While cannabis legalization is now a bipartisan issue and enjoys a majority of support in both parties, the issue has historically been framed as a Democrat policy. And now, with a Democratic President, House, and Senate, many observers are asking, “what’s next for cannabis in the United States?”
Cannabis legalization at the federal level remains unlikely. President Joe Biden has signaled that while he will not interfere with state recreational or medical systems or ad-hoc legislation targeting specific sectors (such as banking), he does not support full legalization. His stance on marijuana legalization is largely in lockstep with the positions adopted by presidents Barrack Obama and Donald Trump.
So what changes are coming down the pipeline for cannabis? The new legislature is likely to introduce some variation of the Secure and Fair Enforcement Banking Act (“SAFE Act”) first introduced in the previous legislative session. The Act, which was included in a permutation of the Democrat’s COVID-19 relief bill but ultimately excluded from the final version, would allow cannabis companies to access and use FDIC-insured financial institutions and banks. A reintroduced SAFE Act would likely pass Congress with little opposition and be signed into law by President Biden.
Less likely to succeed is the Marijuana Opportunity Reinvestment and Expungement Act (“MORE Act”), also introduced in the previous legislative section. The MORE Act sought to fully decriminalize cannabis and proposed sentencing reforms for non-violent drug offenders but was stalled in the previously GOP-controlled Senate. While Democrat Senate Majority Leader Chuck Schumer has indicated support for a reintroduced MORE Act, President Biden would likely veto any bill proposing full legalization.
Counter proposals to the MORE Act have been brought forward to relist cannabis as a Schedule III drug under the Controlled Substances Act. A bill containing such changes is more likely to be adopted by President Biden.
As cannabis gains greater acceptance throughout the United States, observers are likely to see incremental progress at the federal level. Cannabis companies will need to continue managing disparate state regimes and regulations in this tightly regulated sector, as legislatures continue to enact new bills and policies.