SF 2398 (LSB 2172SV (4) 87)

SENATE FILE 2398

BY  COMMITTEE ON WAYS AND MEANS

(SUCCESSOR TO SF 329)

(As Amended and Passed by the Senate 2018-04-04)

A BILL FOR

An Act relating to industrial hemp, including the regulation of its production as part of a research program, marketing for purposes of manufacturing industrial hemp products, providing for fees, making appropriations, providing for enforcement and the confiscation and destruction of certain property, and including penalties. 
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:

    Section 1.  Section 124.401, subsection 5, Code 2018, is amended by adding the following new unnumbered paragraph:
   NEW UNNUMBERED PARAGRAPH.  Notwithstanding this subsection or any other provision of this chapter to the contrary, a person may produce, possess, deliver, transport, process, and use industrial hemp in accordance with the provisions of chapter 188. 
    Sec. 2.  NEW SECTION.  188.1  Short title.
   This chapter shall be known and may be cited as the “Iowa Industrial Hemp Act”.
    Sec. 3.  NEW SECTION.  188.2  Definitions.
   As used in this chapter, unless the context otherwise requires:
   1.  “Association” means the Iowa crop improvement association recognized pursuant to section 177.1.
   2.  “Certified industrial hemp seed” means industrial hemp seed that has been certified pursuant to section 188.18.
   3.  “Council” means the industrial hemp council established in section 188.11.
   4.  “Department” means the department of agriculture and land stewardship.
   5.  “Industrial hemp” means any part of the Cannabis sativa plant, whether growing or not, with a concentration of delta-9 tetrahydrocannabinol that does not exceed the maximum concentration for the plant as determined pursuant to section 188.8.
   6.  “Industrial hemp plant” means all nonseed parts of industrial hemp, whether growing or not. 
   7.  a.  “Industrial hemp product” means any item manufactured from industrial hemp, including but not limited to cloth, cordage, fiber, food, fuel, paint, paper, particleboard, plastic, industrial hemp seed, seed meal, or seed oil.
   b.  “Industrial hemp product” does not include industrial hemp seed that is capable of germination.
   8.  “Industrial hemp seed” means seed produced by industrial hemp regardless of whether the seed is capable of germination. 
   9.  “Iowa state university” means Iowa state university of science and technology.
   10.  “Law enforcement agency” means the department of public safety, an office of county sheriff, or a city’s police force.
   11.  “Licensee” means a person who obtains a license from the department under section 188.15 to participate in the industrial hemp commodity program established pursuant to section 188.13 or the industrial hemp production program established pursuant to section 188.14.
   12.  “Production” means any part of planting, cultivating, or harvesting industrial hemp.
   13.  “Regents institution” means the university of Iowa, Iowa state university of science and technology, or the university of northern Iowa governed by the state board of regents under section 262.7.
   14.  “Registrant” means a regents institution that registers with the department to administer the industrial hemp production program established in section 188.14.
    Sec. 4.  NEW SECTION.  188.3  Report.
   1.  The department shall prepare and submit an annual report to the governor and general assembly not later than January 10. The report shall evaluate the success of the industrial hemp commodity program established pursuant to section 188.13 and the industrial hemp production program established pursuant to section 188.14. The department, in cooperation with any registrant, may establish performance benchmarks and make recommendations for consideration by the general assembly in order to meet the purposes of the programs in compliance with the requirements of 7 U.S.C. §5940.
   2.  a.  In preparing the report, the department may require that a select number of licensees complete and submit a brief survey regarding the licensee’s business operations including the production, handling, transportation, or processing of industrial hemp.
   b.  A registrant shall assist the department in preparing and compiling the results of the survey. Until a regents institution is registered under section 188.14, Iowa state university shall act in lieu of the registrant.
   3.  The report may include the compilation of data, but shall not disclose any information that is confidential under section 188.9, including the identity of a licensee or the location of any facility used by the licensee in the production of industrial hemp. This subsection shall not preclude the disclosure of information to the extent that the licensee voluntarily agrees in writing that such information is to be considered a public record under section 188.9.
