Senate File 265 - IntroducedA Bill ForAn Act 1regulating consumable hemp products, including by
2providing for in-person, face-to-face sales, and including
3effective date provisions.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1   Section 1.  Section 204.7, subsection 8, paragraphs b and c,
2Code 2023, are amended to read as follows:
   3b.  A person manufacturing a consumable hemp product in this
4state shall register with the department of inspections and
5appeals on a form prescribed by the department of inspections
6and appeals by ruleThe registration form and information
7required to be included on the registration form shall be
8prescribed by rules adopted by the department of inspections
9and appeals.
The department of inspections and appeals may
10impose a fee, established by the department of inspections and
11appeals by rule, on a registrant not to exceed the cost of
12processing the registration. The department of inspections and
13appeals shall adopt rules for the revocation of a registration
14issued to a manufacturer who manufactures a consumable hemp
15product not in compliance with this chapter.
   16c.  A person selling a consumable hemp product in this state
17shall register with the department of inspections and appeals
18on a form prescribed by the department of inspections and
19appeals by rule and shall keep on the premises of the person’s
20business a copy of the certificate of analysis issued pursuant
21to section 204.8 for the hemp contained in the consumable
22hemp products sold by the person
The registration form and
23information required to be included on the registration form
24shall be prescribed by rules adopted by the department of
25inspections and appeals. However, the registration form shall
26include the name and the street or road address of the person’s
27established place of business.
The department of inspections
28and appeals may impose a fee, established by the department of
29inspections and appeals by rule, on a registrant not to exceed
30the cost of processing the registration. The department of
31inspections and appeals shall adopt rules for the revocation of
32a registration issued to a person who sells a consumable hemp
33product not in compliance with this section.
34   Sec. 2.  Section 204.7, subsection 8, Code 2023, is amended
35by adding the following new paragraphs:
-1-1   NEW PARAGRAPH.  0d.  For hemp contained in consumable hemp
2products sold at retail, a registrant must keep copies of
3certificates of analysis issued pursuant to section 204.8 at
4the registrant’s established place of business described in
5paragraph “c”.
6   NEW PARAGRAPH.  00d.  (1)  Except as provided in subparagraph
7(2), a registrant must conduct in-person, face-to-face retail
8sales of all consumable hemp products at the registrant’s
9established place of business as described in paragraph “c”.
   10(2)  The registrant may conduct in-person, face-to-face
11sales of consumable hemp products at one or more temporary
12locations if all of the following apply:
   13(a)  Information regarding the registrant’s established
14place of business has been included on registration forms as
15provided in paragraph “c” for the last two complete registration
16years.
   17(b)  Rules adopted by the department of inspections and
18appeals do not prohibit the use of the temporary location.
19   Sec. 3.  ADMINISTRATIVE RULES.  The department of
20inspections and appeals shall submit a notice of intended
21action to the administrative rules coordinator and the
22Iowa administrative code editor pursuant to section 17A.4,
23subsection 1, paragraph “a”, not later than September 1, 2023,
24for the adoption of rules required to implement this Act.
25   Sec. 4.  EFFECTIVE DATE.  The section of this Act requiring
26the department of inspections and appeals to submit a notice
27of intended action for the adoption of rules, being deemed of
28immediate importance, takes effect upon enactment.
29EXPLANATION
30The inclusion of this explanation does not constitute agreement with
31the explanation’s substance by the members of the general assembly.
   32BACKGROUND. The “Iowa Hemp Act” (IHA) regulates the
33production, manufacture, and sale of hemp, including the
34manufacture and sale of consumable hemp products (CHP) in
35this state (Code chapter 204) under authority granted to the
-2-1department of agriculture and land stewardship (DALS) by the
2federal government (Code section 204.3). Hemp is the plant
3Cannabis sativa L., or any part of that plant, with a delta-9
4tetrahydrocannabinol concentration (THC) of 0.3 percent or
5less on a dry weight basis when tested and includes a product
6derived from such hemp when manufactured (Code section 204.2).
7Hemp or an associated hemp product meeting IHA requirements
8is excluded from the list of controlled substances (Code
9section 124.204). A CHP is a type of hemp product that
10includes a substance metabolized or is otherwise subject to
11a biotransformative process when introduced into the human
12body (Code section 204.2 and amended Code section 204.7). The
13IHA does not recognize a CHP that is inhaled (Code section
14204.2). DALS regulates the production, harvest, processing,
15transportation, and manufacture of hemp (21 IAC ch.96) and
16the department of inspections and appeals (DIA) regulates the
17manufacture and sale of CHP (amended Code section 204.7 and
18481 IAC ch.32). A manufacturer or person engaged in the
19retail sale of a CHP must register with DIA (amended Code
20section 204.7(8)). A registration expires one year after being
21approved (481 IAC 32.2(5)).
   22BILL’S PROVISIONS. The bill expressly authorizes DIA to
23obtain information by registrants regarding their established
24place of business, including the name and address of a
25registrant engaged in the retail sale of CHP. In order to
26enhance the readability of the Code, the bill moves a provision
27that requires a registrant engaged in the retail sale of CHP
28to keep certain records regarding THC levels of hemp used to
29manufacture the CHP. The bill requires that when a registrant
30makes an in-person, face-to-face retail sale of CHP, the sale
31must be made at the registrant’s established place of business
32as described on the registration form. However, the bill
33provides for an exception subject to two conditions: (1) the
34registrant’s established place of business must have been
35included on a registration form for at least the prior two
-3-1complete years, and (2) the temporary location must not be
2prohibited by DIA rules.
   3APPLICABLE PENALTIES. DIA may revoke a registration issued
4to a person who sells CHP in violation of the IHA (amended
5Code section 204.7(8)(c)). A registrant violating the IHA is
6subject to a civil penalty of not less than $500 and not more
7than $2,500 (Code section 204.12).
   8ADMINISTRATIVE RULES AND EFFECTIVE DATE. The bill requires
9DIA to begin the process of adopting rules required to
10implement the bill’s provisions by September 1, 2023, and that
11part of the bill takes effect upon enactment.
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