Rescheduling Marijuana Would Let D.C. Finally Legalize Marijuana Sales, But There’s A Catch, Congressional Researchers Say

If the federal government follows through with rescheduling marijuana, the reform would free up Washington, D.C. to finally legalize adult-use cannabis sales, congressional researchers say. But the types of products that could be sold may depend on a legal interpretation of what a “tetrahydrocannabinols derivative” is.

In a report published on Friday, the Congressional Research Service (CRS) analyzed the potential impact of moving marijuana from Schedule I to Schedule III of the Controlled Substances Act (CSA) on a provision of appropriations legislation that’s barred the District from using its local tax dollars to establish a commercial recreational cannabis market for the past decade.

“If the current appropriations policy rider were to remain, effect unchanged, the proposed rescheduling of marijuana would permit the District government, as a matter of local law, to authorize the commercial sale of recreational marijuana, establish market regulations, and levy marijuana taxes, among other policy options,” CRS said.

That’s because the rider—which was initially omitted from a 2025 spending bill introduced in a House committee before being amended back in—specifically says D.C. can’t use its funds to “legalize or otherwise reduce penalties associated with the possession, use, or distribution of any schedule I substance.”

Therefore, in addition to removing certain marijuana research barriers and allowing state-licensed cannabis business to take federal tax deductions, moving the plant to Schedule III would also remove the local sales ban in the nation’s capital, which would be a welcomed development for lawmakers who have long contested the policy rider but have been unsuccessful in past attempts to remove it.

However, as CRS notes, there may be a complication. The rider from Rep. Andy Harris (R-MD) also specifically prevents the District from using its funds to legalize or reduce penalties for “any tetrahydrocannabinols derivative.” While both federal and local law have definitions for “marijuana,” there is no definition for what constitutes a THC derivative.

“The continued prohibition on legalization of tetrahydrocannabinols derivatives by the District could lead to interpretive questions about whether a particular substance is legally marijuana, hemp, a tetrahydrocannabinols derivative, or something else,” the report says.

“Certain synthetic tetrahydrocannabinols remain illegal for recreational use under D.C. law, but it is not clear whether these synthetic substances would constitute derivatives,” it says. “In addition, although federal law defines marijuana and hemp to be exclusive of each other, a substance could conceivably be both a tetrahydrocannabinols derivative and marijuana or hemp as a matter of law.”

As CRS has explained in past marijuana-related analyses, Congress maintains authority to legislate cannabis policy issues at the federal level, regardless of the Justice Department’s proposal to reclassify it.

“If the DEA reschedules marijuana from Schedule I to Schedule III and Congress wishes to continue to prohibit the District from making further changes to local marijuana laws, Congress would need to amend the current appropriations rider to apply specifically to marijuana,” it says. “Congress could also achieve this result by passing a permanent law, rather than an annual appropriations rider, amending the local D.C. Code’s marijuana provisions.”

“If Congress takes no action beyond maintaining the current appropriations rider, and if the DEA reschedules marijuana, the District likely will be able to repeal additional local prohibitions and regulate marijuana further, at least to the extent the regulated substances do not constitute ‘tetrahydrocannabinols derivatives.’ In that case, Congress could consider clarifying what substances constitute tetrahydrocannabinols derivatives, as opposed to marijuana or hemp.”

While the D.C. marijuana sales ban was originally excluded from a 2025 spending bill covering Financial Services and General Government (FSGG), it was re-added under an amendment approved by the House Appropriations Committee last month.

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That marked another major setback for advocates, as the full committee also voted to remove a section of the bill that would’ve provided limited marijuana banking protections.

President Joe Biden has consistently maintained the D.C. ban in his budget proposals, which made it all the more notable that it was originally omitted from a version in a GOP-controlled subcommittee.

The same appropriations subcommittee under Democratic control similarly omitted the D.C. cannabis sales ban and included the banking section in a spending bill for fiscal year 2022, but the reforms did not make it into the final package.

Both the House and Senate had excluded the D.C. marijuana rider in their respective versions of appropriations legislation in 2022 before it was ultimately retained following bicameral and bipartisan negotiations.

Lawmakers in the District have enacted certain workarounds, including allowing people to self-certify as medical marijuana patients, but the congressional blockade has been a consistent source of frustration.

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