While the Hemp Industries Association (HIA) has been a resounding voice throughout the industry for the past quarter century, the organization has recently come under fire for withholding payments from its state chapters and, shortly after receiving a complaint about it, dissolving them suddenly in July.
Jody McGinness, who became executive director for the organization in early July, tells Hemp Grower that earlier this year, the organization went through a “cash flow crisis” and needed to take immediate action to resolve it.
But some from the state chapters say troubles extend beyond this year and aren’t solely a result of the state affiliate program. Missing funds, a confusing membership portal and a lack of communication from the HIA have resulted in some chapters, like Kentucky, to recommend those considering membership hold off until the chapters receive clarity.
“Without a clear path forward, or visibility into our State Chapter’s viability or budget, we cannot properly plan outreach and advocacy campaigns. We are making a strong suggestion that members do not renew their dues until we can make light of what is going on,” the Kentucky Hemp Industries Association (KYHIA) said in a statement. “With absolutely no input from the local or regional levels, we do not want to see your money go toward a wasteful initiative.”
(The statement has since been removed by the HIA and replaced with a different statement by the national organization. See HIA’s full statement here.)
Dissolving The Chapters
The HIA had 14 chapters before it voted to dissolve them July 15. As part of its affiliate program, the HIA had an agreement with its chapters to split membership fees 50/50.
The move to dissolve the chapter program abolished that split in fees, effective immediately, and set up a task force to establish a new affiliate program that matches the shifting needs of the organization, McGinness says. The HIA is also working out plans for the chapters’ use of its name and logo, as many of the chapters are their own nonprofit organizations and can operate independently without support from the national organization.
“All organizations that were formerly chapters of the HIA are being provided with an agreement to license the continued use of HIA’s logos and intellectual property during the transition period between the end of the previous chapter program and the implementation of a new affiliate structure so that they can continue to conduct business,” the HIA said in a statement.
By July, the state chapters had been aware of the HIA’s looming decline in revenue, which McGinness says is down 70% from this same time in 2019. It’s one of a few reasons why he says the HIA decided to abolish the existing affiliate program.
McGinness says earlier this year, the HIA examined its “remarkable” 50/50 split fee with the chapters and realized “how atypical it was as far as how dues are typically handled with chapters.”