By: King of Uvalde, Guillen, H.B. No. 3948
      Morales of Maverick, Israel, et al.
 
 
A BILL TO BE ENTITLED
 
AN ACT
  relating to the production and regulation of hemp and consumable
  hemp products; authorizing a fee.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 121.003, Agriculture Code, is amended by
  adding Subsection (e) to read as follows:
         (e)  Not later than the 90th day after the date a change to a
  state statute, federal statute, or federal regulation takes effect,
  the department shall submit to the secretary of the United States
  Department of Agriculture any amendments to the state plan
  necessary to incorporate and implement the change.
         SECTION 2.  Subchapter A, Chapter 122, Agriculture Code, is
  amended by adding Section 122.005 to read as follows:
         Sec. 122.005.  HEMP RESEARCH BY INSTITUTIONS OF HIGHER
  EDUCATION. (a) The department shall issue a license to an
  institution of higher education in this state that requests the
  license.
         (b)  Notwithstanding any provision of this chapter or
  department rule other than Subsection (c), an institution of higher
  education conducting research involving hemp:
               (1)  is not required to pay a fee collected by the
  department under this chapter;
               (2)  is not required to obtain from the department a lot
  crop permit or other permit for each location where hemp is grown;
               (3)  is not required to obtain preharvest testing under
  Section 122.153 before harvesting plants, except as provided by
  Subsection (c);
               (4)  may use hemp seed and cultivate and handle plants
  grown from seed that is not certified or approved under Section
  122.252; and
               (5)  is not subject to Section 122.403(c) or (d).
         (c)  An institution of higher education may not sell or
  transfer hemp to another person unless the institution complies
  with the requirements of Sections 122.153 and 122.356.
         SECTION 3.  Section 122.051, Agriculture Code, is amended by
  adding Subsection (c) to read as follows:
         (c)  Not later than the 90th day after the date a change to
  this chapter, a federal statute, or a federal regulation takes
  effect, the department shall propose any rules necessary to
  incorporate and implement the change.
         SECTION 4.  Section 122.151, Agriculture Code, is amended by
  adding Subsection (g) to read as follows:
         (g)  A laboratory that performs testing required by this
  chapter shall report the delta-9 tetrahydrocannabinol
  concentration, the total tetrahydrocannabinol concentration, and
  the concentration of any other federally regulated cannabinoid of
  the sample on a dry weight basis and the measurement of uncertainty
  in the test result.  The measurement of uncertainty must comply with
  International Organization for Standardization ISO/IEC 17025 or a
  comparable or successor standard.  For purposes of this chapter,
  the delta-9 tetrahydrocannabinol concentration of the sample is the
  lowest possible value given that measurement of uncertainty.
         SECTION 5.  Section 122.201(a), Agriculture Code, is amended
  to read as follows:
         (a)  A license holder shall harvest the plants from a plot
  not later than the 30th [20th] day after the date a preharvest
  sample is collected under Section 122.154 unless field conditions
  delay harvesting or the department authorizes the license holder to
  delay harvesting. This subsection does not prohibit the license
  holder from harvesting the plants immediately after the preharvest
  sample is collected.
         SECTION 6.  Subchapter E, Chapter 122, Agriculture Code, is
  amended by adding Section 122.203 to read as follows:
         Sec. 122.203.  HARVEST WHILE LICENSE SUSPENDED OR REVOKED.
  (a) A person whose license is suspended or revoked after planting
  hemp plants may obtain preharvest or postharvest testing under
  Subchapter D and may harvest the plants under Section 122.201 in the
  same manner as a license holder.
         (b)  While a person's license is suspended or revoked, the
  department may:
               (1)  prohibit the person from selling or using plants
  harvested under Subsection (a); or
               (2)  if the delta-9 tetrahydrocannabinol concentration
  of the plants is not more than 0.3 percent on a dry weight basis,
  allow the person to sell or use plants harvested under Subsection
  (a) in the same manner as a license holder under Section 122.202.
         (c)  A person whose license is reinstated may sell or use
  plants harvested under Subsection (a) as provided by Section
  122.202.