    Sec. 5.  NEW SECTION.  188.4  Rules and forms.
   The department shall adopt all rules and prepare and publish all forms required to administer this chapter and comply with 7 U.S.C. §5940. The department may require the mandatory use of a form and refuse to accept a document that is not prepared using a mandatory form.
    Sec. 6.  NEW SECTION.  188.5  Compliance with federal law.
   1.  The purpose of this chapter is to fully implement the provisions of 7 U.S.C. §5940.
   2.  The programs established under this chapter and any projects administered under those programs are for the exclusive purpose of growing, cultivating, and marketing industrial hemp in a manner that complies with the programs and projects described in 7 U.S.C. §5940. 
   3.  a.  The department shall seek to obtain any necessary approval by the drug enforcement administration of the United States department of justice in order to obtain industrial hemp seeds for certification pursuant to section 188.18 as part of the industrial hemp commodity program as provided in section 188.13 or the industrial hemp production program as provided in section 188.14. 
   b.  A registrant may seek to obtain any necessary approval by the drug enforcement administration of the United States department of justice in order to obtain industrial hemp seeds for certification pursuant to section 188.18 as part of the industrial hemp production program as provided in section 188.14. 
   4.  The department or a registrant may seek a waiver of a federal regulation promulgated by the United States department of agriculture or the drug enforcement administration of the United States department of justice if necessary to fully implement the provisions of this chapter.
    Sec. 7.  NEW SECTION.  188.6  General prohibitions.
   1.  A person shall not produce, handle, transport, market, or process industrial hemp in this state unless the industrial hemp has been produced pursuant to the industrial hemp commodity program established pursuant to section 188.13 or the industrial hemp production program established pursuant to section 188.14.
   2.  Nothing in this chapter prevents a person from producing, handling, transporting, marketing, or processing an industrial hemp product.
    Sec. 8.  NEW SECTION.  188.7  Cannabidiol production prohibited —— contingent repeal.
   1.  Industrial hemp shall not be used to produce medical cannabidiol as defined in section 124E.2.
   2.  Nothing in this chapter shall be construed to authorize a person to recommend, possess, use, dispense, deliver, transport, or administer medical cannabidiol.
    Sec. 9.  NEW SECTION.  188.8  Maximum concentration of tetrahydrocannabinol. 
   1.  A test of a Cannabis sativa plant under this chapter shall be conducted by the department or a qualified public or private laboratory approved by the department. The department shall establish protocols for sampling and testing Cannabis sativa plants produced pursuant to the provisions of this chapter, including for obtaining test samples for delivery to the laboratory, and the receipt of test results delivered to the department, a registrant, or a licensee. The concentration of delta-9 tetrahydrocannabinol present in a Cannabis sativa plant shall be measured on a dry weight basis in the same manner as provided under 7 U.S.C. §5940 unless subsequent controlling federal law provides otherwise.
   2.  The maximum concentration of delta-9 tetrahydrocannabinol present in a Cannabis sativa plant in order for the plant to qualify as industrial hemp shall be established by the department. The department’s established maximum concentration shall be the same as the maximum concentration allowed to be present to qualify as industrial hemp under 7 U.S.C. §5940 or any subsequent controlling federal law.
   3.  In testing Cannabis sativa plants which comprise a crop, a composite test result that exceeds the maximum concentration of delta-9 tetrahydrocannabinol as provided in subsections 1 and 2 is deemed conclusive that the crop exceeds the maximum concentration for industrial hemp.
    Sec. 10.  NEW SECTION.  188.9  Confidential information —— exceptions.
   1.  a.  All of the following information is confidential:
   (1)  A completed license application, or information which is part of such application, acquired by the department, a registrant, or a law enforcement agency under section 188.15. For purposes of this subparagraph, a completed license application does not include the results of a national criminal history record check acquired by the department from the department of public safety pursuant to section 188.15.
   (2)  A license issued by the department to the applicant under section 188.15.
   (3)  Any information acquired by the department or a registrant from a licensee participating in or seeking to participate in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   (4)  A certification of industrial hemp seed issued by the association to the department, a registrant, or a licensee under section 188.18.
