The impending legalization of cannabis has sparked a formal effort in Manitoba to determine how marijuana ought to be regulated and sold.
In Monday’s throne speech, the Selinger government said Manitoba’s Liquor & Gaming Authority and Manitoba Liquor & Lotteries "will be well positioned to regulate the sale and distribution of marijuana in a safe and socially responsible manner" once Justin Trudeau’s Liberals make it legal to light up.
On Dec. 3, when the Trudeau government issues its own throne speech, Canada’s provinces and territories expect to receive direction to help them plan for the not-so-distant future when consumers can buy a bag of weed on the up and up.
That planning effort is already underway in Manitoba, where the Liquor & Gaming Authority expects to serve as a marijuana regulator.
"We’re waiting for Ottawa to make some decisions on what our foundation will be," said chief administrative officer Elizabeth Stephenson.
She said agencies like her own can use lessons learned from the legalization of liquor and gambling to handle the transition of cannabis from an illicit substance to a legal, controlled product.
"With both liquor and gambling, society evolved to a certain extent," she said. "This is going to be an interesting challenge."
Even before Ottawa changes legislation governing cannabis, Liquor & Gaming is looking at Colorado and Washington, the first two states to legalize cannabis, to see what regulatory practices it may wish to adopt or avoid.
Manitoba Liquor & Lotteries is also looking at the U.S. experience – as well as that in Vancouver, where so-called medical dispensaries have proliferated – even though it’s unclear how it will proceed.
Liquor & Lotteries could serve as a cannabis distributor, as a retailer or perform both roles – either on its own, or alongside private marijuana dispensaries.
"I don’t know what the model will be, but intuitively, based on the fact we currently retail a controlled substance used only by adults, I think we’re in a good position to be a lead on the discussion," Liquor & Lotteries CEO John Stinson said.
"Would it fit into our existing retail model? I’m not sure it would. I’m not sure my mom, who’s 92, when she goes to the liquor store to purchase her bottle of Blue Nun, wants to be next to the guy buying Jamaican gold."
Stinson is only partly joking. While cannabis consumption is widespread, it’s not as deeply woven into Canadian society as alcohol is at this moment. Hence the questions about the best retail model for cannabis, which is sold entirely through private-sector retailers in Colorado, Washington and Oregon.
"We haven’t seen much of a government-run retail model anywhere in the U.S.," said Taylor West, deputy director of the Denver-based National Cannabis Industry Association.
"The thing to consider is whether a government-run store is going to be able to respond to market demands. If there isn’t a wide variety of products, you could drive demand underground."
One of the chief aims of cannabis legalization is to eliminate a revenue stream for organized criminal gangs. Legalization is also expected to free up some police resources and provide governments with new tax revenue.
The profit motive alone, however, should not dictate Manitoba decisions about cannabis retailing, said Stinson, who points to U.S. research that suggests marijuana legalization has had some negative mental-health consequences for younger men.
"I think we need to approach this, at least initially, quite cautiously," he said, adding Liquor & Lotteries could also be tasked with handling marijuana-infused booze, cannabis vape cartridges or other products containing THC and cannabidiol, two of the active ingredients in marijuana.
The Canadian Taxpayers Federation, meanwhile, believes Manitoba should leave the sale of cannabis to the private sector.
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"Governments aren’t very good at selling liquor, so I’d be cautious about doubling down with another substance," said prairie director Todd MacKay in Regina, where the Brad Wall government plans to private Saskatchewan liquor sales.
"Is it better to have a government employee selling it rather than a well-regulated private-sector retailer? I’d argue no."
While legislation making cannabis legal in Canada is coming, actual sales are not expected for another two years, said Stinson, adding this will give Ottawa and the provinces time to come up with regulations and sales practices.
"There are no closed doors. We’re entering new territory," said Ron Lemieux, the Manitoba minister responsible for Liquor & Lotteries, who nonetheless said Colorado and Washington are "probably envious" of Manitoba’s existing capacity to regulate and sell cannabis. "I won’t give you any puns on how high I am on our throne speech."
In the western hemisphere, Uruguay appears to be the only jurisdiction where a government sells cannabis.
Liquor & Gaming Authority: This provincial agency issues licenses that allow establishments to sell alcohol and conduct gambling. It also inspects these places and can mete out fines and suspensions. Once cannabis is legal, it likely will be tasked with developing a regulatory framework and issuing licenses to sell marijuana.
Manitoba Liquor & Lotteries: This Crown corporation distributes and sells alcohol and operates casinos. When marijuana becomes legal, it’s unclear whether it will serve as a distributor, a retailer or both – either alone or alongside private-sector retailers.