House File 781 H-1273 Amend House File 781 as follows: 1 1. By striking everything after the enacting clause and 2 inserting: 3 < DIVISION I 4 IOWA HEMP ACT 5 Section 1. NEW SECTION . 204.1 Short title. 6 This chapter shall be known as the “Iowa Hemp Act” . 7 Sec. 2. NEW SECTION . 204.2 Definitions. 8 As used in this chapter, unless the context otherwise 9 requires: 10 1. “Controlled substance” means the same as defined in 11 section 124.101. 12 2. “Conviction” means a conviction for an indictable 13 offense, in this state or another state, and includes a guilty 14 plea, deferred judgment from the time of entry of the deferred 15 judgment until the time the defendant is discharged by the 16 court without entry of judgment, or other finding of guilt by a 17 court of competent jurisdiction. 18 3. “Crop site” or “site” means a single contiguous parcel 19 of agricultural land suitable for the planting, growing, or 20 harvesting of hemp, if the parcel does not exceed forty acres. 21 4. “Department” means the department of agriculture and land 22 stewardship. 23 5. “Federal hemp law” means that part of Tit. X of the 24 Agriculture Improvement Act of 2018, Pub. L. No. 115-334, that 25 authorizes hemp production according to a state plan approved 26 by the United States department of agriculture, as provided in 27 §10113 of that Act, amending the Agricultural Marketing Act 28 of 1946, 7 U.S.C. §1621 et seq., including by adding §§297A 29 through 297E. 30 6. a. “Hemp” means the plant cannabis sativa L. and 31 any part of that plant, including the seeds thereof, and 32 all derivatives, extracts, cannabinoids, isomers, acids, 33 salts, and salts of isomers, whether growing or not, with a 34 delta-9 tetrahydrocannabinol concentration of not more than 35 -1- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 1/ 26 #1.

three-tenths of one percent on a dry weight basis. 1 b. “Hemp” also means a plant of the genus cannabis other 2 than cannabis sativa L., with a delta-9 tetrahydrocannabinol 3 concentration of not more than three-tenths of one percent 4 on a dry weight basis, but only to the extent allowed by the 5 department in accordance with applicable federal law, including 6 the federal hemp law. 7 7. “Hemp license” or “license” means a hemp license issued 8 pursuant to section 204.4. 9 8. a. “Hemp product” means an item derived from or made 10 by processing hemp or parts of hemp, including but not limited 11 to any item manufactured from hemp, including but not limited 12 to cloth, cordage, fiber, food, fuel, paint, paper, particle 13 board, plastic, hemp seed, seed meal, or seed oil. 14 b. “Hemp product” does not include any of the following: 15 (1) An item or part of an item with a maximum delta-9 16 tetrahydrocannabinol concentration that exceeds three-tenths of 17 one percent on a dry weight basis. 18 (2) Hemp seed that is capable of germination. 19 9. “Licensee” means a person who obtains a hemp license from 20 the department under this chapter. 21 10. “Local law enforcement agency” means an office of county 22 sheriff or a municipal police department. 23 11. “Negligent violation program” or “program” means the 24 program that may be established by the department to allow 25 a licensee to correct certain violations of this chapter as 26 provided in section 204.14. 27 12. “Produce” means to provide for the planting, raising, 28 cultivating, managing, harvesting, and storing a crop. 29 Sec. 3. NEW SECTION . 204.3 State plan —— implementing 30 rules. 31 1. The department shall prepare a state plan to be submitted 32 to the United States secretary of agriculture under the federal 33 hemp law. 34 2. Upon approval of the state plan, the department shall 35 -2- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 2/ 26

