Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Author: Scarinci Hollenbeck, LLC
Date: October 29, 2019
The Firm
201-896-4100 info@sh-law.comThe U.S. Department of Agriculture (USDA) recently announced that industrial hemp growers can qualify for insurance coverage under the Whole-Farm Revenue Protection (WFRP) program for crop year 2020. WFRP allows coverage of all revenue for commodities produced on a farm up to a total insured revenue of $8.5 million. According to the USDA, additional insurance coverage options for hemp growers are also on the horizon.
As investment in the hemp industry continues to expand across the country, USDA’s announcement is timely. Martin Barbre, the Administrator of USDA’s Risk Management Agency (RMA), recently noted that a number of hemp producers are anxious for a way to protect their crops from natural disasters. According to Mr. Barbre, “[t]he WFRP policy will provide a safety net for them. We expect to be able to offer additional hemp coverage options as USDA continues implementing the 2018 Farm Bill.”
The newly-available insurance coverage is made possible by the 2018 Farm Bill, which amended the Controlled Substances Act (CSA) to remove industrial hemp from the list of banned substances. The Farm Bill defines “legal” hemp as containing 0.3 percent or less tetrahydrocannabinol (THC) on a dry weight basis.
Under the 2018 Farm Bill, hemp may be grown (1) with a valid USDA-issued license, (2) under a USDA-approved State or Tribal plan, or (3) under the 2014 Farm Bill industrial hemp pilot authority. That pilot authority will expire one year after USDA establishes a plan for issuing USDA licenses pursuant to the 2018 Farm Bill.
While the USDA works on regulations to implement the 2018 Farm Bill, federal agencies are working to make resources available to hemp producers. In June, the USDA published guidance regarding the importation of hemp seeds, which previously required approval from the Drug Enforcement Administration (DEA). More recently, the National Credit Union Administration (NCUA) issued guidance giving federally insured credit unions the green light to provided financial services to the legal hemp industry.
The availability of federal insurance coverage is the latest development. Under the new USDA directive, coverage for hemp grown for fiber, flower or seeds will first be available to producers who are in areas covered by USDA-approved hemp plans or who are part of approved state or university research pilot programs. However, other hemp producers can’t obtain coverage until a USDA-approved plan is in place.
To be eligible, among other requirements, a hemp producer must comply with applicable state, tribal or federal regulations for hemp production and have a contract for the purchase of the insured industrial hemp. WFRP provisions state that hemp having THC above the compliance level will not constitute an insurable cause of loss. Additionally, hemp will not qualify for replant payments under WFRP.
The USDA’s Agricultural Marketing Service (AMS) is currently drafting regulations that will include specific details for both a USDA plan for the production of hemp and a process for submission of state, territorial or tribal plans to USDA. According to the USDA, the regulations will post to the Federal Register later this year.
Once rulemaking is complete, RMA, the Farm Service Agency (FSA), the Natural Resources Conservation Service and other USDA agencies will share eligibility information on their programs, which include safety net, conservation, farm loan and disaster assistance programs. The USDA further advises that the FSA looking at additional coverage options through its Noninsured Crop Disaster Assistance Program and through RMA-administered crop insurance.
If you have any questions or if you would like to discuss the matter further, please contact the Scarinci Hollenbeck attorney with whom you work, at 201-806-3364.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Over the past year, brick-and-mortar stores have closed their doors at a record pace. Fluctuating consumer preferences, the rise of online shopping platforms, and ongoing economic uncertainty continue to put pressure on the retail industry. When a retailer seeks bankruptcy protection, a myriad of other businesses are often impacted. Whether you are a supplier, customer, […]
Author: Brian D. Spector
Since his inauguration two months ago, Donald Trump’s administration and the Congress it controls have indicated important upcoming policy changes. These changes will impact financial services policies and priorities. The changes will particularly affect cryptocurrency, as well as banking rules and regulations. Key Regulatory Changes in Cryptocurrency For example, in the burgeoning cryptocurrency business environment, […]
Author: Dan Brecher
The retail sector has experienced a wave of bankruptcy filings over the last year. Brick-and-mortar businesses in financial distress include big-name brands like Big Lots, Party City, The Container Store, and Vitamin Shoppe. When large retailers seek bankruptcy protection, they are not the only businesses impacted. Landlords can be particularly hard hit. While commercial landlords […]
Author: Brian D. Spector
The bankruptcy legal landscape presents both challenges and opportunities for businesses navigating financial distress. Understanding current bankruptcy trends can help businesses make more informed and strategic decisions. Corporate Bankruptcy Filings Trending Upwards Bankruptcy filings continued to trend upwards in 2024. According to statistics released by the Administrative Office of the U.S. Courts, personal and business […]
Author: Brian D. Spector
In December, the U.S. Securities and Exchange Commission (SEC) announced charges against two privately held companies for failing to file a Form D notice, which is generally utilized for exempt securities offerings. Here, the SEC’s enforcement sends a strong message: compliance with regulatory requirements is not optional and failure to comply can have significant consequences. […]
Author: Kenneth C. Oh
On February 14, 2025, the Office of General Counsel (OGC) of the National Labor Relations Board (NLRB) under Acting General Counsel William B. Cowen issued Memorandum 25-05, “New Process for More Efficient, Effective, Accessible and Transparent Case handling.” The Memorandum rescinds nearly all of the Memoranda issued by his direct predecessor, Jennifer Abruzzo, setting the […]
Author: Matthew F. Mimnaugh
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!