Pennsylvania House Approves Bill to Legalize Marijuana Through State Owned Stores

Pennsylvania House of Representatives approved a bill to legalize pot with an innovative model of state-run marijuana stores.

It has been a particularly fast-paced legislative process in the case of this bill from Reps. Rick Krajewski, (D), and Dan Frankel, (D). This measure was presented on Sunday. Frankel, the chair of the House Health Committee on Monday advanced it to second reading. The full chamber approved the measure on Tuesday by a score of 102-101.

The measure would be sent to the Senate after a third reading vote.

While there’s a competing bipartisan legalization measure that’s expected to be unveiled soon, this one already has 27 House Democrats signed on as cosponsors—more than one-fourth of the party’s caucus in the chamber.

The expedited consideration of the bill has already elicited criticism from the GOP side of the aisle, with Rep. Charity Grimm Krupa (R), a member of the Health Committee, saying during Monday’s Health Committee hearing that “it’s no secret that I stand in opposition to broadly legalized adult-use marijuana—but frankly, I’m appalled by the manner in which it’s being rammed through the committee and the legislature.”

Frankel replied to the criticism, saying that it was a “transparent process”, which “took into account all inputs from potential stakeholders.”

“My door has been open to all those stakeholders on an ongoing basis for the past two year—the six hearings we had and an opportunity for the minority party to have to have a meeting to talk about this,” the chair said.

GOP members raised concerns regarding the change in policy, as well. These included possible impairments to driving and work-place intoxication.

The bill was amended on the House floor by a variety of members.

Frankel clarifies in a letter that medical marijuana is included within the definition of the measure. According to the sponsor, this will “create consistency” for our DUI laws. The body approved it.

Rep. John Lawrence, (R), filed and then retracted on the floor several amendments. One of them would have permitted university governing boards to allow cannabis consumption in certain areas.

A lawmaker also retracted an amendment that would have excluded synthetic cannabinoids specifically from the market for adult-use cannabis, as well as prohibiting any cannabis products such “as gummy candy or mint, lollipop candy, candy bars, or other cannabis products, determined by the Board.”

Lawrence’s amendment, which he never withdrawn, was described by him as a means for municipalities to decide whether or not they want cannabis businesses operating in their local jurisdictions. This amendment narrowly lost in a vote by 101-102.

Aaron Bernstine’s (R) amendment, which he claimed was focused on drug tests and making sure that teachers aren’t high while on the job, was also withdrawn.

Other amendments—including one from Rep. Abby Major (R), who is sponsoring separate, yet-to-be-seen legalization legislation—that would allow the sale of alcohol at medical marijuana dispensaries were also withdrawn.

A Rep. Doyle Heffley’s (R) amendment that was to transfer tax revenues designated for state general funds into a fund of property tax relief has been withdrawn.

Pennsylvania must catch up and relax cannabis use for adults. The House of Representatives passed a law to prevent the ruin of lives by a cannabis plant, which is safer than alcohol, Karen O’Keefe said to MEDCAN24.

The federal law prevents the operation of state-run shops. “Unfortunately,” said Ms. Smith, this approach would be an expensive boondoggle. The House, Senate and Governor should all work together to find a legalization model that is effective, to ensure that Pennsylvanians have access to safe and regulated cannabis, while the Commonwealth can use hundreds of millions of dollars in tax revenues to improve their constituents’ wellbeing.

What would the HB 1200 bill accomplish? 

