted for USDA approval. 

(ii) A State or Tribal plan must be 

amended in order to comply with future 

amendments to Subtitle G the Act and 

this part. 

(e) Producer rights upon revocation of 

State or Tribal plan. If USDA revokes 

approval of a State or Tribal plan due 

to noncompliance as defined in 

paragraph (b)(2) of this section and 

§ 990.5, producers licensed or 

authorized to produce hemp under the 

revoked State or Tribal plan may 

continue to produce for the remainder 

of the calendar year in which the 

revocation became effective. Producers 

operating in a State or Tribal territory 

with a revoked plan would have to 

apply to USDA for a license to continue 

producing. 

§ 990.5 Audit of State or Tribal plan 

compliance. 

The Secretary may conduct an audit 

to determine a State or Indian Tribe’s 

compliance with their approved plan. 

(a) Frequency of audits. Compliance 

audits may be scheduled, no more 

frequently than every three years, based 

on available resources. Audits may 

include an onsite-visit, a desk-audit, or 

both. The USDA may adjust the 

frequency of audits if deemed 

appropriate based on program 

performance, compliance issues, or 

other relevant factors identified and 

provided to the State or Tribal 

governments by USDA. 

(b) Scope of audit review. The audit 

may include, but is not limited to, a 

review of the following: 

(1) The resources and personnel 

employed to administer and oversee its 

approved plan; 

(2) The process for licensing and 

systematic compliance review of hemp 

producers; 

(3) Sampling methods and laboratory 

testing requirements and components; 

(4) Disposal and/or remediation of 

non-compliant hemp plants or hemp 

plant material practices, to ensure that 

correct reporting to the USDA has 

occurred; 

(5) Results of and methodology used 

for the annual inspections of producers; 

and 

(6) Information collection procedures 

and information accuracy (i.e., 

geospatial location, contact information 

reported to the USDA, legal description 

of land). 

(c) Audit reports. (1) Audit reports 

will be issued to the State or Tribal 

government no later than 60 days after 

the audit concludes. If the audit reveals 

that the State or Tribal government is 

not in compliance with its USDA 

approved plan, USDA will advise the 

State or Indian Tribe of noncompliances and the corrective 

measures that must be completed to 

come into compliance with the Act and 

regulations in this part. The USDA will 

require the State or Indian Tribe to 

develop a corrective action plan, which 

must be reviewed and approved by the 

USDA. The corrective action plan must 

include a reasonable date by which the 

State or Indian Tribe will correct make 

corrections. USDA will approve or deny 

the corrective action plan within 60 

days of its receipt. USDA will conduct 

a second audit to determine if the State 

or Indian Tribe is in compliance with 

the corrective action plan and has 

corrected the non-compliances. 

(2) If the USDA determines that the 

State or Indian Tribe is not in 

compliance after the second audit, the 

USDA may revoke its approval of the 

State or Tribal plan for one year or until 

the State or Indian Tribe becomes 

compliant whichever occurs later. 

USDA will not approve a State or Indian 

Tribe’s plan until the State or Indian 

Tribe demonstrates upon inspection that 

it is in compliance with all regulations 

in this part. 

§ 990.6 Violations of State and Tribal 

plans. 

(a) Producer violations. Producer 

violations of USDA-approved State and 

Tribal hemp production plans shall be 

subject to enforcement in accordance 

with the terms of this section. 

(b) Negligent violations. Each USDAapproved State or Tribal plan shall 

contain provisions relating to negligent 

producer violations as defined under 

this part. Producers shall not receive 

more than one negligent violation per 

growing season. Negligent violations 

shall include: 

(1) Failure to provide a legal 

description of land on which the 

producer produces hemp; 

(2) Failure to obtain a license or other 

required authorization from the State 

department of agriculture or Tribal 

government, as applicable; or 

(3) Production of cannabis with a total 

delta-9 tetrahydrocannabinol 

concentration exceeding the acceptable 

hemp THC level. Hemp producers do 

not commit a negligent violation under 

this paragraph (b)(3) if they make 

reasonable efforts to grow hemp and the 

cannabis (marijuana) does not have a 

total delta-9 tetrahydrocannabinol 

concentration of more than 1.0 percent 

on a dry weight basis. 

(c) Corrective action for negligent 

violations. Each USDA-approved State 

or Tribal plan shall provide for the 

correction of negligent violations. Each 

corrective action plan shall include, at 

a minimum, the following terms: 

(1) A reasonable date by which the 

producer shall correct the negligent 

violation. 

(2) A requirement that the producer 

periodically report to the State 

department of agriculture or Tribal 

government, as applicable, on its 

compliance with the State or Tribal plan 

and corrective action plan for a period 

of not less than the next 2 years from the 

date of the negligent violation. 

(3) A producer that negligently 

violates a State or Tribal plan approved 

under this part shall not as a result of 

that violation be subject to any criminal 


khammond on DSKJM1Z7X2PROD with RULES6
5686 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

enforcement action by the Federal, 

State, Tribal, or local government. 

(4) A producer that negligently 

violates a State or Tribal plan three 

times during a 5-year period shall be 

ineligible to produce hemp for a period 

of 5 years beginning on the date of the 

third violation. 

(5) The State or Indian Tribe shall 

conduct an inspection to determine if 

the corrective action plan has been 

implemented as submitted. 