assume primary regulatory authority over the production of hemp 1 in this state as provided in this chapter. However, nothing in 2 this chapter affects the powers and duties of the department of 3 public safety or local law enforcement agencies from enforcing 4 any law within its purview or jurisdiction. The department of 5 public safety shall be the chief criminal enforcement agency 6 under this chapter. 7 3. The department may prepare any number of amended state 8 plans or any number of amendments to an existing state plan to 9 be submitted for approval by the United States secretary of 10 agriculture. 11 4. The department may provide for the receipt, filing, 12 processing, and return of documents described in this chapter 13 in an electronic format, including but not limited to the 14 transmission of documents by the internet. The department 15 shall provide for the authentication of official forms in an 16 electronic format that may include electronic signatures as 17 provided in chapter 554D. An official form in an electronic 18 format shall have the same validity and is discoverable and 19 admissible in evidence if given under penalty of perjury in the 20 same manner as an original printed form. The department shall 21 provide for the issuance of certificates of crop inspection in 22 an electronic format as provided in section 204.8. 23 5. a. The department shall prepare the state plan, any 24 amended state plan, or amendment to an approved state plan, by 25 adopting rules pursuant to chapter 17A. 26 b. The department may adopt the rules on an emergency basis 27 as provided in section 17A.4, subsection 3, and section 17A.5, 28 subsection 2, and the rules shall be effective immediately upon 29 filing unless a later date is specified in the rules. 30 Sec. 4. NEW SECTION . 204.4 Hemp license —— requirements. 31 1. The department shall establish and administer a process 32 to receive, evaluate, and approve or disapprove applications 33 for a hemp license. 34 2. The department shall prepare and publish one or more hemp 35 -3- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 3/ 26

license application forms in cooperation with the department of 1 public safety. A completed application form submitted to the 2 department shall contain all of the following: 3 a. The applicant’s full name and residence address. 4 b. A legal description and map of each crop site where the 5 applicant proposes to produce the hemp including its global 6 positioning system location. 7 c. The number of crop acres to be used for hemp production. 8 d. The name of the hemp variety. 9 e. The results of a national criminal history record check 10 of an applicant as may be required by the department. The 11 department shall inform an applicant if a national criminal 12 history record check will be conducted. If a national criminal 13 history record check is conducted, the applicant shall 14 provide the applicant’s fingerprints to the department. The 15 department shall provide the fingerprints to the department 16 of public safety for submission through the state criminal 17 history repository to the federal bureau of investigation. The 18 applicant shall pay the actual cost of conducting any national 19 criminal history record check to the department of agriculture 20 and land stewardship. The department shall pay the actual cost 21 of conducting the national criminal history record check to 22 the department of public safety from moneys deposited in the 23 hemp fund pursuant to section 204.6. The department of public 24 safety shall treat such payments as repayment receipts as 25 defined in section 8.2. The results of the national criminal 26 history check shall not be considered a public record under 27 chapter 22. 28 f. Any other information required in order to administer and 29 enforce the provisions of this chapter. 30 3. As a condition for issuance of a hemp license, the 31 licensee consents to the department, the department of public 32 safety, or a local law enforcement agency entering upon a crop 33 site as provide in section 204.9. 34 4. The department may do all of the following: 35 -4- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 4/ 26

a. Require that all or some licenses expire on the same 1 date. 2 b. Provide a different application form and requirements 3 relating to the submission, evaluation, and approval or 4 disapproval of an application for a renewed hemp license 5 consistent with federal law. 6 5. An applicant shall not be issued a hemp license unless 7 the applicant agrees to comply with all terms and conditions 8 relating to the regulation of a licensee as provided in this 9 chapter. 10 6. A person may hold any number of licenses at the same 11 time. However, the person shall not hold a legal or equitable 12 interest in a licensed crop site, if the total number of acres 13 of all licensed crop sites in which the person holds all such 14 interests equals more than forty acres. 15 7. An initial hemp license expires one year from the date 16 of issuance and may be issued on a renewal basis annually. The 17 department may require that a licensee apply for an amended or 18 new initial license if information contained in the existing 19 application is no longer accurate or is incomplete. 20 8. The department and the department of public safety shall 21 cooperate to develop procedures for the sharing of information 22 regarding applicants, including information required to be 23 completed on application forms. Upon request, the department 24 or the department of public safety shall provide information 25 regarding an applicant to a department of agriculture or law 26 enforcement agency in another state. 27 9. Information received on an application form shall be 28 maintained by the department for not less than three years. 29 10. The department shall disapprove the application of a 30 person for good cause, which shall include, but is not limited 31 to, any of the following: 32 a. A conviction for committing a criminal offense involving 33 a controlled substance as described in section 204.7. 34 b. A third violation of a provision of this chapter in 35 -5- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 5/ 26