   (5)  A survey acquired by the department or by Iowa state university from the department under section 188.3.
   (6)  Information relating to the inspection of a licensee participating in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   (7)  The results of any test sample of an industrial hemp crop regardless of whether the test was conducted by the department, a registrant, or a licensee participating in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14. 
   (8)  Any other information that identifies the business location, operations, management, practices, or finances of a licensee participating in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   b.  The confidential information may be in a printed or electronic format as part of a document, other tangible medium, or accessible by a computer or similar device.
   2.  The confidential information described in subsection 1 is not a public record and is not otherwise subject to disclosure under chapter 22. Such information that is subsequently disclosed to a person under this chapter retains its confidentiality in the manner provided in this section. 
   3.  The department shall establish requirements and procedures for the disclosure of confidential information described in subsection 1, including to any of the following:
   a.  To a person authorized to receive the confidential information under this chapter.
   b.  A federal agency or another state’s agency as part of the process to evaluate the approval or renewal of a license under section 188.15 or the licensee’s participation in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   c.  A law enforcement agency or a federal agency which requests the confidential information in order to respond to an emergency situation, a criminal complaint, or an ongoing criminal investigation, subject to any applicable confidentiality requirements for public records under section 22.7.
   d.  The department in conducting a disciplinary action against a licensee under section 188.26.
   e.  A party in any judicial or administrative proceeding involving discovery, so long as the disclosure is made upon subpoena, or other means of legal compulsion for release.
   f.  Any person making a request to the custodian of the confidential information in the same manner as provided in section 22.2 to the extent that the licensee voluntarily agrees in writing that such information is to be considered a public record subject to chapter 22.
    Sec. 11.  NEW SECTION.  188.10  Liability.
   The department or a registrant is not liable for the actions of a licensee regardless of the department’s or registrant’s legal relationship with the licensee, including but not limited to any relationship as an agent, principal, fiduciary, or party to a contract.
    Sec. 12.  NEW SECTION.  188.11  Industrial hemp council —— establishment, membership, procedures.
   1.  An industrial hemp council is established under the purview of the department.
   2.  a.  The council shall consist of the following voting members:
   (1)  An individual who has experience in the regulation of industrial hemp production, appointed by the secretary of agriculture.
   (2)  An individual who is a member of an agricultural cooperative association as defined in section 502.102, appointed by the secretary of agriculture. 
   (3)  Two employees of the department appointed by the secretary of agriculture. The employees shall be knowledgeable regarding the production of agricultural crops. One employee may be the state entomologist. One employee may be an employee knowledgeable about procedures and practices relating to the import of agricultural seeds or inputs.
   (4)  One employee of the department of natural resources appointed by the director of the department of natural resources. The employee must be knowledgeable regarding agricultural practices and environmental regulations. 
   (5)  One employee of the department of public safety appointed by the director of the department. The person must be knowledgeable regarding federal and state drug enforcement policies.
   (6)  One employee of a registrant appointed by the president of the registrant’s regents institution. The employee must be knowledgeable regarding plant sciences. Until such a registrant is appointed, one employee of Iowa state university appointed by the president of the university shall serve as a member. The employee must be knowledgeable regarding plant sciences. 
   b.  The council shall also include four members of the general assembly appointed to serve in an ex officio, nonvoting capacity. The legislative members shall be selected, one member each, by the majority leader of the senate, the minority leader of the senate, the speaker of the house of representatives, and the minority leader of the house of representatives.
   3.  A voting member who has not been appointed shall be confirmed by the senate pursuant to section 2.32.
   4.  A public member is eligible to receive compensation as provided in section 7E.6 and shall be reimbursed for actual and necessary expenses incurred in the discharge of the member’s duties. The moneys used to pay expenses and compensation shall be paid from moneys in the industrial hemp commodity fund established in section 188.23. A legislative member is eligible to receive a per diem and expenses as provided in section 2.10.
