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How historic reclassification of marijuana could impact states where it's legal, including Michigan

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MADISON HEIGHTS, Mich. (WXYZ) — The biggest federal marijuana reform in decades could soon take effect.

According to multiple reports, the U.S. Drug Enforcement Administration is looking to reclassify marijuana as a less dangerous drug, from a Schedule I drug, in the same category as heroin and LSD, to a Schedule III in the same category as testosterone and ketamine.

The proposal still has to be reviewed, but the policy would have wide-ranging effects in states where marijuana is legal and states where it is still not.

While marijuana is legal in Michigan, this would open other doors for dispensaries in the state.

“It’s unfathomable that in 2024, it took this long to change that,” said Nick Hannawa, the chief legal counsel at PUFF Cannabis Company.

 PUFF Cannabis Company Chief Legal Counsel Nick Hannawa
Nick Hannawa, the chief legal counsel at PUFF Cannabis Company. (April 30, 2024)

Marijuana dispensaries like PUFF have been legally operating in Michigan since the drug became legal here in 2018.

Now as the DEA looks to reschedule marijuana from a serious, abusive Schedule I drug to a low-risk Schedule III, it would get rid of the Internal Revenue Service's code Section 280E which doesn't allow companies like PUFF to deduct business expenses, providing a huge tax relief.

“State legal businesses like ours, even though we’re legally licensed in the state of Michigan, we’re not allowed federally to take normal deductions like any other business, so we’re majorly disadvantaged,” Hannawa said.

PUFF CANNABIS MADISON HEIGHTS
Heather Goddard at PUFF Cannabis in Madision Heights. (April 30, 2024)

The rescheduling of marijuana would also open the doors to medical research to help people with not only anxiety but seizures, but chronic pain and more.

“They’re saying there’ll be more research then for people to use it medicinally like I do,” Heather Goddard said.

Goddard uses marijuana to treat her anxiety, she says she takes it to help her in her life, but would love more research on the drug.

“It opens the research federally, so that we can have doctors using this in colleges and universities, which has not been done before. It's been banned from all the colleges and universities and medical schools,” said Jay VanDyke, director of the American Medicinal Marijuana Association.

Jay VanDyke American Medicinal Marijuana Association
Jay VanDyke, director of the American Medicinal Marijuana Association, talks with 7 News Detroit reporter Ruta Ulcinaite about the possible reclassification of marijuana. (April 30, 2024)

The reclassification would not legalize marijuana nationwide; it only labels it as less dangerous, which not everyone agrees with.

“My biggest fears is that young people are going to get the message that this is OK and they're going to be seeing the mass commercialization, promotion and industrialization of marijuana like we never have before,” said Kevin Sabet, president and CEO of Smart Approaches to Marijuana. “And it reminds me of Big Tobacco. Really, this is what Big Tobacco did for a century.”

Kevin Sabet Smart Approaches to Marijuana
Kevin Sabet, president and CEO of Smart Approaches to Marijuana, talks with 7 News Detroit about the possible reclassification of marijuana. (April 30, 2024)

Sabet led the 2018 movement in Michigan to not legalize marijuana and says the motivations behind this from the DEA may not sincere.

“It was essentially, completely a political decision done in a political year, an election year,” Sabet said. “Very concerned about that.”

The proposal must be signed off by the White House Office of Management and Budget and there has to be public comment. The decision may not take effect for months still. However, it would reclassify the drug for the first time in 50 years.

Heather Goddard at PUFF Cannabis in Madision Heights. (April 30, 2024)
Heather Goddard at PUFF Cannabis in Madision Heights. (April 30, 2024)

“Oh, it’s definitely time. It’s most definitely time,” Goddard said. “I’m really glad that we’re making progress and I hope that it goes through.”