(d) Culpable violations. Each USDAapproved State or Tribal plan shall 

contain provisions relating to producer 

violations made with a culpable mental 

state greater than negligence, including 

that: 

(1) If the State or Tribal government 

determines that a producer has violated 

the plan with a culpable mental state 

greater than negligence, the State or 

Tribal government, as applicable, shall 

immediately report the producer to: 

(i) The U.S. Attorney General; and 

(ii) The chief law enforcement officer 

of the State or Indian Tribe, as 

applicable. 

(2) Paragraphs (b) and (c) of this 

section shall not apply to culpable 

violations. 

(e) Felonies. Each USDA-approved 

State or Tribal plan shall contain 

provisions relating to felonies. Such 

provisions shall state that: 

(1) A person with a State or Federal 

felony conviction relating to a 

controlled substance may not 

participate in the plan and may not 

produce hemp under the State or Tribal 

plan for 10 years from the date of the 

conviction. An exception applies to a 

person who was lawfully growing hemp 

under section 7606 of the Agricultural 

Act of 2014 (7 U.S.C. 5940) before 

December 20, 2018, and whose 

conviction also occurred before that 

date. 

(2) The State or Tribal plan shall 

define who is participating in the plan 

or program and is subject to the felony 

conviction restriction for purposes of 

paragraph (e)(1) of this section. To 

determine whether a person is subject to 

the felony conviction restriction, the 

State or Tribe much obtain a criminal 

history report for that person. The State 

or Indian Tribe may require additional 

reports or checks as it deems necessary. 

(3) For each license or authorization 

that the State or Indian Tribe issues, its 

plan must identify at least one 

individual as participating in the plan 

and for whom it will obtain a criminal 

history report to determine eligibility 

under paragraph (e)(1) of this section. 

(f) False statement. Each USDAapproved State or Tribal plan shall state 

that any person who materially falsifies 

any information contained in an 

application to participate in such 

program shall be ineligible to participate 

in that program. 

(g) Appeals. For States and Indian 

Tribes who wish to appeal an adverse 

action, subpart D of this part will apply. 

§ 990.7 Establishing records with USDA 

Farm Service Agency. 

All producers licensed to produce 

hemp under an USDA-approved State or 

Tribal plan shall report hemp crop 

acreage to FSA and shall provide, at 

minimum, the following information: 

(a) Street address and, to the extent 

practicable, geospatial location for each 

lot or greenhouse where hemp will be 

produced. If an applicant operates in 

more than one location, or is producing 

under multiple licenses, production 

information shall be provided for each 

location. 

(b) Acreage dedicated to the 

production of hemp, or greenhouse or 

indoor square footage dedicated to the 

production of hemp. 

(c) License or authorization identifier 

in a format prescribed by USDA. 

§ 990.8 Production under Federal law. 

Nothing in this subpart prohibits the 

production of hemp in a State or the 

territory of an Indian Tribe for which a 

State or Tribal plan is not approved 

under this subpart if produced in 

accordance with subpart C of this part, 

and if the production of hemp is not 

otherwise prohibited by the State or 

Indian Tribe. 

Subpart C—USDA Hemp Production 

Plan 

§ 990.20 USDA requirements for the 

production of hemp. 

(a) General hemp production 

requirements. The production of hemp 

in a State or territory of an Indian Tribe 

where there is no USDA approved State 

or Tribal plan must be conducted in 

accordance with this subpart, provided 

that the production of hemp is not 

prohibited by the State or territory of an 

Indian Tribe where production will 

occur. 

(b) Convicted felon ban. A person 

with a State or Federal felony 

conviction relating to a controlled 

substance is subject to a 10-year 

ineligibility restriction on participating 

in and producing hemp under the 

USDA plan from the date of the 

conviction. An exception applies to a 

person who was lawfully growing hemp 

under section 7606 of the Agricultural 

Act of 2014 (7 U.S.C. 5940) before 

December 20, 2018, and whose 

conviction also occurred before that 

date. 

(c) Falsifying material information on 

application. Any person who materially 

falsifies any information contained in an 

application for a license under the 

USDA plan shall be ineligible to 

participate in the USDA plan. 

§ 990.21 USDA hemp producer license. 

(a) General application 

requirements—(1) Requirements and 

license application. Any person 

producing or intending to produce 

hemp must have a valid license prior to 

producing hemp. A valid license means 

the license is unexpired, unsuspended, 

and unrevoked. 

(2) Application dates. Applicants may 

submit an application for a license at 

any time. 

(3) Required information on 

application. The applicant shall provide 

the information requested on the 

application form, including: 

(i) Contact information. Full name, 

residential address, telephone number, 

and email address. If the applicant is a 

business entity, the full name of the 

business, the principal business location 

address, full name and title of the key 

participants, title, email address (if 

available), and employer identification 

number (EIN) of the business; and 

(ii) Criminal history report. A current 

criminal history report for an 

individual, or if the applicant is a 

business entity, all key participants, 

dated within 60 days of the application 

submission date. A license application 

will not be considered complete without 

all required criminal history reports. 

(4) Submission of completed 

application forms. Completed 

application forms shall be submitted to 

USDA. 

(5) Incomplete application 

procedures. Applications missing 

required information shall be returned 

to the applicant as incomplete. The 

applicant may resubmit a completed 

application. 

