Tag: Regulations

In statements touting the news, Braun said the legislation would let farmers “tap into one of the fastest growing agricultural markets” and Tester said that they “don’t need government bureaucrats putting unnecessary burdens on their operations.”

Left unsaid was how the bill had come together.

Interviews with six hemp advocates, company officials and Senate aides reveal that hemp lobbyists and businesses brought the original idea for the legislation to Tester’s office. An email obtained by POLITICO also shows that in February they got a word-for-word early look at the bill that the two senators would go on to introduce weeks later.

“It comes down to the definition of ‘write,’” said Geoff Whaling, chair of the advocacy organization National Hemp Association, when asked if hemp insiders helped write the legislation. “Did they all provide feedback and comments and told the senator’s office: ‘Do we need this changed?’ Absolutely. Part of the legislative process is consultation with stakeholder groups and certainly, like any legislation, that was done.”

Depending on one’s vantage point, the process by which the Industrial Hemp Act of 2023 was put together resembles a thoughtful process or government at its quintessential unseemliness. Either way, it underscores how Congress often turns to self-interested outsiders for help understanding arcane issues and illustrates the blurry line between relying on industry expertise and letting those industry forces craft their own regulations.

The hemp lobby is hardly a D.C. powerhouse on the scale of Big Oil or Big Pharma. It’s only been since 2018 that hemp has been legal, done so as part of that year’s farm bill. It was touted as a potential boon for farmers, particularly in states where tobacco was once a major cash crop. But the market for hemp-derived CBD products has failed to develop as hoped, in part due to continuing legal and regulatory uncertainty. Five years ago, it was supposed to hit $22 billion in 2022, according to the Brightfield Group, which tracks the industry, but instead was less than a quarter of that size last year. That’s led the industry to shift more toward industrial applications for hemp, like textiles and building supplies.

Industry officials have been hoping that lawmakers will use the 2023 farm bill to provide changes to boost the fledgling industry. And they’ve made this case directly to members of Congress and their staff.

Tester’s aides said his office wrote the bill themselves with the nonpartisan Senate Office of the Legislative Counsel in order to help a Montana-based hemp business that reached out with a problem in 2022.

“As a third-generation Montana farmer, Jon Tester will always fight to do what’s best for his state,” said Eli Cousin, a Tester spokesperson. “After hearing directly from Montana small business owners who expressed that government red tape was putting unnecessary burdens on their operations, he did what he always does: took their feedback with him and worked across the aisle to find a solution. He’ll keep fighting until this bipartisan bill becomes law.”

The email obtained by POLITICO, however, suggests more direct collaboration between the senator’s office and the hemp industry Congress is tasked with regulating.

By this February, Tester’s office said, it had been working for a year on the legislation slashing regulations for hemp growers. That month Courtney Moran, who serves as the chief legislative strategist at Agricultural Hemp Solutions, emailed a legislative assistant for Tester, as well as Morgan Tweet, co-founder of that Montana-based industrial hemp company that contacted Tester’s team, IND HEMP; Erica Stark, the executive director of the National Hemp Association; and Cort Jensen, an attorney for the Montana Department of Agriculture.

“CONFIDENTIAL – Industrial Hemp Act, 2023,” read the subject line from Moran.

Moran included a PDF document in the email. It was the bill that Tester and Braun would go on to introduce.

Moran addressed the note to Jensen and thanked him for bringing together the “team” at the Montana Department of Agriculture earlier that week. “We greatly appreciate everyone’s feedback and insight,” she said.

“Attached is the current (and hopefully final!) draft bill language,” she wrote, adding that the legislation was sent to the U.S. Department of Agriculture the week prior for a “final review.”

“Appreciate you letting us know if you have any questions or comments after reading the bill,” Moran said. “PLEASE KEEP THIS CONFIDENTIAL at this time, and not share outside of the Department. Really appreciate you!”

It is unclear whether or how Jensen and the hemp industry insiders replied to the email. The document obtained by POLITICO did not include any follow-up. A USDA spokesperson said Tester’s office had sent the legislation to them, not industry officials.

Moran is registered as a lobbyist on behalf of IND HEMP, disclosing this year and last that she lobbied on the issue of industrial hemp to the Senate and USDA. One of her specific lobbying issues cited in 2023 is Tester and Braun’s Industrial Hemp Act.

A spokesperson for Braun said that his office negotiated his co-sponsorship with Tester’s team. They also suggested that they were uncomfortable with the degree to which advocates were involved in the process.