a five-year period. The department shall disapprove any 1 application of a person for a five-year period following the 2 date of the person’s last violation in the same manner as 3 provided in section 204.15. 4 c. The revocation of a hemp license under section 204.11, 5 or the revocation of a license, permit, registration, or other 6 authorization to produce hemp in any other state. 7 11. A hemp license shall be suspended or revoked as provided 8 in section 204.11. 9 Sec. 5. NEW SECTION . 204.5 Hemp fees. 10 1. The department shall impose, assess, and collect the 11 following hemp fees: 12 a. A license fee which shall be paid by a person being 13 issued a hemp license as provided in section 204.4. 14 b. An inspection fee which shall be paid by a licensee for 15 the inspection of the licensee’s crop site, including obtaining 16 samples of plants to conduct a test, as provided in section 17 204.8. 18 2. a. For each hemp license, the license fee shall be 19 imposed on an interim basis until June 30, 2022. The amount of 20 the license fee shall not be more than the following: 21 (1) Five hundred dollars plus five dollars per acre, for 22 each crop site that is five acres or less. 23 (2) Seven hundred and fifty dollars, plus five dollars per 24 acre, for each crop site that is more than five acres but not 25 more than ten acres. 26 (3) One thousand dollars plus five dollars per acre, for 27 each crop site that is more than ten acres. 28 b. For conducting an inspection and official test as 29 provided in section 204.8, the department shall charge an 30 inspection fee on an interim basis until June 30, 2022, as 31 follows: 32 (1) In the case of an annual inspection and official test, a 33 base fee of not more than one thousand dollars. The department 34 may charge a supplemental fee in an amount determined by the 35 -6- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 6/ 26

department for conducting an inspection and official test of 1 any additional variety of hemp produced on the same licensed 2 crop site. 3 (2) In the case of any other inspection and official test, 4 conducted at the request of the licensee, the department shall 5 charge a base fee or supplemental fee in the same manner as 6 provided in subparagraph (1). 7 c. This subsection is repealed on July 1, 2022. 8 3. a. The department shall adopt rules to establish hemp 9 fees for the issuance of a hemp license pursuant to section 10 204.4. 11 b. The department shall adopt rules to establish hemp fees 12 for conducting inspections and obtaining samples of plants 13 to conduct tests, including but not limited to an annual 14 inspection and official test, pursuant to section 204.8. 15 c. The department shall calculate the rates, or a range of 16 rates, of the hemp fees to be effective for each successive 17 twelve-month period. The total amount of hemp fees collected 18 by the department pursuant to this subsection shall not be 19 more than the department’s estimate of the total amount of 20 revenues necessary to administer and enforce the provisions 21 of this chapter based on the expected revenue collected from 22 the hemp fees and the costs to be incurred by the department 23 in administering and enforcing the provisions of this chapter 24 during that period. The department may adjust the rates within 25 the range throughout the period as the department determines 26 necessary to comply with this paragraph. 27 d. The department may establish different rates for any 28 category of hemp fees based on criteria determined relevant by 29 the department, which may include the number of acres of the 30 licensee’s crop site and the type of hemp license issued. 31 e. (1) The rules shall first take effect immediately after 32 the repeal of subsection 2. 33 (2) This paragraph “e” is repealed immediately after the 34 rules described in subparagraph (1) take effect. 35 -7- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 7/ 26