         SECTION 7.  The heading to Subchapter F, Chapter 122,
  Agriculture Code, is amended to read as follows:
  SUBCHAPTER F.  HEMP SEED AND PLANTS
         SECTION 8.  Section 122.252, Agriculture Code, is amended to
  read as follows:
         Sec. 122.252.  CERTIFICATION OR APPROVAL OF SEED AND PLANT
  VARIETIES. (a) The department or an entity authorized to certify
  seed and plants under Chapter 62 shall identify and certify or
  approve varieties of seed and plants confirmed to produce hemp.
         (b)  The department or entity may not certify or approve a
  variety of hemp seed or plant if the variety [seed] is tested and
  confirmed to produce a plant that has delta-9 tetrahydrocannabinol
  concentration of more than 0.3 percent on a dry weight basis. For
  purposes of this subsection, the department may partner with a
  private entity or an institution of higher education to test seed
  and plant varieties for the purpose of certification or approval
  under this section.
         (c)  The department may authorize the importation of hemp
  seed and plant varieties certified in accordance with the law of
  another state or jurisdiction that requires as a condition of
  certification that hemp be produced in compliance with:
               (1)  that state or jurisdiction's plan approved by the
  United States Department of Agriculture under 7 U.S.C. Section
  1639p; or
               (2)  a plan established under 7 U.S.C. Section 1639q if
  that plan applies in the state or jurisdiction.
         (d)  The department shall maintain and make available to
  license holders a list of hemp seed and plant varieties [seeds]
  certified or approved under this section.
         SECTION 9.  Subchapter F, Chapter 122, Agriculture Code, is
  amended by adding Section 122.254 to read as follows:
         Sec. 122.254.  SEEDLINGS AND OTHER IMMATURE PLANTS. (a)  In
  this section, "immature plant" means a hemp seedling, clone, or
  cutting that requires substantial cultivation and further growth
  before the beginning of the period under Section 122.201(a) when
  the plant may be harvested.
         (b)  A person may transport into this state, and a license
  holder may obtain and cultivate, immature plants propagated outside
  this state if the plants are accompanied by shipping documentation
  that:
               (1)  complies with any requirements of the state of
  origin;
               (2)  indicates the grower of the immature plants is
  licensed by the state of origin;
               (3)  lists the recipient license holder in this state
  and the recipient's license number; and
               (4)  shows that the variety of the immature plants is
  certified or approved under Section 122.252.
         (c)  A license holder may obtain and cultivate immature
  plants propagated in this state by another license holder if the
  plants are accompanied by the shipping certificate or cargo
  manifest required by Section 122.055 that shows that the variety of
  the immature plants is certified or approved under Section 122.252.  
  The immature plants are not subject to preharvest testing under
  Section 122.153.
         (d)  A license holder may transplant immature plants
  propagated by the license holder from one plot to another plot
  controlled by the license holder.  The department by rule shall
  waive the requirement that a license holder obtain a lot crop permit
  for and may not require a license holder to pay any fee for a
  greenhouse or other location used to propagate immature plants if
  the plants are transplanted to another plot controlled by the
  license holder and are not sold or transferred to another person.  
  The department by rule may waive the requirement that a person
  obtain a shipping certificate or cargo manifest to transplant
  immature plants from one plot to another plot operated by the
  license holder.
         SECTION 10.  Section 122.301, Agriculture Code, is amended
  by adding Subsection (c) to read as follows:
         (c)  Notwithstanding Subsection (b), a person may
  manufacture products described by that subsection in this state if:
               (1)  the products are sold only to persons located
  outside this state; and
               (2)  the person was manufacturing or processing
  consumable hemp products, as those terms are defined by Section
  443.001, Health and Safety Code, in this state on May 22, 2019.
         SECTION 11.  Subchapter A, Chapter 443, Health and Safety
  Code, is amended by adding Section 443.005 to read as follows:
         Sec. 443.005.  CONSUMABLE HEMP PRODUCTS ACCOUNT. (a)  The
  consumable hemp products account is an account in the general
  revenue fund administered by the department.
