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Appropriations panel debates S.323 changes for farms, fees and hemp regulation
Summary
Committee counsel and members reviewed S.323 sections affecting farm permit eligibility, removal of large/medium farm fees proposed to be backfilled from the general fund, and a transfer of hemp licensing to the Cannabis Control Board; members asked for agency testimony and requested an amendment to strike fee sections pending appropriations clarification.
The Senate Appropriations Committee on March 19 reviewed Senate Bill 323, a sprawling agriculture bill that includes changes to on‑farm permit eligibility, several program technical fixes and a package of fee and licensing changes that would shift some revenue and regulatory authority.
Bradley Shman of the Office of Legislative Council walked members through the bill and focused the committee on the sections with potential fiscal impact. He said the bill would expand accessory on‑farm permitting by allowing donated crops to count toward the statutory test that determines whether a property qualifies as a farm and is exempt from certain municipal permitting requirements. That statutory threshold “is at least $2,000 a year” of products raised or donated, counsel and staff said.
Members voiced concerns about how the donation change could be used in practice. One committee member described a constituent complaint that owners operating short‑term rentals were claiming farm status to avoid local rules; counsel said municipal zoning carve‑outs and Act 250 exemptions do not automatically shield every use and recommended the district coordinator in charge of Act 250 enforcement answer detailed questions.
The bill also would remove two annual fees currently charged to large and medium farms (a $2,500 fee for large farms and a $1,500 fee for medium farms). Committee discussion identified a governor’s FY27 budget proposal that would replace those fees with a recurring $231,500 general‑fund appropriation to the Agency of Agriculture. Members pushed for additional testimony from the agency on how removing fee revenue from the Water Quality Special Fund would affect water‑quality grants and programs.
Separately, the bill transfers hemp licensing authority from the Agency of Agriculture to the Cannabis Control Board and reorganizes several hemp fees. Under the proposal, some existing per‑acre fees would be removed, grower licensing fees would be set at lower flat amounts in some categories and processor fees would be increased; a new licensing fee was proposed for hemp‑infused products that exceed a specified THC threshold.
Members asked Legislative Counsel to draft an amendment that would strike the fee‑removal sections so the committee could consider the policy only after clarifying whether and how the general fund offset would be appropriated. The committee did not take final action on S.323 at this meeting; staff noted the committee still awaited finance committee materials needed to move the bill.
Authorities cited in the discussion included Act 250 and existing state statutes governing agricultural programs and licensing. The committee asked agency staff to provide a fiscal follow‑up on the water quality special fund and on any downstream operating impacts of transferring hemp oversight to the control board. The committee deferred further action until that information is available.