(6) License expiration. USDA-issued 

hemp producer licenses shall be valid 

until December 31 of the year three 

years after the year in which license was 

issued. 

(b) License renewals. USDA hemp 

producer licenses must be renewed 

prior to license expiration. Licenses are 

not automatically renewed. 

Applications for renewal shall be 

subject to the same terms, information 

collection requirements, and approval 

criteria as provided in this subpart for 

initial applications unless there has 

been an amendment to the regulations 

in this part or the law since approval of 

the initial or last application. 

(c) License modification. A license 

modification is required if there is any 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5687 

change to the information submitted in 

the application including, but not 

limited to, sale of a business, the 

production of hemp in a new location, 

or a change in the key participants 

under a license. 

(d) Licensing for research. (1) 

Producers that produce hemp for 

research must obtain a USDA license. 

However, the hemp that is produced for 

research and does not enter the stream 

of commerce is not subject to the 

sampling requirements in §§ 990.24 and 

990.26; provided that the producer 

adopts and carries out a USDA 

approved alternative sampling method 

that has the potential to ensure, at a 

confidence level of 95 percent, that the 

cannabis plant species Cannabis sativa 

L. that will be subject to this alternative 

method will not test above the 

acceptable hemp THC level. 

(2) USDA licensees shall ensure the 

disposal of all non-compliant plants in 

accordance with § 990.27. Only research 

institutions registered with DEA to 

handle marijuana can keep hemp that 

tests over the 0.3 acceptable hemp THC 

level until the end of the study. 

(3) USDA licensees shall comply with 

the reporting requirements in § 990.71 

including reporting disposal of noncompliant plants. 

§ 990.22 USDA hemp producer license 

approval. 

(a) A license shall not be issued 

unless: 

(1) The application submitted for 

USDA review and approval is complete 

and accurate. 

(2) The criminal history report(s) 

submitted with the license application 

confirms that all key participants to be 

covered by the license have not been 

convicted of a felony, under State or 

Federal law, relating to a controlled 

substance within the past ten (10) years 

unless the exception in § 990.20(b) 

applies. 

(3) The applicant, if the applicant was 

previously or is currently licensed, 

submitted all reports required as a 

participant in the hemp production 

program by this part. 

(4) The application contains no 

materially false statements or 

misrepresentations and the applicant 

has not previously submitted an 

application with any materially false 

statements or misrepresentations. 

(5) The applicant’s license is not 

currently suspended, if the applicant is 

currently licensed. 

(6) The applicant is not applying for 

a license as a stand-in for someone 

whose license has been suspended, 

revoked, or is otherwise ineligible to 

participate. 

(7) The State or territory of the Indian 

Tribe where the person produces or 

intends to produce hemp does not have 

a USDA-approved plan or has not 

submitted a plan to USDA for approval 

and is awaiting USDA’s decision. 

(8) The State or territory of the Indian 

Tribe where the person produces or 

intends to produce hemp does not 

prohibit the production of hemp. 

(b) USDA shall provide written 

notification to applicants whether the 

application has been approved or 

denied. USDA shall provide written 

notification to applicants in a State or 

territory of an Indian Tribe that has 

submitted a plan to USDA and is 

awaiting USDA approval that their 

application is being returned. 

(1) If an application is approved, a 

license will be issued. 

(2) Licenses will be valid until 

December 31 of the year three after the 

year in which the license was issued. 

(3) Licenses may not be sold, 

assigned, transferred, pledged, or 

otherwise disposed of, alienated or 

encumbered. 

(4) If a license application is denied, 

the notification from USDA will explain 

the reason for denial. Applicants may 

appeal the denial in accordance with 

subpart D of this part. 

(c) If the applicant is producing in 

more than one State or territory of an 

Indian Tribe, the applicant may have 

more than one license to grow hemp. If 

the applicant has operations in a 

location covered under a State or Tribal 

plan, that operation must be licensed 

under the State or Tribal plan, not the 

USDA plan. 

§ 990.23 Reporting hemp crop acreage 

with USDA Farm Service Agency. 

All USDA licensees shall report hemp 

crop acreage to FSA within 30 days of 

hemp been planted and shall provide, at 

a minimum, the following information: 

(a) Street address and, to the extent 

practicable, geospatial location of the 

lot, greenhouse, building, or site where 

hemp will be produced. All locations 

where hemp is produced must be 

reported to FSA. 

(b) Acreage dedicated to the 

production of hemp, or greenhouse or 

indoor square footage dedicated to the 

production of hemp. 

(c) The hemp license number. 

§ 990.24 Responsibility of a USDA licensee 

prior to harvest. 

USDA licensees must: 

(a) No more than 30 days prior to the 

anticipated harvest of cannabis plants, 

have a sampling agent collect samples 

from the cannabis plant for total delta9 tetrahydrocannabinol concentration 

level testing. 

(b) Have samples collected from the 

flowering tops of the plant by cutting 

the top five to eight inches from the 

‘‘main stem’’ (that includes the leaves 

and flowers), ‘‘terminal bud’’ (that 

occurs at the end of a stem), ’’or ‘‘central 

cola’’ (cut stem that could develop into 

a bud) of the flowering top of the plant. 

