Manitoba chooses 7 rural communities for expansion of retail cannabis footprint

The Manitoba government is opening up the retail cannabis market in seven rural communities.

The province will license non-medicinal cannabis stores in Flin Flon, Niverville, Swan River, Virden, Altona, Lac du Bonnet and the rural municipality of Russell Binscarth, CBC News has learned.

The retailers will be chosen randomly from a list of nearly 100 pre-qualified applicants who responded to the province's second call for pot shop proposals last summer. The expansion aims to bring recreational cannabis sales to areas underserved by the initial distribution rollout, following the legalization of marijuana last October.

Once the new stores are open for customers, the province says it will have met its goal of having a cannabis shop within a 30-minute drive of 90 per cent of Manitobans.

"There are still a few, if I can call them, holes in the province where that 30-minute access is not available right now," Minister of Growth, Enterprise and Trade Blaine Pedersen said Wednesday.

"This is to fill in those holes, realizing that we still want to go to full open-access retail in the future."

The province initially picked four retailers to open as many as 40 stores provincewide after legalization. The Liquor, Gaming and Cannabis Authority of Manitoba has so far licensed half that number of stores — 12 in Winnipeg, three in Brandon and one each in Dauphin, Thompson, Morden, Opaskwayak Cree Nation and Keeshkeemaquah.

Pedersen said the government chose the seven rural communities for the expansion with its 30-minute access target in mind, while respecting those communities that voted against cannabis sales in referendums last fall, such as Winkler and Steinbach.

"Ultimately, when a retailer is picked for these seven communities, they will work with the municipality," he said, explaining the applicants must still be licensed by the cannabis authority.

"As to the actual location, that's between the retailer and the municipality."

The province is expected to make a formal announcement on Friday. 

Supply shortages behind delay 

The second phase of retail expansion is limited to seven stores because Manitoba, like the rest of the country, is grappling with a product shortage, Pedersen said.

The lack of supply is also why the four main retailers don't already have 40 stores in place, he said, and why the second phase of retail sales has been delayed for months. 

Once the supply issues are resolved, Manitobans can expect a more open market, Pedersen said.

"Until we reach that level of where stores can actually have a supply, there's going to be limited interest in opening stores unless you have a product to sell."

Manitoba Liquor & Lotteries, the province's cannabis distributor, said it receives only about 30 per cent of the product it expects every month. 

Pedersen said the province is working out the logistics of the selection process, but he said the government plans to conduct the random draws this spring. He couldn't say when the stores will open, as that's up to the municipalities, prospective retailers and the time it takes to license them.

Each of the pre-qualified applicants can decide which communities they are interested in, the province said. They must demonstrate retail experience and have at least $300,000 in cash holdings.

It's a very controversial topic, but I think any business is good for any area as long as it's run right.- Cheryl Kingdon-Chartier, municipality of Russell Binscarth

Mayors from the chosen rural centres said they expect some blowback from residents, including in traditionally conservative communities like Altona and Niverville.

"I'd expect so," said Altona Mayor Al Friesen. "We're taking an illegal product and moving it into a legal product."

He said council has allayed concerns by establishing where cannabis stores are permissible through a bylaw. Any additional issues could be aired at a public hearing, he said.

Niverville Mayor Myron Dyck said some pushback should be expected whenever something new is instituted.

'Sensitive to both sides'

"It's a unique business that is new to the overall business scene in our country, which is why I'm saying that we, as council, want to be sensitive to both sides and we want to do our due diligence and be prudent to all parties."

He's neutral himself to a cannabis store opening in Niverville, but he wouldn't be surprised if retailers clamour for the spot in his town south of Winnipeg, Niverville's population spiked nearly 30 per cent in the last census to almost 5,000 residents. A Dairy Queen opened this month and a pizzeria this week, he said.

Cheryl Kingdon-Chartier, mayor of the municipality of Russell Binscarth, is pleased, but she respects that her neighbours may feel differently.

"It's a very controversial topic, but I think any business is good for any area as long as it's run right," she said.

"If it's run according to Manitoba Liquor [& Lotteries], along those guidelines, we feel it will be beneficial."