4. The license fee and any annual inspection fee shall 1 be collected by the department at the time the hemp license 2 application is submitted. 3 5. Any hemp fee collected by the department under this 4 section shall be deposited in the hemp fund established 5 pursuant to section 204.6. 6 6. The department may refund all or any part of a hemp fee 7 collected under this section to an applicant. 8 Sec. 6. NEW SECTION . 204.6 Hemp fund. 9 1. A hemp fund is established in the state treasury under 10 the management and control of the department. 11 2. The hemp fund shall include moneys collected by the 12 department from hemp fees imposed and assessed under section 13 204.5 and moneys appropriated by the general assembly for 14 deposit in the hemp fund. The hemp fund may include other 15 moneys available to and obtained or accepted by the department, 16 including moneys from public or private sources. 17 3. Moneys in the hemp fund are appropriated to the 18 department and shall be used exclusively to carry out the 19 responsibilities conferred upon the department under this 20 chapter as determined and directed by the department, and 21 shall not require further special authorization by the general 22 assembly. 23 4. a. Notwithstanding section 12C.7, interest or earnings 24 on moneys in the hemp fund shall be credited to the hemp fund. 25 b. Notwithstanding section 8.33, moneys credited to the 26 hemp fund that remain unexpended or unobligated at the end of a 27 fiscal year shall not revert to any other fund. 28 Sec. 7. NEW SECTION . 204.7 Regulations —— exemption for 29 certain criminal offenses. 30 1. The Iowa crop improvement association recognized in 31 chapter 177 shall adopt procedures to certify hemp seed capable 32 of germination. Hemp seed certified under this subsection 33 shall be presumed to comply with the requirements for hemp 34 produced under this chapter. 35 -8- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 8/ 26

2. A person who materially falsifies any information 1 contained in an application under section 204.4 shall be 2 ineligible to produce hemp under this chapter. 3 3. a. A licensee convicted of an offense punishable 4 as a felony, for producing, possessing, using, harvesting, 5 handling, manufacturing, marketing, transporting, delivering, 6 or distributing a controlled substance before, on, or after 7 the implementation date of this chapter shall be ineligible to 8 produce hemp under this chapter for a ten-year period following 9 the date of conviction. 10 b. A licensee convicted in another state of an offense, 11 punishable in that state as a felony, substantially 12 corresponding to an offense described in paragraph “a” , before, 13 on, or after the implementation date of this chapter, shall be 14 ineligible to produce hemp under this chapter for a ten-year 15 period following the date of conviction. The department shall 16 recognize the statute of another state which defines such 17 offense substantially equivalent to an offense described in 18 paragraph “a” as a corresponding statute. 19 4. The department shall adopt rules regulating the 20 production of hemp, including but not limited to inspection 21 and testing requirements under section 204.8 or 204.9, and the 22 issuance of a certificate of crop inspection under section 23 204.8. The department shall adopt rules as necessary to 24 administer the negligent violation program. The department may 25 adopt other rules as necessary or desirable to administer and 26 enforce the provisions of this chapter relating to hemp or hemp 27 products. 28 5. A licensee is not subject to a criminal offense 29 under chapter 124 or 453B for producing, possessing, using, 30 harvesting, handling, manufacturing, marketing, transporting, 31 delivering, or distributing hemp, if all of the following 32 apply: 33 a. The hemp is hemp seed delivered to the licensee for 34 planting at the licensee’s crop site, or the hemp is or was 35 -9- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 9/ 26

produced at the licensee’s crop site. 1 b. The department, the department of public safety, or 2 a local law enforcement agency is allowed to access the 3 licensee’s crop site as part of an inspection as provided in 4 sections 204.8 and 204.9, including by obtaining a sample of 5 plants to conduct a test pursuant to section 204.8. 6 c. The department has issued a certificate of crop 7 inspection to the licensee covering the harvested hemp as 8 provided in section 204.8. 9 6. A person other than a licensee is not subject to a 10 criminal offense under chapter 124 or 453B for producing, 11 possessing, using, harvesting, handling, manufacturing, 12 marketing, transporting, delivering, or distributing hemp, 13 while on the licensee’s crop site, if all of the following 14 applies: 15 a. The hemp is produced at the licensee’s crop site. 16 b. The person is authorized to be on the licensee’s crop 17 site by the licensee. 18 7. A person other than a licensee is not subject to a 19 criminal offense under chapter 124 or 453B for possessing, 20 handling, using, manufacturing, marketing, transporting, 21 delivering, or distributing hemp produced in this state, if all 22 of the following applies: 23 a. The hemp is hemp seed delivered to the licensee for 24 planting at the licensee’s crop site, or the hemp was produced 25 at a licensee’s crop site. 26 b. If the hemp has been harvested, the person holds a 27 certificate of crop inspection covering the harvested hemp as 28 provided in section 204.8. 29 c. The person is acting in compliance with the federal hemp 30 law and other applicable federal law. 31 8. A person is not subject to a criminal offense under 32 chapter 124 or 453B for possessing, using, harvesting, 33 handling, manufacturing, marketing, transporting, delivering, 34 or distributing hemp produced in another state in compliance 35 -10- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 10/ 26