• According to the bill, adult consumers aged 21 or older could legally purchase and possess cannabis in stores that are licensed by the Liquor Control Board. (LCB), the body which regulates alcohol sales currently.
• LCB is responsible not only for the retail cannabis industry but also the cultivation, processing and transportation of marijuana, as well as the on-site consumption business.
• In a 24-hour time period, cannabis shops cannot sell an adult more than 42,5 grams of marijuana. This would be considered the maximum possession amount.
• Possession up to three-times the legal amount will be criminalized. Possession of the maximum amount, which is around three ounces (up to two times that amount), would result in a fine up to $250.
• Edibles could only contain five milligrams THC in each serving.
• Adults can grow two mature plants and two immature ones in a safe place at home for their personal use.
• Possession of small quantities of marijuana (defined as less than 30 grams) will be treated like a summary offence with only a $250 fine.
• The excise taxes on marijuana products in shops licensed with the state would amount to 12 percent.
• The Department of Revenue will manage a Cannabis Revenue Fund. It would cover the administrative costs of all departments who are involved in regulating cannabis, such as the facilitation and expungement for those with previous marijuana convictions. Rest of the revenue will be allocated to a Community Reinvestment Fund (50%) and substance abuse treatment programs (10) as well as cannabis business development (5%), minority business development (2%) and grants for county courts who process expungements (2%). The rest goes into state general funds.
• Local municipalities can impose a tax of 3 percent on the on-site lounges in their jurisdiction.
• Administrative Office of Pennsylvania Courts is responsible for the oversight of cannabis expungements. It will provide courts with a listing of all eligible cases which must be automatically sealed in two years.
• The bill would establish a Social and Economic Equity Advisory Committee to “promote participation and inclusion in the regulated marijuana industry by individuals who may be eligible to be a Social and Economic Equity applicant, including those that are involved with indirect cannabis businesses.” This committee is responsible for the Social and Economic Equity Loan and Grant Program. It will “provide financial support to certified social and economical equity applicants, licensed social and economically equitable businesses and indirect cannabis business that meets social andeconomic equity criteria.”
• Social and Economic Equity applicants who are eligible must have an annual household income that is below 200 percent the Area Median Income in the county where they reside. They also need to have at least 65 percent ownership from justice-impacted people or have spent the past five years living in designated historically affected communities.
• The bill also contains rules around policies related to cannabis advertising, packaging and labeling—as well as requirements for businesses around ownership and a mandate to have a labor peace agreement in place for workers.
• The public consumption of alcohol would be banned. Offenders could face a fine up to $100 for the first offense and $200 for any subsequent offences.
• Legislation would provide protections at the state level, and clarify that residents who are in compliance with law can’t be denied their firearm rights, access to medical care, custody or professional licensure.
• Workers who use cannabis off the job also could not be punished or fired based on the presence of THC metabolites in a drug tests—with key exceptions. Employees who work for federally-contracted companies could face sanctions, even if their rules explicitly prohibit cannabis use.
• Local municipalities cannot ban cannabis retail stores from their jurisdictions.
• Underage marijuana possession would not be punishable by jail. Instead, the penalty is escalating fines or a referral to an alternative program.
• In regards to licensing, LCB is required to provide licenses for up to 50 growers, 50 microcultivators 50 processors 50 microprocessors as well as 50 transporters. These numbers may increase depending on results from a market analysis.
• If LCB decides that expanding the market is best for the state, they could license existing medical cannabis processors and cultivators to supply the adult-use marijuana market. These prospective licensees will need to pay an application fee of $15,000 and a license costing $20 million.

The largest challenge for the legislation going forward will likely come down to its proposal to have the state control cannabis sales—a regulatory model that exists in no other legal market in the U.S. The cosponsor list shows that there is strong support among the Democratic Caucus, but it will likely face stiff opposition from Republicans who control the Senate and some Democrats.

For what it’s worth, a recent poll found that Pennsylvania voters say they favor a model where cannabis is sold by licensed private businesses, rather than through a system of state-run stores.

Gov. Josh Shapiro has been calling for legalization of marijuana use by adults, and he included the issue in his three most recent budget requests. But he’s not explicitly endorsed state control.

On Monday, the bill by Krajewski & Frankel was approved in Health Committee with a party-line vote of 14-12.

Key Pennsylvania lawmakers have already made clear that they’re at odds on the path forward for legalization—while a top Republican senator recently dismissed the idea that the reform is achievable at all this session.

Frankel’s recent comments about his legalization bill referred to the state-run plan. He added that he had worked “hand-in hand” with Democratic leaders.

“There are zero votes for a state-store model in the Republican caucus,” Major—who is sponsoring another forthcoming legalization bill that envisions a traditional private sales model alongside Rep. Emily Kinkead (D)—said.

Major stated that despite Frankel’s comment, she feels “we are truly the closest to ever legalizing cannabis” in the Commonwealth.

The bill that is being presented now will not be the final one. Kinkead added that “the sooner those discussions can start, the better,” adding that both she and Major will have to make a decision in early May.