         (b)  The account consists of:
               (1)  appropriations of money to the account by the
  legislature;
               (2)  public or private gifts, grants, or donations,
  including federal funds, received for the account;
               (3)  fees collected under this chapter or under Chapter
  431 as it applies to consumable hemp products;
               (4)  interest and income earned on the investment of
  money in the account;
               (5)  penalties for violations of this chapter or
  Chapter 431 as it applies to consumable hemp products; and
               (6)  funds from any other source deposited in the
  account.
         (c)  The department may accept appropriations and gifts,
  grants, or donations from any source to administer and enforce this
  chapter and Chapter 431 as it applies to consumable hemp products.
  Money received under this subsection shall be deposited in the
  account.
         (d)  Money in the account may be appropriated only to the
  department for the administration and enforcement of this chapter
  and Chapter 431 as it applies to consumable hemp products.
         SECTION 12.  Section 443.103, Health and Safety Code, is
  amended to read as follows:
         Sec. 443.103.  APPLICATION; ISSUANCE.  An individual or
  establishment may apply for a license under this subchapter by
  submitting an application to the department on a form and in the
  manner prescribed by the department.  The application must be
  accompanied by:
               (1)  the physical address [a legal description] of each
  location where the applicant intends to process hemp or manufacture
  consumable hemp products [and the global positioning system
  coordinates for the perimeter of each location];
               (2)  written consent from the applicant or the property
  owner if the applicant is not the property owner allowing the
  department, the Department of Public Safety, and any other state or
  local law enforcement agency to enter onto all premises where hemp
  is processed or consumable hemp products are manufactured to
  conduct a physical inspection or to ensure compliance with this
  chapter and rules adopted under this chapter;
               (3)  any fees required by the department to be
  submitted with the application; and
               (4)  any other information required by department rule.
         SECTION 13.  Subchapter C, Chapter 443, Health and Safety
  Code, is amended by adding Section 443.106 to read as follows:
         Sec. 443.106.  CHANGE OF OWNERSHIP. The department may
  modify a license held by an establishment in the event of a change
  in ownership of the establishment if:
               (1)  the current owner and the new owner apply to the
  department for the modification;
               (2)  the new owner is not ineligible to hold the license
  under Section 443.102; and
               (3)  one party to the transaction submits any license
  modification fee to the department.
         SECTION 14.  Section 443.152, Health and Safety Code, is
  amended by adding Subsection (d) to read as follows:
         (d)  The executive commissioner by rule may exclude a
  substance that is generally recognized as having no risk of
  contaminating a finished consumable hemp product, including a
  microorganism or other substance that is inevitably destroyed or
  removed while processing or manufacturing the product, from the
  testing required under Section 443.151.
         SECTION 15.  Section 443.201, Health and Safety Code, is
  amended by adding Subsection (c) to read as follows:
         (c)  A person may transport and deliver a consumable hemp
  product to a consumer who purchased the product in compliance with
  this chapter. The person transporting and delivering the consumable
  hemp product is not required to:
               (1)  obtain a license under Section 443.101, unless the
  person processes or manufactures the product delivered; or
               (2)  register under Section 443.2025, unless the person
  sells the product delivered.
         SECTION 16.  Section 443.204, Health and Safety Code, is
  amended to read as follows:
         Sec. 443.204.  RULES RELATED TO SALE OF CONSUMABLE HEMP
  PRODUCTS. (a) Rules adopted by the executive commissioner
  regulating the sale of consumable hemp products must to the extent
  allowable by federal law reflect the following principles:
               (1)  hemp-derived cannabinoids, including cannabidiol,
  are not considered controlled substances or adulterants;
               (2)  products containing one or more hemp-derived
  cannabinoids, such as cannabidiol, intended for ingestion are
  considered foods, not controlled substances or adulterated
  products;
               (3)  consumable hemp products must be packaged and
  labeled in the manner provided by Section 443.205; and
               (4)  the processing or manufacturing of a consumable
  hemp product for smoking is prohibited.
         (b)  Notwithstanding Subsection (a)(4), a person may
  manufacture products described by that subsection in this state if:
               (1)  the products are sold only to persons located
  outside this state; and
               (2)  the person was manufacturing or processing
  consumable hemp products in this state on May 22, 2019.
         SECTION 17.  This Act takes effect September 1, 2021.