PENNSYLVANIA'S MEDICAL CANNABIS
sales. An industry of that size would generate $581 million in annual state revenue from the taxation and regulation of cannabis. But, as Kahl found out, participation comes at a high cost. During the first two rounds of the state’s medical marijuana application process, which took place in 2017 and 2018, the application fee for growers was a nonrefundable $10,000 and, if accepted, the permit cost $200,000, but that fee had to be submitted up front with the application. Rejected applicants were refunded the initial permit fee. On top of that, potential growers like Kahl needed to prove to the state they had $2 million in capital to even be considered for a permit. Paul Leger, former finance director for the City of Pittsburgh, said fees shouldn’t be arbitrarily set for any industry, but in this case, they could be justly high. In the permit application, there are stipulations that could render the fee necessary for the cost of the state to regulate and oversee grow operations, like the creation of an electronic system that allows the state to track the inventories of all approved sellers on a daily basis. Democratic State Rep. Ed Gainey said he didn’t want the fees to be that high, but he believes Republicans in the Pennsylvania House and Senate wanted to restrict access to grow or sell cannabis to ensure that applicants were large companies that “would be able to play ball.” “What it came down to was passing Act 16 swiftly to provide immediate relief to individuals and families,” Gainey said.
AS SMALL FARMING STRUGGLES, SOME SEE CANNABIS AS A SOLUTION The number of farms in the U.S. peaked in 1935 and then declined drastically into the 1970s, but during that time, the amount of farmland in the U.S. remained about the same, according to the U.S. Department of Agriculture. Over the decades, small farms have been bought up by larger producers who have much higher rates of productivity, making it difficult for the rural farmer to compete. The majority of farm operator households operate at a net loss from farming activities, according to the USDA, and last year that loss was expected to grow to negative $1,691 from negative $800 in 2017. “I got excited about medical [cannabis],” she said, “[but] when I started to loosely look into it, I realized I pretty much had to have a million dollars.” “It would be incredibly beneficial if it was possible for small family farms to be able to support themselves with [medical cannabis],” Kahl said, but the cost of the application and permit in Pennsylvania makes it impossible for small operators like her to enter the industry. Bill Brittain, owner of Shadyside Nursery in Pittsburgh, said he was caught off guard by not just the high fees, but the passage of the bill itself. Brittain considers it injudicious to Some rural farmers, like Kahl, see cannabis as an opportunity to combat that downward trend.
American Consequences 53
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