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November 4, 2025
Built by a former cannabis regulator, Policy, Decoded helps operators see the policy terrain before it shifts beneath their feet.
Shutdown brinkmanship tells a simple truth: cannabis still sits too low on the federal priority stack to move even when procedural tools exist. Meanwhile, real markets adjust in real time - operators leave California, courts take constitutional swings, and AGs rethink hemp positions when nuance matters. Across the map, the rules are changing faster than many businesses can keep pace.
A moment of recognition today for Nicole Elliott. She fought to build coherence in a system that rarely offered it, and she did the job with grit, discipline, and integrity. The work is hard. She showed up anyway. No doubt she will continue to do so, too.
This edition is supported by Mindstream and I Hate It Here.
Let’s have a productive week - plenty to navigate, and we’re right here with you.
📉 Shutdown exposes federal indifference
🏛️ Commerce Clause challenge advances
🌿 State regulators shift on hemp
Let’s get to work.
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Start here — the day’s most important development, decoded for impact.
📌 What Happened: President Trump demanded Senate Republicans invoke the nuclear option to eliminate the 60-vote filibuster and end the monthlong government shutdown, calling on his Truth Social account October 31st for the "nuclear option" to pass legislation with simple majority votes. Senate Majority Leader John Thune rejected the demand within hours, stating the filibuster remains "a bulwark against a lot of really bad things happening," while Kentucky Senator Rand Paul threatened to block any spending bills containing provisions to ban hemp-derived THC products. Paul's stance pits him against fellow Republicans Mitch McConnell and Andy Harris, who advanced language through Senate Appropriations Committee in July defining hemp to exclude products with "quantifiable amounts" of THC. The shutdown entering day 35 has cut SNAP benefits to 42 million Americans and forced 900,000 federal employees into furlough, but DEA cannabis rescheduling hearings remain frozen due to litigation that began in January when Administrative Law Judge John Mulrooney granted an interlocutory appeal over alleged improper DEA communications with anti-rescheduling witnesses.
💡 Why It Matters: The nuclear option debate kills the convenient fiction that Senate procedure blocks cannabis reform rather than leadership indifference. Democrats controlled both chambers and the White House from January 2021 through January 2023 with power to eliminate the filibuster themselves, but Joe Manchin and Kyrsten Sinema blocked the move for voting rights legislation while Chuck Schumer spent those two years blocking SAFER Banking from the 2021 NDAA despite bipartisan House passage, then promising floor votes in September 2023 and March 2024 that never materialized. The bill cleared Senate Banking Committee 14-9 in September 2023 with at least 59 likely Senate votes for passage, yet Schumer never scheduled a floor vote for 15 months before Republicans took control, later admitting "the banking bill deals with a small part of reform" while comprehensive legislation remained his actual priority. Biden initiated rescheduling through executive action in October 2022 precisely because Congress wasn't moving, and that administrative process continues regardless of shutdown or filibuster rules since it runs through DEA regulatory proceedings rather than legislation. Paul blocking hemp bans to differentiate himself from McConnell while neither position reflects industry economics shows how cannabis becomes leverage for unrelated political transactions where regulatory clarity matters less than intraparty positioning.