Sampling guidelines and training 

requirements for sampling agents are 

available from USDA. The method used 

for sampling must be sufficient at a 

confidence level of 95 percent that no 

more than one percent (1%) of the 

plants in the lot would exceed the 

acceptable hemp THC level. The 

method used for sampling must ensure 

that a representative sample is collected 

that represents a homogeneous 

composition of the lot. 

(c) Have an authorized representative 

of the USDA licensee present at the 

growing site during a scheduled sample 

collection, if possible. 

(d) Ensure that sampling agents are 

provided with complete and 

unrestricted access during business 

hours to all hemp and other cannabis 

plants, (whether growing or harvested), 

all hemp production and storage areas, 

all land, buildings, and other structures 

used for the cultivation, handling, and 

storage of all hemp and other cannabis 

plants, and all locations listed in the 

producer license. 

(e) Not harvest the cannabis crop prior 

to samples being taken. 

(f) Use post-harvest samples only for 

remediated biomass. 

§ 990.25 Standards of performance for 

detecting total delta-9 tetrahydrocannabinol 

(THC) concentration levels. 

Analytical testing for purposes of 

determining total THC in cannabis 

plants shall meet the standards in this 

section. 

(a) Laboratory quality assurance must 

ensure the validity and reliability of test 

results. 

(b) Analytical method selection, 

validation, and verification must ensure 

that the testing method used is 

appropriate (fit for purpose), and that 

the laboratory can successfully perform 

the testing. 

(c) The demonstration of testing 

validity must ensure consistent, 

accurate analytical performance. 

(d) Method performance 

specifications must ensure analytical 

tests are sufficiently sensitive for the 

purposes of the detectability 

requirements of this part. 

(e) Laboratory must have an effective 

disposal procedure for non-compliant 

samples that do not meet the 

requirements of this part. 

(f) Measurement of uncertainty (MU) 

must be estimated and reported with 


khammond on DSKJM1Z7X2PROD with RULES6
5688 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

test results. Laboratories shall use 

appropriate, validated methods and 

procedures for all testing activities and 

evaluate measurement of uncertainty. 

(g) At a minimum, analytical testing 

of samples for total THC must use postdecarboxylation or other similarly 

reliable methods approved by the 

Secretary. The testing methodology 

must consider the potential conversion 

of THCA in hemp into THC and the test 

result must reflect the total available 

THC derived from the sum of the THC 

and THCA content. Testing 

methodologies meeting the 

requirements of this paragraph (g) 

include, but are not limited to, gas or 

liquid chromatography with detection. 

(1) The total THC shall be determined 

and reported on a dry weight basis. 

Additionally, measurement of 

uncertainty (MU) must be estimated and 

reported with test results. Laboratories 

shall use appropriate, validated 

methods and procedures for all testing 

activities and evaluate measurement of 

uncertainty. 

(2) Any sample test result exceeding 

the acceptable hemp THC level shall be 

conclusive evidence that the lot 

represented by the sample is not in 

compliance with this part. 

(3) After December 31, 2022, USDA 

licensees may only use laboratories 

registered with the DEA to conduct 

testing under this section. 

§ 990.26 Responsibility of a USDA 

producer after laboratory testing is 

performed. 

(a) The producer shall harvest the 

crop no later than thirty (30) days after 

the date of sample collection. 

(b) If the producer fails to complete 

harvest within thirty (30) days of sample 

collection, a second pre-harvest sample 

of the lot shall be required to be 

submitted for testing. 

(c) Harvested lots of hemp plants shall 

not be commingled with other harvested 

lots or other material. 

(d) Lots that meet the acceptable 

hemp THC level may enter the stream 

of commerce. 

(e) Lots that do not meet the 

acceptable hemp THC level are subject 

to § 990.27. 

(f) Any producer may request 

additional pre-harvest testing if it is 

believed that the original total delta-9 

tetrahydrocannabinol concentration 

level test results were in error. 

Additional testing may be conducted by 

the laboratory that conducted the initial 

test, or another laboratory. 

§ 990.27 Non-compliant cannabis plants. 

(a) Cannabis plants exceeding the 

acceptable hemp THC level constitute 

marijuana, a schedule I controlled 

substance under the Controlled 

Substances Act (CSA), 21 U.S.C. 801 et 

seq., and producers must either use a 

DEA-registered reverse distributor or 

law enforcement to dispose of noncompliant plants or ensure the disposal 

of such cannabis plant on site at the 

farm or hemp production facility. 

(b) Producers must notify USDA of 

their intent to dispose of or remediate 

non-conforming plants and verify 

disposal or remediation by submitting 

required documentation. 

(c) If a producer elects to perform 

remediation activities, an additional 

sampling and testing of the postremediated crop must occur to 

determine THC concentration levels. 

§ 990.28 Compliance. 

(a) Audits. USDA licensees may be 

audited by the USDA. The audit may 

include a review of records and 

documentation, and may include site 

visits to farms, fields, greenhouses, 

storage facilities, or other locations 

affiliated with the producer’s hemp 

operation. The audit may include the 

current crop year, as well as any 

previous crop year(s). The audit may be 

performed remotely or in person. 

(b) Frequency of audit verifications. 

Audit verifications may be performed 

once every three (3) years unless 

otherwise determined by USDA. If the 

results of the audit find negligent 

violations, a corrective action plan may 

be established. 

