DEA's Drug-Felony Hiring Bar Covers Dispensary Clerks, Not Cannabis Growers

Nicole Huff had already said no to firing anyone. Late in the summer, a Drug Enforcement Administration diversion investigator named Ashlie Way had written to Huff, the chief executive of Wildflower Medical Dispensary in Aberdeen, Mississippi, to say that two of her employees had felony convictions and that the dispensary's application for federal registration could not move forward as filed. Huff answered that she would ask for waivers for both workers and, if it came to that, argue their case before an agency judge in Washington. (S1, S2)

In more recent conversations, the DEA offered a middle path, and Huff does not think it is much of one. The agency told her the two workers could "move to a non-plant-touching position while awaiting an employee waiver," she said in an interview published Oct. 23 by Marijuana Moment. "Creating an administrative position simply to keep someone employed during that process is not financially practical for many cannabis companies," Huff said. (S1)

Then there was the clock, or the lack of one. Huff said the DEA gave her no estimate of how long a waiver decision might take. Her workers have been with Wildflower for more than a year without discipline. Her own exposure, as she sees it, is existential: "A single $20,000 DEA fine could be enough to close many businesses already struggling to stay afloat," she said. (S1, S2)

In the same report, Huff got a hearing from someone with a bigger microphone. Sen. Cory Booker, the New Jersey Democrat who has sponsored federal legalization bills with expungement and repair provisions, told Marijuana Moment that the DEA policy was "really problematic." "That's an issue I've been fighting on for years. I think that's ridiculous," Booker said, adding that people convicted of nonviolent offenses for conduct that is now legal should have their records expunged. (S1)

Huff's fight now has a strange neighbor. Since April, when the Justice Department moved state-licensed medical marijuana into Schedule III, federal registration has been the route to operating as a Schedule III business under federal law; congressional researchers concluded in May that medical cannabis businesses need to register to be Schedule III compliant, Cannabis Business Times reported. On Oct. 5, the DEA opened its Form 225 application to medical cannabis manufacturers, distributors and analytical labs, extending registration from dispensaries to the growers, extractors and testers behind them. A close reading of the DEA's rules shows those applicants do not face the regulation that caught Huff's two employees. (S3, S4, S5)

That regulation is 21 C.F.R. 1301.76(a), and it is a single sentence. A registrant "shall not employ, as an agent or employee who has access to controlled substances, any person who has been convicted of a felony offense relating to controlled substances," or anyone whose own DEA registration was denied, revoked or surrendered for cause. The section's title is "Other security controls for practitioners," the DEA's term for registrants who dispense to patients, such as pharmacies and, now, medical marijuana dispensaries. The only release valve is a general provision, 21 C.F.R. 1307.03, under which anyone may apply in writing for an exception and the administrator may grant one in his discretion. (S6, S7)

For dispensaries, the cost of asking was spelled out in Way's email to Huff. Huff could waive her right to the expedited application if she wanted to pursue an employment waiver, or withdraw her application. If she did neither, Way wrote, the file would go to DEA headquarters for an Order to Show Cause, an attorney would notify Wildflower of its right to a hearing, and an administrative law judge would decide whether the application proceeds to a registration or is denied. (S1)

Expedited processing is the valuable thing being traded. The final order Acting Attorney General Todd Blanche signed in April directed the DEA administrator to make every effort to process applications filed within 60 days of publication within six months, and allowed those early applicants to keep operating under their state licenses while review was pending. An applicant who gives up that track to seek an employment waiver gives up the six-month commitment along with it. (S4)

Growers and processors are non-practitioners in the DEA's vocabulary, and their employee rules sit in a different subpart of the same regulations, 21 C.F.R. 1301.90 through 1301.93, under the heading Employee Screening. Those sections set out "the position of DEA" that conviction records are a proper subject of inquiry, and they suggest a screening question asking whether an applicant has been convicted of a felony within the past five years. They also say an employer should tell job applicants that what an inquiry turns up "will not necessarily preclude employment, but will be considered as part of an overall evaluation of the person's qualifications." The flat hiring bar that does appear in the non-practitioner security section, 1301.74(o), is written for reverse distributors, the firms that take back controlled substances for disposal. (S6, S9, S10)

Put plainly, on the text of the rules, a cannabis cultivator registered on Form 225 is told to screen and weigh a worker's drug felony, while a dispensary registered as a practitioner is told it shall not employ that worker in a job with access to the product. The DEA can still deny any registration on public-interest grounds, and nothing stops it from weighing a grower's staff when it does. But the asymmetry runs opposite to the scale of the product: the grow room holds the harvest, and the dispensary counter holds the finished goods. (S5, S6, S9)

The manufacturers pay more for the softer standard. The April order lists annual registration fees of $3,699 for manufacturers and $1,850 for distributors. Cannabis Business Times, which walked through the new Form 225 screens, reported that the background section asks whether the applicant, or any officer, partner, stockholder or proprietor of a closely held company, has been convicted of a controlled-substance crime, and requires dates, places and written explanations for any yes. That question is about owners, not the hourly staff who trim and pack. (S4, S5)

The DEA has a coherent defense, and Blanche wrote it into the order. Folding state licensing systems into federal registration was the "most effective and efficient" way to meet the Controlled Substances Act's goals for medical marijuana while "causing the least disruption for patients and existing state systems," the order says, and it does so "while preserving the Administrator's authority to deny or revoke registration where specific public-interest concerns arise." The registration regime also helps the United States meet its obligations under the Single Convention on Narcotic Drugs, which requires federal oversight against diversion. On that reading, holding a dispensary to the employee rule that governs a pharmacy is the point, not a mistake. The trouble for that defense is that a cannabis grower is not held to the same flat bar. (S4, S5)

Not every regulator sees federal registration only as a burden. Dominique Mendiola, senior director of Colorado's Marijuana Enforcement Division, told High Times in written responses that licensees seeking DEA registration "will face an added layer of oversight and increased federal engagement," and that state regulators can coordinate with federal inspectors to avoid duplicated effort. "Where Schedule I status previously hindered meaningful collaboration, we now have key opportunities to strengthen this coordination," she said. (S8)

Colorado also offers a warning. Its original rules kept some people with felony drug convictions from owning or working in licensed cannabis businesses, including people from communities prohibition hit hardest, and the equity fixes came later, inside a market Mendiola describes as saturated. Huff is asking the DEA not to repeat that sequence: in September she said she would ask the agency's judge for a grandfather provision covering nonviolent offenders who were employed before an application was filed and who have clean work records. (S2, S8)

“We were also given no timeline for how long the waiver process might take, leaving both the business and the employee facing indefinite uncertainty.”

— Nicole Huff, CEO, Wildflower Medical Dispensary

The DEA's field practice is not uniform, which makes the waiver question harder to plan around. Mississippi operators were among the first to get on-site inspections in June, Colorado applicants received a list of 26 questions in August, and industry sources have told Marijuana Moment that inspections and follow-up interviews vary between the agency's regional offices. Huff's exchange ran through the Jackson District Office. An operator in Denver or Detroit may not get the same offer. (S1)

Booker's legalization bills would reach the record itself through expungement, which the DEA cannot do. Huff directed her appeal closer to home. "We urgently need our elected officials in Mississippi and other states to stand with licensed cannabis businesses and the employees who depend on us," she said, asking for "clear guidance, reasonable waiver timelines and practical employment options while applications are pending." (S1)

Some operators decided registration was not worth it at all. In Missouri, only about a third of the state trade association's 90-plus members applied for registration, after the state regulator told licensees in May that registering was not required to stay in compliance with state rules. In Oklahoma, the state drug bureau has set Jan. 1, 2027 as the date after which it may move against medical marijuana manufacturers and distributors that lack a DEA registration. The Wildflower case sits between those poles: an operator who wants in, has paid to get in, and is being asked to choose between two employees and her place in line. (S11, S12)

1. Pending: the DEA's decision on Wildflower's two employment waivers, the first public test of how 21 C.F.R. 1301.76 is applied to cannabis retail.
2. If denied: an Order to Show Cause and a hearing before a DEA administrative law judge in Washington, where Huff says she will seek a grandfather provision.
3. Now open: Form 225 registrations for medical cannabis manufacturers, distributors and labs, launched Oct. 5, 2026, under the non-practitioner screening rules.
4. Jan. 1, 2027: Oklahoma's drug bureau may begin acting against medical marijuana manufacturers and distributors without DEA registration.

Huff has not fired anyone. Her two employees are still at Wildflower in Aberdeen, still waiting on a federal decision with no date attached, and she is still asking for a rule that would let people who were already doing the job keep doing it. "Our employees are the backbone of our businesses," she said. "They need these jobs, and we need a clear, workable process that allows us to retain them." (S1)

The DEA's offer, a desk for each of them until the agency decides, solves the federal problem and creates a payroll one. Upstream, on the text of the rules, a grower registered on Form 225 could put the same two people on its trim line, provided it had asked the screening questions first. (S1, S6, S9)

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