In a legal opinion that other states may heed, South Dakota's existing medical marijuana laws comply with federal marijuana rescheduling, according to the state attorney general.
Does federal medical marijuana rescheduling mean FDA compliance?
Though many operators are looking forward to federal tax relief – and investors as well as operators are hoping that relief from Internal Revenue Service Code 280E will be retroactive and wipe out an estimated $1.6 billion in cumulative outstanding tax debt – there are whispers that existing business models are no longer tenable.
Attorneys and other observers have speculated that since other Schedule 3 drugs must be prescribed by a doctor and must be approved by the FDA after a lengthy and rigorous process, such rules – and onerous good manufacturing practice requirements – must be coming for state-regulated cannabis.
That’s not so, according to South Dakota Attorney General Marty Jackley.
In an Oct. 6 opinion given to state lawmakers at their request, Jackley found little cause for concern for state law-compliant operators who pursue registration with the U.S. Drug Enforcement Administration.
According to Jackley, “the federal rescheduling of marijuana does not preempt South Dakota’s medical-marijuana program because Congress has not expressly preempted state action, it has not totally occupied the field of marijuana regulation, and South Dakota’s medical-marijuana law does not conflict with the federal scheduling.”
Do states need to change their MMJ laws after federal marijuana rescheduling?
“Similarly, federal rules currently permit actors in the state medical-marijuana industry to continue to function so long as they obtain the proper federal and state credentials,” Jackley added in part.
“Because federal law explicitly permits state medical-marijuana programs, South Dakota’s program may continue to operate as it has without impact from marijuana’s federal rescheduling to a Schedule III controlled substance,” the memo concluded.
Jackley prepared his legal opinion for the state Medical Marijuana Oversight Committee, which discussed marijuana rescheduling on Tuesday, as KELO reported.
Lawmakers on the committee had proposed legislation last year that would have seen South Dakota’s MMJ laws repealed upon federal rescheduling.
That bill failed, and both of that bill’s lead sponsors lost reelection bids in Republican primaries over the summer, KELO reported.
Will all marijuana be rescheduled in 2026?
Meanwhile, the DEA’s top administrative law judge has yet to rule on a proposal that would see all marijuana under federal law, including adult-use cannabis, be reclassified as a Schedule 3 drug.
That process is temporarily paused while rescheduling’s opponents demand the DOJ consider a recent Government Accountability Office report that noted the process used to find cannabis had medical benefits was ad hoc.
More briefings are due in that case on Oct. 21, diminishing hopes that cannabis might be rescheduled before the November midterm elections.
Meanwhile, millions of dollars in campaign contributions from cannabis companies eager to curry favor with President Donald Trump appear destined for anti-marijuana candidates, such as Texas Attorney General Ken Paxton, the Republican nominee for U.S. Senate in that state.