with the federal hemp law and other applicable federal law. 1 9. a. A person may engage in the retail sale of a hemp 2 product if the hemp was produced in this state or another state 3 in compliance with the federal hemp law or other applicable 4 federal law. A person may engage in the retail sale of a hemp 5 product if the hemp was produced in another jurisdiction in 6 compliance with applicable federal law and the laws of the 7 other jurisdiction, if such law is substantially the same as 8 applicable federal law. 9 b. To the extent consistent with applicable federal law, 10 a derivative of hemp, including hemp-derived cannabidiol, may 11 be added to cosmetics, personal care products, and products 12 intended for human or animal consumption. The addition of such 13 a derivative shall not be considered an adulteration of the 14 product, unless otherwise provided in applicable federal law. 15 c. A person may transport a hemp product within and through 16 this state and may export a hemp product to any foreign nation, 17 in accordance with applicable federal law and the law of the 18 foreign nation. 19 d. A hemp product complying with this subsection is not a 20 controlled substance under chapter 124 or 453B. 21 Sec. 8. NEW SECTION . 204.8 Inspections and tests —— 22 certificate of crop inspection. 23 1. a. The department shall conduct an annual inspection 24 of a licensee’s crop site to determine if the crop produced 25 at the site qualifies as hemp under this section. The annual 26 inspection shall include obtaining a sample of plants that 27 are part of the crop and providing for an official test of 28 that sample. The inspection shall be conducted as provided in 29 section 204.9. 30 b. A licensee shall deliver a notice to the department 31 stating the expected harvest date for the crop produced at the 32 licensee’s crop site. The department must receive the notice 33 at least thirty days prior to the expected harvest date. The 34 department shall conduct the annual inspection of the site 35 -11- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 11/ 26

within thirty days prior to the actual harvest date. 1 c. The department shall provide the department of public 2 safety any official test results that indicate a sample exceeds 3 the maximum concentration of delta-9 tetrahydrocannabinol in 4 excess of two percent on a dry weight basis. 5 d. A licensee shall not harvest any portion of a crop 6 produced at the licensee’s crop site unless the department has 7 issued the licensee a certificate of crop inspection. The 8 department shall issue a verified copy of the certificate to 9 any other person upon request of the licensee. The certificate 10 shall be published by the department as an official form. To 11 the extent allowed by the federal hemp law, the certificate 12 shall be proof that the harvested crop described on the form 13 qualifies as hemp pursuant to the results of an official test. 14 2. The department may conduct official tests for additional 15 varieties of hemp located on the same licensed crop site. The 16 department may conduct additional inspections and tests upon 17 the request of a licensee. 18 3. The official test shall be a composite test of the plants 19 obtained by the department from a licensee’s crop site during 20 the annual inspection and shall be conducted by a laboratory 21 designated by the department. The sample must have a maximum 22 concentration of delta-9 tetrahydrocannabinol that does not 23 exceed three-tenths of one percent on a dry weight basis. 24 4. The department of public safety or a local law 25 enforcement agency may conduct an inspection of a licensee’s 26 crop site in order to determine that the licensee is complying 27 with the criminal provisions of this chapter as well as 28 chapters 124 and 453B. The department of public safety or a 29 local law enforcement agency may conduct a test of the plants 30 obtained by that department or local law enforcement agency 31 from the licensee’s crop site during the inspection according 32 to procedures adopted by the department of public safety. 33 Sec. 9. NEW SECTION . 204.9 Right of access. 34 1. a. The department, including an authorized inspector, 35 -12- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 12/ 26

