The 2018 Farm Bill
The 2018 Farm Bill is crucial for the healthy future of the fast growing hemp industry in the US.
The Bill, if passed, includes the Hemp Farming Act of 2018, which will remove hemp as a designated as controlled substance, legalizing the crop under federal law, which will allow CBD to be legally sold in all 50 states.
The full legalization of hemp would open the floodgates for investment, providing the hemp industry with access to a full range of financial, market development and advisory services that were previously unavailable because of its classification as a controlled substance.
These services include access to small business loans (SBA’s), federal crop insurance, access to banking & traditional capital markets, and unfettered USDA research. Institutional investors and private equity firms will be also be able to enter the space, as federal restrictions have restricted the ability of funds to participate in this sector.
7 Steps To Passing The 2018 US Farm Bill
1.The House and Senate each passed their own versions of the 2018 Farm Bill. The Senate version includes Senate Majority Leader Mitch McConnell’s Hemp Farming Act, which would permanently legalize hemp and popular hemp-derived products like cannabidiol (CBD). The House version was silent on hemp.
2. For the past few months, a House/Senate conference committee has been meeting to resolve the differences between the two bills. A key issue in debate is whether to increase work requirements on the collection of food stamps.
3. In an unprecedented move, Leader McConnell appointed himself to serve on the conference committee. In that role, he publicly guaranteed that the final Farm Bill would include his hemp provisions.
4. The top leadership (the “Big Four”) of the House and Senate Agriculture Committees – Senate Chairman Pat Roberts (R-KS), Senate Ranking Member Debbie Stabenow (D-MI), House Chairman Mike Conaway (R-TX) and House Ranking Member Colin Peterson (D-MN) — have been meeting regularly behind closed doors to iron out differences. Chairman Roberts announced last week that he thought a deal might be reached today.
5.Once the deal is reached, it must be brought to the full House/Senate Conference Committee for a vote. Passage is very likely because the Big Four will have consulted deeply with their colleagues before reaching a compromise.
6. After the conference committee adds its stamp of approval, the consensus Farm Bill will go to the floors of the House and Senate for their votes
7. After the House and Senate pass the bill, it goes to President Trump’s desk for his signature
The Nitty Gritty
Here’s a report from Daniel Cameron of Frost Brown Todd, the Roundtable’s lead DC lobbyist and the former Legal Counsel to Senate Majority Leader Mitch McConnell.
As the wheels of the legislative process continue to turn, the 2018 Farm Bill has confronted its share of potholes, primarily the result of disagreement on food stamp work requirements. Now, an external complication, Hurricane Michael, might push passage of the Farm Bill into early 2019. Per House Agriculture ranking member Collin Peterson, in the lame-duck session, after the November general election, there will be pressure for legislators to immediately turn to emergency funding legislation to help rebuild parts of states that were destroyed by the hurricane. He posits that it will likely take priority over other legislative matters, including the Farm Bill. That said, he still declared his hope that a compromise Farm Bill will be ready for the week of November 12, when Congress will return to Washington.
Of course, there are four other critical partners to the Farm Bill negotiations: Senate Agriculture Chairman Pat Roberts, Senate Ag Ranking Member Debbie Stabenow, House Ag Chairman Mike Conaway, and Senator McConnell. They have not spoken concerning the impact of Hurricane Michael on the timeline of the Farm Bill. So it remains to be seen if the bill is passed by the end of this year or whether it becomes a 2019 priority.
Keep in mind as well that the Farm Bill, and more specifically hemp, could have no bigger proponent than the Majority Leader of the Senate. He wants to get this done and is still very committed to it, given the benefit to farmers and the support it has in Kentucky.
Equally important, the Farm Bill must pass. The Farm Bill must be reauthorized/renewed every four to five years because there are funding streams within the legislation that expire. The 2014 reauthorization of the Farm Bill expired on September 30; however, the funding streams created through that legislation have yet to run out, but are likely to either by the end of this year or sometime during 2019. At some point, the reality of finite or limited funding will create the urgency necessary to get the reauthorization over the finish line, despite difference on food stamp work requirements.
Thankfully, while the “big four” negotiate the reauthorization, the pilot program that you rely on is not subject to any expiration, funding or otherwise, of the 2014 Farm Bill. Section 7606 is permanent. It is firmly codified in the United States Code, under Chapter 7, section 5940, and can only end by way of an affirmative act of Congress. Plus, as recently as October 1, Congress reaffirmed its commitment to protect the pilot program from unwarranted intrusions from the DEA and other law enforcement agencies through its passage and the president’s signing of a temporary appropriations bill. Therein, Congress restated that no funds should be used to contravene “section 7606 of the Agriculture Act of 2014 (7 U.S.C. 5940); or to prohibit the transportation, processing, sale, or use of industrial hemp, or seeds of such plant, that is grown or cultivated in accordance with subsection section 7606 of the Agricultural Act of 2014, within or outside the State in which the industrial hemp is grown or cultivated.”