Philadelphia should be a top priority for the medical marijuana industry, local lawmakers said during a joint press conference Wednesday morning.
State Rep. Jordan Harris, a Democrat who represents Philadelphia in Congress, and Councilman-at-Large Derek S. Green called on the Pennsylvania Department of Health to consider granting Philly more grower-processor permits in Phase II of the state’s medical marijuana program.
That phase kicks off later this summer when 13 additional permits will be granted to cultivators and 23 new permits will be awarded to dispensaries throughout the state.
The problem, Green and Harris said, is that no Philadelphia-based cannabis business received a grower-processor permits in the first phase. To date, only one dispensary has plans to open within city limits.
“We have the opportunity to bring a new industry into the city and provide economic development opportunities for all residents,” Green said. “We want to see that kind of activity and opportunity here in the City of Philadelphia.”
Harris, who supports legalizing cannabis for recreational use, added that the marijuana industry must remain open to people of color. Pennsylvania, in fact, is the only state to date to include language supporting minority-owned companies in its legislation.
“A facility in Philadelphia means jobs for many young folks, but not just jobs working for a grower or dispensary, but all the ancillary jobs that come, as well,” Harris said. “This is a billion-dollar industry that if we’re not careful, we will miss the train.”
But the reality of how much revenue is generated through Pennsylvania’s new cannabis industry remains to be seen.
A new report found that while legalizing and taxing marijuana boosts revenue for state and local governments, it does not generate as much income as previously expected.
Likewise, Moody's described the revenue effect as minimal on local governments in states with legalized pot.
Despite high taxes on the legal sales of the drug, the revenue accounts for a small portion of government budgets. In Colorado, the first state to legalize recreational use, a marijuana tax brings in the equivalent of about 2 percent of the state budget.
In Washington state, gross revenue from marijuana legalization equaled 1.2 percent of general fund revenue in the 2015-17 state budget.
Most of the states that have legalized marijuana earmark the revenue for law enforcement, drug treatment and other specific programs, which doesn't help the states' financial flexibility.
Creating revenue for the state is one argument proponents use for legalization in New Jersey. Gov. Phil Murphy, who supports the effort, is planning on having an additional $60 million in taxes from legalized marijuana in the next fiscal year. That's less than 1 percent of the state's annual spending.
Twenty-nine states now allow marijuana for either medicinal or recreational uses, and the business is growing quickly. Moody's cited data from the market research firm Euromonitor International that projects it will grow from a $5.4 billion business in the U.S. in 2015 to $16 billion by 2020.
Meanwhile, illegal marijuana sales are estimated at $40 billion.