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House of Representatives
Session of 2019 - 2020 Regular Session

MEMORANDUM

Posted:	February 11, 2020 02:06 PM
From:	Representative Jake Wheatley, Jr.
To:	All House members
Subject:	Criminal and Social Justice Reform Through a Legal Adult-Use Cannabis Marketplace

I will soon be introducing House Bill 2050, which will again be the most comprehensive and well-vetted legislation providing for a legal adult-use cannabis industry. Last year I introduced House Bill 50 in the hopes of jump-starting a conversation to get adult-use cannabis legislation enacted in a comprehensive and bipartisan fashion. Unfortunately, there are still some whose ideology keeps them from allowing Pennsylvania to have such an important bipartisan conversation. In the meantime, an overwhelming number of individuals and interest groups have come to see us with excellent suggestions and points of view to help improve the bill. Even if some of my colleagues aren’t willing to be a part of getting it right, people from all over the state have shown how much passion they have for this issue, and it made it really easy to want to make improvements to my bill. House Bill 2050 creates a dynamic permitting structure for growers, processors and dispensaries, allowing any size company to enter the legal cannabis market. This includes lowering initial application and permit fees to alleviate financial barriers. Renewal fees will be based on gross revenue; the higher a company’s gross revenue the higher their renewal fee, which is the fairest way to do it. Among other things, my bill provides for the Commonwealth Reinvestment Fund (CRF). Specifically, the CRF will fund the following initiatives; Minority and Women Grant Program to help disadvantaged populations benefit from this new industry, Student Loan Reimbursement Program, Mixed Income Housing Program, After-School Programs, And a public information campaign to educate the public on adult-use cannabis Revenue for the CRF will be generated by a tax on the sale of cannabis. Under my legislation, a wholesale tax of 10% will be levied on business to business transactions. Growers and processors who partner with an existing Pennsylvania Farm will not be required to pay the wholesale tax. Consumers will see an excise tax (in addition to sales tax) that will start at 6% for the first two years, 12% for years three and four, and then 19% for each year after. Keeping the tax initially low and allowing it to grow over time is a great example of the advice we heard during numerous meetings with stakeholders. This is part of a critical theme of improvement, and why I felt introducing HB 2.0-50 was so important. This legislation is the evidence of continued good work being done, even when we aren’t YET able to meet the final goal. The failed war on drugs produced countless victims to heavy handed, unreasonable drug laws. Perhaps the most important aspect of this legislation is my Cannabis Clean Slate. By legalizing the use of cannabis and simultaneously expunging records and releasing non-violent drug offenders from prison, the Commonwealth can do its part to repair the damage of the last 40 years. My legislation is a culmination of social and criminal justice reform, aided by legal adult-use. My efforts have been and will continue to be endless in the pursuit of delivering legal adult-use to the more than 60% and growing of Pennsylvanians who support it. I hope you will listen to your constituents and support my legislation.

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