Cannabis and the commonwealth: Politicians, entrepreneurs weigh in on recreational pot in Pa.
As the commonwealth continues to wade its way through the COVID-19 pandemic, some Pennsylvania politicians and citizens are pushing for a unique approach to shore up the sizable gap that has plagued the state budget while also restoring a balance of justice – legalizing marijuana.
Since August, Governor Tom Wolf’s administration has renewed a push for Pennsylvania to allow residents to legally purchase marijuana for recreational purposes. In early September, the governor called upon the state legislature to explore the option, which is part of his broad fall legislative agenda.
“Now more than ever, we see a desperate need for the economic boost cannabis legalization can provide. So today I am proposing we legalize adult-use cannabis here in Pennsylvania with a portion of the revenue going toward existing small business grants,” Wolf said in September.
“Half of these grants would be earmarked for historically disadvantaged businesses, many of which have had difficulties attaining other assistance because of systemic issues. The other portion of the revenue will go toward restorative justice programs that give priority to repairing the harm done to crime victims and communities as a result of cannabis criminalization.”
The quest to legalize pot is nothing new in Pennsylvania, but to apply legalization as a solution for a $3.2 billion budgetary shortfall that closed out the last fiscal year, and a projected $4.8 billion revenue loss through June 2021 – the result of temporary and permanent business closures and other issues throughout the commonwealth due to COVID-19 – certainly appears to be an unorthodox approach to a pressing problem.
THE RIGHT TIME?
When the governor’s administration floated the idea of legalization in August and September of 2020, it was met with both praise and scorn, often split along party lines in the General Assembly in the political sphere.
One of the biggest proponents for legalization has been Lieutenant Governor John Fetterman, who embarked on a listening tour of all 67 Pennsylvania counties in 2019 in a mission to find out what residents thought of recreational marijuana.
The July 2019 report that collected the findings of the tour showed an overwhelming approval of legalization, with 65% to 70% in favor of the measure.
Fetterman has said that the real challenge in legalizing recreational marijuana comes from a small opposition in the General Assembly, who he said have shifted their argument against the initiative from “Pennsylvanians don’t overwhelmingly legalized marijuana” to “now is not the right time.”
“My argument has always been ‘now is absolutely the right time,’ because we’ve got several different crises facing us,” Fetterman said. “I don’t think there’s ever been a better time. So it wouldn’t be changing hearts and minds of wholesale Pennsylvania, it’s really just convincing a few key legislative leaders and saying, ‘Look, respect the democratic will – not the Democratic party, but the will of Pennsylvania’s voters.’”
According to Fetterman, conservative estimates for tax revenue from recreational marijuana sales could amount to between $250 and $300 million per year, though some parties speculate it could even exceed those figures. And while one year of sales may not be able to fix the budget problem, it could go a long way toward preventing future shortfalls.
”Every decade, that’s $2.5 to $3 billion. After 20 years, you’re talking $5 to $6 billion,” Fetterman said. “That’s some real money, think of what that can do. And this is again, free money in the sense that all that money right now that’s being spent on marijuana is going to the drug cartels, and none of it is going to our treasury.”
Representative Maureen Madden (D-115) also cited the “money left on the table” argument, comparing the matter to a failed severance tax on natural gas that could have amassed millions – perhaps billions – of dollars in funding that could be made accessible in the short-term based on projected revenue.
“We’re in jeopardy of doing the same thing with adult use cannabis, because right now the conservative projection is $265 million a year to $500 million,” Madden said. “Think about that over time. If we see that happening, then you can start bonding, borrowing money and using the money, the projected income from cannabis, as a bond, just as they do with the tobacco settlement. So there’s money to be made that way.”
But not everyone is buying that justification.
Congressman Dan Meuser (PA-9), like many Republicans, has argued that Wolf should be exploring other solutions to the budget crisis, with a focus on assisting established businesses.
“Instead of relying on cannabis sales for state revenue, the PA government should first work with businesses and restaurants to develop a plan to safely reopen at fiscally-sustainable capacities,” Meuser said. “We should also implement lower tax rates to retain and attract new businesses, while becoming more competitive with states like Texas. Finally, we should remove the regulatory burdens on families, contractors, farmers, builders, and others that inhibit job growth. The best revenue generator is job creation.”
JUSTICE FOR ALL
Beyond raising money to repair the damage done to business revenue in the commonwealth due to COVID-19, legalization and taxation of recreational marijuana could also help thousands of individuals clear cumbersome charges from their permanent records, according to advocates.
Numerous cities in Pennsylvania, including Allentown, Erie, Harrisburg, Philadelphia and Pittsburgh, have decriminalized possession of small amounts of marijuana over the course of the past few years, though that hasn’t stopped arrests.
According to Pennsylvania State Police records, 21,789 individuals were arrested for marijuana possession in the state in 2019. The year before, 24,305 people were apprehended for marijuana possession, and in 2017, 23,390 faced a similar fate.
Oddly enough, these rates are the highest of the past decade, and easily exceed the number of arrests that took place prior to the introduction of decriminalization efforts. This could be due to the fact that police are allowed to use their own discretion when it comes to arrests, as decriminalization efforts are usually non-binding when it comes to law enforcement.
