(a) Industrial hemp is an agricultural crop in the state. An individual who produces industrial hemp shall apply to the department for registration under this section. Registration is valid for one year but may be renewed. An application for registration or renewal must be on a form prescribed by the department that includes

1. (1) the name and address of the applicant;
2. (2) the address and global positioning system coordinates of the area to be used for the production of industrial hemp; and

3. (3) a signed statement by the applicant, made under the penalty of perjury, affirming that the applicant

   1. (A) has not been convicted of a felony related to a controlled substance in this or another jurisdiction within the 10 years immediately preceding the date of application; or
   2. (B) was lawfully growing hemp before December 20, 2018, and was not convicted of a felony related to a controlled substance in this or another jurisdiction after that date.

(b) An individual registered under this section may

1. (1) produce industrial hemp, including growing, harvesting, possessing, transporting, processing, selling, or buying industrial hemp;
2. (2) use any propagation method, including planting seeds or starts or using clones or cuttings to produce industrial hemp;
3. (3) retain industrial hemp seeds for the purpose of propagating industrial hemp in future years;
4. (4) retain and recondition any industrial hemp that tests between 0.3 percent and one percent delta-9-tetrahydrocannabinol on a dry-weight basis.

(c) An individual registered under this section shall

1. (1) comply with testing standards and procedures established by the commissioner by regulation;

2. (2) maintain, for at least three years following the sale or transfer of industrial hemp, records showing

   1. (A) the name and address of the person that received the industrial hemp;
   2. (B) the amount of industrial hemp transferred;
3. (3) make the records required under (2) of this subsection available for inspection by the department during normal business hours if the department provides at least three days' notice before inspecting the records.

(d) The department shall

1. (1) establish fee levels for application, registration, and renewal of registration so that the total amount of fees collected under this section approximately equals the regulatory costs for regulating the industrial hemp industry;
2. (2) annually review each fee level to determine whether the regulatory cost of industrial hemp is approximately equal to the fees collected;
3. (3) notify the Marijuana Control Board and the Department of Public Safety when the department issues a stop-sale order and issues a violation notice under this section;
4. (4) require an individual registered under this section whose industrial hemp tests over one percent delta-9-tetrahydrocannabinol to destroy the product so that it cannot be used for the purpose of reconditioning other hemp crops or gifted or transferred to another individual other than for the purpose of having the industrial hemp destroyed in full form.

(e) The department

1. (1) shall issue a stop-sale order and issue a violation notice to a person who is producing industrial hemp without a current registration;
2. (2) may adopt regulations regarding approved shipping documentation for the transportation of industrial hemp;
3. (3) may conduct random tests and inspections of industrial hemp for delta-9-tetrahydrocannabinol concentration produced by an individual registered under this section.