(c) Assessment of producer’s hemp 

operations for conformance. The 

producer’s operational procedures, 

documentation, recordkeeping, and 

other practices may be verified during 

the audit verification. The auditor may 

also visit the production, cultivation, or 

storage areas for hemp listed on the 

producer’s license. 

(1) Records and documentation. The 

auditor shall assess whether required 

reports, records, and documentation are 

properly maintained for accuracy and 

completeness. 

(2) [Reserved] 

(d) Audit reports. Audit reports will 

be issued to the producer no later than 

60 days after the audit is concluded. If 

USDA determines through an audit that 

the producer is not compliant with the 

Act or this part, USDA shall require a 

corrective action plan. The corrective 

action plan must include a reasonable 

date by which the producer will correct 

the negligent violation. USDA will 

approve or deny the corrective action 

plan within 60 days of its receipt. 

Producers operating under a corrective 

action plan must also periodically 

report to USDA on their compliance 

with the plan for a period of not less 

than two calendar years following the 

violation. The producer’s 

implementation of a corrective action 

plan may be reviewed by USDA during 

a future site visit or audit. If additional 

instances of noncompliance occur, 

USDA may revoke the producer’s USDA 

license for one year or until the 

producer becomes compliant whichever 

occurs later. 

§ 990.29 Violations. 

Violations of this part shall be subject 

to enforcement in accordance with the 

terms of this section. 

(a) Negligent violations. Hemp 

producers are not subject to more than 

one negligent violation per calendar 

year. A hemp producer shall be subject 

to enforcement for negligently: 

(1) Failing to provide an accurate legal 

description of land where hemp is 

produced; 

(2) Producing hemp without a license; 

and 

(3) Producing cannabis exceeding the 

acceptable hemp THC level. Hemp 

producers do not commit a negligent 

violation under this paragraph (a) if they 

make reasonable efforts to grow hemp 

and the cannabis does not have a total 

THC concentration of more than 1.0 

percent on a dry weight basis. 

(b) Corrective action for negligent 

violations. For each negligent violation, 

USDA will issue a Notice of Violation 

and require a corrective action plan 

from the producer. The producer shall 

comply with the corrective action plan 

to cure the negligent violation. 

Corrective action plans will be in place 

for a minimum of two (2) years from the 

date of their approval. Corrective action 

plans will, at a minimum, include: 

(1) The date by which the producer 

shall correct each negligent violation; 

(2) Steps that will be taken to correct 

each negligent violation; and 

(3) A description of the procedures 

that will demonstrate compliance must 

be submitted to USDA. 

(c) Negligent violations and criminal 

enforcement. A producer who 

negligently violates this part shall not, 

as a result of that violation, be subject 

to any criminal enforcement action by 

any Federal, State, Tribal, or local 

government. 

(d) Subsequent negligent violations. If 

a subsequent negligent violation occurs 

while a corrective action plan is in 

place, a new corrective action plan must 

be submitted with a heightened level of 

quality control, staff training, and 

quantifiable action measures. 

(e) Negligent violations and license 

revocation. A producer that negligently 

violates the license 3 times in a 5-year 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5689 

period shall have their license revoked 

and be ineligible to produce hemp for a 

period of 5 years beginning on the date 

of the third violation. 

(f) Culpable mental state greater than 

negligence. If USDA determines that a 

licensee has violated the terms of the 

license or of this part with a culpable 

mental state greater than negligence: 

(1) USDA shall immediately report 

the licensee to: 

(i) The U.S. Attorney General; and 

(ii) The chief law enforcement officer 

of the State or Indian territory, as 

applicable, where the production is 

located; and 

(2) Paragraphs (a) and (b) of this 

section shall not apply to culpable 

violations. 

§ 990.30 USDA producers; License 

suspension. 

(a) USDA may issue a notice of 

suspension to a producer if USDA or its 

representative receives some credible 

evidence establishing that a producer 

has: 

(1) Engaged in conduct violating a 

provision of this part; or 

(2) Failed to comply with a written 

order from the USDA–AMS 

Administrator related to negligence as 

defined in this part. 

(b) Any producer whose license has 

been suspended shall not handle or 

remove hemp or cannabis from the 

location where hemp or cannabis was 

located at the time when USDA issued 

its notice of suspension, without prior 

written authorization from USDA. 

(c) Any person whose license has 

been suspended shall not produce hemp 

during the period of suspension. 

(d) A producer whose license has 

been suspended may appeal that 

decision in accordance with subpart D 

of this part. 

(e) A producer whose license has been 

suspended and not restored on appeal 

may have their license restored after a 

waiting period of one year from the date 

of the suspension. If the license was 

issued more than three years prior to the 

date of restoration, the producer shall 

submit a new application and criminal 

history report to USDA. 

(f) A producer whose license has been 

suspended may be required to provide, 

and operate under, a corrective action 

plan to fully restore their license. 

§ 990.31 USDA licensees; Revocation. 

USDA shall immediately revoke the 

license of a USDA licensee if such 

licensee: 

(a) Pleads guilty to, or is convicted of, 

any felony related to a controlled 

substance; or 

(b) Made any materially false 

statement with regard to this part to 

USDA or its representatives with a 

culpable mental state greater than 

negligence; or 

(c) Is found to be growing cannabis 

exceeding the acceptable hemp THC 

level with a culpable mental state 

greater than negligence or negligently 

violated this part three times in five 

years. 

