As
of
this
writing,
38
states
have
legalized
medical
marijuana.
A
total
of
24
states
have
also
legalized
the
drug
for
recreational
use.
Despite
the
legitimate
domestic
cannabis
market
being
worth
an
estimated
$30
billion,
marijuana
remains
an
illegal
controlled
substance
under
federal
law.
Though
the
federal
government
rarely,
if
ever,
prosecutes
individuals
who
operate
within
the
confines
of
states’
legal
cannabis
frameworks,
marijuana’s
current
status
as
a
Schedule
I
drug
does
have
significant
implications
for
the
industry.
This
will
likely
change
soon.
The
U.S.
Drug
Enforcement
Administration
is
set
to
reclassify
marijuana
as
a
less
dangerous
Schedule
III
drug
under
a
proposal
from
the
Justice
Department.
Schedule
I
drugs
—
others
include
heroin
and
LSD
—
are
considered
by
the
federal
government
to
have
a
high
potential
for
abuse
and
to
have
no
legitimate
medical
uses.
On
the
other
hand,
Schedule
III
drugs
—
examples
include
ketamine
and
certain
anabolic
steroids
—
often
have
widely
recognized
medical
uses
and
pose
a
lower
risk
of
addiction.
The
historic
move
to
reclassify
marijuana
from
Schedule
I
to
Schedule
III
will
be
a
needed
lifeline
for
struggling
legal
cannabis
businesses.
Venture
capital
investment
in
marijuana
companies
has
tapered
off
significantly
in
recent
years:
after
reaching
the
$3
billion
mark
in
2019
with
a
further
$2.7
billion
invested
in
2020,
last
year
venture
capitalists
poured
only
$550
million
into
legal
cannabis.
Publicly
traded
stocks
tied
to
the
marijuana
industry
are
far
from
their
record
highs,
and
just
days
ago,
MedMen,
one
of
the
most
well-known
cannabis
companies,
filed
for
bankruptcy.
The
Schedule
III
reclassification
could
help
cannabis
providers
in
many
ways.
It
would
allow
cannabis
companies
to
deduct
business
expenses
on
their
federal
taxes,
eliminate
many
restrictions
on
cannabis
research
(possibly
expanding
medical
applications
of
the
drug),
and
provide
protections
for
medical
marijuana
consumers
who
can,
at
present,
still
be
punished
for
marijuana
use
within
the
scope
of
employment
or
housing
under
the
existing
federal
regime.
Even
as
it
would
rectify
a
number
of
difficulties,
reclassifying
marijuana
would
fail
to
address
several
of
the
most
pernicious
problems
within
the
legal
cannabis
industry.
The
change
would
not
allow
for
legal
interstate
trade
of
cannabis
–
though
it
may
be
the
first
step
toward
necessary
approval
of
interstate
transfers
by
the
U.S.
Food
and
Drug
Administration
(marijuana
markets
in
some
states
have
suffered
greatly
from
oversupply).
Schedule
III
status
also
would
leave
in
place
the
ban
on
business
with
cannabis
companies
for
federally
chartered
financial
institutions.
Yet,
reclassification
may
spur
Congress
into
finally
approving
The
SAFER
Act,
a
banking
bill
specific
to
the
cannabis
industry
which
would
expand
dispensary
access
to
banking
services.
Notably,
Schedule
III
reclassification
would
absolutely
not
legalize
marijuana
nationwide,
and
a
few
procedural
hurdles
remain.
To
take
effect,
the
proposed
reclassification
must
still
make
it
through
the
White
House
Office
of
Management
and
Budget,
a
public
comment
period,
and
review
by
an
administrative
law
judge.
Removing
marijuana
as
a
Schedule
I
drug
and
placing
it
on
the
Schedule
III
tier
will
not
alleviate
all
the
issues
plaguing
the
legal
cannabis
industry.
From
a
federal
perspective,
cannabis
is
still
a
long
ways
from
being
regulated
like
tobacco
or
alcohol.
Even
so,
this
change
would
sever
quite
a
few
barriers
to
business,
and
would
indisputably
be
the
most
significant
federal
action
taken
with
respect
to
marijuana
in
a
very
long
time.
Jonathan
Wolf
is
a
civil
litigator
and
author
of Your
Debt-Free
JD (affiliate
link).
He
has
taught
legal
writing,
written
for
a
wide
variety
of
publications,
and
made
it
both
his
business
and
his
pleasure
to
be
financially
and
scientifically
literate.
Any
views
he
expresses
are
probably
pure
gold,
but
are
nonetheless
solely
his
own
and
should
not
be
attributed
to
any
organization
with
which
he
is
affiliated.
He
wouldn’t
want
to
share
the
credit
anyway.
He
can
be
reached
at jon_wolf@hotmail.com.