employee, or agent of the department, may enter onto a crop 1 site during reasonable hours to determine whether a licensee is 2 acting in compliance with the requirements under this chapter. 3 The department may also enter into any structure if all of the 4 following apply: 5 (1) The structure is not a dwelling. 6 (2) The structure is located on or in close proximity to the 7 licensee’s crop site, and the use of such structure is directly 8 related to the production of hemp, including but not limited to 9 a barn, machine shed, greenhouse, or storage crib. 10 b. The department may require the licensee to furnish 11 business records, including books, accounts, records, files, 12 and any other documents in print or electronic media that the 13 department deems relevant to an inquiry conducted under this 14 chapter. 15 c. The department may request the department of public 16 safety or a local law enforcement agency accompany the 17 department of agriculture and land stewardship when conducting 18 an inspection. 19 2. a. The department of public safety or a local law 20 enforcement agency may conduct an inspection of a licensee’s 21 crop site or enter into a structure located on or in close 22 proximity to the crop site and may require a licensee to 23 furnish business records, in the same manner and according to 24 the same limitations as the department of agriculture and land 25 stewardship pursuant to subsection 1. 26 b. The department of public safety or a law enforcement 27 agency may obtain a sample of plants that are part of the 28 crop and provide for a test of that sample as provided in 29 section 204.8. The department of public safety or a local law 30 enforcement agency shall not impose, assess, or collect a fee 31 for conducting an inspection or test under this section. 32 4. A person shall not prevent the department, the department 33 of public safety, or a local law enforcement agency from 34 administering and enforcing the provisions of this section by 35 -13- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 13/ 26

any means, including but not limited to any act, including 1 a refusal to allow entry, misrepresentation, omission, or 2 concealment of facts. 3 5. A licensee shall not harvest any portion of a crop 4 produced at the licensee’s crop site if the department, the 5 department of public safety, or a local law enforcement agency 6 has been prevented from accessing the site under this section. 7 Sec. 10. NEW SECTION . 204.10 Order of disposal. 8 1. If a crop that is produced at a licensee’s crop site does 9 not qualify as hemp according to an official test conducted 10 pursuant to section 204.8, the department, in consultation with 11 the department of public safety, shall order the disposal of 12 the crop by destruction at the site or if necessary require the 13 crop to be removed to another location for destruction. 14 2. The department may request assistance from the 15 department of public safety or a local law enforcement agency 16 as necessary to carry out the provisions of this section. The 17 department upon request shall deliver any sample of the crop 18 to the department of public safety or a local law enforcement 19 agency. 20 3. The licensee shall pay the department for all actual 21 and reasonable costs of the destruction of the crop. If the 22 department assumes any amount of the costs, it may charge that 23 amount to the licensee. If the licensee fails to reimburse any 24 of that amount to the department, the department may report the 25 amount to the county treasurer. The amount shall be placed 26 upon the tax books, and collected with interest and penalties 27 after due, in the same manner as other unpaid property taxes. 28 The county shall reimburse the department within thirty days 29 from the collection of the property taxes. 30 4. To the extent allowed by applicable federal law, the 31 department may provide for the disposal of the mature stalks 32 of the crop confiscated by the department for the licensee’s 33 on-farm use and at the licensee’s expense. 34 Sec. 11. NEW SECTION . 204.11 Disciplinary action. 35 -14- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 14/ 26

