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A bill that would allow farmers to grow industrial hemp was tied up Friday night.

It had been attached to H.747, a bill dealing with youth smoking, in the Senate. Part of that bill ended up in a miscellaneous tax bill, making it look like a push for the cash crop would fail this year.

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But Friday night, the Senate agreed with a House compromise that allows the Department of Agriculture to write rules but not issue permits until federal rules outlawing hemp cultivation change.

An amendment by Sens. Tim Ashe and Vince Illuzzi would have allowed the state to start a program and issue permits right away. It recently passed in the Senate as an amendment to the youth smoking bill.

Illuzzi was outraged when the most important part of that legislation — the rate hike on “little cigars” had been inserted in the miscellaneous tax bill. He said it took away the impetus for his amendment to move forward.

Illuzzi tried to block suspension of the rules to take up the conference report on the tax bill, but his colleagues overruled him on a voice vote.

Later in the night, the Senate came back to settle on a compromise.

Rep. Jill Krowinski, D-Burlington, said H.747 was a youth smoking prevention bill and a key element of the legislation was the “little cigars” tax. That provision would not have survived, she said, had it not been included in the omnibus tax bill. The tax puts the flavored small cigars, which seem to be targeted to teenagers, on a par with cigarette taxes

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“The little cigar bill had a lot of support in both bodies,” Krowinski said. “We wanted to make sure the underlying bill gets support.”

The Senate amendment caused a stir, given it could land farmers in court with the feds.

Under the Senate version, the State Department of Agriculture could issue a permit for a farmer to grow hemp and violate federal law. The House passed the compromise Thursday night that would allow the department to do everything but issue a permit.

Keith Flynn, commissioner of the Vermont Department of Public Safety, told a House committee Wednesday that even if growing hemp is legal in Vermont it would still violate federal law.

“People that do go ahead and grow this would be in violation of federal law and may be subject to the same criminal divisions and the same civil forfeiture [as people growing marijuana],” Flynn said.

In 2008, the state passed a law that would allow an industrial hemp cultivation program once the federal law allowed it. The Senate amendment would allow the state to start a program right away.

Under federal law, there is no distinction between marijuana cultivated for illegal drug use and industrial hemp used for clothing and other legal goods. State businesses can import hemp products from other countries under federal law.

Illuzzi told the House Committee on Human Services that the hemp legislation could be good for farmers because it would “put a lot of idle farmland to work.” Never mind that even if the bill became law Vermonters could be sued by the feds.

“Armed with a state permit, they can go to the DEA [Drug Enforcement Administration] and make the pitch that they’re essentially being denied the right to cultivate industrial hemp,” he said.

Efforts at the federal level to pass laws distinguishing between industrial hemp and cannabis used for recreation or medical purposes have failed.

In 2005, the United States Supreme Court ruled that the federal government could criminalize the production and use of cannabis for medical purposes even if states allow its use for medicinal purposes. The nation’s highest court has not addressed the issue in terms of industrial hemp.

The New Hampshire legislature is considering similar legislation this year. In 2011, California Gov. Jerry Brown vetoed an industrial hemp bill that would establish guidelines for hemp cultivation.

In 2007, North Dakota farmers sued the federal government to change the definition of industrial hemp under the Controlled Substances Act, but a judge dismissed their case.

Editor’s note: Alan Panebaker and Anne Galloway wrote this report.

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