How hemp can give our communities an economic boost
STATE SEN. KEVIN PARKER, Candidate for NYC Comptroller | 3/25/2021, midnight
It is no secret that New York State is going through challenging economic times. The unemployment rate for January, the most recent month for which data is available, was a staggering 9.4%—more than double the rate it was last year. In New York City, the situation is even worse, with the unemployment rate having more than tripled, to 13.1%.
My colleagues in the legislature and I have been hard at work finding new ways to generate economic activity for working people and aspiring entrepreneurs. A consistently popular idea has been to legalize recreational marijuana (cannabis) in order to help spur the creation of production facilities, retail enterprises, jobs and tax revenues from its growth, shipment and sale throughout our state.
Our discussion has included ideas for expanding access to cannabis-based business opportunities targeted towards communities of color, where disproportionately higher levels of arrest, prosecution and sentencing for its distribution and recreational use have had devastating economic and social ramifications. While these efforts will never fully heal the wounds of those disenfranchised by the war on drugs, they can become a significant and impactful component of our ongoing efforts to ensure economic justice and equity for all New Yorkers.
While this discourse is long overdue, it has conspicuously neglected the enormous economic potential for a cannabis variety that lacks any psychoactive properties: hemp.
Hemp is the same species as the plant we call “marijuana,” but lacks enough tetrahydrocannabinol to produce a euphoric effect. Industrial hemp has an estimated 25,000 plus uses, including textiles, paper, building materials and biodegradable plastics. Its seeds are a nutritious source of protein.
It is also a sustainable option: it requires much less water than cotton, grows faster than trees, returns a majority of the nutrients it uses back to the soil, and naturally resists pests. There is a reason we call the plant “weed”: it grows like one.
And demand is strong: the global market for industrial hemp is projected to grow from $3.5 billion today to $19 billion by 2025, with a compound annual growth rate of 32.17%. If New York State taps into some of that market, industrial hemp has major economic potential to help our state have a just and equitable recovery. These are jobs that would be Upstate, where they were desperately needed even pre-pandemic. Indeed, Upstate New York has some of the best potential anywhere for industrial hemp, as Cornell University boasts an entire institute for the study of its cultivation.
Fortunately, reforms at the state and federal levels are making industrial hemp a viable, legal industry. In 2016, we legalized hemp in the state, and the federal government followed suit in 2018. The governor also injected $10 million in research and capital grants for hemp production in the state.
At the same time, we must ensure that we produce living wage jobs with benefits, particularly if we will be doling out support. One hemp processing facility opening in Broome County promised to create 400 jobs and received a 39% property tax reduction, only to change its projection to 75 low-paying jobs. And a hemp farm in Cortland received a $3.5 million grant from the state while promising to create a measly 20 jobs. The state, then, is going to need to do more to ensure the creation of good-paying jobs if we keep doling out these corporate giveaways. The Farmworkers Fair Labor Practices Act that I co-sponsored is a step in the right direction to ensuring decent jobs for industrial hemp farm workers, but more legislation or better negotiation of government largesse will need to follow.
It is true that hemp is not a panacea for New York City’s economic woes. For one, we will probably not grow nearly enough hemp in the five boroughs, although I am fully prepared to don a straw hat and overalls and till soil in Prospect Park. So, I will need to do additional work in Albany, and next year in the NYC Comptroller’s office, to create jobs in our city, such as promoting clean energy jobs. And at the very least, Upstate hemp farming would produce goods that we in the city can sell or use as input materials.
Hemp will also not produce full employment Upstate. Despite the potential, growing industrial hemp still carries significant financial risk, particularly since few growers have had much experience. Many first-time hemp growers learned this the hard way after legalization, thinking industrial hemp was easy money, then lost their shirts when they could not make a profit. Nevertheless, the data shows that a properly running hemp farm can be a profitable venture.
The industry faces other challenges. Even after legalization, institutions are weary to lend, insure, or offer savings accounts to hemp farmers. Fortunately, some waiving of federal regulations helped, and the city’s pension funds can help with capital. But other regulations are still needed. In particular, New York State declined to submit a draft hemp plan to the USDA, saying the federal requirements were unduly burdensome. The state will have to correct for this, and soon.
Another issue is that even though demand for industrial hemp is growing robustly, it is not reaching its full potential. No doubt this is because of stigma and myths surrounding hemp, such as beliefs that hemp textiles have a rough texture or will cause someone to fail a drug test. Insufficient demand prompted plans for two Upstate processing facilities to be scrapped. The industry will have to win over the public through campaigns. And I am happy to do my part by wearing a hemp suit.
As I have said throughout my campaign for Comptroller, the three biggest priorities for an equitable recovery are jobs, jobs and jobs. If we can create living wage jobs with benefits, then we have hit the nail on the head. Industrial hemp has the potential to become a major cash crop that brings economic development to New York City and State. However, it will require a legal framework, and holding producers accountable, if we want economic justice.
If we get it right, and the state and the city can work in full cooperation, the potential wealth of opportunities for small and mid-sized production and retail hemp businesses for downstate New Yorkers is extremely promising. To this day, the injustices caused by the war on drugs haunt communities of color and economically challenged communities throughout our state. Expanding access to this new economic avenue for its victims is an essential part of repairing the soul of our democracy.