To effect change, Democrats will need to work with the GOP controlled Senate even though they control the House of Representatives and the Governor’s office. In addition to conflicting viewpoints amongst pro-legalization lawmakers, this political dynamic could be another barrier to reform.

Senate Majority leader Joe Pittman said that he does not see a consensus among the governor, the other four caucuses or the Senate majority on enacting separate regulations related to gaming reform. [marijuana legalization] Priority is important.”

Regardless of which direction Pennsylvania lawmakers do—or don’t—go on marijuana legalization session, a survey released last week shows a majority of adults in the state support the reform—and opposition to the policy change has fallen by nearly 50 percent over the last decade.

Kinkead has made the case in another recent interview that legalizing cannabis in Pennsylvania will help the state mitigate public health and safety concerns associated with the illicit market, including the fact that unregulated products can be laced with fentanyl.

The lawmaker previously introduced a separate bipartisan marijuana legalization bill, alongside 15 other cosponsors, last September. The bill did not progress, though.

Meanwhile, a Republican Pennsylvania senator recently called for the creation of a state “legacy” fund, using tax revenue from adult-use marijuana sales and gaming to make long-term investments in the Commonwealth’s economy.

Senator argued, that the state, in addition to using tax revenues to finance day-today public projects, should also set aside a part of these tax dollars to create a “sustainable source of prosperity” that would last for many generations.

Pennsylvania House Speaker Joanna McClinton (D) recently said that Democrats are ready to pass a marijuana legalization bill this session, but that the party “will need Republican support” to get the job done—adding that it will be a “heavy lift.”

Another Democratic lawmaker said legislature is “substantially closer” to reaching a deal on marijuana legalization, and an initial vote on a bipartisan cannabis reform bill could come as early as this month.

The reform is stalled consistently in the legislative branch, in part due to GOP opposition. But not all Republican members are against the policy change—and one recently said she felt her party should seize the “opportunity to snatch” the issue from Democrats.

Separately in March, the Pennsylvania House approved a bill sponsored by Frankel that’s meant to strengthen safety standards and oversight of the state’s medical marijuana program as lawmakers work to advance adult-use legalization.

Pennsylvania’s medical cannabis program, which was implemented nearly a decade earlier, has now been sent to the Senate. Lawmakers say it is needed to improve the testing compliance, the product audits and the lab inspections.

Meanwhile, Pennsylvania Democratic lawmakers recently introduced a bill that would allow farmers and other small agriculture operators to sell marijuana they cultivate to existing growers and and processors if the state moves to legalize adult-use cannabis.

Separately, an independent Pennsylvania agency is projecting more tax dollars to be generated from adult-use marijuana sales compared to what the governor’s office has estimated, although it expects significantly less overall revenue from cannabis legalization due to differing views on licensing fees.

Pennsylvania officials also have launched a survey inviting legal marijuana businesses in the United States to share information on their business operations. This will help Pennsylvania better understand the cannabis market as legislators consider adult-use legalization during this legislative session.

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Also, in a video interview released in March, the governor emphasized that the state is “losing out” to others that have already enacted adult-use legalization, while maintaining a policy that’s enriched the illicit market.

I think this is a matter of liberty and freedom. He said that if people want to smoke they should have the option to do it in a way that is safe and legal. “We should shut down the black market—and, by the way, every state around us is doing it. Pennsylvanians pay their taxes and drive into other states.

Pennsylvania’s Republican attorney general recently said he wants to be a “voice for potential public safety risks” of enacting the governor’s proposal—though he said his office would be ready to enforce the new law if lawmakers did vote to pass it.

The state’s agriculture secretary separately told lawmakers that he’s fully confident that his department is in a “really good” position to oversee an adult-use marijuana program if lawmakers act.

Meanwhile, in February, top Pennsylvania police and health officials told lawmakers they are prepared to implement marijuana legalization if the legislature moves forward with the reform—and that they stand ready to work together as the details of legislation to achieve it are crafted.

Amid the growing calls for marijuana legalization in Pennsylvania, a GOP state senator said prohibition has been a “disaster,” and a regulated sales model for cannabis—similar to how alcohol and tobacco are handled—could serve as an effective alternative.

A Republican Pennsylvania senator also recently defended the push to legalize and regulate marijuana, calling it “the most conservative stance” on the issue.

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Philip Steffan is the photographer.