 Good morning everybody, it's Wednesday morning, March 24th, and this is the Senate Agricultural Committee. We're going to get started on a proposal this morning dealing with hemp and cannabis, and we have Michelle Childs with us, our legislative address person. Good morning, Michelle. And Kevin Ellis and Pedro Lin and all the committee members, and I think we've all met a week or so ago, and so I'll skip by the introductions of everyone, and we'll get right to the draft that, Michelle, would you like to run through that draft that you sent us and go for it? Okay to share my screen. Are you guys okay with me sharing the screen? Some chairs don't like it because they don't, because you can't see everybody. Is this okay? Sure, as long as you don't take any more than that. No, go ahead. Okay, so great. So what I have here is an amendment for discussion that addresses the issue of cannabis establishments and dispensaries being able to purchase and process hemp under their cannabis establishment license or their dispensary license. So I know I don't have to give you all the backstory. You know that all the hemp stuff is completely separate from the cannabis regulation. So hemp is controlled by a chapter in title six and the cannabis in title seven. It's a completely separate process for licensing that we're in the midst of setting up. And so the first licenses are supposed to be issued next spring. And then the witnesses had brought an issue to you around concern whether or not if someone is licensed under the new cannabis system, could they purchase hemp products for processing and inclusion in any cannabis products that they might be either manufacturing or selling. And so I know the witnesses have suggested an amendment in the cannabis chapters that would change the definition of cannabis. The definition of cannabis excludes hemp and they were looking for kind of to kind of build on that exception and say, well, it doesn't include hemp except under certain conditions. And I have a reluctance to changing the definition of cannabis to include hemp because we've gone to great lengths to date to kind of keep them clearly separate and make sure that we're not jeopardizing anything in terms of our hemp program, our hemp pilot program. And so I talked it over with Grady because he's the expert on hemp and and so I think we decided that the best approach to address this would be just to make an amendment within the cannabis chapter specifically authorizing those licensees to be able to handle hemp. And so what I drafted it as a potential amendment to S25 because that is on the floor this week, but you know, I just wasn't sure where it might go. So I just drafted it as an amendment, individual amendment. There's two sections. The first section, section 20, starting on line six. This is just adding an exception there because there is already something in current law that says clearly that the cannabis chapters don't apply to the regulation of hemp. So I just did a little carve out there on line nine. And then you have a new section on 21. And so this is adding section 870 to title seven. And this is within the cannabis establishment chapter to say that hemp flour and biomass may be purchased and extracted by a cannabis a cannabis establishment licensed pursuant to this chapter. And so those are the the adult use licensees and then or a dispensary license pursuant to chapter 37. So the dispensaries are currently regulated in title 18 chapter 86 and are regulated by the Department of Public Safety. But one thing that's happening is that they're to move over to the cannabis control board from DPS. Last year in Act 164, they had them moving over in March, but S25 moves them over earlier moves them over July 1. They will continue to operate under the title 18 provisions till they switch over in March. So that doesn't change. But under the current scheme under 18 dispensaries can purchase hemp and handle hemp under their existing statutory scheme. And so this is just that when the new one drops down in March, they would be able to do it similarly. And so they can purchase and extract the flour and biomass as long as it was obtained from a hemp grower that's registered under our program, or if they are registered or licensed in a state authorized to produce and sell hemp under federal law. And so my understanding in talking with Mike was that that's possible currently under our existing scheme for the hemp. And what about the testing, Michelle? Y'all, have you built in regulations of the testing to make sure that we aren't running over any limits for THC or any of that? Well, the thing we hear is that when you're talking about we're talking just regulating here the cannabis establishment. So they're already authorized. Okay. Mike and I are trying to silo it, right? So it's like it's not changing anything with regard to who is registered under title six to grow hemp. This is just saying that if you are licensed under the new cannabis law, you can also work with hemp. And so I think it's permissible under the current law, but the witnesses would like some better clarity about that rather than leaving it up to the board. There is a provision in current law that requires the board to adopt rules