“When you look at the number of arrests that we have in this state, we’re talking over 20,000 on average,” Fetterman said. “20,000 Pennsylvanians are introduced and dragged into the criminal justice system for consuming a plant. And that’s not helpful. That’s a waste of resources, the most important resource being the criminal records of these Pennsylvanians that will have this black mark on their records until they get a pardon or we get a wholesale pardon through legalization.”
Clearing those records would also help address a rather glaring discrepancy when it comes to punitive actions related to marijuana.
A 2019 ACLU report, “A Tale of Two Countries,” noted that Black people in Pennsylvania were about three times more likely to be arrested for marijuana possession charges than whites, despite similar rates of usage.
As such, Madden has said that balancing the scales of justice is one of the most important factors in the fight for legalization and pardons in Pennsylvania.
“There’s a difference in justice if I were to get arrested buying a bag, and say to the officer, ‘It’s for my own personal use, I was just taking it home.’ He might look at me and see a white, middle-aged woman and say, ‘Okay, I’m going to let her off with a warning,’ or ‘I’m going to give her a summons,’ like they do in New York, if you have a certain amount,” Madden said. “But, if I were a Black woman or a Black man getting pulled over, I can say with a large degree of certainty that would probably turn out differently for the Black person.”
Furthermore, eliminating possession charges and establishing recreational legalization could help individuals with employment opportunities. Madden has said that many people charged with possession have been unfairly punished even after serving time or paying fines due to that proverbial black mark on their records.
“We really can’t talk about equality in justice if we’re not talking about helping people get their lives together after they made a mistake,” Madden said.
SETTING UP A SYSTEM FOR SUCCESS
Part of the beauty of legalization would be the simplicity of the setup, many proponents have stated. As medicinal marijuana is legal in Pennsylvania, much of the regulation and legislative action that would be need for recreational legalization can essentially be ported over.
“If we decide to legalize it, the infrastructure is already in place – we can grandfather it into the state system that we’re using for medicinal,” Madden said.
And according to Victor Guadagnino Jr., co-owner, co-founder and Chief Business Development Officer of Keystone Canna Remedies, many medicinal shop owners would happily venture into the realm of recreational sales if the permits they currently hold could be applied to other adult-use sales.
Some compromises may be necessary – shops may have to establish separate product menus, entrances, or visiting hours for medicinal and recreational patients, or new locations may have to be set up – but in the end, businesses like Keystone Canna Remedies, which has locations in Stroudsburg, Bethlehem and Allentown, could potentially expand their market while providing valuable tax revenue for the state treasury.
“There’s a lot of ‘if’ to see how that would look, but I can tell you that almost every permit holder, every permit holder currently, will be going for reciprocity licenses for adult use, because that would at least give them the option to execute their brand the way they want to,” Guadagnino said.
However, some critics have stated that it is far too early to pursue complete legalization, and that more time is needed to study the industry before opening the doors for recreational sales.
“Pennsylvania recently legalized marijuana for medical use,” Meuser said. “We need to ensure this program is working in the manner intended before pursuing new legislation for recreational use.”
Advocates like Guadagnino have argued that success stories in several other states have proven that Pennsylvania can stand to legalize recreational marijuana, even if the nuts and bolts of the system have to be worked out in regulations and legislation – particularly when it comes to protecting the established medicinal market.
“Typically, with legislation or any type of new program, you don’t want to hurt existing business,” Guadagnino said. “So you want to make sure you’re protecting the business interests of your medical marijuana cardholders by allowing reciprocity of that license.”
Defending medical marijuana concurrently with the introduction of recreational products may be a touchy subject to some, but officials like Fetterman have said that complete legalization could actually prove beneficial to those who use cannabis for its medicinal properties.
“It is all about the medical research, and remember, once it’s legal, then you can do more and more research, and you can make it much more specialized, and it can be (made) much more effective and targeted,” Fetterman said. “I think it absolutely is the best thing that can happen to the medical marijuana world, to legalize it. That would open up a floodgate of all kinds of innovation and direct product development.”
Essentially, the only element missing is a piece of legislation that addresses the issues particular to a recreational marijuana market, which, as both Guadagnino and Fetterman have said, is at least somewhat dependent upon changing some minds in the General Assembly.
“So that’s the next step in getting a well-formed bill that is going to protect the medical marijuana program and set up a program for success (for other adult use),” Guadagnino said. “That is our next hurdle, just figuring out how to do it. And then the opposition is really coming down to more of those conservative Republicans in office, but because of the deficit, a lot of those minds are changing as well.”
While complete legalization of cannabis in the commonwealth remains up in the air for the time being, the coming months could greatly contribute to the arguments both for and against the initiative. The state of the budget, the actions of law enforcement officers, and the perceptions of the commonwealth’s legislative and executive branches will surely affect the momentum of the issue.
Ask the advocates about the matter, though, and they’ll certainly point out that allowing recreational legalization would prove beneficial for just about any person or party in Pennsylvania, no matter where their area of interest lies.
“If you care about social justice, it’s got something big for you. If you’re only about revenue, it’s got something there for you. If you care about personal freedom, like you’re a libertarian, it’s got something for you. It literally has something for everybody,” Fetterman said.
Gov. Wolf’s administration – along with many advocates – has pushed for legalized recreational marijuana to help with budget and justice issues.