Raise THC limits, improve access to banking, provide tax relief and offer opportunities for new hemp and CBD businesses – one Congressman has heard distress calls from the nascent hemp industry and is working to introduce legislation that could help.
U.S. Rep. Denver Riggleman, a Republican from Virginia, says he plans to introduce legislation called the Hemp Opportunity Zone Act to advance the industry.
Riggleman is a co-sponsor of the legislation introduced in January by House Agriculture Committee Chair Collin Peterson, a Democrat from Minnesota. Peterson’s bill would change the Federal Food, Drug and Cosmetic Act to include the regulation of hemp-derived CBD and products.
Hemp Industry Daily recently caught up with Riggleman to learn more.
Tell us about the Hemp Opportunity Zone Act.
There are three main points that we’re looking at here:
- Create hemp opportunity zones.
- Hemp tax relief.
- A marketability study and report.
The first portion is (determining) how we nominate specific opportunity zones to allow resources to be applied and to look at eligible taxpayers for capital-gains relief.
For hemp tax relief, I’m going way out. We have to ban any hemp or CBD excise tax as people get started, and we need to increase the qualified business income deduction for anybody with a hemp-related business.
There should be a beginning hemp farmer tax credit (and) a small hemp farmer tax credit. I believe people should be able to rent their land to hemp farmers and get a tax deduction there, also.
But anybody who’s actually the producer, wholesaler or retailer should also get tax relief because we’re trying to de-risk their entry into the market.
The other thing is, why do we have these choke-point policies in place by banks? They’re not allowing retail sales (because) they can’t process credit cards. I’m on the Financial Services Committee, (and) I’m fixing that.
Will you build the THC percentage increase into the legislation, as well?
The percentage increases (is) part of the marketability study portion of it.
We need to look at increasing the THC levels considered hot. That definition now is at 0.3% – we need to make sure that we up those levels to where it’s practical.
We also have to make sure that farmers are held harmless for any accidental increase in THC that they might not be aware of. There shouldn’t be any criminal penalty for that; there should be some type of remediation or arbitration that allows them to move on.
We might be able to fix some of those hotness issues through processing. There’s a lot of things we can do to mitigate any issues that the general public might have for THC content.
How does your experience as an alcohol distillery owner contribute to your advocacy for the hemp industry?
The first time I met with hemp farmers, I told my staff, ‘Listen, it’s time for us to help.’
What I went through building a manufacturing business on the spirits side, I know that there’s rules and regulations out there that are harmful, based either on ignorance or on other industries wanting to make sure that there’s a high cost of entry. I’m not going to let that happen.
Where we need to start now is (with) education and being positive. It’s about (finding) solutions to these issues and not anger. If we do that, people are going to help us out.
What does the industry need to understand about how THC limits are changed?
If we legislate that, USDA has to follow. We make the law.
There’s a power to the number of co-sponsors that you get on legislation. …
If (industry members) get actively involved with their district, (we) will be able to utilize their representatives as co-sponsors and push that bill across the finish line.
What can hemp industry members do to be more effective in communicating with Congress?
The thing that impresses me the most when I have constituents come in is talking about the risks that they’re taking with their own resources, their time (and) their fortunes.
It’s also the stories of how regulation hurts them and (how) the lack of knowledge by those that are making those regulations (affects them). That’s what congressmen want to know. Please just give me three specific things I can fight, because it’s very difficult to parse everything real time. I need specifics because I have 740,000 constituents, but so do those other representatives.
Will the negligence issue be part of your legislation, as well?
Yes, absolutely. Anytime you have arbitrary definitions that really don’t take into account the reality of the program, we need to bring some light and some transparency to them, and that is what we’re doing.
We know we could never make 100% of people happy; it’s impossible. But I think we can get to the 80% threshold.
Let’s take a step and not let the perfect be the enemy of the good. Let’s get things done.
What is your timeline for introducing this bill?
I want to drop this bill the next 30 days – that’s why we’re pushing it so hard.
Now, remember, you’ve always got to double anything a Congressman tells you, but if I can get it in the next 30 days to 60 days, that’s a huge victory.
And then I need to mobilize the forces of hemp to help me make sure I get it across the finish line.
This interview has been edited for length and clarity.
Laura Drotleff can be reached at [email protected]