Pa. Gov. Urges Legalizing Pot, Cutting Liquor Tax Amid Virus

Pennsylvania's governor urged lawmakers Tuesday to pass a sweeping COVID-19 relief package, including legalizing recreational marijuana and dedicating part of the revenue to business grants, and temporarily killing or reducing the alcohol tax to help struggling restaurants and bars.

Gov. Tom Wolf, a Democrat who has frequently battled with Republicans in the legislature over the best way to respond to the COVID-19 pandemic in Pennsylvania, said in a lengthy statement Tuesday that the marijuana and alcohol measures were designed to boost small businesses. Medicinal marijuana is already legal in Pennsylvania. 

"The governor is calling on the legislature to legalize recreational marijuana with the proceeds going to existing small business grant funding," the statement from Wolf's office said. "The legislature should also provide relief for bars and restaurants by canceling the alcohol tax and allowing businesses to buy at cost."

Wolf expanded on his proposals at a news conference, saying they would be mostly funded with $1 billion the state has not used from its portion of federal funds from the Coronavirus Aid, Relief and Economic Security Act . On legalization, Wolf said he envisioned that marijuana would be sold in stores run by Pennsylvania.

"The proposal is, that for people over 21 years of age, I think we have a state store system that would be an ideal way to distribute it," Wolf said. "But I think it's also a way that the state could actually get some tax revenue from something that people are evidently already doing."

Asked if there would be an "appetite" for legalized marijuana in the Republican legislature, Wolf said some legislators had indicated in the past that they would be amenable.

"My hope is that with the pandemic and the hit we've taken, there might be more interest," Wolf said.

Pat Oglesby, founder of the tax policy nonprofit Center for New Revenue, told Law360 that state-run marijuana stores would be a first, but said there is a municipally run store in Stevenson, Washington. He said there are several things to recommend the approach.

State stores would eliminate the often-unwieldy and lengthy process of issuing licenses, Oglesby said. There would likely be less advertising of marijuana, which might appeal to parents, he said. And Oglesby added that although marijuana remains illegal according to federal law, he did not think the state would be in legal jeopardy.

"I think the worst that could happen is the federal government would say cease and desist," said Oglesby, who is also a lawyer. "Of course, one of the problems with state stores is that the marijuana community hates the government, they don't want the government in their bailiwick."

In the statement, Wolf personally chastised Republicans, saying that Democrats have been trying to assist Pennsylvania workers and families in getting through the pandemic caused by the novel coronavirus, while the Republican majority has "focused on ignoring the public health crisis."

"That must stop now," the governor said.

Republican leaders responded swiftly, indicating that Wolf's proposals will face a difficult reception in the legislature.

"Gov. Wolf has spent the last six months turning his back on the people's representatives in the General Assembly despite our numerous attempts to work with him to fight this pandemic," said House Majority Leader Kerry Benninghoff, R-Bellefonte. "It is disingenuous for this governor to put forward an unaffordable legislative agenda and require taxpayers to bail him out of his unilateral mandates that have devastated their lives and livelihoods."

--Additional reporting by Paul Williams. Editing by Robert Rudinger.

Update: This story has been updated to include more comments from Wolf and Oglesby.

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