§ 990.32 Recordkeeping requirements. 

(a) USDA licensees shall maintain 

records of all hemp plants acquired, 

produced, handled, disposed of, or 

remediated as will substantiate the 

required reports. 

(b) All records and reports shall be 

maintained for at least three years. 

(c) All records shall be made available 

for inspection by USDA inspectors, 

auditors, or their representatives during 

reasonable business hours. The 

following records must be made 

available: 

(1) Records regarding acquisition of 

hemp plants; 

(2) Records regarding production and 

handling of hemp plants; 

(3) Records regarding storage of hemp 

plants; and 

(4) Records regarding disposal and 

remediation of all cannabis plants that 

do not meet the definition of hemp. 

(d) USDA inspectors, auditors, or 

their representatives shall have access to 

any premises where hemp plants may 

be held during reasonable business 

hours. 

(e) All reports and records required to 

be submitted to USDA as part of 

participation in the program in this part 

which include confidential data or 

business information, including but not 

limited to information constituting a 

trade secret or disclosing a trade 

position, financial condition, or 

business operations of the particular 

licensee or their customers, shall be 

received by, and at all times kept in the 

custody and control of, one or more 

employees of USDA or their 

representatives. Confidential data or 

business information may be shared 

with applicable Federal, State, Tribal, or 

local law enforcement or their designee 

in compliance with the Act. 

Subpart D—Appeals 

§ 990.40 General adverse action appeal 

process. 

(a) Persons who believe they are 

adversely affected by the denial of a 

license application under the USDA 

hemp production program may appeal 

such decision to the AMS 

Administrator. 

(b) Persons who believe they are 

adversely affected by the denial of a 

license renewal under the USDA hemp 

production program may appeal such 

decision to the AMS Administrator. 

(c) Persons who believe they are 

adversely affected by the revocation or 

suspension of a USDA hemp production 

license may appeal such decision to the 

AMS Administrator. 

(d) States and Indian Tribes that 

believe they are adversely affected by 

the denial of a proposed State or Tribal 

hemp plan may appeal such decision to 

the AMS Administrator. 

§ 990.41 Appeals under the USDA hemp 

production plan. 

(a) Appealing a denied USDA-plan 

license application. A license applicant 

may appeal the denial of a license 

application. 

(1) If the AMS Administrator grants 

an applicant’s appeal of a licensing 

denial, the applicant will be issued a 

USDA hemp production license. 

(2) If the AMS Administrator denies 

an appeal, the applicant’s license 

application will be denied. The 

applicant may request a formal 

adjudicatory proceeding within 30 days 

to review the decision. Such proceeding 

shall be conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Adjudicatory 

Proceedings, 7 CFR part 1, subpart H. 

(b) Appealing a denied USDA-plan 

license renewal. A producer may appeal 

the denial of a license renewal. 

(1) If the AMS Administrator grants a 

producer’s appeal of a licensing renewal 

denial, the applicant’s USDA hemp 

production license will be renewed. 

(2) If the AMS Administrator denies 

the appeal, the applicant’s license will 

not be renewed. The denied producer 

may request a formal adjudicatory 

proceeding within 30 days to review the 

decision. Such proceeding shall be 

conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Formal Adjudicatory 

Proceedings, 7 CFR part 1, subpart H. 

(c) Appealing a USDA-plan license 

termination or suspension. A USDA 

hemp plan producer may appeal the 

revocation or suspension of a license. 

(1) If the AMS Administrator grants 

the appeal of a license termination or 

suspension, the producer will retain 

their license. 

(2) If the AMS Administrator denies 

the appeal, the producer’s license will 

be terminated or suspended. The 

producer may request a formal 

adjudicatory proceeding within 30 days 

to review the decision. Such proceeding 

shall be conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Formal Adjudicatory 

Proceedings, 7 CFR part 1, subpart H. 


khammond on DSKJM1Z7X2PROD with RULES6
5690 Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 

(d) Filing period. The appeal of a 

denied license application, denied 

license renewal, suspension, or 

revocation must be filed within the 

time-period provided in the letter of 

notification or within 30 business days 

from receipt of the notification, 

whichever occurs later. The appeal will 

be considered ‘‘filed’’ on the date 

received by the AMS Administrator. 

The decision to deny an appeal of a 

license application or renewal, or 

suspend or terminate a license, is final 

unless a formal adjudicatory proceeding 

is requested within 30 days to review 

the decision. Such proceeding shall be 

conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Adjudicatory 

Proceedings, 7 CFR part 1, subpart H. 

(e) Where to file. Appeals to the 

Administrator must be filed in the 

manner as determined by AMS. 

(f) What to include. All appeals must 

include a copy of the adverse decision 

and a statement of the appellant’s 

reasons supporting why the decision 

was not proper or made in accordance 

with applicable program regulations in 

this part, policies, or procedures. 

§ 990.42 Appeals under a State or Tribal 

hemp production plan. 

(a) Appealing a State or Tribal hemp 

production plan application. A State or 

Indian Tribe may appeal the denial of a 

proposed State or Tribal hemp 

production plan by the USDA to the 

AMS Administrator. 

