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Green Machine

Agriculture Dept. releases initial set of rules for CBD and hemp products.


"I personally think it's stupid," Rachel Nanda, an employee at Twisted Roots, says of potential registration fees for CBD products. - ENRIQUE LIMÓN
  • Enrique Limón
  • "I personally think it's stupid," Rachel Nanda, an employee at Twisted Roots, says of potential registration fees for CBD products.

Rachel Nanda stands behind the counter at the downtown Salt Lake City Reggae shop Twisted Roots and points inside the glass case that holds CBD (cannabidiol) balms, oils and gummies. A broad range of clientele browses the display, Nanda says, from cancer patients to seemingly healthy mothers who peruse while keeping one eye on their children. Regardless of what ails them, the patrons are all seeking the same thing: cannabis-based relief that doesn't get them high.

"Most people come for anxiety," Nanda says. The CBD pens are the most popular item she sells, meaning most customers would rather smoke than put a few drops under their tongues. That might be because of the difference in cost—the pens go for $20, the 300-milligram tinctures for $70. "They're skeptical because of the price," Nanda points out.

In the coming months, that price could climb even higher.

Utah lawmakers passed several bills in their last legislative session that would allow state-approved licensees to cultivate and process industrial hemp, set the requirements for retailers to legally sell commodities containing CBD and grant terminally ill patients with less than six months to live a "right to try" cannabis-based treatment.

The Utah Department of Agriculture and Food is in charge of creating the rules that'll guide the state's industrial hemp program before the new laws can be implemented. After holding a series of public input meetings earlier in the year, UDAF released a set of proposals on Sept. 1 geared toward the licensing and registration requirements to grow, process and distribute hemp and CBD products. UDAF will host two more public hearings—one in Cedar City on Sept. 17, and one in Salt Lake City on Sept. 20—and listen to those suggestions before finalizing the new directives.

In addition to providing rules on goods containing low concentrations of tetrahydrocannabinol—THC, the compound in cannabis that gives users a high—UDAF must also come up with guidelines for medical cannabis, which the recently released recommendations do not cover. UDAF Deputy Commissioner Scott Ericson says his office is working with the Utah Attorney General's office to identify legal issues that are likely to arise as the state writes that law's provisions. Ericson expects a draft of proposals will be released in the next couple of months. In the meantime, terminally ill patients will not be given state-approved cannabis for treatment, since the state does not yet have a program in place to contract with a third-party cannabis grower.

The "right to try" bill is narrower than Proposition 2, the November ballot initiative that would legalize medical cannabis for card-holding patients suffering from a variety of serious or chronic medical conditions. If Prop 2 passes, UDAF would have to write its accompanying requirements, too.

"Having two different statutes to follow, to administer for one product, is difficult to do for a state agency," Ericson says, suggesting lawmakers would need to come up with a fix. Gov. Gary Herbert pledged during a late August news conference that, depending on whether the referendum passes, elected officials will tweak the initiative's flaws or pass their own medical cannabis bill in a future legislative session. "Either way, we're going to get to the right spot, I believe, with the help of the legislature," Herbert said.

Per the Utah State Bulletin, the state's official noticing publication, the Industrial Hemp Program will cost $154,000 its first year; $257,500 during the second. Hemp processors and growers will need to adhere to federal guidelines that limit THC to less than 0.3 percent.

The bulletin goes on to propose rules for products containing CBD, since the substance comes from the industrial hemp plant. Before reaching shelves, items containing hemp and CBD must be tested by a third-party lab for a number of substances, including pesticides, microbials and heavy metals. The component's cannabinoid profile must also be analyzed. Retailers who sell CBD merchandise need to make sure those goods are appropriately labeled and outfitted with a QR code or web address that links to an array of information, including batch size and expiration date, giving CBD enthusiasts crucial information not currently listed on the products they're buying.

Ericson says there's currently no verification process that ensures what a consumer purchases as CBD oil is, in fact, CBD oil. "It could be coconut oil, who knows what it is? Because nobody's verifying what's in there."

Each product containing hemp or CBD has to be registered with the state, the bulletin continues, including those purchased online and shipped to Utah, and each requires an annual $200 registration fee. "If you have 25 different flavors of something, that's 25 different products," Ericson says, specifying that retailers do not necessarily have to foot that bill. "They're not required to do it themselves unless it hasn't been done at other points in the supply chain," he says. "If I were a retailer, I would be trying to push that to the other folks in the supply chain."

Daniella Lucero, owner of Gardner Village's M Soaps by Marguerite, doesn't have anywhere to push it. Lucero makes her own CBD and hemp-infused lotions and soaps that she sells to customers looking to alleviate ailments such as headaches, anxiety and muscle pain. "I'm going to have, like, 16 products to register," she says. As the rules are written, Lucero would need to pay $3,200 in annual fees.

However, there's still hope. "If anybody has concerns like that, they should address them in writing to us, and that gives us the opportunity to look at and understand whether this is an issue to one individual or if this is company-wide," Jack Wilbur, UDAF's information and social marketing specialist, says after being told about potential registration gripes. "All that factors into the rulemaking process."

All this is a shame, Lucero says, because her customers benefit from her creations. The low THC concentration means users don't experience a high, but still reap the benefits from her bath bombs and essential oils. "Basically, you can eat 5,000 tons of it and you would never get stoned," Lucero says.

Jokes aside, provisions would bar legally eating any CBD products. Referencing the state's statute, Ericson says goods must be sold in one of six medicinal dosage forms—tablet, capsule, concentrated oil, liquid suspension, transdermal or sublingual—to be eligible for registration. In other words, soaps and balms are OK, edibles are not. "If it cannot be registered, it cannot be sold in the state," Ericson says.

That means Twisted Roots won't be legally able to sell its CBD gummies. Nanda says the shop does not make its own hemp or CBD stock, so they might not be the ones to pay the registration fees. But if their distributor decides to push the cost to them, it'll most likely end up being tacked onto the consumer's bill.

"CBD products are already expensive," Nanda says. "It seems like the whole agenda is to make it less accessible."