South Dakota Gov. Kristi Noem vetoes hemp bill in blow to flourishing new industry

Gov. Kristi Noem has issued a veto on an industrial hemp bill that would have eased a THC restriction on the crop and removed an annual industry study.

Noem vetoed House Bill 1209 on Thursday, which would allow state licensed industrial processors to accept raw hemp containing up to 5% delta-9 tetrahydrocannabinol, or THC, which is the psychoactive component found in both hemp and cannabis.

The legislation would also repeal a section of the state's hemp laws that requires the attorney general to file an annual hemp report intended to study "the effect legalizing industrial hemp has had on controlled substance and marijuana prosecutions in this state."

“Federally, marijuana is classified as anything that contains over 0.3% THC,” Noem wrote in her veto letter. “If this bill were to become law, South Dakota would allow hemp products and crops to contain over 16 times more THC than is currently allowed at the federal level.”

More:South Dakota AG report hard on hemp despite only 1 drug violation statewide

Reasoning behind Noem's veto is 'completely false,' bill proponents argue

The news of the decision comes to the dismay of the state's young industrial hemp industry, which was considered a leading hemp growing state by the U.S. Department of Agriculture.

Ken Meyer, president of the South Dakota Industrial Hemp Association, was critical of the statements in the veto. He specifically raised issue with Noem's claim that "hemp products and crops" would contain a vastly increased amount of THC, calling it a "bold-faced lie."

Meyer explained House Bill 1209 would not change any laws regarding the THC amounts in the crops or hemp products, as Noem stated in her letter.

He said it would only affect the "products in process," or the raw materials being used to make industrial hemp products, which Meyer said would be tested to ensure they return to THC levels allowed per state law.

"The bill doesn't talk about 'hemp products and crops.' Hemp product is by definition and statute always something - and would continue to be if the bill were passed - to be at or under 0.3% THC," Meyer told Argus Leader. "That would be the case for crops as well. So the first statement … is just completely false."

Noem's veto letter does note the bill would change products in process and references Colorado and New York as states that allow 5% THC in unrefined industrial hemp materials. The bill's language indicates the 5% THC allowance would only apply to products in process.

Democratic Rep. Oren Lesmeister, the prime sponsor of the bill, told the Argus Leader the 5% stipulation is meant to ease processing restrictions in the state. He said the current 1% limit essentially prevents harvested hemp from being processed in the state. This is because the THC levels in the plant often naturally rises to 2 to 4 percent as the crop it's being run through a processor, the rrepresentative said.

Katie Sieverding, a registered lobbyist for SDIHA, said hemp growers typically ship their crops to other states for processing because of the current THC limitations in South Dakota.

She argued the 5% limitation would have incentivized farmers to have their harvested hemp processed in-state, which would have aided the state's Department of Agriculture and Natural Resources in regulating the finished hemp products - cannabidiol pain creams, hand lotions, chapsticks and the like.

"I thought with this type of law and regulation, if we get the processing done in state, the department and the state government has the regulatory authority over these license holders, so they have more control and they have more eyes on the process," Sieverding said.

In Meyer's eyes, it's a harsh move to maintain this restriction on the hemp industry, since the raw materials in question are in the hands of processors. Raw hemp is not an item that would end up in the hands of the public, he said, but if it did, the proposed law also stipulates that containers carrying the unrefined product must contain labeling stating that the product is not for human consumption.

However, Meyer also points out a bitter irony: If someone wanted to buy pure and highly concentrated caffeine for injestion, that's perfectly legal in South Dakota, despite the fact that even a spoonful of the substance could kill you.

"If you take a spoonful of caffeine, my understanding is you're going to die. But you can you buy that concentrated," Meyer said. "At some point, people are aware, right? You don't eat paint thinner. You don't do certain things. It doesn't make sense."

This article originally appeared on Sioux Falls Argus Leader: Gov. Kristi Noem vetoes South Dakota hemp bill in blow to industry