   5.  a.  A public member shall serve a three-year staggered term commencing and ending as provided in section 69.19. A state employee member shall serve at the pleasure of the appointing authority. 
   b.  The voting members shall elect a chairperson and vice chairperson annually from the voting membership. A majority of the voting members constitutes a quorum. If the chairperson and vice chairperson are unable to preside over the council, a majority of the voting members present may elect a temporary chairperson.
   6.  A vacancy on the council shall be filled in the same manner as the original appointment. A member appointed to fill a vacancy created other than by expiration of a term shall be appointed for the remainder of the unexpired term.
   7.  The council shall be housed within the department and the department, in cooperation with Iowa state university, shall furnish the council with a meeting place and all articles, supplies, and services necessary to enable the council to perform its duties. Iowa state university or the office of attorney general may provide any technical or legal assistance requested by the council or department.
   8.  The appointments of the public members are subject to the requirements of sections 69.16, 69.16A, and 69.19. A public member is eligible for reappointment. The secretary may remove a public member if the removal is based on the public member’s misfeasance, malfeasance, or willful neglect of duty or other just cause, after notice and hearing, unless the notice and hearing is expressly waived by the public member in writing.
    Sec. 13.  NEW SECTION.  188.12  Industrial hemp council —— powers and duties.
   1.  The council shall advise the department and each registrant regarding all of the following:
   a.  All aspects relating to the administration of the industrial hemp commodity program established pursuant to section 188.13 and the industrial hemp production program established pursuant to section 188.14.
   b.  The establishment of fees assessed, imposed, and collected pursuant to sections 188.21 and 188.22.
   c.  The management of the industrial hemp commodity fund established in section 188.23.
   2.  The council shall advise the department regarding all of the following:
   a.  Disciplinary action taken against a licensee pursuant to section 188.26. 
   b.  The establishment of a range of civil penalties to be imposed, assessed, and collected pursuant to section 188.27.
   3.  The council shall advise a registrant regarding the terms and conditions of contracts entered into with a selected licensee under section 188.17.
   4.  The council shall not control policy decisions or direct the administration or enforcement of this chapter.
    Sec. 14.  NEW SECTION.  188.13  Industrial hemp commodity program —— department and licensees.
   1.  The department shall establish and administer an industrial hemp commodity program. The purpose of the program is to determine the economic feasibility of producing industrial hemp as a profitable commodity in this state and of the effective handling, transporting, marketing, and processing of the commodity in this state. 
   2.  A person must be licensed pursuant to section 188.15 to participate in the program. Under the program, a licensee may produce all of the following:
   a.  Industrial hemp plants which shall to every extent feasible be processed into industrial hemp products for marketing in commercial channels. 
   b.  Industrial hemp seeds which shall to every extent feasible be processed into industrial hemp products or used to produce a subsequent industrial hemp crop.
   3.  The department may establish standards for the labeling or marketing of industrial hemp produced under this section. The standards shall to every extent feasible be in accordance with applicable standards in chapter 210.
   4.  A licensee must immediately report the loss of any industrial hemp to the department. 
   5.  A licensee shall retain industrial hemp or transfer industrial hemp to another person only as authorized by the department. The licensee may retain industrial hemp seeds capable of germination only as authorized by the department. The licensee shall only transfer industrial hemp seed that is capable of germination to the department, a registrant, or another licensee as approved by the department or any other person authorized by law to receive the industrial hemp seed.
   6.  A licensee must regularly test the industrial hemp to ensure that the industrial hemp does not exceed the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8.
   7.  The department shall conduct an inspection of the licensee’s facilities and business records as provided in section 188.16.
    Sec. 15.  NEW SECTION.  188.14  Industrial hemp production program —— registrants and licensees.
   1.  A regents institution, or two or more regents institutions acting jointly, may establish and administer an industrial hemp production program. The purpose of the program shall be to determine the feasibility of increasing the production acreage and yield of industrial hemp as a profitable crop and reducing the concentration of delta-9 tetrahydrocannabinol in the industrial hemp. 
   2.  In order to administer a program, the regents institution or regents institutions acting jointly must register with the department according to requirements established by the department. The registration shall include a research plan that summarizes the quantifiable short-term and long-term goals of the research. A copy of the registration shall also be filed with the council, the governor, and the general assembly.
