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Licensing details for hemp being ironed out as South Dakota legislators mull amendment

An amendment to House Bill 1008 was discussed Thursday, Jan. 30, during a House Agriculture and Natural Resources committee hearing, but action could not be taken since there was no prison impact statement on the preliminary amendment.

A prison impact statement shows what kind of impact a bill may have on the state’s prison system and the prisons’ populations and required for legislation that could increase or decrease the number of persons incarcerated.

HB 1008 would legalize the growth and production of industrial hemp and derivative products in South Dakota.

District 21 state Rep. Lee Qualm, R-Platte, and District 28A state Rep. Oren Lesmeister, D-Parade, explained the preliminary amendment Thursday and how it would change HB 1008. Both men were on the interim committee that focused on studying the impact of legalizing hemp that met throughout summer and fall of 2019.

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Licensing details for hemp being ironed out as South Dakota legislators mull amendment 1

Lesmeister explained that the United States Department of Agriculture requires that anyone who is going to grow or produce hemp or hemp seeds need a background check, but the amendment would not require the employees or family members of a person who has a license to have a background check.

“Custom harvesters and the children that come out on farm to help don’t need a background check,” Lesmeister said. “Only the people that are in charge of the workers will need a background check.”

Lesmeister said the application and licensing fees under the proposed preliminary amendment would increase to match the fees set by other states who have legalized hemp.

The annual application fee would be set at $ 50 and the annual license fee would be set at $ 350. Lesmeister said the annual licensing fee could even go up to $ 500. Inspection fees per lot would be set at $ 250 and transportation permits would be set at $ 25.

“The secretary shall deny licensure if any applicant, key participant or landowner has been convicted of a misdemeanor or felony related to a controlled substance or marijuana under state or federal law within the previous 10 years,” the preliminary amendment version states.

Hemp operations would need to be grown outdoors on at least five continuous acres. No indoor growing is allowed at this point.

All plants need to have a THC content of 0.03% or less. If tests determine that the plants exceed this level, they can be retested. If the second test shows the hemp plant still has a content over the allowed THC amounts, the crop must be destroyed.

The South Dakota Department of Public Safety will handle the inspections.

Lesmeister reiterated the importance that if hemp is legalized in South Dakota, first-time hemp producers need to approach growing hemp with extreme caution as there is no certified seed that will ensure their plants will stay under 0.03% THC levels.

“There’s going to have to be some research done and I think growers are going to have to be very careful of who they’re buying from,” Lesmeister said.

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Brunner expects the committee will have a final version of the amendment on Tuesday during the committee’s next hearing.

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