regarding additives to cannabis products. There's not much discussion of hemp in the existing cannabis laws other than if you're a retailer that's going to be selling cannabis products and you also sell hemp products, you're supposed to clearly label those as such in your retail store. Consumers aren't confused about which product they're and you have to kind of keep them separate, but that's really all that's addressed currently with regard to the hemp. So I think it's permissible under current law, but the witnesses and they can speak for themselves, but they I think they're looking for for clarity on this at this point through legislation. So it's really this is clarifying the law to make it very clear that it is an allowable use. Yes. Yep. But it's not changing anything with regard to your hemp program. Again, we didn't want to mess with that or jeopardize that by injecting the cannabis issue into the hemp program. It's not changing the cannabis rags either, right? Only it's clarifying the language that you can use hemp as an additive to cannabis. Yes, it's specifically authorizing that it's silent on the matter in the current law but has the board adopting rules with with respect to additives. So it's totally permissible for it under the current scheme. But, you know, I guess there is the possibility that the board could put forth something and say they don't, you know, the cannabis establishment couldn't be working with them. But I mean, I think that would be arguably tough for them to put forward because there are some specific do not combine cannabis with certain ingredients under the cannabis license scheme. So there's a specific prohibition against combining cannabis and alcohol or cannabis and nicotine. And that's in statute. So I think if there was if the board was going to interpret it that they could say you can't combine it with hemp, I think there's a strong argument to say, well, we would have said that in the legislation. But you know, there's there's no harm in articulating this specifically in statute. I'm just saying that if you didn't, I personally don't have a lot of concern. It wouldn't be addressed by the board, but I understand the industry, you know, wants more certainty about that. Yeah. So page two subsection B is that the cannabis establishments and dispensaries can obtain and process the hemp in the form of distillate or isolate and all process hemp derivative shall be accompanied by certificate of analysis showing potency levels for all those chemical compounds that I can't pronounce. And that's modeled after Illinois. And subsection C is just kind of a cross reference about the provision I spoke about about the adoption of rules with regard to additives. And that's it. So it's pretty pretty straightforward. I'm hopeful that the that Pietro and Kevin might think that this will address their concerns if you're interested in moving forward. Yeah. And are there any questions from committee members of Michelle at this point? Yeah, I have a question. Yeah. Good morning, everybody. Michelle, I'm trying to get my head around this because I and I heard you say that this is sort of already handled. And I, you know, there's a lot of investment and energy that's gone into the hemp and the CBD business world today in Vermont for the last several years. There's a lot of sort of pent up energy to go into the cannabis THC world and this explicit blending of them. I can't give you a good reason, but it does make me a little bit uneasy because I don't pretend I understand all of the ramifications. And I'm not convinced there's a rush, but I want to just explore. You sort of said, I don't think this is necessary. And that's kind of my assumption. I mean, if somebody is growing or processing under the cannabis scheme, there's no part of the state that is checking up on what kind of cannabis plant you have, right? So cannabis producer could grow some CBD cannabis. Nobody cares about that, right? I mean, help me understand. I get that maybe it's a little not clear, but is there a problem? What problem are we really aiming at? And the reason I ask is every time we talk about this on the floor and bring floor amendments especially, it's just there's an unease. And I got to be convinced that it's really worth it before we take that on because everything was just complicated. So Michelle, can you help me understand? You sort of said, I'm not sure this is necessary. Everybody wouldn't mind a little extra clarity maybe. But what do you think, Michelle? Does it make a real change or is it just simply a little belt and suspenders? I think that what the witnesses are looking to do I think is totally permissible under the existing statutory scheme and the way that I view how this would be worked with the board and the adoption of rules. I would anticipate that this is all going to be a part of that and it would be a board decision. But if you want to be absolutely sure that it's clear to the board that a cannabis establishment or dispensary can be handling PEMP separate and apart, but do it under there. But it's not any kind of violation of their license under Title VII. It's fine to certainly be very direct in that and include that in there. So this was not a discussion as part