White House Signals Shift on Hemp Regulation Ahead of Federal ALJ Hearing

A little over a month before the federal Administrative Law Judge (ALJ) hearing on rescheduling, the White House has made one of its clearest policy statements yet on hemp—and it could have broader implications than many realize.

This week, Office of Management and Budget (OMB) Director Russell Vought sent a letter to Congress requesting supplemental authorities as part of a broader funding package. Buried near the end of the letter was a paragraph asking Congress to revise federal hemp regulations or, at minimum, delay implementation of Section 781 of Public Law 119-37—the law that is scheduled to dramatically redefine legal hemp this November.

Specifically, the Administration asked Congress to revise federal hemp regulations "to ensure the fair treatment of hemp products" consistent with Representative Andy Barr's Amendment #54 to H.R. 8646. That amendment would have replaced the upcoming broad restrictions with a more targeted regulatory framework, preserving many hemp-derived products while adding labeling requirements, taxes, and consumer safeguards. The amendment never received a floor vote after being blocked in the House Rules Committee.

Fancy Signatures

The significance isn't simply what was written—it's who signed it.

Russell Vought isn't a congressional staffer, trade association, or industry lobbyist. As Director of the Office of Management and Budget, he speaks on behalf of the Executive Branch when communicating the Administration's legislative priorities.

OMB reviews virtually every major regulatory action across the federal government. When the Director formally requests Congress to change a law, it reflects a coordinated Administration position rather than an isolated opinion.

In other words, this is one of the strongest indications yet that the White House believes Section 781, as written, reaches too far and should be revised before taking effect.

Tony, Tone, Ton

The request also represents a noticeable shift in tone.

Over the past year, much of the conversation in Washington has centered on closing the "hemp loophole." This letter instead argues for preserving access to appropriate full-spectrum CBD products while still restricting products that present legitimate public health concerns.

That's a meaningful distinction.

Rather than advocating for an outright rollback of regulation, the Administration appears to be supporting a more nuanced approach—one that separates non-intoxicating hemp products from products Congress intended to regulate more aggressively.

Nightmare Rotation

The DEA has released the witness schedule for the Administrative Law Judge hearing on marijuana rescheduling, which will run from June 29 through July 14. The list includes the federal government, the National Drug and Alcohol Screening Association, SAMHSA, Dr. Kenneth Finn, the Tennessee Bureau of Investigation, and representatives from Nebraska, Idaho, Indiana, and Louisiana.

The lineup contains few surprises. Most of the non-government participants are either plaintiffs in ongoing litigation challenging the proposed Schedule III rule or organizations that have publicly opposed rescheduling. MMJ BioPharma stands out as the primary exception, having generally supported moving the process forward.

One notable development is who was left off the schedule. According to Marijuana Moment, the DEA denied participation to a proposed witness whose testimony relied heavily on disputed claims linking marijuana to psychosis, suggesting the agency is applying at least some scrutiny to the evidentiary record.

While the witness list is largely what many expected, the testimony itself—not the names on the docket—is likely to have the greatest impact as the hearing moves forward.

Hearing Aide

The timing is difficult to ignore.

In the coming weeks, the DEA's Administrative Law Judge will hear testimony regarding the proposed rescheduling of marijuana under the Controlled Substances Act. While the hemp legislation and the rescheduling proceeding are legally separate issues, they are part of the same broader federal conversation about cannabinoid policy.

The White House's request does not direct the DEA, nor does it determine the outcome of the ALJ hearing. The hearing concerns whether marijuana should be moved to Schedule III under existing statutory standards, while the hemp request concerns congressional amendments to federal law.

However, it does provide additional evidence that the Executive Branch is favoring regulatory modernization over blanket prohibition. The Administration is simultaneously supporting continued access to full-spectrum hemp products while allowing the rescheduling process to move forward. Those are separate decisions, but together they suggest a broader policy preference toward regulated access rather than categorical bans.

Whether the ALJ ultimately recommends rescheduling will depend on the administrative record and applicable law—not this letter. But the Administration's public position on hemp demonstrates that, at least from a policy standpoint, federal officials are continuing to look for regulated pathways instead of simply restricting cannabinoid products across the board.

For operators throughout the industry, that may be the most important signal to come out of Washington this week.