DEA hearing regarding rescheduling marijuana will occur after election
The Drug Enforcement Administration (DEA) has scheduled a hearing for December 2, 2024, to gather evidence and expert opinions on the proposed rescheduling of marijuana from Schedule I to Schedule III under the Controlled Substances Act (CSA). This hearing follows a Notice of Proposed Rulemaking (NPRM) published in May, which suggested reclassifying marijuana due to its accepted medical use and lower potential for abuse compared to other substances currently listed in Schedules I and II.
The timing of the hearing has drawn significant attention, as it is set to occur after the November presidential election. The delay has raised concerns within the cannabis industry and among advocates who hoped for a decision prior to the election. According to reports, the DEA received over 43,000 public comments during the initial comment period, reflecting both support and opposition to the proposed change.
“Rescheduling marijuana would adjust the regulatory controls applicable to it under federal law,” the DEA stated in the NPRM. “However, it would still be subject to the same criminal prohibitions under the CSA, and products containing marijuana would remain under the jurisdiction of the Federal Food, Drug, and Cosmetic Act (FDCA).”
The proposed rescheduling is part of a broader review of U.S. cannabis policy initiated by President Joseph Biden in October 2022. This review also included pardons for thousands of individuals with federal convictions for simple cannabis possession. In January 2024, the Department of Health and Human Services (HHS) recommended rescheduling marijuana to Schedule III based on a review of available evidence, which found that marijuana has legitimate medical uses and meets the criteria for a less restrictive classification under federal law.
Despite the momentum for reform, the delay until after the election introduces uncertainty, especially considering potential shifts in political leadership. “The decision to hold a hearing is understandable but frustrating,” said Lauren Fontein, Chief Compliance Officer and founder of California licensed dispensary firm The Artist Tree. “It means that cannabis businesses may be subject to one additional year of taxation under 280E, which makes a tremendous difference to the bottom line for cannabis companies, many of which are already struggling financially given the overall industry conditions.”
The hearing is expected to attract a diverse range of participants, including medical professionals, researchers, industry representatives, and advocacy groups. Interested parties must submit a written notice of intention to participate by the specified deadline, detailing their interest in the proceeding and the specific issues they wish to address.
“Every interested person, as defined under the CSA, who wishes to participate in the hearing must file a notice with the DEA,” the agency noted. “The hearing will be conducted under the provisions of the Administrative Procedure Act and DEA regulations, with a presiding officer designated to ensure a fair and efficient process.”
The potential rescheduling of marijuana to Schedule III could have significant implications for the cannabis industry, particularly regarding tax regulations. Under the current Schedule I classification, cannabis businesses cannot take standard business expense tax deductions under IRS regulations. Moving marijuana to Schedule III would allow these businesses to take such deductions, potentially saving millions of dollars.
However, the decision to delay the rescheduling process has been met with disappointment by many in the industry. George Sadler, CEO and co-founder of Gelato Canna Co., expressed frustration, saying, “Waiting until after the presidential election is just another example of kicking the can down the road and making those of us working to make cannabis a safer, better industry sit in another holding pattern for no reason.”
As the hearing date approaches, the DEA has committed to a transparent process, with updates provided on its website. The outcome of this hearing could play a crucial role in shaping the future of cannabis regulation, research, and use in the United States.
For more information regarding rescheduling, the DEA continues to provide information related to rescheduling on the Agency’s homepage.
View the corresponding documents below.
Schedules of Controlled Substances: Rescheduling of Marijuana
PROPOSED RULE: Schedules of Controlled Substances: Rescheduling of Marijuana
Notice of Proposed Rulemaking: Proposed Rescheduling of Marijuana
Basis for the Recommendation to Reschedule Marijuana into Schedule III of the Controlled Substances Act
Denial of Petition to Initiate Proceeding to Reschedule Marijuana Docket No. DEA-427
Denial of Petition to Initiate Proceeding to Reschedule Marijuana Docket No. DEA-426
Questions to OLC Related to the Potential Rescheduling of Marijuana