of Act 164 last biennium around these two. And as you know, because you're always dealing with Mike and in your committee on the hemp issue, you know, they very, very separate issues intentionally. And so, you know, we're probably going to see obviously as the industry grows more and more of a blending of the two, you're right. So people who are currently growing hemp are probably many of them are interested in converting to cannabis and obtaining a cannabis license. And maybe they would want to be registered under the hemp program and have a cannabis establishment license. But, you know, I don't know that would be a question for Mike about whether or not that would jeopardize something under the hemp program. That's where the real, I think concern is. But this is just talking about cannabis establishments. See, this is and again, nobody is nailing this. But this is my concern that there clearly are people in the hemp world that are warming up to get into the cannabis world that that is everybody understands that. But there are also people in the hemp world that are happy in the hemp world and don't don't have any desire, I believe to go into cannabis. And I'm a little bit worried that this shift may be undermining them, those people without us fully understanding it. So to the extent I'm expressing hesitancy, that's part of it. Anyway, thank you. Brian. Thank you, Mr. Chair. So, Senator Pearson's question prompted me to think about this as well. And I'm probably not going to say this the right way, but this seems like a one-way street to me. In other words, if you are already having a cannabis license, you're asking for an additional ability to grow hemp. But those who only have a hemp license aren't going to get that same sort of flexibility in their world. And I'm wondering how many people are we talking about that need both licenses, if you will? Right. Is there something in the law that says you can't have both licenses? There, I don't think there's anything in, there isn't anything in this bill or this draft that would prohibit going either way. I can't see. Maybe I'm missing it, but. There isn't. I guess the question I would have, and it would be for Mike, unfortunately, I'm sorry, I can't answer it, but is about the practical implications if you had someone who was growing both. Is that a concern in terms of the hemp program because of the federal rules around that and what's required to be a part of that project? I don't think that anything in amendment or the statutory scheme jeopardizes that. And so that's one of the things we wanted to be very clear about is we didn't want to mess with the hemp statutes because they're, you know, they're created in a way to make sure that you're in compliance with federal law. And so, but I don't, I don't know the answer to the question. If somebody was growing hemp and then decided to apply for a cultivation license and then they were doing both what their liability is with regard to the hemp and the federal program. I do. Did you have a question? I see a hand go up. You did. And I was hoping if the committee would allow it or you, Mr. Chairman, would allow it that that I would be permitted to speak to the the issue that Michelle rightly raised. And so, so look, the concern here, and I think as again, remember, I'm a lawyer and I work with courts in statutes in terms of statutory construction and application. And this is my fear. If we were adding vitamin C to cannabis, it would be an additive. And we wouldn't need to worry about any changes to the current statutory scheme. It's fine. What is different here is we are changing the nature of the CBD oil through the process in turning it into as part of this combination with cannabis into THC. And so it's quite literally a court could easily conclude that is not an additive. That is a transformation of the CBD oil into something else. And so the distinction for me is if we were just putting CBD oil into a cannabis product and say, look, CBD oil is healthy for you. So when you use the cannabis, you get these other health benefits. That would be one thing. But what we are proposing and the technology that exists allow us to use cannabis and CBD oil in combination and turn it into relatively pure THC. That's the that's the gap that that we're concerned about. And let me transition for a moment to Michelle's draft, which I thought was excellent. And I think it does two things. It creates certainty around processing the CBD oil into THC and then puts it under the umbrella of the cannabis statutory scheme and the cannabis board. And I think that's all for the positive. But it does something else that I'm not sure I had considered. What it does is it expands the marketplace for hemp farmers because it grants an ability to process the hemp into THC, first making isolator distillate and then later into THC. So hemp farmers in Vermont have a broader marketplace for their product. So that was Chairman Starr. That's what I wanted to raise. Yeah. So Chris, do you have an issue with timing? Because that bill that that bill's up this week and today's Wednesday. So I don't it's tomorrow. I think that bill comes up today. It's today. And so yeah. And so I mean, I'm not enthusiastic. I can't articulate