Week in Review: Ohio Medical Cannabis Legalization a Possible Tipping Point

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By John Schroyer

With the stroke of a pen, a former Republican presidential candidate legalized medical marijuana this week in the nation’s seventh-largest state by population.

Let that sink in for a moment.

The politician wielding the pen: Ohio Gov. John Kasich, the last GOP presidential candidate to drop out against now-presumptive nominee Donald Trump.

The result: Kasich not only cleared the way for a new medical marijuana market and countless business opportunities, but he also gave the cannabis movement a major boost on the national stage with his John Hancock.

In short, he enabled MJ reformers to unquestionably hit the halfway mark: There are now at least 25 states that have legalized viable medical cannabis programs – or 26, depending on who’s counting.

Marijuana Business Daily considers Louisiana, which reformed its MMJ system last month, a viable medical cannabis state, bringing the current total nationwide to 26. (Some stakeholders still don’t believe Louisiana has a workable program yet).

Regardless, Kasich’s action elevates Ohio’s importance in the national debate over cannabis policy and could help the industry expand even further.

“With Ohio’s approval of medical marijuana, we are reaching a tipping point that could push Congress to act. Washington may be starting to catch up with the states in this rapidly advancing policy area, but we are still behind,” Congresswoman Dina Titus of Nevada said in statement to Marijuana Business Daily.

“We need to pass legislation protecting banks and other licensed operations like radio advertising that work with marijuana businesses in states where it is legal. We need to facilitate medical research on the effects of marijuana,” Titus, a Democrat, added. “Whether one considers it a states’ rights issue, a criminal justice issue, or a basic fairness issue, we must move ahead.”

Zeta Ceti, the owner of California’s Green Rush Consulting, said it’s yet another indication that marijuana has the momentum to shed its illegal status under the eyes of Uncle Sam.

“It’s a completely different day and age, within just a few years,” Ceti said. “It’s all heading towards federal legalization.”

Impending Congressional Moves?

Although Ceti doesn’t think the federal prohibition against marijuana will end until 2020 at the earliest, he does think smaller steps could gain traction now that a key swing state like Ohio has legalized MMJ.

One of the most important ramifications: Ohio’s actions are likely to sway even more members of Congress to either support – or at least pay attention to – federal cannabis reforms.

Oregon Congressman Earl Blumenauer called Ohio’s legalization a “milestone.” In a statement to Marijuana Business Daily, the Oregon Democrat said:

“The federal government will have no choice but to catch up, and the culmination of these efforts will inevitably lead to real reform at the federal level. I’m pushing Congress and the administration to make meaningful change now and end failed marijuana prohibition.”

Congress already has a host of marijuana-related measures to consider. For example, lawmakers have introduced four bills to tackle the problems of marijuana industry banking and the 280E tax code provision, both of which have been enormous obstacles for legal cannabis companies.

It’s unclear whether lawmakers will take up either issue next year, after the presidential election. But Kasich’s signature certainly doesn’t reduce the likelihood.

DEA Rescheduling?

While the Drug Enforcement Administration may not expressly react to state-level moves on marijuana legalization, Ohio’s new MMJ policy is one more reason to think that the DEA could decide this summer to move cannabis from Schedule I to Schedule II, Colorado attorney Charles Feldmann said.

“The magic number of 25 is significant,” said Feldmann, a former DEA agent. “But if you remember, the DEA last year said that they had all the information that they needed for this report that’s coming out.”

If cannabis is rescheduled, however, that won’t mean the end of the legal cannabis industry’s problems. That’s because it wouldn’t do away with the application of Section 280E for plant-touching companies. (Section 280E would only cease to apply if cannabis was moved to Schedule III or lower).

But rescheduling would call into question a host of state-level policies, Feldmann said.

“It’s going to open a whole new can of worms that didn’t exist before,” he said. “If it does go to Schedule II, that’s going to be a completely different landscape that marijuana’s never been in. What’s that mean for Ohio, a brand new state?”

Growing Interest & More Work Ahead

Ohio has been the latest in a string of states to move forward with an MMJ program, as Louisiana and Pennsylvania have made similar moves this year as well. That, in turn, has led to an enormous uptick in business interest in the industry, Ceti said.

“It’s getting so huge my phone is constantly ringing off the hook, with people wanting to be involved in this industry,” Ceti said.

Feldmann has the same enviable problem.

“We’re inundated with calls right now from all over the country, whether it’s investors, new businesses,” Feldmann said, citing California, Florida, Louisiana and Texas.

But Ethan Nadelmann, executive director of the Drug Policy Alliance, warned that the industry and activists shouldn’t misinterpret Ohio as meaning the tide has completely turned and that federal legalization is inevitable.

“Just one hostile committee chair at the local or federal level can hold up reform for years,” Nadelmann noted. “The ballot measure process only exists in about half the states … So it’s going to take a lot of hard work and a lot of time to put this one to bed.”

John Schroyer can be reached at johns@mjbizdaily.com