A new report released today by the Congressional Research Service details the legal consequences of the federal government rescheduling marijuana.
The report starts by noting that on August 29, 2023, “the Department of Health and Human Services (HHS) reportedly recommended to the Drug Enforcement Administration (DEA) that marijuana be rescheduled from Schedule I to Schedule III under the Controlled Substances Act (CSA)”, with the DEA “currently reviewing HHS’s recommendation.”
When considering whether to schedule or reschedule a controlled substance, “DEA is bound by HHS’s recommendations on scientific and medical matters. However, DEA has also stated that it has “final authority to schedule, reschedule, or deschedule a drug under the Controlled Substances Act.”
The report states that moving marijuana to schedule III would “allow marijuana businesses to deduct business expenses on federal tax filings”, which they are currently barred from doing due to IRS code 280E.
“With respect to medical marijuana, a key difference between placement in Schedule I and Schedule III is that substances in Schedule III have an accepted medical use and may lawfully be dispensed by prescription, while Substances in Schedule I cannot”.
However, the report notes that any medical marijuana product would need FDA approval to be legally prescribed, and “if one or more marijuana products obtained FDA approval, manufacturers and distributors would need to register with DEA and comply with regulatory requirements that apply to Schedule III substances in order to handle those products.”
Users of medical marijuana “would need to obtain valid prescriptions for the substance from medical providers, subject to federal legal requirements that differ from existing state regulatory requirements for medical marijuana.”
The report warns that “Moving marijuana from Schedule I to Schedule III, without other legal changes, would not bring the state-legal medical or recreational marijuana industry into compliance with federal controlled substances law”, while also stating that “If marijuana were moved to Schedule III, applicable penalties for some offenses would be reduced. However, CSA penalties that apply to activities involving marijuana specifically, such as the quantity-based mandatory minimum sentences discussed above, would not change as a result of rescheduling.”
The report says that regardless of what the DEA does, congressional lawmakers wanting to change federal marijuana law have “broad authority to do so before or after DEA makes any scheduling decision.”
The report ends with the following “Considerations for Congress”:
Either Congress or the executive branch has the authority to change the status of marijuana under the CSA. Congress can change the status of a controlled substance through legislation, while the CSA empowers DEA to make scheduling decisions through the notice-and-comment rulemaking process. As noted above, DEA is reportedly considering whether to reschedule marijuana. A proposal from the 118th Congress would provide for congressional review of DEA rescheduling decisions related to marijuana.
If Congress wishes to change the legal status of marijuana, it has broad authority to do so before or after DEA makes any scheduling decision. Several proposals from the 118th Congress would remove marijuana from control under the CSA or move the substance to a less restrictive schedule. If Congress moved marijuana to Schedule III by legislation, it could simultaneously consider whether to change some of the legal consequences of Schedule III status described above. Congress could also legislate to move marijuana to another CSA schedule, which would subject it to controls more or less stringent than those that apply to Schedule III controlled substances.
Rescheduling or descheduling marijuana under the CSA could raise additional legal questions. For instance, FDA regulates certain cannabis products under the Federal Food, Drug, and Cosmetic Act, so Congress might also consider whether to alter that regulatory regime or create some alternative regulatory framework. In addition, relaxing the CSA’s restrictions on marijuana could implicate the United States’ international treaty obligations.
While most recent proposals would relax federal regulation of marijuana, Congress could also seek to impose more stringent controls. One proposal from the 118th Congress would withhold certain federal funds from states in which the purchase or public possession of marijuana for recreational purposes is lawful. A proposal from the 117th Congress would have prohibited the use of benefits under the Temporary Assistance for Needy Families block grant at any store that offers marijuana for sale. Other proposals from the 117th Congress sought to address the issues of workplace impairment or driving under the influence of marijuana and other substances.
