The annual fee to grow hemp in Washington would increase to $7,500 from $300 under a state Department of Agriculture proposal intended to cover the cost of regulating the crop.
The 2,400 percent hike could be avoided if state lawmakers continue subsidizing the fledgling hemp industry with general taxes, or if more growers emerge to share the expense. Agriculture department spokesman Hector Castro said the agency understands concerns that raising the fee could discourage potential hemp farmers.
“That really is unfortunate. It’s not what we’re trying do,” he said. “We’re focused on raising enough money, otherwise we can’t operate the program.”
Hemp remains a federally controlled substance, but has taken off as a crop in some other states, including Oregon. In Washington, hemp has been slow to catch on. The entire licensed crop this year will be the approximately 100 acres planted by the Colville Confederated Tribes in north-central Washington.
The 2014 Farm Bill allowed hemp farming and processing under state supervision. The 2018 Farm Bill, now being negotiated by the House and Senate, may further loosen federal restrictions.
Besides the Colville tribe, Washington has one other licensed hemp farm, and it didn’t plant this year. Diane Zimberoff of Wellness Paradise Farm in Graham, Wash., said she started pursuing a license in February. The farm got it in mid-July.
“By the time all the things went through, it was a little too late to plant the crop this year,” she said. “The whole process is convoluted.”
Zimberoff said the farm is interested in growing hemp for building supplies, such as insulation and blocks. It could have planted at least 30 acres this year, she said.
The license will expire next July, and Zimberoff said that she wasn’t sure the farm would renew the license at the higher fee. “I’d really have to think about that,” she said. “We’d really have to have our ducks in a row and be guaranteed we could plant.”
Washington regulates the hemp seed supply, as well as the harvesting and processing of hemp. With so few growers to fund the oversight, the Legislature last spring gave the department $100,000 to keep the program going this year without fee increases. The department has asked that the budget the governor sends to the Legislature next year include $287,000 to fund the program for two years.
Industrial Hemp Associate of Washington lobbyist Bonny Jo Peterson said she’s optimistic that the Legislature and more growers will make raising fees unnecessary.
“I don’t believe it’s going to come to that,” she said. “For next year, we have a lot of interest in growing hemp.”
The department also licenses hemp processors and seed distributors. Under the department’s proposal, a license to both grow and process hemp would increase to $14,500 from $300. A license to distribute seeds would increase to $7,500 from $300.
In addition to a fee for a license, prospective hemp farmers must pay a nonrefundable $450 application fee. The department’s proposal doesn’t touch that fee, but does propose decreasing the application fee for a combination grower-processor license to $450 from $800.
If the federal government turns over hemp regulation to the state. Washington growers could still have restrictions that farmers in other states don’t. Currently, Washington forbids manufacturing hemp oil, which is marketed as a health supplement. Also, hemp can’t be grown within 4 miles of a marijuana operation because of fears hemp will cross-pollinate with the more lucrative cannabis crop.
Zimberoff said her farm met that requirement. “It’s an amazing feat because there’s a lot of pot growing in this area,” she said.