Pennsylvania takes first-ever step toward legalizing recreational marijuana under a state-store model

HARRISBURG, Pa. — Pennsylvania took its first step Wednesday toward legalizing recreational marijuana under a state-owned-store model, adopting the same system for how the state currently sells liquor.

The Pennsylvania state House, for the first time, narrowly approved a bill to legalize, tax and regulate recreational marijuana for adults ages 21 and older in a 102-101 vote along party lines. The bill passed Wednesday — which is likely to die in the Republican-controlled state Senate — would also expunge and vacate certain marijuana-related criminal convictions.

House Bill 1200, introduced Sunday and fast-tracked through the state House this week, was authored by Reps. Rick Krajewski (D., Philadelphia) and Dan Frankel (D., Allegheny). The lawmakers said during floor debate Wednesday that the bill marked the culmination of years of work to create a legal adult-use cannabis industry, with the intention to generate new revenue that nearly all of Pennsylvania’s neighboring states have tapped into, while benefitting communities that have historically been most affected by the criminalization of marijuana.

“We are losing public dollars and ruining lives with outdated laws that prolong our failed war on drugs,” Krajewski said in remarks on the House floor. “The reality is, criminalization of cannabis does not work. It does not deter usage, it does not promote safety, and it is not in the best interest of our commonwealth.”

All of Pennsylvania’s neighboring states except West Virginia have legalized recreational marijuana, with mixed results on how much revenue the new industry actually brings in. The bill would impose a 12% excise tax, a 6% sales tax and give local governments the opportunity to tack on an additional 3% tax.

The revenue generated from the legalization of adult-use cannabis would then be split among several pots of money: 50% for a new community reinvestment fund for communities that have historically been hurt by marijuana criminalization, particularly majority Black and brown communities; 10% toward substance use disorder prevention and treatment; 5% to a cannabis business development fund geared toward social equity in the new industry; 2% to the state’s court system to help counties expunge and vacate marijuana convictions; and 30.5% to the state’s general fund.

Gov. Josh Shapiro, a Democrat, proposed in February legalizing recreational marijuana as part of his annual budget pitch, hoping the industry would generate $1.3 billion in revenue for the state its first five years.

He has proposed the measure every year since he took office in 2023. But this year, as COVID relief funds dry up and spending is set to outpace revenue, lawmakers need to create new revenue generators to help fill a $4.5 billion budget shortfall in this year’s budget deal — and the legalization and taxation of recreational marijuana could be one.

Democratic House members on Wednesday, in nearly three hours of floor debate, said they support legalizing recreational marijuana through state-owned stores as a way to end illicit markets, while allowing the state to cash in on marijuana usage that’s already happening, as Pennsylvania residents drive across state lines to purchase legal weed.

However, the bill will face a certain death in the GOP-controlled state Senate, where the chair of the committee that will be assigned the legislation has already said he would not consider legalizing recreational marijuana under a state-store model.

“As someone who has advocated for a responsible approach to legalization, I have repeatedly made it clear that a state-store model will not pass the Pennsylvania Senate,” said Sen. Dan Laughlin (R., Erie), the chair of the state Senate Law and Justice committee, in a statement.

The 173-page bill calls for Pennsylvania to create cannabis retail stores as freestanding retailers or co-locate at an existing state-owned Fine Wine & Good Spirits store. It would also prohibit the use of marijuana in public spaces, as well as downgrade the penalty for people under age 21 who use or possess marijuana from a criminal offense to a $25 fine and written warning.

Republican House members voiced a number of concerns with the legislation, including questioning its constitutionality to have state employees sell a federally classified drug, its potential health effects on adults and children, its affect on law enforcement, negative impacts seen in other states that legalized recreational marijuana, and more.

“Are you going to look back on this day and this vote and say, ‘Boy, am I glad I voted to legalize another recreational drug?’” asked Rep. Kerry Benninghoff (R., Centre), rhetorically. “I doubt you will, and I won’t be doing it.”

The proposal is broadly opposed by Pennsylvania’s medical marijuana industry that already has hundreds of dispensaries across the state. The legalization of recreational marijuana is also opposed by several medical groups, including the Pennsylvania Medical Society.

However, as Frankel noted in his floor remarks, although the Pennsylvania Medical Society opposes recreational adult-use cannabis, the organization recognized the bill had “measures that aim to protect public health.”

“Pennsylvanians want legal cannabis. Poll after poll shows it, time and time again,” Frankel said, adding that residents go across state borders to buy legal weed there or from “quasi-legal vape stores” that exist around Pennsylvania.

Legalizing recreational marijuana for adult use was always going to face an uphill battle in the state Senate. Top Senate GOP leaders have said that there is not yet broad support within the caucus to legalize recreational marijuana.

What’s more: Pennsylvania’s state-owned liquor stores have long been the ire of some members of the General Assembly, with several efforts over the years to try to privatize the industry.

Even Sen. Sharif Street (D., Philadelphia) who has long worked on the issue of legalizing recreational marijuana released a statement Wednesday opposing a state-store model, but said he looked forward to working on the bill now that it has reached the Senate.

House Majority Leader Matt Bradford (D., Montgomery) said the Senate GOP now has a responsibility to consider House Democrats’ proposal.

“It is not enough to say ‘[Dead on arrival]’ or, ‘We don’t like this structure or this THC limit’ or whatever fake excuse they have for not taking immediate action,” Bradford added. “We don’t expect them to accept this bill as written and perfect. We recognize it may not be, but they can no longer hide from their responsibility to protect our communities.”