🧠 THC Group Take: Cannabis sits in legislative purgatory because it first needs to be someone's actual priority before any procedural lever gets pulled to move it. Could the right bill get 60 votes? Probably. Could the right bill get 51 votes? Almost certainly. Could the right policy make its way through HHS and DEA procedures? All those options remain open, which makes the inaction more damning rather than less. Schumer could have moved the votes to eliminate the filibuster in 2021, chose to preserve it for institutional reasons, then blocked SAFER Banking from must-pass legislation because he wanted comprehensive reform that never had Republican support and never got a floor vote. Democrats spent their trifecta passing $1.9 trillion COVID relief, $1.2 trillion infrastructure, and climate legislation through budget reconciliation while cannabis banking sat in committee despite 321 House votes and 41 Senate cosponsors. The filibuster was never tested because Schumer never brought SAFER Banking to the floor, leaving senators free to claim support without taking actual votes that risk political consequences. Paul versus McConnell on hemp is a more interesting tell to me: Paul isn't blocking hemp bans because he studied cultivator economics (though I think he does understand them). It feels more like he is blocking them to stake out libertarian ground against McConnell's prohibitionist instincts, and neither cares whether their position helps operators run businesses under workable regulatory frameworks. Trump calling for the nuclear option changes nothing about cannabis's queue position. Reform happens when it serves larger political purposes. Biden announcing rescheduling review before 2022 midterms, Trump potentially supporting state rights when Florida's amendment helps with swing voters. Never because the industry matters enough to burn political capital advancing it over abortion, immigration, or health care that actually drive voter turnout and fundraising. So whenever the gamesmanship picks up in DC and you hear promises about imminent action, don't believe it until you see it.
Fast-moving headlines, flagged for what matters.
Boies Schiller Flexner filed cert petition asking SCOTUS to revisit Gonzales v. Raich on behalf of Massachusetts operators Canna Provisions, Verano, and others, arguing the Commerce Clause doesn't permit federal enforcement against purely intrastate cannabis activity. Lead attorney Josh Schiller told Marijuana Moment he's "hopeful" the Court takes the case given 38 states now have legal programs and cultural stigma has evaporated since the 2005 Raich decision. DOJ response is due November 28, and four justices must vote to grant cert. The petition frames Raich as a constitutional outlier at a moment when conservative justices care deeply about federalism limits and liberal states are suddenly filing suits to restrict federal power in their jurisdictions. Schiller says rescheduling wouldn't change the constitutional analysis, which matters because even Schedule III cannabis remains federally illegal for intrastate commerce purposes. (Marijuana Moment)
The monthlong government shutdown has frozen federal cannabis policy at a critical moment, with DEA rescheduling review stalled, USDA hemp program coordination suspended, and Farm Bill negotiations over McConnell's hemp THC ban stuck in limbo while Senate Democrats and Republicans negotiate over SNAP benefits and ACA subsidies. Eight moderate Senate Democrats including Jon Ossoff and Mark Kelly are meeting to find a path to reopen government, but any deal requires buy-in from President Trump and Speaker Mike Johnson, meaning cannabis industry priorities remain hostage to completely unrelated budget fights. The shutdown exposes what sophisticated operators already know but many still ignore: your business doesn't just depend on cannabis regulators or industry-specific legislation - it depends on the entire appropriations process, leadership dynamics, and political relationships that have nothing to do with your product. When Rand Paul can hold up government funding over hemp policy and McConnell can bottle up Farm Bill provisions you need, suddenly your local congressman's relationship with leadership or position on totally unrelated issues like food stamps determines whether your regulatory clarity happens this quarter or gets pushed to next year. Cannabis executives who think they can just hire a cannabis lobbyist and ignore broader political engagement don't understand that their industry is threaded through agriculture, commerce, health, and appropriations committees where your concerns are a footnote to much bigger fights. (The Hill)