   3.  The department has all the same powers to regulate a licensee under this program as the department does in regulating a licensee under the industrial hemp commodity program pursuant to section 188.13. A licensee participating in this program shall comply with the same requirements as a licensee participating in the industrial hemp commodity program under section 188.13, unless the department provides otherwise.
   4.  Only a registrant, including a licensee acting under the supervision of the registrant, may participate in the program. Under the program, a registrant may produce any of the following:
   a.  Industrial hemp plants which may be processed into industrial hemp products.
   b.  Industrial hemp seeds which may be processed into industrial hemp products. A registrant may retain industrial hemp seeds capable of germination to produce the next crop of industrial hemp or transfer the seeds to another person for purposes of scientific research. The registrant shall retain or transfer the seeds after consulting with the department. 
   5.  A registrant must regularly test the industrial hemp to ensure that the industrial hemp does not exceed the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8. 
   6.  A registrant must immediately report the loss of any industrial hemp produced by the registrant to the department. 
   7.  A registrant must maintain records regarding production and transfer of the industrial hemp by the registrant. The records shall to every extent practicable contain the same type of information contained in records maintained by licensees under section 188.13. 
   8.  A registrant’s inspection of a licensee’s facilities may be conducted as provided in the industrial hemp production contract entered into by the registrant and licensee under section 188.17. The registrant may request that the department assign an official or that a law enforcement agency assign an officer to accompany the registrant during the inspection.
    Sec. 16.  NEW SECTION.  188.15  Industrial hemp commodity license —— requirements.
   1.  The department shall establish and administer a process to receive, evaluate, and approve applications for industrial hemp commodity licenses by persons seeking to participate in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14. A license expires one year from the date of issuance. An expired license may be renewed for three additional years. The department may require that a licensee apply for an amended or new license if information contained in the existing application is no longer accurate or is incomplete.
   2.  An applicant shall not be issued a license unless the applicant agrees to comply with all terms and conditions relating to the department’s regulation of the licensee. 
   3.  The department shall disapprove the application of a person for good cause, which shall include any of the following:
   a.  The conviction of a felony within the prior ten years or any drug offense within the same period, regardless of whether the conviction is in this state or another state.
   b.  The revocation of a license under section 188.26, or the revocation of a license, permit, registration, or other authorization to produce industrial hemp in any other state.
   4.  The department shall not issue a license until the applicant has furnished a surety bond to the department in an amount of not more than ten thousand dollars. The surety bond shall insure payment of any amount that the licensee is legally obligated to pay for any costs associated with the confiscation and destruction of the licensee’s industrial hemp crop under section 188.25. The surety bond shall be maintained at all times during the period of licensure. The department shall be notified ten days prior to any reduction in the amount of the surety bond made at the request of the applicant or cancellation of the surety bond by the surety. The total and aggregate liability of the surety shall be limited to the face amount of the surety bond.
   5.  The department may do all of the following:
   a.  Limit the number of applications that it accepts or limit the period or periods when applications will be received, evaluated, or accepted each year. 
   b.  Establish criteria required to participate in a program which may be based on the qualifications or good character of the applicant, the applicant’s proposed investment in industrial hemp production, the applicant’s experience in commercial crop production, and the type and size of the applicant’s existing agricultural operation. The department may prepare and publish guidelines to assist persons in determining eligibility requirements.
   c.  Require the issuance of different types of licenses or require an applicant to obtain more than one license based on criteria established by the department, including but not limited to whether the proposed industrial hemp production is to occur on noncontiguous parcels of land, whether industrial hemp plants or industrial hemp seeds are proposed to be produced, or whether the applicant is proposing to participate in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   d.  Require that all or some licenses expire on the same date. 
   e.  Provide a different application and requirements for the submission, evaluation, and approval or disapproval of an application for a renewed license. However, the department shall require a check of the applicant’s national criminal history record to be conducted under this section each time a license is issued or renewed. 
