What changed since late-Biden, what’s (not) moving under Trump, and the biggest state-level legalization wins and losses you should actually know.
We’ll be honest: trying to follow federal cannabis policy this year feels like watching your Uber spin the block for 20 minutes because it “can’t find the entrance.” The federal push to move cannabis from Schedule I to Schedule III started under the Biden administration, slowed, then shifted into a wait-and-see under Trump. Meanwhile, states kept quietly reshaping their own markets; some sprinting, and some stuck in neutral. Here’s where rescheduling actually stands in late 2025, minus the bureaucratic smoke and mirrors, plus why it matters to anyone who buys, rolls, or lights up.
Quick definition : What is Cannabis Rescheduling?
Cannabis rescheduling is the federal process to move the substance off Schedule I (no accepted medical use, highest restriction) to Schedule III (with accepted medical use and lower abuse risk) under the Controlled Substances Act. Practically, Schedule III would still mean federal illegality for recreational or adult-use, but it would ease research, lift the IRS 280E tax hammer on licensed businesses, and lower some enforcement barriers.
Where rescheduling sits in 2025 (and how we got here)
The modern push began when HHS formally recommended Schedule III in August 2023 based on updated medical and abuse-potential reviews. That was the first big federal domino to wobble in decades.
Next, the DOJ published a formal proposed rule in May 2024, kicking off public comments and setting up an administrative hearing. Then, the brakes: a DEA administrative law judge who had started evidentiary hearings in late 2024 canceled the January 2025 sessions and sent questions back to the agency. The docket was left “pending” into spring.
By summer, a new DEA chief—Terry Cole (sworn in July 23, 2025)—took the helm, but offered no public shift on rescheduling priorities. In mid-August, President Trump told reporters a decision could come “in the coming weeks,” signaling the White House was actively weighing options, but not committing to an outcome.
Bottom line right now: No final rule yet. Cannabis remains Schedule I at the federal level while the administration and DEA decide whether to finalize, revise, or shelve Schedule III.
Why Schedule III would matter in real life to everyday smokers
Taxes: Rescheduling would neutralize IRS 280E for licensed operators, letting them deduct normal business expenses; think payroll, rent, marketing. Over time, that can improve pricing power, selection, and store stability.
Research: Moving to Schedule III lowers barriers to clinical studies and supply, which feeds better product standards and medical guidance.
Banking: Banks are likelier (not guaranteed) to expand services to state-legal operators when a substance is Schedule III (and as parallel measures like SAFER Banking evolve). Even so, Congress hasn’t passed a comprehensive fix yet.
For Blazers, you’ll feel the impact via steadier supply chains, fewer cash-only hiccups, and long-term pressure against the “illicit beats legal on price” problem. (That’s the theory; execution depends on state rules and competition.)
The map moved anyway: state legalization in late 2024–2025
Federal policy sets the weather while states decide if you need an umbrella. Here's a rundown of the most consequential moves at the state level:
Alabama’s saga continues. Medical cannabis remains snarled in litigation and licensing resets, though summer brought hints of movement (including a lab license and talk of advancing contested permits). Patients are still waiting for storefronts.
Delaware finally hit the “open” sign. After legalizing in 2023, the First State launched legal recreational sales on August 1, 2025 with an equity-minded rollout. Think: measured licensing, safety rules, and an actual plan.
Florida’s near-miss. Voters backed 2024’s Amendment 3 by ~56%—short of the state’s 60% supermajority requirement—so adult use did not pass. The takeaway: even in a huge medical market, the ballot math matters.
Hawaii’s stalled momentum. A 2025 adult-use bill advanced through committees, but then the House killed it for the year, repeating a 2024 pattern. There’s motion on medical flexibility, but not a green light for recreational sales.
Kentucky went from “maybe one day” to medical cannabis live on January 1, 2025, with a state portal for patients and providers. Not flashy, but huge for the Commonwealth.
