Pennsylvania Lawmakers Consider State-Run Liquor Stores as Potential Cannabis Retailers

PENNSYLVANIA– As Pennsylvania’s governor introduces a budget with details for taxing adult-use cannabis, lawmakers are exploring different options for how a recreational market could be structured. Among those options is allowing state-run liquor stores to sell cannabis instead of giving existing medical cannabis companies priority in the market.

State Rep. David Delloso has introduced a bill for the third time that would make the Pennsylvania Liquor Control Board and its chain of Fine Wine & Good Spirits stores the only retailers allowed to sell recreational cannabis. Delloso claims that his bill would bring in “hundreds of millions” in tax revenue to the state. However, many cannabis advocates are not in favor of this idea.

In a memo last month, Delloso argued that “permitting private companies to sell cannabis in Pennsylvania could allow large corporations to take over the cannabis industry, putting profits before the well-being of our communities.” But plenty of other stakeholders don’t like the idea of state-run liquor stores being the only option for retail sales of cannabis.

According to a spokesman for the National Organization for the Reform of Marijuana Laws (NORML), “The state store model just seems poorly designed to accomplish” competitive pricing on cannabis products for consumers. Meanwhile, several bills legalizing recreational marijuana are already pending in the Pennsylvania Legislature, and Rep. Dan Frankel believes that if legalization happens this year, the final bill will be a compromise that includes elements from several bills.

There is plenty of political momentum behind legalization in Pennsylvania, but the GOP-dominated state Senate remains a hurdle. Governor Josh Shapiro’s budget proposal, which includes a 20% tax on recreational cannabis, is also up for negotiation. Some critics argue that this tax is too high and could lead to continued black market activity.

Regardless of the outcome, the potential revenue from a legal adult-use cannabis market in Pennsylvania is substantial. A report from The Commonwealth Foundation estimates that legalization could generate between $580 million and $1.14 billion in annual revenue for the state.