   6.  The department shall prepare and publish license application forms. A completed application form submitted to the department shall contain all of the following:
   a.  The applicant’s full name and residence address.
   b.  A legal description, global positioning system location, and map of the site where the applicant proposes to produce the industrial hemp.
   c.  Information required by the department to conduct a check of the applicant’s criminal history record. The department shall require an applicant to submit pictures, fingerprints, and descriptions of physical characteristics on forms required by the department of public safety. The department of agriculture and land stewardship shall submit the applicant’s fingerprints and other necessary information to the department of public safety, division of criminal investigation, for the purpose of conducting a national criminal history record check through the federal bureau of investigation. The department of public safety shall notify the department of agriculture and land stewardship of the results of the national criminal history record check. The results shall be considered a confidential record under chapter 22 and shall not be released without the consent of the department of public safety. The department of agriculture and land stewardship shall reimburse the department of public safety for costs associated with conducting the national criminal history record check.
   d.  Any other information required by the department in order to administer this chapter. 
   7.  The department of agriculture and land stewardship shall deliver a copy of an approved application for a license to the department of public safety and the office of the county sheriff in the county where the industrial hemp is approved to be produced by the licensee in order to participate in the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14.
   8.  A license shall be suspended or revoked as provided in section 188.26. 
    Sec. 17.  NEW SECTION.  188.16  Licensees —— inspections by department and law enforcement agencies.
   1.  The department may conduct an official inspection of a licensee’s facilities where industrial hemp is produced, stored, handled, transported, marketed, or processed. The department shall conduct an official inspection during regular business hours. As part of an official inspection, the department shall collect a sample of the crop for testing under section 188.8 at least once and within thirty days prior to harvest. The department may order or request that a licensee independently collect and test one or more samples of the crop during the growing period and notify the department of the results. 
   2.  A licensee shall immediately notify the department of the results of any test that exceeds the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8, regardless of whether the department ordered, requested, or knew of the test.
   3.  The department may request that a law enforcement agency assign an officer to accompany the department during an official inspection of the facilities of a licensee.
   4.  As part of its official inspection, the department may examine the licensee’s business records. However, a law enforcement officer shall not accompany the department during the examination.
    Sec. 18.  NEW SECTION.  188.17  Industrial hemp production contract —— requirements.
   A registrant may enter into an industrial hemp production contract with a licensee to produce industrial hemp under the supervision of the registrant. The registrant shall supervise the production of the industrial hemp in cooperation with the department. The contract shall provide for the regulation of the licensee and the industrial hemp produced by the licensee in the same manner as provided in section 188.13, unless otherwise provided by the department in consultation with the registrant. 
    Sec. 19.  NEW SECTION.  188.18  Industrial hemp seed capable of germination —— certification.
   1.  The Iowa crop improvement association shall certify industrial hemp seed capable of germination for use by a licensee as part of the industrial hemp commodity program under section 188.13 or a registrant as part of the industrial hemp production program under section 188.14. The association may provide different certification processes, including for industrial hemp seed produced or obtained by a registrant or obtained from a qualified and reputable industrial hemp seed source and supplier. 
   2.  The association’s certification protocols may be based on standards promulgated by independent organizations including but not limited to the association of official seed certifying agencies and verifications offered by qualified and reliable persons in the business of providing such seed. 
   3.  The Iowa crop improvement association shall notify the department and the registrant, as applicable, of the results of a request for the certification of industrial hemp seed.
   4.  A licensee may import industrial hemp seed for certification only if allowed by the department acting in consultation with the association. A registrant may import industrial seed for certification after consulting with the department and the association. 
    Sec. 20.  NEW SECTION.  188.19  Industrial hemp seed capable of germination —— sale by the department.
   1.  The department shall offer certified industrial hemp seed for sale to licensees participating in the industrial hemp commodity program established pursuant to section 188.13. The department may offer certified industrial hemp seed for sale to a registrant participating in the industrial hemp production program established pursuant to section 188.14.
   2.  Moneys collected by the department from the sale of certified industrial hemp seed shall be deposited into the industrial hemp commodity fund established in section 188.23. 
