
Daniel T. McKillop
Partner
201-896-7115 dmckillop@sh-law.comFirm Insights
Author: Daniel T. McKillop
Date: November 26, 2018
Partner
201-896-7115 dmckillop@sh-law.comWhile cannabis advocates may still be waiting for the state to legalize recreational marijuana, Gov. Phil Murphy recently signed an important cannabis bill clearing the way for growers to cultivate its less controversial “cousin.” Under Assembly Bill 1330, which was signed into law by Governor Murphy last week, license holders will be able to plant, grow, harvest, possess, process, distribute, buy, or sell industrial hemp within the state.
The new law does not mean that growers can immediately start producing industrial hemp. Rather, it directs the New Jersey Department of Agriculture to establish an industrial hemp agricultural pilot program that would research the cultivation of hemp crops to the maximum extent permitted by federal law. Nonetheless, New Jersey’s latest cannabis law does pave the way for the state capitalize on the growing demand for industrial hemp.
“It’s time for New Jersey to put its finger on the pulse of the hemp industry,” Sen. Declan O’Scanlon, the bill’s primary sponsor, said in a prepared statement. “This pilot program is a win for local farmers who need a diversity of opportunities to compete in the global agriculture market. Hemp is growing in value as a cash crop, and I am sure the New Jersey economy and our farmers will benefit from this pilot program.
Under the Controlled Substances Act (CSA), all forms of cannabis, including industrial hemp, are considered Schedule I controlled substances. However, marijuana and hemp are quite different, each having distinct chemical makeups and applications. Marijuana plants contain high levels of tetrahydrocannabinol (THC); meanwhile, hemp contains miniscule amounts of the psychoactive chemical. As a result, marijuana is consumed for recreational and medical purposes, while hemp is used in industrial applications, such as dietary supplements, skin products, clothing, and accessories.
While marijuana remains illegal under federal law, the 2014 farm bill authorizes limited hemp production under certain circumstances. Most notably, hemp must be grown and cultivated “in accordance with an agricultural pilot program … established by a State department of agriculture or State agency … in a State where the production of industrial hemp is otherwise legal under State law.” New Jersey will now join 38 other states that have already established industrial hemp programs.
The new law directs the Department of Agriculture (Department) to establish an agricultural pilot program to study and promote the cultivation of industrial hemp to the maximum extent permitted by federal law. It further provides that the Department may partner with any institution of higher education in the State to administer the agricultural pilot program.
The new law defines industrial hemp as an agricultural product that is any variety of Cannabis sativa L with a delta-9-tetrahydrocannabinol concentration of 0.3% or less on a dry weight basis. Under the bill, the Department is required to adopt rules and regulations to administer the pilot program. The regulations must address, at minimum, the following areas:
As proponents of the legislation highlighted, the ability to grow hemp on an industrial scale would allow farmers to diversify their products by adding a lucrative cash crop. In addition, researching cultivation methods of industrial hemp would greatly aid farmers seeking to grow hemp for the first time.
New Jersey’s pilot program may only be the beginning. Industrial hemp could soon be legal across the United States. While Congress has yet to reach a consensus on the 2018 farm bill, a provision in the Senate version would amend the CSA to exclude “industrial hemp” from the statutory definition of marijuana. Industrial hemp would be defined based on its THC content and set at a threshold of 0.3%
Following the midterm elections, Senate Majority Leader Mitch McConnell stated that the Farm Bill was one of his top legislative priorities for the remainder of 2018. He also confirmed the importance of the hemp legalization provision. According to McConnell, “If there’s a farm bill it will be in there, I guarantee you that.”
If you have any questions or if you would like to discuss the matter further, please contact me, Dan McKillop, at 201-806-3364.
This article is a part of a series pertaining to cannabis legalization in New Jersey and the United States at large. Prior articles in this series are below:
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Corporate transactions can have significant implications for a corporation and its stakeholders. For deals to be successful, companies must act strategically to maximize value and minimize risk. It is also important to fully understand the legal and financial ramifications of corporate transactions, both in the near and long term. Understanding Corporate Transactions The term “corporate […]
Author: Dan Brecher
Ongoing economic uncertainty is forcing many companies to make tough decisions, which includes lowering staff levels. The legal landscape on both the state and federal level also continues to evolve, especially with significant changes to the priorities of the Equal Employment Opportunity Commission (“EEOC”) under the Trump Administration. Terminating an employee is one of the […]
Author: Angela A. Turiano
While filing annual reports may seem like a nuisance, failing to do so can have significant ramifications. These include fines, reputational harm, and interruption of your business operations. In basic terms, “admin dissolution for annual report” means that a company is dissolved by the government. This happens because it failed to submit its annual report […]
Author: Dan Brecher
Antitrust laws are designed to ensure that businesses compete fairly. There are three federal antitrust laws that businesses must navigate. These include the Sherman Act, the Federal Trade Commission Act, and the Clayton Act. States also have their own antitrust regimes. These may vary from federal regulations. Understanding antitrust litigation helps businesses navigate these complex […]
Author: Robert E. Levy
If you’re considering closing your business, it’s crucial to understand that simply shutting your doors does not end your legal obligations. Unless you formally dissolve your business, it continues to exist in the eyes of the law—leaving you exposed to ongoing liabilities such as taxes, compliance violations, and potential lawsuits. Dissolving a business can seem […]
Author: Christopher D. Warren
Contrary to what many people think, corporate restructuring isn’t all doom and gloom. Revamping a company’s organizational structure, corporate hierarchy, or operations procedures can help keep your business competitive. This is particularly true during challenging times. Corporate restructuring plays a critical role in modern business strategy. It helps companies adapt quickly to market changes. Following […]
Author: Dan Brecher
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!