The Coalition for Cannabis Scheduling Reform (CCSR) recently released its comprehensive report on the federal classification of cannabis, co-authored by Perkins Coie Cannabis industry group co-chair Andrew Kline, with support from associate Tommy Tobin, and edited by paralegal Hanna Barker Mullin.

CCSR makes the case in its report that marijuana is improperly placed in the same schedule as drugs like heroin and argues that the more appropriate options are to either remove the plant from the list of controlled substances altogether or reschedule it to Schedule III or below. The report outlines the scientific, economic, legal, and social justice considerations of these options compared to the status quo.

Marijuana is presently listed in Schedule I under the CSA, subjecting it to the greatest level of control reserved for substances deemed to have “no accepted medical use” and a “high potential for abuse.” As a result of its classification, marijuana continues to be harshly criminalized, Americans continue to be incarcerated for possession and use of cannabis, and state-licensed cannabis businesses operate under extreme regulatory burdens.

CCSR is clear in its report that descheduling is the ideal result, particularly for criminal justice reform, but makes a case that moving cannabis to a less restrictive schedule would still be significant incremental reform.

“Descheduling is the optimal outcome and the one that would mark the greatest improvement over the status quo possible without congressional intervention,” per the CCSR report. However, if the U.S. Food and Drug Administration (FDA) “determines that it cannot find its way to recommending marijuana descheduling, the Agency should instead recommend rescheduling to schedule III, IV, or V.”

The report comes amid the Biden administration’s review of the status of cannabis under the Controlled Substances Act (CSA), for which a decision is expected later this year. Currently, the FDA, under the U.S. Department of Health and Human Services (HHS), is conducting an eight-factor scientific review. HHS will submit findings and recommendations to the Drug Enforcement Administration (DEA) under the U.S. Department of Justice (DOJ). DEA has the final say but is bound to accept HHS’s recommendations on scientific and medical matters.

“FDA is not going to find that there’s zero abuse potential for cannabis,” Kline told Law360. “It’s just not a realistic expectation. And so I think we should all be prepared for schedule III, IV, or V.”

One immediate benefit of rescheduling to schedule III, IV, or V is that it would allow state-licensed cannabis businesses to take federal tax deductions. Section 280E of the Internal Revenue Code prevents businesses “trafficking” in schedule I and II substances from taking deductions for ordinary business expenses. Rescheduling would eliminate this financial burden, providing much needed relief for regulated cannabis businesses.

Rescheduling would also “reduce the scope of criminal liability for cannabis-related activity” and “support an industry generating billions of dollars for the American economy and creating hundreds of thousands of American jobs,” according to the report.

There have been five articles on the release of this report so far: Marijuana MomentLaw360Green Market ReportBenzinga and GreenState.