More province-run pot shops approved, mostly for smaller B.C. towns

Five months after cannabis was legalized in Canada, B.C. is operating only one province-run store, in Kamloops, and the earliest that the next government stores will open is late summer.

There are 12 other B.C. communities that have been given the green light by the province’s liquor distribution branch (LDB) to open retail pot outlets, and Kamloops has been given approval for two more, said branch spokeswoman Kate Bilney in an email.

Communities expected to have a provincial store by late summer include Campbell River, Cranbrook and Terrace, and Kamloops with a second store, she said.

“At this time we cannot say when other stores will be open,” said Bilney.

The province has also approved the opening of stores by the municipalities of Williams Lake, Fort St. John, Salmon Arm, Prince George, Powell River, Quesnel, Port Alberni, Trail and Courtenay.

The branch’s website says that once a lease has been signed, “it can take up to seven months” to build the store.

“The LDB has been actively investigating suitable locations across the province and is committed to a careful and efficient rollout” of stores, Bilney said.

There are no provincial stores in B.C.’s largest communities, Metro Vancouver, Victoria or Kelowna, because “a number of factors are creating challenges for the LDB … including distance requirements from existing private retailers that are expected to receive licensing, schools and community centres,” said Bilney.

For instance, in Vancouver, pot shops can’t open within 300 metres of another legal shop, schools, community centres or houses. There are three legal, private shops in Vancouver and several that continue to operate illegally. About 60 have received development permits from the city, the first step in opening a legal private store.

Bilney wouldn’t reveal the cost of opening each province-run store: “Once several stores are open we’ll have a better idea of the average cost per store.” Nor will the LDB report sales data for its stores, online or in-store, because it says it represents competitive business information.

From Oct. 17 to Dec. 31, 2018, the average price of pot in the legal market was $9.70 per gram, about 50-per-cent higher than the $6.51 per gram charged by illegal suppliers, according to Statistics Canada. The LDB handled 84,480 separate cannabis sales online and 47,730 at their first store in Kamloops, which opened in October, by the end of February this year.

The province said it doesn’t expect substantial revenues from cannabis sales because it will cost a substantial amount to establish regulations, create an enforcement unit and establish a retail system. B.C. Finance Minister Carole James revised B.C.’s expected share of federal excise taxes on legal marijuana sales to $68 million over the next three years, substantially less than the $200 million over three years the province wrote into its 2018-19 budget. Provinces receive 75 per cent of excise taxes from Ottawa on pot sales, which, from the first 15 days of sales, worked out to about $5 per sale, in addition to PST and GST.

Municipalities at the last Union of B.C. Municipalities convention discussed how to get a share of the taxes to cover zoning and licensing costs.

StatsCan data shows 15 per cent of Canadians over age 15 reported using cannabis in the first three full months after legalization in October.

Related

• B.C.’s first hit of cannabis tax revenue much lower than expected
• Cannabis consumption on the rise in Canada since legalization: Study