“[O]ur chief of staff called the chair of one of these advocacy groups to tell them we were negotiating directly with the other office and told them frankly we did not want them involved in our process,” said the spokesperson, who spoke candidly on the condition of anonymity. “We support this bill because it doesn’t make sense for industrial hemp crops grown in Indiana to go through the same testing and sampling as cannabinoid hemp.”

How a bill becomes law

According to Tester’s aides, the process by which the bill came together was more nuanced and deliberative than the email suggests. They said Tweet, whose business reports having between 11 and 50 employees, came to the senator’s team in February 2022 with a dilemma: A provision in the 2018 farm bill was creating major headaches for grain and fiber hemp farmers because it treated all hemp the same, whether it was being grown for industrial purposes or for consumer CBD products. Tester’s staffers invited Tweet, who brought Moran, to a meeting to discuss a legislative fix. Moran and Tweet then sent his office a draft legislative proposal in the spring of 2022 that sought to remedy the regulatory issues they were facing.

Between the summer of 2022 and this spring, Tester’s staffers said the bill went through at least five revisions, and that his and Braun’s offices solicited feedback from numerous stakeholders, including the USDA, the National Sheriffs’ Association, the Montana Farmers Union and the Montana Department of Agriculture.

Tester’s aides said their final bill included a number of changes from the original proposal that Tweet and Moran suggested, including different and sometimes stricter penalties for hemp farmers found to be in violation of the law, rulemaking authority provided to the USDA, and the added ability for states and tribes to create their own more stringent protocols for violations.

Asked to assess the differences between the final bill and the original plan by Moran and Tweet, Eric Steenstra, president of hemp advocacy group Vote Hemp, said they are fairly small.

“They were relatively minor in the bigger picture of what the thing was trying to accomplish,” he said. “It’s a few little details about how it was going to be implemented.”

Moran, the hemp lobbyist who wrote the February email, said in a statement that IND Hemp had approached her to represent them to fix their regulatory issues. “They reached out to Senator Tester to relay their on-the-ground challenges, and I helped articulate the issues they are facing. Senator Tester and his office did what any good representative would do – take this constituents’ feedback and work across the aisle to propose a legislative solution.”

Tweet, the hemp company co-founder, said the idea that the bill stemmed from a secretive process “is not true in the slightest,” pointing to the fact that she and others worked on it for 18 months with Tester’s office and “held several calls” with other fellow stakeholders “to garner as much input as impossible.”

“IND HEMP is the largest processor of grain and fiber in the United States,” she said of her company. “I say that so you know that this initiative was created because we know more than anyone else how burdensome and clunky the current hemp program is and how we need congressional language to implement change that would impact those farmers.”

Stark, the National Hemp Association executive director, said that she is “proud to be part of this effort” to get the bill introduced.

“This bill has the power to unlock the full potential of industrial hemp for fiber and grain, creating a host of economic and environmental benefits for our farmers and our planet,” she said.

Jensen, the state attorney who also received the email, said in a statement the “Montana Department of Agriculture always attempts to work with all of our elected officials at the state and federal level when legislation will have an impact good or bad on farms, ranches, and related agricultural industries.” In a brief interview, he added, “I think they [the advocates] definitely wrote some of the language. … People would often bounce bills by me.”

Whaling scoffed at the idea that the bill was a product of lobbyists, calling himself an advocate and noting the small stature of the industry.

“We didn’t need the paid lobbyists that the cannabinoid industry has engaged,” he said. “We’re not Big Tobacco, we’re not Big Marijuana, we’re not Big Alcohol.”

The day that Tester and Braun introduced the legislation, Whaling took to social media to praise the “stellar efforts” by Moran, Tweet and Stark to get it “drafted, negotiated, endorsed and introduced today in the US Senate.”

Congressional experts said it is not uncommon for trade organizations, especially those focused on niche subjects like hemp, to have major sway over bills introduced on Capitol Hill. Two trade industry executives POLITICO spoke with said this is especially common with cannabis because most lawmakers and their staff have never had to work on the issue until recently. The executives were granted anonymity to speak candidly about how cannabis policy gets made in Washington.

“No one knows shit about this on Capitol Hill,” said one of the executives.

The second executive with experience working on cannabis policy on Capitol Hill said they’ve seen multiple pieces of weed-related legislation introduced by lawmakers that were written entirely by trade organizations. Those bills often were never vetted by other outside sources or even lawyers who could determine if they would work correctly, the person said. In Tester’s case, however, aides pointed out that he has been working on hemp legislation for the better part of a decade.

The Industrial Hemp Act of 2023 could soon be a part of a top debate facing all of Congress. Advocates say their goal is to potentially get it into the farm bill.

Natalie Fertig contributed to this report.