The House Passes the MORE Act and the Medical Marijuana Research Act. Will It Matter?

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During the last two weeks, the U.S. House of Representatives passed two bills aimed at reforming marijuana laws, the Marijuana Opportunity, Reinvestment and Expungement Act (MORE Act) and the Medical Marijuana Research Act (MMJ Research Act).  Since neither bill will be considered by the Senate in the present session of Congress, they will have to be reintroduced and pass both the House (again) and Senate in the next session of Congress.  Will a new Congress be prepared to spend political capital on controversial marijuana reform with so many other important matters on the Congressional agenda?

Let’s assume marijuana reform is on a roll and the answer to that question is yes.  Let’s also assume the House passes both bills.  What then?  If the Senate is still controlled by McConnell as majority leader, the MORE Act will be dead on arrival.  Even if the Democrats take control of the Senate by winning both Georgia Senate seats in early January, passage of the MORE Act is not assured.  The MORE Act passed the House with a few members of each party switching sides.  Several Democrats voted against the bill and a handful of Republicans voted for the bill.  The same thing is likely to occur if the bill ever gets to a Senate vote.  For example, will Joe Manchin (D-WVa) vote for the bill?  Will Pat Toomey (R-Pa) vote against the bill? Who knows?

The future of the MMJ Research Act is more uncertain and may have a better chance of becoming law.  It passed the House by a voice vote and appears to have bipartisan support in both the House and Senate.  Unlike the MORE Act, which would remove marijuana from Schedule I of the Controlled Substances Act, the MMJ Research Act would not legalize or decriminalize marijuana, but would allow for expanded FDA approved research of medical marijuana.  Thus, it would allow members of Congress opposed to legalizing marijuana to vote for the bill.

Despite all the positive press heralding the passage by the House of the MORE Act and the MMJ Research Act, don’t get too excited.  If either or both of these bills is enacted into law, we could still be years away from a normalized marijuana industry.  Here’s why.  First look at hemp.  Hemp was descheduled in 2018 with the passage of the Farm Bill and here we are, almost three years later, with regulatory and legal uncertainty, truckloads of hemp in interstate commerce being seized by state police, and banks still very cautious about lending and providing financial services to the hemp industry.  In late June of this year, the Financial Crimes Enforcement Network (FinCen),  a bureau of the U.S. Department of Treasury, issued new guidelines for providing banking and financial services to the hemp industry.

Marijuana will be even more complicated.  If the MORE Act becomes law and marijuana is removed from Schedule I of the Controlled Substances Act, there should be one immediate and positive impact, the removal of the burden of Section 280E of the Internal Revenue Code (to read about 280E go here).  Everything else will have to wait.  States, banking authorities, the FDA and other regulators will have to put in place statutes and regulations to govern the industry.  States that legalized marijuana are still struggling with legal and regulatory issues – look at California.

The MMJ Research Act would provide for expanded cultivation of legally sanctioned marijuana for research and would allow for FDA-approved research of marijuana.  Despite the development of a COVID-19 vaccine in warp speed, most medical research takes years.  Once research studies are completed, however, positive results can form the basis of legal and regulatory reform.

So will it matter that the House passed these admittedly historic pieces of legislation?  It’s certainly a first step on the road to full legalization, but there’s a lot of steps still ahead.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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