State Cannabis Regulators Left Without Guidance After Rescheduling

When Acting Attorney General Todd Blanche moved state-licensed medical cannabis from Schedule I to Schedule III on April 23, 2026, the action set a 60-day registration clock running for medical cannabis businesses and opened a string of questions about what the federal change requires in practice. Weeks later, state cannabis regulators say they’ve been unable to get substantive answers.

The DEA has declined state requests for specific briefings, telling regulators it will share implementation details publicly — and all at once. For officials charged with advising licensees on day-to-day compliance, that posture has created a standoff that only grows more costly as the registration deadline approaches.

“We continue to request meetings with the federal offices leading this work,” said Clint Kellum, director of the California Department of Cannabis Control, in a May 2026 notice to the state’s licensees. “But so far, we have not received guidance beyond what is publicly available. We recognize this creates uncertainty for our licensees, given the size and complex structure of our medicinal and adult-use markets.”

The 60-Day Window and What It Leaves Unanswered

The April 23, 2026 order is narrow. It moved two categories of cannabis into Schedule III: products approved by the Food and Drug Administration, and cannabis operating under a qualifying state medical marijuana license. Adult-use cannabis remains under the most restrictive federal classification regardless of state law. The order was published in the Federal Register on April 28, 2026, starting the 60-day window during which medical businesses can apply for federal DEA registration and continue operating under state licenses while their applications are reviewed.

The most concrete immediate benefit is tax relief: medical operators are no longer subject to the federal tax disallowance that had long blocked ordinary business deductions — rent, payroll, marketing — against their taxable income. That change takes effect in 2026. Lawmakers have pushed the IRS for further clarity on retroactive relief and on how mixed-use operators should allocate expenses, but that guidance remains pending. Adult-use operators face no change in their federal tax treatment for now.

Vermont Cannabis Control Board Chair James Pepper expressed the broader operational problem in remarks to Stateline: state regulators cannot effectively advise licensees on what the rescheduling means for their operations, calling the situation “incredibly frustrating, especially with a ticking clock.” Oklahoma, Washington, and other states told Stateline they are waiting for federal direction before determining whether their programs require any changes at all.

How States Are Navigating the Gap

California moved more aggressively than most. The state’s Department of Cannabis Control proposed emergency regulations in mid-May 2026 to allow businesses holding both medical and adult-use license designations to separate them into two distinct licenses. The change would give dual-designated operators a path to pursue federal DEA registration for their medical activity without entangling their adult-use operations in the process. The DCC estimated roughly 1,600 retailers and microbusinesses could be eligible but acknowledged that key implementation details — how inventory tracking, tax collection, and local authorization requirements interact with the new structure — remain under evaluation.

In Oklahoma, the state Bureau of Narcotics and Dangerous Drugs Control sent a letter on May 8, 2026 warning licensed medical cannabis manufacturers and distributors that they must obtain federal DEA registration or face potential state license revocation. The bureau said it would not pursue administrative action for noncompliance until January 1, 2027. The Oklahoma Medical Marijuana Authority struck a different tone: businesses choosing not to register may continue operating under existing state rules and may still qualify for federal tax relief, the authority said, noting that the Department of Justice’s rescheduling order removes the federal tax disallowance for state-licensed medical operators regardless of whether they pursue DEA registration. The same federal order produced conflicting guidance from two Oklahoma agencies.

Nevada released a statement acknowledging the rescheduling allows medical licensees to register with the DEA, while noting that Nevada law still classifies non-medical marijuana as a Schedule I substance under state code. The message tracking across most states: their regulatory programs don’t change automatically because federal classification shifted, but the specific compliance obligations created by the federal change remain undefined.

What Operators Should Watch

A DEA administrative hearing set to begin June 29, 2026 will take up whether broader rescheduling — covering adult-use cannabis as well as medical — should proceed through a formal rulemaking process. The outcome would substantially change the compliance picture for the majority of the industry operating in adult-use markets. Consumer support for the administration’s cannabis approach has grown since the April 23, 2026 order, but the legal footing remains contested.

Three Republican attorneys general — from Indiana, Louisiana, and Nebraska — have filed suit to block the order, arguing the Department of Justice exceeded its statutory authority. Anti-rescheduling advocacy groups filed a parallel challenge earlier in May 2026. A successful challenge could reinstate the Schedule I obligations the April order removed, adding legal risk to the registration decisions businesses are being asked to make against a federal compliance picture that, for now, the federal government has declined to fully explain.