Bill would move hemp oversight to Cannabis Control Board, align state definition with new federal THC limits

A legislative committee on Agriculture, Food Resiliency, & Forestry on Thursday reviewed a bill that moves oversight of hemp and hemp‑derived products to the Cannabis Control Board and revises definitions, testing, enforcement and fee structures to conform with recent federal changes.

Staff member, who led the walkthrough, said the bill ties the legal status of hemp products to forthcoming federal statutes and shifts primary regulatory authority from the Agency of Agriculture to the Cannabis Control Board. "The purpose of the subchapter is unified oversight of hemp and hemp‑derived cannabinoids under the Cannabis Control Board to more effectively prohibit illicit product trade whilst positioning growers and processors and non‑intoxicating hemp products to take advantage of natural opportunities," the staff member said.

Why it matters: committee members flagged that the federal measurement method is changing from a delta‑9 percentage test to a total‑THC concentration test and that federal language imposes a per‑container cap of 0.4 milligrams of total THC. Staff member noted that "the final product cannot contain more than 0.4 milligrams total THC," and warned that many products currently sold as hemp could be excluded from interstate commerce under the federal standard.

The bill sets three regulated categories — producers (growers), processors, and products — and requires registration or licensure for each. Staff member summarized rulemaking powers the board may use, including mandatory testing protocols, labeling and source‑disclosure requirements, prohibitions on hazardous additives, sampling and inspection authority, stop‑sale orders, and disposal or remediation obligations for noncompliant products.

Enforcement and penalties: the draft applies compliance and enforcement procedures used for cannabis establishments to persons licensed or registered under the hemp subchapter and removes numeric caps that previously limited administrative penalties. The staff member said the board may assess administrative penalties and seek civil collection; the bill also narrows who may bring a civil collection appeal compared with current law.

Fees and fiscal effects: the proposed fee schedule replaces a tiered, acreage‑based structure with flat fees: $50 for producers, $500 for processors and a new $75 fee to register each product. Staff member said the $500 processor fee is a recommendation from the Cannabis Control Board; the committee asked for the Board to return to explain why the higher processor fee was proposed. Committee members noted that some existing fees and certain lab‑certification fees would be repealed under the bill, shifting how costs fall across small and large operators.

Questions and concerns: members repeatedly asked how the state should respond if federal or board standards diverge from current Vermont practice. One committee member asked whether the statute should set state‑specific THC thresholds; staff member warned that diverging from federal definitions could create federal enforcement risk and practical problems such as restricted banking access for affected businesses. Members asked the Cannabis Control Board to explain distinctions the Board sees between CBD and other cannabinoid products and how sales and payment processes might differ if products are regulated as cannabis rather than hemp.

Timing and next steps: staff member said the bill's effective date is July 1 but noted federal rule changes expected in November could create timing issues the legislature may want to address with contingencies. The committee concluded by requesting the Cannabis Control Board return for detailed testimony on rulemaking, enforcement, and the Board's fee recommendations and agreed to reconvene the following day at 09:30.

The committee did not take a vote on the bill during the recorded session.