myself well because I'm not understanding this. And I guess if it were left to me, I would encourage our friends here to to work on this on the second half. This bill goes, you know, is only just getting started in our process. Yeah. So but, you know, I'm not going to I'm not going to throw down over this if the committee is interested. I'm just be honest and say I'm not understanding all the ramifications. This is a brand new industry. I think frankly, it's why we set up a board to handle some of these more nuanced considerations. And I'm not sure of the harm if this gets sorted out in year two of our markets. I mean, you talk over over the years, we talk about having a mature market and it will take many years. You don't even see that a Massachusetts and other states that have been four or five years under under a tax and regulate scheme. So I'm not seeing the urgency and I'm a little uncomfortable acting quick. But that's just me. You know, if committee is this is a Senate bill, right? And so it's got to go to the house. I don't, Kevin, have you talked with any any House members at all to see, you know, what they're feeling is like, I don't know if this should be, you know, we haven't an egg. We haven't dealt with cannabis really hardly at all. But we've dealt with a hemp. So I'm wondering, have you talked with, so I would expect this bill will go to judiciary on the House side. And I, I really haven't talked with any of them to see if they would take this proposal that we could, you know, I think we could send them a letter or whatever asking if they would please consider this because of its timeliness coming to us kind of late. But, you know, it all makes sense to me. I, you know, about putting being able to combine the products without having a lot of problems with the regulators and clarifying the language. So you could do that. But if I mean, we, this is only the second day, I guess, that we really worked on this. What do you think about something like that, Kevin, politically working? Mr. Chairman, I think that's great. I don't want to put the Senator Pearson in a difficult position and I see Why not? He gets a big box. And, and we're, you know, a letter to the House judiciary would be great. Our goal here was to get this issue on the table so it could be discussed. And we're happy to go over to the House Judiciary Committee and introduce the issue with a little more deliberation and see, and see what happens. You know, I think that that works fine. And I'm grateful to Michelle for putting, you know, putting her head on this and making, putting pen to paper. So it would also give us an opportunity to talk with Senator Sears and our Judiciary Committee asking them, you know, to think about this. And Michelle, of course, is in there probably about every day. And, you know, it would give our whole side more opportunity to get used to this. And if we could support it over on the other side to some degree, you know, I'm, I'm sure we could talk with Carolyn and the Ag Committee about where we are, you know, on this or late getting started and, but would ask that they would consider it and, and Sears, Senator Sears, if, if we can get him to buy into this, he could talk with the House Judiciary Committee as well. Yeah, it was Senator Sears that sent us over to you because he was, he was busy with racial equity and a lot of other issues. So that's what led us to you. And I would, I'd love to get some advice about whether we should go talk to House Judiciary or House Ag first. We'll do both, whatever you want. Well, it's actually not House, it's House Government Operations. So Judiciary, now that cannabis, cannabis in Title VII, Judiciary doesn't work on it all in the House. And I think that's probably going to shift over in the Senate as well to be gov ops, because they're dealing with the criminal and civil violation, you know, cannabis stuff. And so now that it's really just regulating an industry and setting up the agency, it's the gov ops committee. So it would be Representative Copeland-Hanses, and, and then if you wanted Ag, you know, to, to take a look at it, I decided to make a recommendation to House Government Operations on the issue. We'll do that. Yeah. So what's the committee, committee agreeable with that, that, that we would, I don't know, punt this over to the House. And, and, you know, it, to me, it sounds like it's clarifying language. And if it would allow our hemp guys a little one more sales outlet, you know, their sales haven't been, to this point, haven't been that great. If it would allow an additional market for them, I think it would be, it would be good. I don't think cannabis growers are going to want to grow hemp unless they've got plots of land lots, lots of miles apart because of cross pollination and stuff. I think they'd probably just as soon let the farm, hemp farmers grow the hemp and buy what they want to buy from them rather than, than pooling around, you know, growing hemp and growing cannabis. So, so Brian. Thank you, Mr. Chair. I'm fully in support of your suggestion that we allow the other body to well consider this. Yeah. And, and you guys are okay, I guess, Kevin. I think, I think you've got a pretty good crew to work with there