(1) If the AMS Administrator grants a 

State or Indian Tribe’s appeal of a 

denied hemp plan application, the 

proposed State or Tribal hemp 

production plan shall be established as 

proposed. 

(2) If the AMS Administrator denies 

an appeal, the proposed State or Tribal 

hemp production plan shall not be 

approved. Prospective producers 

located in the State or territory of the 

Indian Tribe may apply for hemp 

licenses under the terms of the USDA 

plan. The State or Indian Tribe may 

request a formal adjudicatory 

proceeding be initiated within 30 days 

to review the decision. Such proceeding 

shall be conducted pursuant to the U.S. 

Department of Agriculture’s Rules of 

Practice Governing Adjudicatory 

Proceedings, 7 CFR part 1, subpart H. 

(b) Appealing the suspension or 

termination of a State or Tribal hemp 

production plan. A State or Tribe may 

appeal the revocation by USDA of an 

approved State or Tribal hemp 

production plan. 

(1) If the AMS Administrator grants a 

State or Indian Tribe’s appeal of a State 

or Tribal hemp production plan 

suspension or revocation, the associated 

hemp production plan will remain in 

place and effective. 

(2) If the AMS Administrator denies 

an appeal, the State or Tribal hemp 

production plan will be suspended or 

revoked as applicable. Producers 

located in that State or territory of the 

Indian Tribe may continue to produce 

hemp under their State or Tribal license 

until the end the calendar year in which 

the State or Tribal plan’s disapproval 

was effective or when the State or Tribal 

license expires, whichever is earlier. 

Producers may apply for a USDA 

license under subpart C of this part 

unless hemp production is otherwise 

prohibited by the State or Indian Tribe. 

The State or Indian Tribe may request 

a formal adjudicatory proceeding be 

initiated to review the decision. Such 

proceeding shall be conducted pursuant 

to the U.S. Department of Agriculture’s 

Rules of Practice Governing Formal 

Adjudicatory Proceedings, 7 CFR part 1, 

subpart H. 

(c) Filing period. The appeal of a State 

or Tribal hemp production plan 

suspension or revocation must be filed 

within the time-period provided in the 

letter of notification or within 30 

business days from receipt of the 

notification, whichever occurs later. The 

appeal will be considered ‘‘filed’’ on the 

date received by the AMS 

Administrator. The decision to deny a 

State or Tribal plan application or 

suspend or revoke approval of a plan, is 

final unless the decision is appealed in 

a timely manner. 

(d) Where to file. Appeals to the 

Administrator must be filed in the 

manner as determined by AMS. 

(e) What to include in appeal. All 

appeals must include a copy of the 

adverse decision and a statement of the 

appellant’s reasons supporting why the 

decision was not proper or made in 

accordance with applicable program 

regulations in this part, policies, or 

procedures. 

Subpart E—Administrative Provisions 

§ 990.60 Agents. 

As provided under 7 CFR part 2, the 

Secretary may name any officer or 

employee of the United States or name 

any agency or division in the United 

States Department of Agriculture, to act 

as their agent or representative in 

connection with any of the provisions of 

this part. 

§ 990.61 Severability. 

If any provision of this part is 

declared invalid or the applicability 

thereof to any person or circumstances 

is held invalid, the validity of the 

remainder of this part or the 

applicability thereof to other persons or 

circumstances shall not be affected 

thereby. 

§ 990.62 [Reserved] 

§ 990.63 Interstate transportation of hemp. 

No State or Indian Tribe may prohibit 

the transportation or shipment of hemp 

lawfully produced under a State or 

Tribal plan approved under subpart B of 

this part, under a license issued under 

subpart C of this part, or under 7 U.S.C. 

5940 through the State or territory of the 

Indian Tribe, as applicable. 

Subpart F—Reporting Requirements 

§ 990.70 State and Tribal hemp reporting 

requirements. 

(a) State and Tribal hemp producer 

report. Each State and Indian Tribe with 

a plan approved under this part shall 

submit to USDA, by the first of each 

month, a report providing the contact 

information and the status of the license 

or other authorization issued for each 

producer covered under the applicable 

State and Tribal plans. If the first of the 

month falls on a weekend or holiday, 

the report is due by the first business 

day following the due date. The report 

shall be submitted using a digital format 

compatible with USDA’s information 

sharing systems, whenever possible. 

The report shall contain the information 

described in this paragraph (a). 

(1)(i) For each new producer who is 

an individual and is licensed or 

authorized under the State or Tribal 

plan, the report shall include the full 

name of the individual, license or 

authorization identifier, Employee 

Identification Number (‘‘EIN’’) of the 

business entity, business address, 

telephone number, and email address (if 

available). 

(ii) For each new producer that is an 

entity and is licensed or authorized 

under the State or Tribal plan, the report 

shall include full name of the entity, the 

principal business location address, 

license or authorization identifier, and 

the full name, title, and email address 

(if available) of each employee for 

whom the entity is required to submit 

a criminal history report. 

(iii) For each producer that was 

included in a previous report and whose 

reported information has changed, the 

report shall include the previously 

reported information and the new 

information. 

(2) The status of each producer’s 

license or authorization. 

(3) The period covered by the report. 

