The DEA's Historic Move: Rescheduling Marijuana to Schedule III

The DEA's Historic Move: Rescheduling Marijuana to Schedule III

 

After over fifty years of strict regulation, the United States Drug Enforcement Administration (DEA) has announced a pivotal decision to reschedule marijuana from a Schedule I to a Schedule III controlled substance. This landmark change not only recognizes the evolving public and scientific perception of cannabis but also marks a significant shift in federal cannabis policy.

Unpacking the Historic Nature of Rescheduling

For decades, marijuana has been classified under Schedule I, a category reserved for substances considered to have a high potential for abuse, no accepted medical use, and a lack of accepted safety for use under medical supervision. This classification has placed marijuana alongside drugs like heroin and LSD, which has long been a point of contention among advocates, medical professionals, and lawmakers. The move to reschedule marijuana to Schedule III, a category that includes drugs like ketamine and anabolic steroids, is monumental. This reclassification implies acknowledgment of the drug's potential medical benefits and a lower potential for abuse compared to Schedule I or II drugs.

Implications for Medical Research and Taxation

One of the most significant impacts of this rescheduling is on medical research. Schedule III status will considerably ease the stringent regulations that have hampered scientific studies on cannabis for years. Researchers can now delve deeper into cannabis's therapeutic benefits without the red tape associated with Schedule I substances. This could lead to more robust clinical trials, potentially paving the way for new, FDA-approved cannabis-based treatments. Importantly, there is a hope that these trials will include a diverse group of participants, including minorities, ensuring that the research encompasses a wide demographic and addresses health disparities that have historically been overlooked in clinical research.

Economically, the rescheduling could substantially reduce the tax burden on cannabis businesses. Under the previous classification, marijuana businesses were subject to Section 280E of the Internal Revenue Code, which disallows deductions and credits for businesses trafficking Schedule I or II substances. The move to Schedule III allows these businesses to claim a broader range of tax deductions and credits, significantly affecting both large companies and small dispensaries.
 
Legal and Unlegal Ramifications of Schedule III
Schedule III drugs are considered to have a moderate to low potential for physical and psychological dependence. The regulatory requirements for handling, prescribing, and documenting these drugs are less stringent than for Schedule I or II drugs but more regulated than for Schedules IV and V. This classification will change how cannabis is prescribed and dispensed, potentially making it more accessible to patients who can benefit from its use medically.
However, rescheduling marijuana to Schedule III does not resolve all legal and criminal justice issues associated with cannabis. Despite medical marijuana being legal in 38 states and adult-use (recreational) programs existing in 19 states, federal law has continued to treat cannabis possession, use, and sale as a crime. This rescheduling does little to address the disparities in arrest and incarceration rates, which disproportionately affect minority communities. While it is a significant step forward, it does not eliminate the potential for arrest and incarceration under federal law, nor does it address past convictions.
 
The Impact on Social Equity and Access to Capital

The rescheduling of marijuana could have profound implications for social equity within the cannabis industry. Historically, strict federal laws have made it difficult for small and disadvantaged business owners to access the capital needed to start or grow their cannabis businesses. Banks and other financial institutions have been hesitant to provide financial services to marijuana-related businesses due to the legal uncertainties and the risks of federal enforcement.

With marijuana moving to Schedule III, these businesses may now find it easier to access banking services and loans. This change can open up significant new funding opportunities, which are especially crucial for minority-owned businesses that have disproportionately faced barriers in the cannabis industry. Improved access to capital can help level the playing field, allowing these businesses to expand, compete, and contribute more effectively to their communities.

The Road Ahead: Complete Legalization?

While the DEA’s decision is a progressive step, many advocates and stakeholders like myself argue that it is not sufficient. The ideal goal for many in the cannabis reform movement is the complete legalization of the plant, which would address both the medicinal and social justice disparities long associated with its prohibition. Though federal legalization seems to be a more distant goal, the rescheduling of marijuana to Schedule III certainly adds momentum to the ongoing advocacy for cannabis reform.

Aspiring for Continued Reform and Restoration

As we celebrate this regulatory milestone, our aspirations stretch further towards the comprehensive legalization of marijuana. The current rescheduling, while impactful, does not fully address the significant damages inflicted by decades of marijuana-related arrests and incarcerations. The path forward should not only continue to alleviate restrictions on cannabis but also actively repair the harm done to those most affected by previous policies. and "The War on Drugs."

I'm hoping to see a future where policy reform aligns more closely with justice and equity, fully freeing the plant from the shackles of past regulations. This includes advocating for policies that expunge past convictions, reinvest in communities hardest hit by the war on drugs, and ensure that the burgeoning cannabis industry grows inclusively and equitably. By pushing for these changes, we can hope to mend the fabric of communities torn by unjust laws and pave the way for a fair and thriving cannabis market.

In conclusion, the DEA’s decision to reschedule marijuana is a historic and pivotal moment in the history of cannabis regulation in the United States. It opens new doors for medical research and economic relief for cannabis businesses but stops short of addressing the broader issues of criminal justice reform. As the nation continues to evolve in its relationship with cannabis, this decision will undoubtedly play a crucial role in shaping future policies. The journey towards full legalization is long, but continued advocacy and policy reform can eventually deliver justice and freedom for the cannabis plant and those impacted by its prohibition.

 

Roz McCarthy

M4MM, Founder/CEO

Back to blog