Gov. Mike Dunleavy’s veto of Alaska's hemp pilot program may not actually save the state any money.

Dunleavy axed $375,000 because “currently there is no existing industry to support a state funded program.” However, Alaska cannot have a legal industry without a state pilot program.

The 2014 Farm Bill gave states the federal go-ahead to begin the process to legal production.

Senate Bill 6, which authorized legal hemp in Alaska, was unanimously passed by the Senate in 2017 and unanimously passed by the House in 2018.

Language in the bill states the Department of Natural Resources “shall 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.”

That means any funds the state spent on the program would have been recouped with the money farmers spent to be test growers for the pilot.

In April, staff at the Plant Materials Center (PMC) began growing hundreds of hemp plants from six different strains. With the budget cut they’ve destroyed all but 15, which are wilting and turning yellow.

The Division of Agriculture took away 17 positions, laying off more than half of its workforce. Two of the four greenhouses at the PMC closed because there aren’t enough staff members to keep up with the work.

The Hemp Industries Association estimates the total retail sales from hemp products in 2016 was nearly $700 million.

Copyright 2019 KTVA. All rights reserved.

MORE NEWS FROM KTVA: