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Where is Cannabis Legal?

A guide to deciphering the complex web of cannabis legalization in the United States

Where is Cannabis Legal

History of Cannabis Legalization

Medical Use

In the 20th century, cannabis was illegal in the US, but this changed in 1996 when California voters passed Proposition 215, which legalized the medical use of cannabis in the state. Other states followed California’s lead with 15 states legalizing medical use from 1998-2011. Since 2012, 22 additional states legalized medical marijuana and, as of February 2023, the use of medical marijuana was legal in 37 states plus the District of Columbia.

Recreational Use

In 2012, Colorado and Washington became the first states to legalize cannabis for recreational use. This was followed by Alaska, Oregon, and Washington DC in 2014, and by California, Massachusetts, Maine, and Nevada in 2016. Michigan and Vermont legalized the recreational use of cannabis in 2018, and since then, 11 other states followed their lead.

timeline of recreational cannabis legalization

Recreational legalization has recently accelerated. Even though it took six years for the first 10 states to legalize the recreational use of cannabis, another 10 states legalized the recreational use in only the last three years (2020-2022). This trend toward national legalization is expected to continue as new cannabis legalization ballot initiatives are planned for future elections or legalization is currently being debated in state legislatures.

In the 2020 election, voters in Arizona and Montana passed a resolution to legalize the recreational use of marijuana. Through its state legislatures, New Jersey legalized recreational use in February 2021, and New Mexico, Virginia, and New York legalized recreational use in April 2021. Connecticut also legalized recreational marijuana in July 2021. Rhode Island then legalized recreational use in May 2022 and in the November 2022 election, voters in Maryland and Missouri legalized recreational use.

As of February 2023, the use of recreational marijuana was legal in 21 states plus the District of Columbia.

CBD and Low THC Hemp

From 2014-2017, 48 states legalized Low THC/High CBD products that are produced from hemp. However, since the Farm Bill passed in 2018, hemp-derived CBD is legal in all 50 states (though some states require formulations that have 0% THC and most require THC levels that are 0.3% or less).

While CBD products are widely available online and CBD can be incorporated into lotions or topicals throughout the US, the current market delay is that the FDA is still developing regulations for the incorporation of CBD into food and beverage products, thus delaying the national introduction of CBD edibles into mass retail. This situation was exacerbated in January 2023 when the FDA stated that it was unable to regulate CBD and called on Congress to resolve the situation.

cannabis legislation

Cannabis User Population

As of February 2023, 72% of the adult population lived in states that have legalized medical or recreational cannabis. 48% live in states that have legalized both medical and recreational use and 25% live in states that have legalized only the medical use of cannabis. Another 28% live in states where only CBD or low THC (0%-0.3% THC) products are legal.

According to an April poll by the Pew Research Center, 91% percent of US adults support some form of legalized cannabis.

Based on the growing acceptance of cannabis, New Frontier Data estimates that annual total US legal sales are projected to grow at a CAGR of 11%, exceeding $57 billion by 2030.

Cannabis Population

The Future of Cannabis

State Legalization Efforts

As a result of the increasing legalization of cannabis and its broader social/political acceptance, cannabis industry professionals expect more states to legalize the recreational and medical use of cannabis. However, the timing is less certain. Typically, the legalization of medical use precedes the adoption of legalized recreational use and there is a significant delay from the adoption of medical marijuana to the formation of a licensed recreational marketplace. For example, Massachusetts legalized medical use in 2012 but recreational use dispensaries did not open until 2018. The good news is that legal markets have demonstrated that time lapses between adopted medical programs and subsequent recreational legalization in the same markets have shortened.

There is also a lag from the time that recreational use is legalized to the establishment of a state regulatory structure that allows the sale of cannabis from licensed dispensaries. This process took two years in Massachusetts but can take even longer in other states. For instance, Vermont legalized recreational use in 2018, but Burlington only had one recreational dispensary by October 2022.

For 2023, industry experts expect that recreational cannabis legalization may pass in Oklahoma (medical use was approved in 2018). Cannabis advocates collected enough signatures for a recreational cannabis referendum, but they missed the deadline for the November 2022 ballot. The initiative will be voted on in a special election in March 2023.

Additional states are expected to make progress in legalizing cannabis. In Minnesota, cannabis legalization is working its way through state Senate and House committees. Both chambers and the governorship are controlled by Democrats, so the initiatives are expected to pass. Minnesota governor, Tim Waltz, recently included proposed funding for recreational marijuana legalization in his latest budget.

In Ohio, voters are expecting a ballot referendum in 2023 where 60% of voters favor the legalization of recreational marijuana.

Cannabis advocates in Hawaii also expect that recreational use will soon be legalized in the state even though legislative provisions have faced an uphill battle in the past (Hawaii legalized medical marijuana over 20 years ago). Newly elected Governor Joshua Green said he would support a cannabis legalization bill if approved by the legislature. In contrast, former Gov. David Ige opposed full cannabis reform during his eight years in office. With the elimination of the veto threat, Democratic legislators in both statehouses have introduced legislation that would legalize recreational use.

In Florida, a campaign supporting a ballot initiative to legalize marijuana, Smart and Safe Florida, has raised $20 million. Funding is from Trulieve Cannabis Corp., a marijuana business that operates in several states, including Florida. The campaign is collecting signatures to place the initiative on the ballot for Nov. 5, 2024. There are also plans to offer cannabis ballot initiatives in Wyoming and Nebraska.

While cannabis ballot initiatives failed in Arkansas, North Dakota, and South Dakota in November 2022, many cannabis professionals believe that future ballot measures will reappear in South Dakota because the measure narrowly failed with just 52% of voters opposed. Furthermore, South Dakota voters already approved recreational cannabis in 2020 with 54% approval but the legislative efforts were halted after the governor won a lawsuit that prohibited its implementation.

Other states that may enact cannabis legalization through state legislators include New Hampshire (recreational), Pennsylvania (recreational), Delaware (recreational), and Kentucky (medical). Pennsylvania is especially promising since newly elected Governor Josh Shapiro has expressed support for legalization and for the first time in over a decade, the lower chamber is controlled by Democrats (based on three special elections that were held earlier this year). Many cannabis professionals are optimistic about recreational legalization in New Hampshire and Delaware because both states are surrounded by legalized recreational markets. State legislators understand that they may be losing tax revenue to neighboring states as it is fairly easy to cross state lines to purchase cannabis (even though it is technically illegal).

Federal Regulation

The biggest hurdle to widespread cannabis adoption is the inaction of the federal government in updating cannabis regulations to correspond to the changes in state laws. In the US, the federal government still classifies marijuana as a Schedule I controlled substance even though marijuana has been legalized in 37 states. Schedule I substances are deemed to have a high potential for abuse and there are no acceptable medical uses for the drug (which clearly does not apply to marijuana). Prescriptions of Schedule 1 drugs are illegal, and they are not readily available for clinical use or research. In addition to marijuana, Schedule 1 drugs include heroin, cocaine, peyote, ecstasy (MDMA), Quaaludes, and LSD. The government has not yet removed marijuana from Schedule I classification and Congressional bills that would rectify the problem have not yet passed.

Under the Supremacy Clause of the US Constitution, federal law supersedes state law. This means that without declassification, marijuana businesses operate with the risk of being shut down or experiencing a property seizure without notice. During President Obama’s term in office, the federal government followed a policy of non-enforcement and the administration ended federal government raids in states where marijuana had been legalized. In 2014, Congress passed an amendment that prohibited the Justice Department from using federal funds to prevent states from “implementing their own State laws that authorize the use, distribution, possession, or cultivation of medical marijuana.” In 2018, former President Trump revoked the policy of non-enforcement, but the Biden Administration has taken a hands-off approach and Attorney General Merrick Garland has said, “The department’s view on marijuana use is that enforcement against use is not a good use of our resources.”

The House also passed the MORE Act of 2021 in December 2020, which decriminalizes cannabis and removes it from the controlled substances list. However, the Senate was unable to pass the bill so it must be reintroduced in the new Congress. With the House now in Republican control, the bill is unlikely to pass both Houses of Congress.


One of the biggest problems for dispensaries is the inability to obtain financial services from federally insured banks. Most dispensaries are forced to take only cash (which increases the risk of robberies) and must conduct their financial operations with local credit unions or other non-federal banking institutions. Under current federal law, financial institutions providing banking services to legitimate and licensed cannabis businesses under state laws are subject to criminal prosecution under several federal statutes such as “aiding and abetting,” a federal crime, and money laundering.

To resolve this issue, the US Congress introduced the SAFE Banking Act which has already passed the House of Representatives seven times but has not yet passed the Senate. The SAFE Banking Act would provide protections for financial institutions that work with state-legal cannabis businesses. This initiative enjoys broad bipartisan support, but the current political environment makes its passage unlikely. Cannabis advocates are still hopeful that the provisions can be part of a larger appropriations bill in the new Congress.


In December 2022, President Biden signed The Medical Marijuana and Cannabidiol Research Expansion Act into law. This bill will establish a new registration process to facilitate cannabis research and eases restrictions under the Controlled Substance Act (CSA) for cannabis research. This law also allows additional institutions, such as universities, practitioners, and manufacturers, to distribute and possess cannabis for medical research.


On October 6, 2022, President Biden issued a presidential pardon of all prior federal offenses of simple cannabis possession. However, these pardons affected only about 6,500 US citizens who carry federal cannabis-related convictions on their records from 1992 to the present. President Biden urged each governor to follow suit by issuing similar pardons for state offenses. He also ordered the secretary of Health and Human Services to “review expeditiously how marijuana is scheduled under federal law”.


The U.S. cannabis market is large and growing rapidly, despite the complex web of state and federal laws. If you are starting a cannabis-related business, contact us to see how we can help with your business plan and financial forecast.

Devin has over 25 years of experience in marketing and senior management of emerging growth companies, startups, and global consumer products companies. She has advised companies in numerous industries including cannabis and CBD; e-commerce and social media; fashion apparel, footwear, and accessories; music and entertainment; and various consumer products and services.

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