Nebraska's Medical Cannabis Commission voted unanimously to keep draft regulations unchanged after receiving 590 public comments requesting changes across six categories: allowing smoking/vaping/flower, increasing licensed facilities, removing practitioner restrictions, raising plant counts, allowing refills without new physician recommendations, and increasing THC caps. The commission selected two cultivators who scored above 70 points while two others appeal low scores, including Crista Eggers who cited a 61-point scoring spread across evaluators and complained of "conflicting information" about minority ownership rules that led her to submit a weaker solo application. Commissioner Lorelle Mueting defended rejecting 71% voter-approved consumption methods by claiming "we don't make medical decisions based on popular vote, we make medical decisions based on science and research," which translates to regulators substituting their judgment for what voters actually passed. The commission is authorizing just four cultivators limited to 1,250 flowering plants each with two harvests annually to serve an estimated 20,000 patients through only 12 dispensaries - roughly what a single mid-sized Colorado facility grows for a state with 300+ dispensaries serving 60,000 patients. Commissioner J. Michael Coffey said limits can be raised "if there is more demand" but artificial scarcity baked into initial licensing guarantees supply failures while regulators claim prudent implementation. (Nebraska Public Media / Nebraska TV)
Ohio's House passed Senate Bill 56 with an 87-8 vote, sending hemp regulations and marijuana law changes back to the Senate for concurrence, with lawmakers racing to finalize a compromise before Thanksgiving after Governor DeWine's hemp ban was blocked by a judge. The bill would require hemp THC products to be sold only through licensed hemp dispensaries to adults 21+, grandfather in up to 400 existing retailers who were 80% hemp by revenue before August 30, and allow bars to sell 5mg THC beverages while stores can sell 10mg drinks. The legislation also recriminalizes cannabis obtained outside licensed channels, bans public marijuana smoking, and caps home cultivation possession at 2.5 ounces regardless of harvest size, directly rolling back voter-approved freedoms from Issue 2. Senate President Rob McColley said the chamber is unlikely to accept House changes outright because it creates "a brand new regulatory scheme," meaning conference committee negotiations will determine whether Ohio gets hemp regulations or DeWine's executive ban becomes the only enforcement mechanism. The 400-dispensary grandfather cap matters because it effectively closes the market to new entrants unless existing operators fail, creating instant scarcity value for businesses that moved fast on hemp sales. (Ohio Capital Journal / Signal Ohio)
Minnesota AG Keith Ellison defended signing the 39-state letter urging Congress to ban intoxicating hemp products, claiming he meant to close the Farm Bill loophole while protecting Minnesota's regulated THC edibles market through a federal carve-out for states with "adequate regulatory schemes." His office told the Star Tribune they'd accept a Cole Memo-style enforcement discretion as second-best option, but neither preference appeared in the actual letter sent to congressional leadership. State Rep. Nolan West called out the contradiction, noting Ellison's signature "puts support behind those in Congress who want a total ban" even if that wasn't his intent. The cleanup matters because Minnesota has Target piloting hemp beverage sales statewide and a functioning regulated edibles market that an outright federal ban would destroy. Ellison's backpedaling shows how state AGs are realizing the 39-signature letter gave McConnell and Andy Harris ammunition for prohibition without actually securing the nuanced state-regulatory-protection language that would keep their own markets intact. (Marijuana Moment)
Kansas Bureau of Investigation sent notices to retailers claiming THC beverages are illegal, prompting hemp farmer and AdvenTrue co-founder Sheldon Coleman to send a letter to KBI and Attorney General Kris Kobach explaining that beverages under 0.3% THC concentration comply with federal hemp law. KBI told stores that any drink "containing over 0.3% THC concentration" is illegal and sellers could face prosecution, but Coleman said "they were totally mistaken" and the confusion caused business damage across the state's hemp industry. Neither KBI nor Kobach responded to Coleman's letter, but he claims subsequent raids haven't targeted beverages, suggesting "they understood the mistakes made." The story matters because Kansas is one of the strictest prohibition states where even hemp compliance gets tangled in enforcement confusion - if operators can't get clarity on whether federally legal hemp beverages are actually legal under state interpretation, it shows how prohibition states are using vague enforcement threats to chill markets they can't technically ban. Coleman's call for industry self-regulation to "play by the rules" only works if law enforcement actually knows what the rules are, and Kansas appears to be testing whether scary letters can accomplish what their legislature hasn't passed. (KWCH)