1. The department may suspend or revoke a hemp license 1 obtained under section 204.4 by a person who does any of the 2 following: 3 a. Provides false or misleading information to the 4 department under this chapter, including by submitting a false 5 application. 6 b. Fails to comply with or violates any provision of this 7 chapter, including a rule adopted by the department, the 8 department of public safety, or a condition of an application 9 for the issuance of a hemp license under section 204.4. 10 c. Fails to comply with an order issued by the department 11 under this chapter. 12 2. The department shall revoke a license issued pursuant to 13 section 204.4, if any of the following apply: 14 a. The department would disapprove a new application to that 15 person for good cause as provided in section 204.4, subsection 16 10. 17 b. The person submits a materially false application to 18 participate in the negligent violation program. 19 3. The suspension or revocation of a hemp license is in 20 addition to an order of disposal under section 204.10; the 21 imposition of a civil penalty under section 204.12, subject 22 to the provisions of section 204.15; or the imposition of any 23 other civil or criminal penalty authorized under state law. 24 Sec. 12. NEW SECTION . 204.12 Civil penalties. 25 1. A person who violates a provision of this chapter is 26 subject to a civil penalty of not less than five hundred 27 dollars and not more than two thousand five hundred dollars. 28 The department shall impose, assess, and collect the civil 29 penalty. Each day that a continuing violation occurs may be 30 considered a separate offense. 31 2. Notwithstanding subsection 1, a civil penalty shall not 32 be imposed, assessed, or collected against a licensee who is 33 participating in or has successfully completed the negligent 34 violation program pursuant to section 204.15. 35 -15- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 15/ 26

3. All civil penalties collected under this section shall be 1 deposited into the general fund of the state. 2 Sec. 13. NEW SECTION . 204.13 Injunctive relief. 3 The department, or the attorney general acting on behalf of 4 the department, may apply to the district court for injunctive 5 relief in order to restrain a person from acting in violation 6 of this chapter. In order to obtain injunctive relief, the 7 department, or attorney general, shall not be required to post 8 a bond or prove the absence of an adequate remedy at law unless 9 the court for good cause otherwise orders. The court may order 10 any form of prohibitory or mandatory relief that is appropriate 11 under principles of equity, including but not limited to 12 issuing a temporary or permanent restraining order. 13 Sec. 14. NEW SECTION . 204.14 Criminal offense —— falsified 14 certificate of crop inspection. 15 A person is subject to criminal penalties provided under the 16 applicable provisions in chapter 124 or 453B, if all of the 17 following apply: 18 1. The person commits an offense under one of the applicable 19 provisions of chapter 124 or 453B by possessing, handling, 20 using, manufacturing, marketing, transporting, delivering, or 21 distributing the plant cannabis, regardless of whether the 22 plant was produced in compliance with the provisions of this 23 chapter. 24 2. The person is required to hold a certificate of crop 25 inspection under section 204.8 to possess, handle, use, 26 manufacture, market, transport, deliver, or distribute hemp 27 that has been harvested under this chapter. 28 3. The person knowingly or intentionally does any of the 29 following: 30 a. Falsifies the certificate of crop inspection. 31 b. Acquires the certificate of crop inspection that the 32 person knows has been falsified. 33 Sec. 15. NEW SECTION . 204.15 Negligent violation —— 34 program. 35 -16- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 16/ 26

1. a. The department may find that a licensee has 1 negligently violated a provision of this chapter by doing any 2 of the following: 3 (1) Completing an application for a license without 4 providing a legal description of the crop site pursuant to 5 section 204.4. 6 (2) Failing to renew a hemp license for an existing crop 7 site or obtain a hemp license for a new crop site pursuant to 8 section 204.4. 9 (3) Producing a crop on the licensee’s crop site with a 10 maximum concentration of delta-9 tetrahydrocannabinol that 11 exceeds three-tenths of one percent according to the results of 12 an official test of a sample obtained from the licensed crop 13 site pursuant to an inspection conducted under section 204.8. 14 b. It is conclusively presumed that a licensee acted 15 with a culpable mental state greater than negligence, if 16 the department obtains a sample of a crop produced on the 17 licensee’s crop site and the official test results of the 18 sample conducted pursuant to section 204.8 indicate a maximum 19 concentration of delta-9 tetrahydrocannabinol in excess of two 20 percent on a dry weight basis. 21 c. If the department determines a licensee violated this 22 chapter with a culpable mental state greater than negligence, 23 the department shall immediately report the licensee’s 24 violation to the department of public safety, the county 25 attorney, and the attorney general, who shall take action as 26 the facts and circumstances warrant. The department shall also 27 report the licensee to the United States attorney general to 28 the extent required by the federal hemp law. 29 2. The department may establish a negligent violation 30 program. The purpose of the program is to allow a 31 participating licensee who has negligently violated a provision 32 of this chapter as described in subsection 1 to comply with a 33 corrective plan established by the department to correct each 34 negligent violation, including by providing for all of the 35 -17- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 17/ 26

