Cannabis advocates have waited with bated breath as federal officials weigh reform. State-legal medical marijuana was moved from Schedule I to Schedule III earlier this year, but a broader proposal to reschedule cannabis remains unresolved. A federal administrative law judge temporarily halted the proceedings last month, but a new ruling has cleared one potential obstacle.
Opponents of rescheduling asked Drug Enforcement Administration (DEA) Chief Administrative Law Judge Derek Julius to reopen hearings for additional testimony and evidence related to a federal watchdog report identifying gaps in the government’s drug-scheduling procedures.
Julius temporarily paused the proceedings while considering the request but ultimately rejected the bid for additional testimony. The judge said some of the requested testimony was “immaterial for the narrow purpose of this hearing,” while other issues could have been addressed during earlier questioning.
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Instead, Julius agreed to admit the GAO report into the administrative record. Rescheduling opponents and the DEA, which supports the broader Schedule III proposal, may submit written arguments addressing how much weight the report should carry. Optional briefs are due October 29, with replies due November 5.
Once the briefing period ends, Julius will review the record and issue a nonbinding recommendation to DEA Administrator Terry Cole, who will ultimately decide whether to move forward with broader rescheduling.
With the briefing period extending beyond Election Day, a final decision on broader rescheduling is unlikely before the midterm elections.
The impact of rescheduling
Moving cannabis to Schedule III is not full legalization, though it could offer financial benefits to dispensary owners, growers, and other operators by relieving them of Section 280E of the IRS tax code. This law prevents cannabis companies from making common business deductions.
Several medical cannabis companies have applied for DEA registration under the new Schedule III framework, which could allow them to operate within the federal regulatory system. No operators have publicly announced receiving approval. Meanwhile, concerns have emerged that federal restrictions involving employees with certain felony convictions could complicate the registration process.
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The broader impact on consumers remains uncertain, although Schedule III could expand research opportunities and potentially improve medical cannabis access. In Georgia, cannabis regulators have approved rules allowing medical marijuana deliveries through the U.S. Postal Service and other carriers. USPS rules allow approved dispensers to mail prescription drugs.
For cannabis reform advocates, the ruling represents another step forward in a process that has repeatedly stalled. The immediate next step is the November 5 briefing deadline. What happens after that—and how much longer the industry will have to wait—remains anyone’s guess.