    Sec. 21.  NEW SECTION.  188.20  Industrial hemp seed capable of germination —— sale by a registrant.
   1.  A registrant may offer certified industrial hemp seed for sale to the department, or a licensee participating in the industrial hemp production program established pursuant to section 188.14.
   2.  All moneys received by a registrant under subsection 1 shall be handled in the same manner as repayment receipts as defined in section 8.2, and shall be used by the registrant exclusively for the registrant’s administration of the industrial hemp production program.
    Sec. 22.  NEW SECTION.  188.21  Fees assessed by department.
   1.  The department shall assess and collect all of the following: 
   a.  An application fee to be paid by a person seeking to obtain an industrial hemp commodity license as provided in section 188.15. 
   b.  A license fee to be paid by a person being issued an industrial hemp commodity license as provided in section 188.15.
   c.  An inspection fee to be paid by a licensee as part of an inspection of the facilities where the industrial hemp is produced as provided in section 188.16.
   d.  A laboratory fee to be paid by a licensee if the department takes samples of industrial hemp for testing by a laboratory as provided in section 188.8.
   2.  The fees described in subsection 1 are nonrefundable. 
   3.  The total amount of fees collected pursuant to this section shall not exceed the department’s estimate of the total amount of revenues necessary to administer and enforce the provisions of this chapter. Prior to the beginning of a fiscal year, the department shall establish an estimated total amount based on the expected costs to be incurred by the department in administering and enforcing the provisions of this chapter during the subsequent fiscal year.
   4.  The department may establish different rates for any category of fees described in subsection 1 based on criteria determined relevant by the department, which may include the type of license issued and the number of acres set aside for industrial hemp production by a licensee.
   5.  All fees collected by the department under this section shall be deposited into the industrial hemp commodity fund established pursuant to section 188.23.
    Sec. 23.  NEW SECTION.  188.22  Fees assessed by registrants.
   1.  A registrant may assess and collect fees from licensees participating in the registrant’s industrial hemp production program as provided in section 188.14. The total amount of fees paid shall not exceed the expenses incurred by the registrant in selecting licensees to participate in the program, conducting inspections of facilities where the industrial hemp is produced, and taking samples of industrial hemp to be tested by a laboratory as provided in section 188.8. 
   2.  All moneys received by a registrant under this section shall be handled in the same manner as repayment receipts as defined in section 8.2, and shall be used by the registrant exclusively for the registrant’s administration of the industrial hemp production program.
    Sec. 24.  NEW SECTION.  188.23  Industrial hemp commodity fund —— appropriation.
   1.  An industrial hemp commodity fund is established in the state treasury under the management and control of the department.
   2.  The fund shall include moneys collected by the department from the sale of certified seed under section 188.19, fees collected under section 188.21, and moneys appropriated by the general assembly for deposit in the fund. The fund may include other moneys available to and obtained or accepted by the department, including moneys from public or private sources.
   3.  Moneys in the fund are appropriated to the department and shall be used exclusively to carry out the responsibilities conferred upon the department under this chapter as determined and directed by the department, and shall not require further special authorization by the general assembly.
   4.  a.  Notwithstanding section 12C.7, interest or earnings on moneys in the fund shall be credited to the fund.
   b.  Notwithstanding section 8.33, moneys credited to the fund that remain unexpended or unobligated at the end of a fiscal year shall not revert to any other fund.
    Sec. 25.  NEW SECTION.  188.24  Cooperation with department of public safety.
   1.  The department of agriculture and land stewardship and a registrant shall cooperate with the department of public safety in order to administer this chapter. 
   2.  The department of public safety shall assist the department of agriculture and land stewardship in conducting national criminal history record checks of applicants applying for licenses under section 188.15.
   3.  The department of agriculture and land stewardship and a registrant shall upon request or as part of routine process provide the department of public safety with the following information regarding the industrial hemp commodity program under section 188.13 and the industrial hemp production program under section 188.14:
   a.  The status of the production and the results of any test of a crop produced by a licensee under this chapter. 
   b.  The date and time of an inspection of a licensee’s facilities or business records.
   c.  The confiscation and destruction of a crop under section 188.25.
