New hemp rules to take effect Wednesday

DES MOINES — A controversial set of regulations to restrict the sale and potency of consumable hemp products in Iowa will be allowed to take effect Wednesday after a committee of lawmakers opted not to pause the rule-making process, despite concerns from manufacturers and retailers.

The Legislature’s Administrative Rules Review Committee on Tuesday took no action on the rules, drafted by the state Department of Health and Human Services, to implement the state law passed earlier this year that regulates the products.

Health and Human Services staffers said they will use emergency rule-making authority to make the rules take effect Wednesday.

The law, House File 2605, regulates the amount of THC — the main compound in cannabis that causes the high — in consumable hemp products, requires them to have a warning label and requires that they conform to packaging standards. The law also bans sales to minors and the sale of synthetic consumable hemp.

Under the law, products must contain fewer than 4 milligrams of THC per serving and 10 milligrams per container.

The law is facing legal challenges from several hemp retailers who say it is unconstitutional. A federal judge is expected to rule soon on a request to temporarily block the law from taking effect.

The draft rules to implement the hemp law, which have been in the works since May and were subject to two public hearings, have received significant criticism from hemp companies.

The Iowa Health and Human Services Department on Tuesday provided lawmakers with the updated version of the rules, which had not been made public before the hearing.

At the hearing, hemp company owners asked state lawmakers to pause the rules. They said the rules would cast more confusion over the industry and be impossible to follow, subjecting them to criminal liability for what they said were loosely defined terms.

What is a ‘serving’?

One primary issue for retailers is the definition of “serving,” which is not spelled out in the law. Manufacturers had believed they could change the labeling on their 12-ounce cans to include more than one serving, allowing them to sell cans containing up to 10 milligrams of THC. But the draft rules say a 12-ounce can cannot contain more than one serving, deferring to federal serving size standards.

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Scott Selix, the co-founder of Iowa-based beverage manufacturer Climbing Kites, grew visibly frustrated with state regulators during the meeting and said they had not been clear with him on how the law will be enforced.

Selix said the state Department of Health and Human Services should not be dictating how much a “serving” is, as the law did not expressly grant that authority to the department. He said lawmakers had assured him during the legislative session his products would not be affected by the law.

“What the department is proposing is not what was passed,” he said. “The way they regulated servings … the second you all passed that, they said, ‘No, no, no. Now we’re going to define serving so that we get control back.’ ”

Nick Crawford, a member of the department's government relations team, said the portion of the law which directs the department to adopt rules covering “packaging and labeling requirements” gives it the authority to regulate serving sizes.

"We believe that in order to implement packaging and labeling requirements, definitions for serving and container must be established," he said.

The law also directed the HHS department to write the warning label that companies must attach to their products.

Selix said the rulemaking process made it impossible for the company to comply with the warning label requirements, as the final wording of the requirement was not revealed until Tuesday, set to go into effect Wednesday. He said he had manufacturing deadlines long before this week.

“It’s not an exaggeration to say that I have no idea how to comply with this law,” he said. “... The department has refused to answer my questions.”

When asked previously how the law would be enforced, Iowa Department of Health and Human Services spokesperson Alex Murphy said the department will not comment on pending litigation.

Delay thwarted

The Legislature’s Administrative Rules Review Committee has several options to delay or oppose state agency rule-making. It can implement a 70-day pause on rules, delay them until the end of the next legislative session or file a formal objection.

The four Democrats on the 10-member committee supported pausing the implementation of the rules for 70 days, but the motion failed, with opposition from the committee’s majority Republicans.

Sen. Cindy Winckler, D-Davenport, said the rule-making process had moved too fast, and lawmakers should pause their implementation to ensure they conform with the law’s intent.

“With the businesses at stake, with the health of individuals, with the clarity of exactly what it is that will be implemented, I think we need to suspend and give it the 70 days,” Winckler said.

Republicans did not comment on the motion or their reason for opposing it.

Comments: cmccullough@qctimes.com