Industry Roundtable: What Rescheduling Reform Could Mean for Cannabis Operators, Investors, and Policymakers

As talk of rescheduling cannabis gains momentum, the stakes for the industry have never been higher. Moving cannabis from Schedule I to Schedule III would mark the most significant federal policy shift in decades, carrying implications that ripple far beyond Washington, D.C. While rescheduling would not legalize cannabis, it could ease the crushing weight of 280E tax restrictions, open the door to expanded medical research, and reshape how regulators, investors, and operators view the industry.

Yet the path forward remains uncertain. Federal agencies like the DEA have a long history of resistance, and state-level reform efforts have stalled in recent years. Meanwhile, operators - already squeezed by high taxes, limited capital access, and a growing illicit market - are divided on whether rescheduling would be a step forward or a Trojan horse that only benefits the most well-capitalized companies.

In this roundtable discussion, CHNANY members share their candid perspectives on rescheduling reform. From skepticism about federal follow-through, to warnings about market consolidation, to cautious optimism about relief from 280E, their insights reflect both the opportunities and risks of this pivotal moment for cannabis.

Douglas F. Wasser, Partner, Ruskin Moscou Faltischek PC: “Sorry to say that I’m a pessimist on rescheduling. For almost 90 years, the DEA and its predecessors have had a strong institutional bias against cannabis. After all, drug law enforcement is what justifies their existence. That bias reared its ugly head against reform even during the Democratic Biden Administration, HHS approval notwithstanding.

I don’t expect meaningful change from the DEA without a major shift in national consensus on cannabis. And for that, we should look to the states. Historically, states have broken new ground on cannabis reform, with the federal government following their lead.

Unfortunately, state-level reform hit a wall in 2024. Ballot initiatives for adult use failed in South Dakota, North Dakota, Arkansas, Oklahoma, and Florida. Nebraska’s passed, but overall, the national picture is fractured. With progress stalled at the state level, it’s hard to imagine the federal government stepping out on its own and risking voter backlash.

Want to recharge the Washington dynamic? Go local. Florida, 2026, baby.”

Lucas McCann, Co-Founder & Chief Scientific Officer, CannDelta Inc.: “Should federal legalization occur, there would, of course, be many positive outcomes for those permitted to operate in the space. But it is crucial to recognize that most smaller operators would not survive.

Once rescheduling takes place, the structure of the industry as we know it will change entirely. A valid comparison can be drawn from Canada, where federal legalization imposed stringent requirements on production facilities. Licenses required fully built facilities, and compliance with Good Production Practices (GPP) and EU-GMP standards created enormous infrastructure barriers. Only well-capitalized companies could compete.

If applied in the U.S., these requirements would crush the vast majority of today’s operators, who are already surviving month-to-month. The real question is: do we want to see this industry subject to rescheduling at all?”

Mitch Kulick, Founder, Feuerstein Kulick LLP: “There has been much hoopla around President Trump’s announcement that the administration is actively considering rescheduling cannabis from Schedule I to Schedule III. The excitement is palpable, given there has been no meaningful reform at the federal level since the Cole Memorandum in 2013 - more than a dozen years ago.

Trump’s brilliance is delivering wins to ‘fringe’ groups such as pro-lifers, anti-vaxxers, and now, hopefully, the pro-cannabis set. I’m a believer in the adage that the ends justify the means. If Trump delivers on rescheduling, the industry will immediately feel the positive effects.

Removing cannabis from the death grip of 280E would free up cash flow and attract investors who have been waiting for meaningful reform. Just look at the MSOS ETF: on August 1st it closed at $3.08, down more than 94% since March 2021 when it became clear Biden wouldn’t deliver relief. After Trump’s rescheduling comments on August 11th, the ETF closed at $5.21 just two days later.

Money talks and BS walks.”

Conclusion

Rescheduling cannabis has the potential to be a turning point for the industry - but as our members highlight, it also brings deep uncertainty. From skepticism about whether the DEA will act, to concerns about small operators being left behind, to cautious optimism about financial relief, the range of perspectives underscores the complexity of this moment.

CHNANY will continue to convene these industry voices and foster dialogue on the policies shaping cannabis in New York and beyond. By elevating diverse perspectives, we aim to ensure that reform - whether at the federal or state level - serves not only the most powerful players, but the entire cannabis community.