following: 1 a. A reasonable date, established by the department, for the 2 licensee to correct each cause for the violation. 3 b. The filing of periodic reports to the department 4 evidencing that the licensee is complying with the requirements 5 of this chapter. The licensee shall submit the reports to the 6 department according to a schedule required by the department. 7 The licensee shall submit a report to the department for 8 at least two years from the date that the licensee first 9 participated in the program. 10 c. Any other requirement established by the department. 11 3. A licensee shall not participate in the negligent 12 violation program, if a test of a sample of plants that 13 are part of a crop produced on the licensee’s crop site 14 exceeds a maximum concentration of two percent delta-9 15 tetrahydrocannabinol on a dry weight basis. 16 4. A person who has violated a provision of this chapter 17 three times in a five-year period shall be ineligible to 18 participate in the negligent violation program, or produce 19 hemp, for a period of five years beginning on the date of the 20 third violation. 21 5. The department shall certify that a licensee has 22 successfully completed the negligent violation program. The 23 certification shall be published by the department as an 24 official form. The department shall deliver the certification 25 to the licensee which shall be proof of the licensee’s 26 compliance. 27 6. A licensee who is participating in or has successfully 28 completed the negligent violation program shall not be subject 29 to any of the following: 30 a. A civil penalty under section 204.12 for committing a 31 violation of this chapter. 32 b. A criminal offense under chapter 124 or 453B arising 33 out of a negligent violation of this chapter, if the licensee 34 would otherwise be guilty of producing, possessing, using, 35 -18- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 18/ 26

harvesting, handling, or distributing the plant cannabis 1 pursuant to the results of a test conducted pursuant to section 2 204.8. 3 Sec. 16. NEW SECTION . 204.16 Waivers or variances. 4 If the department determines there is a conflict with a 5 regulation or order promulgated by a federal agency and a 6 provision of this chapter, the department may grant a variance 7 or waiver from the provision of this chapter to the extent such 8 variance or waiver is allowed under the federal hemp law and 9 the United States department of agriculture. The waiver or 10 variance shall expire not later than July 1 of the succeeding 11 legislative session. 12 Sec. 17. NEW SECTION . 204.17 Statutory construction. 13 1. Nothing in this chapter shall be construed or applied to 14 be less stringent than required under the federal hemp law. 15 2. Nothing in this chapter shall be construed or applied to 16 be in conflict with any of the following: 17 a. Applicable federal law and related regulations. 18 b. Other laws of this state, including any administrative 19 rules, relating to product development, product manufacturing, 20 consumer safety, or public health so long as the state law is 21 compatible with applicable federal law. 22 c. Local law relating to product development, product 23 manufacturing, consumer safety, or public health so long as the 24 local law is consistent with federal and state law. 25 3. Except as provided in section 204.7, nothing in this 26 chapter shall be construed or applied to prohibit a person 27 from possessing, handling, using, manufacturing, marketing, 28 transporting, delivering, or distributing a hemp product. 29 4. Nothing in this chapter shall be construed or applied 30 to authorize a person to manufacture, recommend, possess, use, 31 dispense, deliver, transport, or administer medical cannabidiol 32 pursuant to chapter 124E. 33 5. Nothing in this chapter shall be construed or applied to 34 infringe upon the ability of the department of public safety 35 -19- HF781.2095 (2) 88 (amending this HF 781 to CONFORM to SF 599) da/rn 19/ 26