Want to Become a Cannabis Retailer? Here’s What to Know About the Municipal Opt-Out System

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January 22, 2019 was a big day for retail cannabis in Ontario. That was the deadline for municipalities across the province to inform the Alcohol and Gaming Commission of Ontario (AGCO) whether they would opt in or out of allowing cannabis retail stores in their communities. For anyone who wants to become a cannabis retailer in Ontario, it is important to understand how the municipal opt-in/opt-out system works and what it means for the future of retail cannabis in the province.

Opt-In Municipalities Offer a Welcoming Environment to Become a Cannabis Retailer

The good news is that an overwhelming majority of municipalities chose to allow cannabis retail stores. In total, 337 municipalities opted in, which included 54 municipalities that never held a council vote on the issue and so opted in by default. In comparison, just 77 municipalities opted out. The municipalities that opted in include many of the province’s largest cities, such as Toronto, Ottawa, Hamilton, London, Kitchener, and Kingston.

Most Ontario municipalities, including Toronto, voted to welcome cannabis stores

Most Ontario municipalities, including Toronto, voted to welcome cannabis stores

Cannabis Retailers Will Have to Avoid Opt-Out Municipalities for Now

However, there were some large cities and towns that opted out of allowing cannabis stores, many of them in the Greater Toronto Area. Some of the most notable included Mississauga, Markham, Vaughan, Oakville, Richmond Hill, and Whitby. For now, no retail cannabis stores will be allowed to open in these municipalities. However, a municipality can choose to opt in later on and residents there can still legally buy cannabis online. For anybody who wants to apply for a cannabis licence, they will need focus on opt-in municipalities for the time being when looking at potential store locations.

The Future of Cannabis Retail Still Looks Bright, Even in Opt-Out Communities

Potential cannabis retailers should remain hopeful about the future of the cannabis industry in Ontario, even in opt-out communities. A number of municipalities that opted out have indicated they may eventually opt in. In many cases, municipalities opted out not because they opposed cannabis retail stores, but because they want more control over cannabis regulations. A major point of contention is that municipalities will not have the final say on where cannabis stores will be located. That decision rests entirely with the provincial AGCO, which will merely consider input from the local community.

It also needs to be stressed that once a municipality opts in it cannot opt out later on. As a result, some municipalities took a wait-and-see approach before giving cannabis stores the final go ahead. Some of them, including Mississauga and Oakville, have already said they will revisit their decisions in the future if the province gives municipalities more control over cannabis regulation.

Another reason to believe that many opt-out municipalities will eventually vote to opt in is because public support for retail cannabis stores is strong, even in opt-out municipalities. For example, in Mississauga—which was the largest city to opt out—one poll found that 68 per cent of residents thought the city should allow cannabis retail stores. So, anybody who wants to become a cannabis retailer in an opt-out municipality has reason to be optimistic.

Do you want to pursue a career in cannabis retail in Ontario?

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