For the first time in a while, Bree says she feels excited and optimistic. “We’ve spent hundreds of hours to try to become regulated,” she says.

Bree operates two marijuana gifting stores in D.C., which for years have existed in legal and regulatory limbo — one that D.C. has been unable to remedy, largely because of Congress. But a sweeping new measure approved Tuesday by the D.C. Council is offering Bree — who asked that we only share her first name, given the tenuous legal situation her industry still faces — a path to legitimacy.

The bill, approved unanimously by the council, dramatically expands the city’s existing medical marijuana program. It lifts existing caps on how many dispensaries are allowed to operate and increases the number of cultivation centers that can open. It creates new licenses for marijuana delivery services, educational offerings like cooking classes, internet-based sales, and on-site marijuana use areas for dispensaries. And it sets aside a large number of the new licenses for “social equity” applicants, defined broadly as those who are low-income or live in low-income areas or people who have served time in prison. The bill will also make permanent an emergency measure passed over the summer that lets people self-certify for medical marijuana; in essence, no more need for a doctor’s note.

But the bill doesn’t stop there. It also offers the city’s many gifting stores — the dispensary-style retailers like the ones Bree operates where anyone can buy a high-priced sticker or piece of clothing and get a “gift” of marijuana — the chance to apply for a medical marijuana license, thus leaving behind the unregulated and illicit “gray” market often prone to police raids.

On its face, the bill is simply a means to expand access to medical marijuana, which has been legal for almost a decade. But it’s also a creative solution to a problem outside the city’s control. Since 2015, Congress has prohibited D.C. from legalizing and regulating sales of recreational marijuana, which city officials have long wanted to do. That prohibition — which remained in the proposed $1.7 trillion federal spending bill Congress will vote on this week — contributed to the unregulated gifting market that started with discrete events but has blossomed into a large number of brick-and-mortar stores that city officials say do more than $600 million worth of business each year. (Under Initiative 71, approved by voters in late 2014, it’s legal to possess, grow, use, and give away small amounts of marijuana in D.C.)

“There’s always going to be an advantage to unlicensed and unregulated: they don’t have to pay taxes, they don’t have to ensure quality. Congress is aiding and abetting that by prohibiting us from regulating that. It’s a real public safety problem,” said Mendelson in an interview with DCist/WAMU on Tuesday.

As the gifting industry grew, the city’s small and tightly regulated medical marijuana dispensers and cultivators complained they were losing customers and revenue. Lawmakers responded by loosening restrictions, capped off by the vote earlier this year to allow people to self-certify for medical marijuana. (That alone more than doubled the number of people registered in the medical marijuana program, from 12,000 earlier this year to roughly 25,000 in November.)

But what to do with the gifters remained a sticking point: D.C. can’t legalize them, but Chairman Phil Mendelson’s multiple efforts to ramp up civil enforcement on them prompted pushback from an increasingly organized and politically active gifting industry. And those efforts were eventually rejected by many of his colleagues, who worried that the impact would be disproportionately felt by Black-owned operators and their employees.

Ultimately, weeks of negotiations between Mendelson and Councilmember Kenyan McDuffie (D-Ward 5) — including during a recent three-hour Amtrak train ride back from a conference they both attended — led to a creative compromise: the gifting shops would be offered a generous “on-ramp” into the legal and newly expanded medical marijuana market, with an emphasis on offering licenses to local and minority applicants. (Black and Latino entrepreneurs have faced limited access to the lucrative legal marijuana market in various states where it is legal.)

Lawmakers insist that they are abiding by the congressional prohibition since they aren’t technically legalizing recreational sales, but some gifters see the bill as a clever way to legalize and regulate a market that already exists using the only mechanism the city has available to it.

“I think the writing is on the wall as far as the gifting model goes. It was a great run. It was a long run. Some good, some bad came with it. But if you want to operate in Washington, D.C., where again, we just do not and most likely will not have state autonomy, this is the only solution for you,” says Mark Nagib, co-owner of Pink Fox, a high-end clothing retailer and gifter. “We were in between a rock and a hard place.”

Bree agrees that entering the medical marijuana market as a stand-in for a recreational-use market, should one ever come to pass, it a “weird place” to be, but she believes it will still offer existing gifters legitimacy and stability that they haven’t yet had. “When you look at California, medicinal retailers became recreational dispensaries as soon as that law passed and they were at the forefront of that,” she says.

That’s the carrot, but the bill also contains a stick: any gifters that don’t apply for a medical marijuana license or meet the qualifications for one will be subject to ramped-up civil enforcement, though it’s not expected to begin for almost a year.

David Grosso, a former councilmember and current lobbyist for the D.C. Cannabis Trade Association, which represents existing medical marijuana operators, says that on balance, the bill is good step forward.

“We certainly would like to see a level playing field across the board, and that hasn’t been the case for as long as the [Initiative 71] folks have been operating illegally. And so we’re hopeful that this effort will bring them into the legal market and then treat them equally with us. And that means all the regulations that come with it, the fees that you have to pay, the inspections you have to endure, all of the restrictions around where you can locate, and everything like that which the current legal market has had to deal with now for more than ten years, which is a huge burden on us,” said Grosso in an interview.

Grosso says his clients are happy that the bill will allow them to deduct business expenses from their local taxes (something not allowable on federal taxes), and that it includes a provision limiting packaging and advertising that could appeal to children. He would have liked to see more rapid enforcement against gifters that don’t apply for licenses, though.

The Generational Equity Movement, a coalition of some gifters, says the bill represents “progress.” The I-71 Committee, another coalition of gifters, calls the bill a “great improvement” over prior drafts that would have given gifters less time to apply for licenses and ramped up civil enforcement more quickly. Still, the committee worries that new cultivators may not have time to keep up with the demands of the many new dispensaries that could come online.

Bree says she’s excited to apply for a medical marijuana license, and is especially pleased that licenses will be set aside for residents who are Black and Latino and were impacted by the war on drugs. “Being able to have a pathway right into the industry is something that we fought for a lot,” she says.