Massachusetts taps the brakes, ok, maybe slams them. On Sept. 3, 2025, AG Andrea Joy Campbell certified two versions of a 2026 ballot petition that would shut down the licensed adult-use market while keeping medical. One version adds THC caps (30% flower, 60% concentrates); both start a signature push (74,574 by Dec. 3, 2025) and, if approved, would take effect Jan. 1, 2028—putting a ~$1.6B market with $8.3B+ in lifetime sales and ~27,000 jobs on the line.
New Hampshire said “Live Free, but not that free.” The House sent over a simple possession bill (no stores), and the Senate tabled it 12–10 in May—again—especially with a governor openly opposed. The Granite State remains New England’s holdout on recreational-use.
New York’s crackdown era. New York’s challenge isn’t legalization, it’s enforcement and onboarding. Through 2025, the state and NYC padlocked hundreds of illicit shops, issued multi-million-dollar penalties, and pushed to stabilize the licensed market amid recalls and rule-tweaks. Expect the map of legal shops to keep expanding, slowly.
Ohio’s big year. Ohio quietly turned into a national case study: adult-use retail started in August 2024 and passed $702.5 million in year-one sales by August 2025, with roughly 160 dual-licensed dispensaries now on the map. It’s not perfect policy, but it is clearly a functioning market.
Pennsylvania’s “state-store” drama. In May 2025, the PA House passed a landmark adult-use bill that would sell cannabis through a state-run model; it immediately ran into headwinds in the GOP-controlled Senate. Expect more negotiation (and likely a more traditional private-retail bill) ahead.
Texas nudges medical forward. Still no recreational-use, but 2025 brought the state’s biggest medical expansion yet. House Bill 46, signed in June, took effect September 1, 2025, adding qualifying conditions like chronic pain, authorizing more licensees (15 total), allowing higher THC caps and easier access via satellite pickup, a pragmatic move in a restrictive landscape.
Wisconsin: the brakes stay on. The governor proposed allowing citizen-initiated ballot measures (a path many states used to legalize), but lawmakers stripped it from the budget, and both medical and adult-use remain stalled. Wisconsin is now surrounded by legal markets.
For the scoreboard keepers: by mid-2025 we’re at ~40 medical states plus D.C. and 24 recreational-use states, with more action likely via ballots and legislatures through the end of the year.
What to watch next (federal edition)
Two tracks to watch in D.C.:
Rescheduling decision (DEA + White House). If finalized as Schedule III, expect multi-month compliance and litigation chapters before the dust settles.
Congressional bills. Banking keeps bobbing up without passing, while House Democrats re-introduced the MORE Act (Aug 29, 2025) to fully de-schedule and expunge records. It’s a marker bill (not the most likely vehicle), but it shows where one caucus wants to go.
So…what should blazers expect for the rest of 2025?
Federally, the process is alive, paused, and political, all at once. The DEA’s hearing calendar got punted; the White House says a decision is coming; Congress is hedging with its own bills. The most likely near-term “win” is 280E relief and research sanity, not nationwide legalization. States will keep leading with patchwork rollouts, messy enforcement (hi, New York), and a few surprise breakthroughs (Delaware-style) that suddenly look “overnight” after years of setup.
On the ground, your experience will keep improving in fits and starts. Some states will open doors, some will tighten enforcement, some will stall until the next session. For buyers, that means checking your local rules and shopping from licensed stores—it’s how we get cleaner inputs, consistent testing, and predictable pricing.
Sources:
U.S. Department of Justice, Drug Enforcement Administration. (2024, May 21). Schedules of Controlled Substances: Rescheduling of Marijuana (Notice of proposed rulemaking). Federal Register.
Marijuana Policy Project. DEA moves to reschedule marijuana to Schedule III: Questions and answers. mpp.org.
Angell, T. (2025, September 4). Kentucky Governor Says Medical Marijuana Sales Should Start By The End Of This Year. Marijuana Moment.
Henry, M. (2025, August 7). Ohio’s recreational marijuana sales surpassed $702.5 million in first year. Ohio Capital Journal.
Moon, J. (2025, April 22). Alabama’s medical cannabis licensing gets reset — again. Alabama Political Reporter.
Lange, T. (2025, February 7). Hawaii House Kills 2025 Cannabis Legalization Bill, Continuing Blockade on Reform. Cannabis Business Times.
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