The U.S. Senate voted 50-47 on July 22 to confirm President Donald Trump's nomination of Terrance Cole as Administrator of the Drug Enforcement Administration (DEA). The move puts Cole in charge of a cannabis rescheduling process that has been delayed for six months and is now at a critical juncture.
Cole has said rescheduling will be "one of [his] first priorities," but offered no concrete assurances on whether or how the process will move forward.
"The industry needs more than vague assurances. We need regulatory clarity, fairness and above all, urgency," said Terry Mendez, CEO of Safe Harbor Financial. "Even in the most optimistic scenario where cannabis is rescheduled from Schedule I to Schedule III, we must be clear-eyed about the limitations of that change."
Rescheduling alone won't solve many of the cannabis sector's most pressing issues. According to Mendez, it won't open up access to banking from major financial institutions, nor will it ease compliance burdens related to anti-money laundering laws.
"Rescheduling might offer incremental improvements, but absent updated FinCEN guidance and comprehensive congressional action like the SAFER Banking Act, the financial exclusion of cannabis operators will continue." From the investment side, there is cautious optimis, but little appetite for further delays.
"Mr. Cole has said cannabis rescheduling will be 'one of [his] first priorities,' and that he will rely on science, expert consultation and the framework of the Controlled Substances Act to guide his decision," noted Anthony Coniglio, CEO of NewLake Capital Partners. "That's not a political promise, it's a procedural one. And in today's regulatory climate, that matters." Cole's past comments also focused heavily on disrupting fentanyl trafficking and transnational criminal organizations, which some view as a positive sign that the DEA may de-emphasize cannabis enforcement in favor of more urgent threats. "Rescheduling cannabis isn't just a policy adjustment, it's a way for the DEA to better distinguish between bad actors and law-abiding, compliance-driven operators," Coniglio added.
In a letter to Administrator Cole, the National Cannabis Industry Association (NCIA) reaffirmed its stance that cannabis should ultimately be removed from the Controlled Substances Act entirely. Still, the association urged the DEA to move forward with rescheduling in a timely and transparent manner.
"Rescheduling would help eliminate unnecessary barriers to research, reduce burdens on legitimate businesses operating under state law, and bring federal policy more in line with overwhelming public opinion and decades of state-level reform."
