Council to hear update on cannabis businesses in the County

Council is scheduled to hear a report tonight from Todd Davis, Community Development Co-ordinator, on the implications and opportunities associated with cannabis businesses in Prince Edward County.

Earlier this month, Paul Gillespie, of Toronto-based Neucrop Growers Canada, a pre-licensed Ontario cannabis producer, made a presentation about interest in locating at the Picton Industrial Park – a site shortlisted by the company along with Belleville, Quinte West, Brighton, Parry Sound and Niagara.

Davis said county staff has met with Gillespe and his realtor to outline a process should Neucrop wish to move ahead with development. Prior to requesting any form of formal support for the project from council, staff has requested that Neucrop make a formal offer on the subject property which can be considered by staff and council.

Davis says the municipality has attracted a number of requests for information related to establishing cannabis production and processing facilities in the past three to four months.

“Our reputation as a community with agriculture and agri-processing strengths has made us a potentially attractive destination for these businesses,” he said. “The significant challenge for these businesses is finding locations with appropriate available services. Access to
municipal water and waste water, three phase power and natural gas supply lines, plus
enough property to accommodate potential future growth demands limits areas of the community for the siting of a cannabis business.”

In follow up to Gillespe’s point that municipalities would receive 75 per cent of tax revenues, Davis notes in his report that staff research indicates tax revenues from the sale of cannabis will be shared between the federal and provincial governments.

“According to federal – provincial negotiations, 75 per cent of the tax revenue will go to the provinces with 25 per cent going to the federal government,” his report states. “The province of Ontario has indicated that it will consider some methodology for sharing some these revenues possibly using a model similar to how gas tax proceeds are distributed.”

He states the Association of Municipalities of Ontario and other municipalities are asking that at a minimum, tax revenue cover any and all costs that could be attributed to the municipality as a result of legalizing cannabis.

“AMO believes there will be increases to the costs of policing, by-law enforcement, public health, fire inspections and other services. Until we have some time to stabilize the industry and an opportunity to understand the impact of legal recreational cannabis we will not know what the impacts will be on a municipality, either financially or socially.”

Davis said staff generally supports the establishment of a cannabis producer or processor within the municipality provided that the facilities are sited and operated appropriately in the community. He notes council should take into account the location of public and community facilities and reserve its support until it can be assured by any proponent that institutions like schools, churches, parks and the public interests are satisfied in instances where the
business would like to locate nearby.

“At this point, it does not appear that a producer or processor would require a letter of support from the municipality to accompany their application; however, they may seek one or seek endorsement from nearby dwelling occupants, organizations, etc. in order to bolster their application or to mitigate their assessment as a high risk site.”

Examining potential impacts on the Prince Edward County economy, Davis reports the Ontario government has committed to work with municipalities for the siting of their retail locations for distribution.

In the first round of locations announced in late 2017
there are no locations indicated for Prince Edward County. The closest points of distribution will be Belleville, Oshawa and Kingston. Future locations to be established
by 2021 have yet to be determined by the government.

“It should be noted that cannabis is currently retailed and could potentially continue to be retailed through businesses in Tyendenega. This may not be a legal activity and may not be considered legal in the future according to the Ontario Cannabis Act,” he said. “Currently there are no plans by the Ontario government to legally distribute cannabis in a retail environment in Prince Edward County.”

The greatest impact on the County economy from the introduction, growth and development of this industry, Davis states, will be from the potential location of a cannabis producer or processor in our jurisdiction.

“This could potentially lead to increased property tax assessment from the proposed site and new jobs in the community. The regulations related to licensing and operations are significant from a location, security and access perspective. Businesses involved in either producing or processing cannabis are to remain heavily regulated by Health Canada and secure from the general
public. Only approved employees will be able to access these facilities and based on the site requirements, structures are likely to be secure, industrial style buildings equipped with fencing and video surveillance.”

“The municipality could potentially have little to do with the location of a cannabis facility provided it is located in a zone that would permit this type of industrial activity. In the licensing phase, the business will be required to inform local authorities for policing, fire and municipal government.”