    Sec. 26.  NEW SECTION.  188.25  Confiscation and destruction.
   1.  A Cannabis sativa plant exceeding the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8 and that is produced under the industrial hemp commodity program established pursuant to section 188.13 shall be confiscated by the department. 
   2.  A Cannabis sativa plant exceeding the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8 and that is produced under the industrial hemp production program established pursuant to section 188.14 shall be confiscated by the registrant in cooperation with the department. 
   3.  The department shall provide for the destruction, including any accompanying disposal, of a confiscated Cannabis sativa plant produced under the industrial hemp commodity program under section 188.13 or the industrial hemp production program under section 188.14. A registrant may provide for the destruction of a confiscated Cannabis sativa plant produced under the industrial hemp production program under section 188.14 in cooperation with the department. The department or a registrant shall not confiscate or destroy a Cannabis sativa plant unless the results of an official test conducted by the department indicate that a sample exceeds the maximum concentration of delta-9 tetrahydrocannabinol as provided in section 188.8. The department, or a registrant acting in cooperation with the department, may require that a confiscated Cannabis sativa plant be kept on the premises where the plant was confiscated, including where it is produced, handled, transported, marketed, or processed, until arrangements are made for the plant’s removal and destruction. The destruction may also occur on the premises where the plant was confiscated if such premises may be reasonably used for that purpose as determined by the department or by the registrant in cooperation with the department. The destruction shall be accomplished in a manner that complies with requirements of the department and shall be in accordance with applicable federal law.
   4.  The department or registrant may request assistance from a law enforcement agency necessary to carry out this section. The department or registrant upon request shall deliver any sample of the plant to the law enforcement agency. 
    Sec. 27.  NEW SECTION.  188.26  Disciplinary action.
   1.  The department may suspend or revoke the license obtained under section 188.15 by a person who does any of the following:
   a.  Provides false or misleading information on an application for an industrial hemp commodity license as provided in section 188.15.
   b.  Provides false or misleading information to the department as part of the industrial hemp commodity program under section 188.13 or to a registrant or the department as part of the industrial hemp production program under section 188.14.
   c.  Fails to comply with or violates any provision of this chapter, including a rule adopted by the department under section 188.4, a condition of an application for the issuance of a license under section 188.15, or a condition of a contract entered into with a registrant under section 188.17. 
   d.  Fails to comply with an order issued by the department or a registrant under this chapter. 
   2.  The suspension or revocation of a license is in addition to the confiscation and destruction of a Cannabis sativa plant under section 188.25, a civil penalty under section 188.27, or any other civil or criminal penalty that may be imposed on the person under state or federal law.
    Sec. 28.  NEW SECTION.  188.27  Civil penalties.
   1.  A person who violates a provision of this chapter is subject to a civil penalty of not less than five hundred dollars and not more than two thousand five hundred dollars. The department may assess and collect the civil penalty. Each day that a continuing violation occurs shall be considered a separate offense. 
   2.  The department shall establish a schedule of civil penalties for violations of this chapter. 
   3.  A civil penalty shall not be assessed against a licensee for a violation that results in the confiscation and destruction of the licensee’s crop under section 188.25, unless the composite test result is greater than two percent delta-9 tetrahydrocannabinol as determined in section 188.8. 
   4.  All civil penalties collected under this section shall be deposited into the general fund of the state.
    Sec. 29.  NEW SECTION.  188.28  Criminal penalties.
   A person who knowingly or intentionally produces the Cannabis sativa plant and who is not the department, a registrant, or a licensee participating in the industrial hemp commodity program established pursuant to section 188.13 or the industrial hemp production program established pursuant to section 188.14 is subject to the provisions in chapters 124 and 453B.
    Sec. 30.  NEW SECTION.  262.80  Industrial hemp production program.
   The board of regents may consult with Iowa state university of science and technology, the university of Iowa, and the university of northern Iowa to provide for the participation of those universities in administering an industrial hemp production program in cooperation with the department of agriculture and land stewardship as provided in chapter 188.