Spectrum News investigation found at least 20 unlicensed Southern California dispensaries connected to companies using stolen identities and fake IDs, with operators telling landlords they're opening clothing stores before changing locks and launching cannabis operations offering opening specials like five free grams with minimum purchase. The network uses shell companies including Redwood Group 12 and Abner Group that share the same Fullerton office building address, with attorney Anthony Sears prolonging evictions through legal tactics while keeping client identities secret across at least 14 connected cases. Dispensaries stop paying rent after moving in but stay open rent-free during eviction proceedings that can take months, and some reopen immediately after DCC raids that confiscated 96,000 pounds of product worth nearly half a billion dollars across 25 operations in three months. The investigation matters because California's illicit market captured 60% of total cannabis consumption in 2024 while legal sales dropped 30% since 2021, and enforcement focuses on individual raids rather than investigating the organized networks behind multiple storefronts. LA County Counsel's Office closed 50 illegal dispensaries this year through civil litigation but admits operators "do all types of games with LLCs and other corporations" to hide ownership, while licensed operators like Swish Cannabis pay close to 40% combined taxes competing against illicit shops within blocks that sell untested product for less. (Spectrum News 1)
Planet 13 is selling its Orange County dispensary and shuttering its Coalinga cultivation facility, leaving California completely to focus on Nevada and Florida. The company called California operations "cash-flow negative" and said the market "no longer aligned with long-term objectives," which is corporate speak for admitting they couldn't make money in the world's largest legal cannabis market. Planet 13 isn't a small operator struggling with compliance complexity - this is a vertically integrated MSO with massive tourist-focused superstores in Las Vegas that decided California wasn't worth the capital. When operators with that kind of retail expertise and balance sheet strength walk away from California entirely, it confirms the state's regulatory burden and tax structure are pushing out everyone except operators with legacy cultivation advantages or massive scale. (Cannabis Business Times)
Lebanon formally established the National Authority for the Regulation of Cannabis Cultivation to license Bekaa Valley farmers who've been growing illegally for decades, betting medical cannabis exports can generate $1 billion annually for an economy where 80% of the population lives below the poverty line after the currency lost 98% of its value. Parliament legalized medical and industrial cultivation in 2020 but implementation stalled until economic desperation forced action, with the government now coordinating licensing across Health, Industry, Economy, and Agriculture ministries while establishing quality standards for pharmaceutical exports. Interior Minister Ahmad al-Hajjar framed regulation as drug enforcement strategy, arguing that formalizing medical cannabis lets security forces focus on Captagon and cocaine trafficking to Saudi Arabia and the Gulf. Lebanon's model matters because it's attempting the same transition US states tried but from a weaker starting position: legitimizing entrenched illicit cultivation through licensing rather than building a legal market from scratch, which only works if farmers can actually afford compliance costs and find legal buyers willing to pay less than black market prices. (High Times)
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From the hearing room to the comment section — we’re watching it all.
💚 Nicole Elliott spent four years trying to build something impossible: a unified regulatory framework for the world's largest legal cannabis market while the economics worked against her at every turn. She inherited three separate agencies with different cultures and combined them into one Department of Cannabis Control while California's tax structure and local bans kept bleeding operators into the illicit market. She was always willing to take the call, show up to industry events, and actually listen when operators explained why policies weren't working on the ground. Building regulatory systems in real time under constant scrutiny requires both thick skin and genuine commitment to getting it right, and Nicole brought both. California's market challenges aren't solved, but they're also not her fault - she was dealt an unwinnable hand of legislative tax policy and local prohibition that no regulator could fix alone. (MJBizDaily)
🎬 Seth Rogen told Bon Appétit that hemp beverage restrictions show "clearly someone is very threatened by them," which matters less for his policy insight and more because 12 million Instagram followers now think these products are mainstream enough that banning them would be taking something away. Target shelves and celebrity endorsements create the perception of legality that makes actual prohibition look like government overreach, not consumer protection. (Marijuana Moment)
💊 Kentucky lawmakers are panicking about medical cannabis gummies looking too much like Skittles, with Senator Karen Berg insisting "it has to look like medicine, because we're treating it as medicine." We are how long into state legalization? And the industry has built sophisticated cultivation science and demonstrated medical efficacy, but walk into a statehouse and legislators are still fixated on whether gummies are too colorful. Nobody demands children's Tylenol taste terrible or come in drab packaging, yet cannabis edibles must signal seriousness through aesthetic punishment because lawmakers can't reconcile "medical program" with "product people actually want to use." (LEX 18)