As the push for federal cannabis reform remains a central talking point, industry leaders are watching closely to see how political developments might shape the market’s future.

With Vice President Kamala Harris and Minnesota Gov. Tim Walz now forming the first explicitly pro-cannabis legalization presidential ticket, expectations are high for progress. But, according to industry experts, lasting change will depend on more than campaign promises.

Anthony Coniglio, CEO of NewLake Capital Partners, discussed what this political shift could mean for cannabis reform during an interview ahead of his appearance at the Benzinga Cannabis Capital Conference.

He shared his views on the potential impact of a pro-cannabis administration and the challenges that the cannabis industry faces regarding federal rescheduling.

Political Support and Legislative Reality

While Harris and Walz's pro-legalization stance offers hope for cannabis reform, Coniglio believes that real progress will only come when Congress enacts bipartisan legislation.

"Cannabis reform has garnered consistent and growing support from a significant majority of Americans, and it's only a matter of time for this necessary policy revision to take shape," Coniglio said.

He added that while having top-level political support is encouraging, "Lasting change will require bipartisan legislation, which remains elusive."

Coniglio emphasized the importance of keeping cannabis reform in front of lawmakers, as political interest can often fade once candidates take office.

"Having an administration that can keep the issue in front of Congress will allow the industry to accelerate the pace of reform," he explained. However, he cautioned that political promises may not sway investors without concrete action. "Investors will need tangible evidence of change versus promises."

Impact of Rescheduling on the Cannabis Industry

Federal rescheduling has been a hot topic of discussion, with predictions that it could happen within the next 12 months. When asked about the potential impact on cannabis businesses, particularly concerning banking and capital markets, Coniglio expressed a measured view.

"For the first 6-12 months, I anticipate only a marginal impact on banking and debt financing for the industry as cannabis would remain illegal at the Federal level, maintaining barriers to entry for many banks and debt providers," Coniglio said.

However, he acknowledged rescheduling would be critical in opening discussions with financial institutions. "Rescheduling cannabis to Schedule III will mark a significant milestone, allowing the industry to move conversations forward with many of these institutions," he added.

Still, Coniglio noted shifting attitudes among banks and other lenders would take time. "Over time, I do think more will shift their stance towards the industry," he said but cautioned that full access to traditional banking might take longer than some hope.

Challenges in Navigating a New Regulatory Framework

As federal cannabis policy evolves, the industry will need to adapt to a new regulatory landscape. Coniglio does not foresee immediate changes in how operators approach compliance, particularly regarding FDA licensing.

"I do not expect many operators to immediately pursue an FDA license for Schedule III substances while regulations and compliance infrastructure are still unclear," he explained. Coniglio expects state-level regulations to continue driving the industry in the short term. "I expect individual states to remain the primary drivers of regulation for the industry," he said.

As the cannabis market braces for potential regulatory shifts, Coniglio's insights highlight the need for patience and a focus on long-term solutions. His appearance at the Benzinga Cannabis Capital Conference on Oct. 8 and 9 in Chicago will likely bring further analysis and discussion on how the industry can navigate these challenges and capitalize on upcoming opportunities.

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