Pennsylvania Gov. Josh Shapiro said he’s “sick and tired of losing to friggin’ Ohio” during his budget address Feb. 6, when the Democratic executive called on state lawmakers to send an adult-use cannabis legalization bill “to my desk.”
Shapiro, who was outspoken about his support for cannabis legalization leading up to his 2022 election, took it up a competitive notch on Tuesday, as Pennsylvania now borders five states that allow for those 21 and older to legally access cannabis: New York, New Jersey, Delaware, Maryland and Ohio.
Specifically, Ohio voters backed a legalization measure with a 57.2% majority in the November 2023 election, and Shapiro said it was time for Pennsylvanians to “catch up” with their neighbors on cannabis policy and other issues.
“We’re losing out on an industry that, once fully implemented, would bring in more than 250 million dollars in annual revenue,” he said. “And our failure to legalize and regulate this only fuels the black market and drains much needed resources for law enforcement. It’s time to catch up.”
In urging Pennsylvania legislators to send a legalization bill to his desk, Shapiro said such a bill should not only ensure a forthcoming industry is regulated and taxed responsibly but also that it is one that creates jobs and builds in-state wealth, “especially in the communities that have been disproportionately harmed by criminalization.”
He also requested that any bill includes an expungement provision for those who have been convicted on nonviolent offenses related to possessing small amounts of cannabis.
“Let’s stop hamstringing ourselves and start competing,” Shapiro said.
The governor’s actual 840-page budget calls for adult-use cannabis to be legalized by July 1, 2024, with sales within Pennsylvania beginning Jan. 1, 2025.
Shapiro’s budget also proposes investing $5 million in restorative justice initiatives from adult-use cannabis tax revenue. Notably, a 20% tax would be placed on the wholesale price of products sold through the regulated marketplace under the governor’s plan.
“The adult-use cannabis industry in Pennsylvania, as a new potential cash crop for our farmers, will be regulated by the Pennsylvania Department of Agriculture,” the budget states.
The budget also directs $2 million in cannabis tax revenue to State Police for enforcement.
The governor’s endorsement for adult-use cannabis legalization comes after a bipartisan attempt by Democratic Sen. Sharif Street and Republican Sen. Dan Laughlin to push reform policy through the Legislature last year as well as in the previous legislative session. Their bill was referred to the Law and Justice Committee, where it still sits.
After Shapiro’s address on Tuesday, Street thanked the governor for including “an end to cannabis prohibition among budget goals” in a social media post.
But Pennsylvania’s Senate, where Republicans control a 28-22 majority, might not be an ideal starting ground for a legalization bill. Specifically, Senate President Pro Tempore Kim Ward said last year that she won’t budge until the U.S. federal government makes a move.
In the Pennsylvania House, meanwhile, Democrats control a slim one-seat majority.
While a legislative path forward on adult-use cannabis legalization remains questionable in Pennsylvania, industry stakeholders expressed optimism following Shapiro’s address on Tuesday.
“With around 450 employees working across the commonwealth, I am proud to applaud Gov. Shapiro’s continued advocacy for a comprehensive policy for cannabis, including legal adult-use sales,” Jushi founder, Chairman and CEO Jim Cacioppo said in a statement provided to Cannabis Business Times.
“Since its creation, the Pennsylvania Medical Marijuana Program has benefited from industry partners’ commitment to patients and public safety,” he said. “Together, we have built a system that has succeeded beyond all expectations and these protections created by the program can now be applied to the adult-use cannabis marketplace. We look forward to working with Gov. Shapiro to implement this commonsense policy into law for this budget cycle without further delay.”
Pennsylvania’s medical cannabis market, which includes more than 436,000 active patient certifications as of mid-January, reported more than $1.5 billion in dispensary sales in 2023 (three times that of Ohio), according to the state’s Department of Health. This sales total makes Pennsylvania’s medical market bigger than all but five adult-use markets: California, Michigan, Illinois, Massachusetts and Colorado.
Since Pennsylvania’s medical cannabis program launched retail sales in February 2018, the state’s licensed dispensaries have recorded more than $5.6 billion in cumulative sales to patients.
Green Thumb Industries founder, Chairman and CEO Ben Kovler also thanked Shapiro for his effort to move the adult-use legalization needle forward in a statement provided to CBT. Green Thumb operates RISE medical cannabis dispensaries in the Keystone State.
“We applaud Pennsylvania Gov. Josh Shapiro for prioritizing adult-use cannabis legalization this year, including a clear, definitive launch date for sales,” Kovler said. “This call for change signals continued progress in the Northeast toward ending Prohibition 2.0 and the devastating impact it has inflicted on communities. The team at Green Thumb is ready to support the people of Pennsylvania on their journey to well-being by providing access to safe, high-quality cannabis.”