on in government ops on the other side. So that should, should move along and Michelle's already done the heavy lifting. So that's good. So that's, that's what we will do and, and wish you well and, and hopefully we can get this done for you. Thank you very much, Mr. Chairman. Thank you for the, to the committee. Thank you, everybody. Have a great day. Yeah. And thank you. So, Linda, what do we got up next? 10 o'clock. Michael's going to come in and walk you through age 434. So we, we haven't got anything until 10. And what about our, our bills that we've got 100 coming up today. And 102. So is Brian, Brian, champions going to offer the, the amendment from education and we're all on board with that. I know Brian, you had a question on the process. Yeah. And actually, I've just received emails that indicate that s 100 is going to be asked to be passed over today. We have apparently some folks that are getting real nervous about the impact on local school budget. So I just got that from, from one of the other senators. It says, Senator Campion agrees this is a big issue and the bill will be passed over today. Oh, yeah. That, that's really bad. Yeah. I was talking with Brian earlier before you guys all got on and we're still on YouTube, by the way, Senator. Yeah, that's fine. I hope it's wired into every superintendent's office in the state. But you know, we spend, if you think about 1600 million dollar bills on education and we can't afford to take 25 of those, those and feed the kids. I mean, it's like having if one of us had $1600 in our pockets and we're at the grocery store quivering over whether we should spend $25 on food. I mean, it's ridiculous that that's even an issue and in the system. And my own little district is getting over $10 million new dollars on top of that to spend on something in the next three or four years. I mean, the whole issue is, is baloney as far as I'm concerned, it's, and I think it's time that we get our, we get a shot in the spine and stand up and take that crew on anytime they run short of money. They certainly know where to come and ask for more. And what we have two school budgets that didn't pass this last year at Cal meeting. So what they're doing is blowing smoke and I don't think school board members or the superintendents have even read the bill. You know, we've got, if it puts them over the spending limits, that's in there to protect them. I mean, we, we did a heck of a job putting a system together to make sure our children get fed properly without a, without a, I mean, I don't know what they think, but anyways, Brian. Yeah. So from what I'm gathering, it's one line in the bill that's creating most of the issue. And I think it's in Chris's part of the bill. And the line says to the extent that costs are not reimbursed through federal or state funds or other sources, the cost of making available school lunches and breakfasts shall be born by school districts. So that's where they're going down and saying, you know, if the state doesn't want to pony up the money and the feds don't want to pony up the money, it's going to fall in the local school districts to do that. And I think that's the one that's causing the most heartache. Yeah, the other thing, you know, so do we agree that we have about 280 schools, something like that? Now what we've heard and 70 of them. So we really have 210 schools left. And if you take 70 to 80, Chris, sure. But let's, let's say there's 210 schools and they've got us, they've got to come up with the $25 million and there's 210 of them. It's, it's $120,000. I mean, it's, it's, it's, you know, so if you're a superintendent, maybe you got four or five of those. It's in five years after, I mean, it really, I think you're right, Mr. Chair, that, that, you know, somebody's sent out provocative emails. Well, you know, it came from the executive director of the three groups last week, we got that nasty letter saying that we were all messed up. Well, then that got sent to all the school districts. And, and of course the school districts, I doubt if they saw the bill, but they got that letter pushing them to push us. Well, tough luck as far as I'm concerned. Well, and, and, you know, we're not oblivious to the pressure this means. We, we, we just haven't pinned it down exactly how we do it, but we've talked about helping them make the transition. We've talked about the federal dollars. We know the, the sales tax is performing well. So the ed fund, you know, there's no reason to think this is a direct hit to property tax. There are a lot of variables here. Well, anyway, we aren't, we aren't completely broke. And I would expect when, when the committee starts dealing with the 22 budget that some of that, some of that cost will get picked up by us. But, you know, hell, we got to work through the system and work, work with the system. And, you know, I, I don't know. I, I hope that we stick to our guns and, and move forward. You know, three, three committees voted the bill out the unanimous. And, and that, that says quite a bit. So anyways, so we're going to, we're going to pass over that, I guess, today. That's the word. Yeah. Can we talk about some other scheduling things just? Yeah. So maybe Linda could take us offline.