(4) Indication that there were no 

changes during the current reporting 

cycle, if applicable. 


khammond on DSKJM1Z7X2PROD with RULES6
Federal Register / Vol. 86, No. 11 / Tuesday, January 19, 2021 / Rules and Regulations 5691 

(b) State and Tribal hemp disposal or 

remediation report. If a producer has 

produced cannabis exceeding the 

acceptable hemp THC level, the 

cannabis must be disposed of or 

remediated. States and Tribes with 

plans approved under this part shall 

submit to USDA, by the first of each 

month, a report notifying USDA of any 

occurrence of non-conforming plants or 

plant material and providing a disposal 

or remediation record of those plants 

and materials. This report would 

include information regarding name and 

contact information for each producer 

subject to a disposal or remediation 

during the reporting period, and date 

disposal or remediation was completed. 

If the first of the month fall on a 

weekend or holiday, reports are due by 

the first business day following the due 

date. The report shall contain the 

information described in this paragraph 

(b). 

(1) Name and address of the producer. 

(2) Producer license or authorization 

identifier. 

(3) Location information, such as lot 

number, location type, and geospatial 

location or other location descriptor for 

the production area subject to disposal 

or remediation. 

(4) Disposal or remediation 

completion date. 

(5) Total acreage. 

(c) Annual report. Each State or 

Indian Tribe with a plan approved 

under this part shall submit an annual 

report to USDA. The report form shall 

be submitted by December 15 of each 

year and contain the information 

described in this paragraph (c). 

(1) Total planted acreage. 

(2) Total harvested acreage. 

(3) Total acreage disposed and 

remediated. 

(d) Test results report. Each producer 

must ensure that the laboratory that 

conducts the test of the sample(s) from 

its lots reports the test results to USDA. 

Informal testing conducted throughout 

the growing season for purposes of 

monitoring THC concentration do not 

need to be reported to USDA. The test 

results report shall contain: 

(1) Producer’s license or authorization 

identifier. 

(2) Name of producer. 

(3) Business address of producer. 

(4) Lot identification number for the 

sample. 

(5) Name of laboratory and, no later 

than December 31, 2022, the DEA 

registration number of laboratory for 

testing. 

(6) Date of test and report. 

(7) Identification of a pre-harvest or 

post-harvest retest. 

(8) Test result. 

§ 990.71 USDA plan reporting 

requirements. 

(a) USDA licensing application. 

USDA will accept applications on a 

rolling basis. Licenses will be valid until 

December 31 of the year three years after 

the license is issued. The license 

application will be used for both new 

and renewal applicants. The application 

shall include: 

(1) Contact information. (i) For an 

applicant who is an individual, the 

application shall include full name of 

the individual, Employee Identification 

Number (‘‘EIN’’) of the business entity, 

business address, telephone number, 

and email address (if available). 

(ii) For an applicant that is an entity, 

the application shall include full name 

of the entity, the principal business 

location address, and the full name, 

title, and email address (if available) of 

each key participant of the entity. 

(2) Criminal history report. As part of 

a complete application, each applicant 

shall provide a current Federal Bureau 

of Investigation’s Identity History 

Summary. If the applicant is a business 

entity, a criminal history report shall be 

provided for each key participant. 

(i) The applicant shall ensure the 

criminal history report accompanies the 

application. 

(ii) The criminal history report must 

be dated within 60 days of submission 

of the application submittal. 

(3) Consent to comply with program 

requirements. All applicants submitting 

a completed license application, in 

doing so, consent to comply with the 

requirements of this part. 

(b) USDA licensee disposal and 

remediation form. USDA licensee 

conducts a disposal or remediation 

activity, that licensee must report the 

activity on the appropriate form to 

USDA no later than 30 days after the 

date of completion of disposal or 

remediation activity. The report shall 

contain the information described in 

this paragraph (b). 

(1) Name and address of the producer. 

(2) The USDA licensee’s USDA 

license number. 

(3) Geospatial location, or other valid 

land descriptor, for the production area 

subject to disposal or remediation. 

(4) Date of completion of disposal or 

remediation. 

(5) Signature of the USDA licensee or 

authorized representative. 

(c) USDA licensee annual report. Each 

USDA licensee shall submit an annual 

report to USDA. The report form shall 

be submitted by December 15 of each 

year and contain the information 

described in this paragraph (c). 

(1) USDA licensee ’s license number. 

(2) USDA licensee ’s name. 

(3) USDA licensee’s address. 

(4) Lot, location type, geospatial 

location, total planted acreage, total 

acreage disposed and remediated, and 

total harvested acreage. 

(d) Test results report. Each USDA 

licensee must ensure that the laboratory 

that conducts the test of the sample(s) 

from its lots reports the test results for 

all samples tested to USDA. Informal 

testing conducted throughout the 

growing season for purposes of 

monitoring THC concentration do not 

need to be reported to USDA. The test 

results report shall contain the 

information described in this paragraph 

(d) for each sample tested. 

(1) USDA licensee ’s license number. 

(2) Name of the USDA licensee. 

(3) Business address of the USDA 

licensee. 

(4) Lot identification number for the 

sample. 

(5) Name of testing laboratory. 

(6) Date of test and report. 

(7) Identification of a pre-harvest or 

post-harvest retest. 

(8) Test result. 

Bruce Summers, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2021–00967 Filed 1–15–21; 8:45 am] 

BILLING CODE P 


khammond on DSKJM1Z7X2PROD with RULES6