For the first time in American history, the United States President mentioned cannabis reform and rescheduling during his State of the Union Address (SOTU). It marks a massive cultural shift and speaks to the public’s changing perceptions around adult-use cannabis.
President Biden noted he has been taking “executive action on police reform,” to give communities the tools necessary to cut down on crime. After which he added,
Keep building trust, as I’ve been doing by taking executive action on police reform, and calling for it to be the law of the land. Directing my cabinet to review the federal classification of marijuana and expunging thousands of convictions for the mere possession, because no one should be jailed for simply using or have it on their record.
– President Joe Biden during the 2024 State of the Union Address
President Biden’s quote refers to his October 6, 2022 categorical pardon for certain federal offenses of simple possession of marijuana, as well as his request that the Secretary of Health and Human Services and the Attorney General initiate a review of how cannabis is scheduled under the Controlled Substances Act.
His statement during the SOTU does not add any new plans for rescheduling or federal reform, but it was still a monumental moment of recognition for cannabis advocates across the country.
Matt Darin, CEO of Curaleaf (the nation’s largest cannabis retail brand ), offered this statement:
It’s a significant moment for the country to hear cannabis rescheduling mentioned during President Biden’s State of the Union speech. This level of public support of cannabis reform at the federal level is long overdue, and demonstrates a strong point of leverage for cannabis politically. We hope that the DEA will follow President Biden’s lead by rescheduling cannabis from Schedule I to Schedule III this year. Rescheduling would contribute to further de-stigmatization of the plant, and by removing the burden of 280-E, would allow businesses to place further focus on growth and job creation. For Curaleaf, removal of 280-E could equate to savings of more than $150MM in excess tax contributions. By reducing the tax burden, cannabis businesses of all sizes will be better positioned to thrive and the true potential of this industry realized.
– Matt Darin, CEO of Curaleaf
Metrc CEO Michael Johnson echoed Darin’s sentiment, noting:
If a move to Schedule III is adopted, it has the potential to significantly transform the cannabis industry landscape. Rescheduling removes the burden of tax provision 280E, which currently prohibits cannabis businesses from deducting a variety of business expenses on their federal tax returns. This can be the difference between companies thriving and going out of business completely.
As it relates to the compliance infrastructure across cannabis supply chains, federal rescheduling would only have a marginal impact, as regulations are still largely up to the states. Metrc will continue to closely monitor federal and state policies to ensure our business partners across the country can easily adapt to any changes.
– Michael Johnson, CEO of Metrc
