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John Horgan suggests dispensaries make B.C. well-positioned for marijuana legalization

B.C. Premier John Horgan speaks to reporters following a meeting of the first ministers in Ottawa on Tuesday.

Justin Tang/The Canadian Press

Premier John Horgan has hinted again that British Columbia's growing number of illegal marijuana dispensaries could have a role to play when recreational use of the drug is made legal next summer.

Mr. Horgan, who in the past has voiced support for bringing existing operators on board, seemed to suggest on Tuesday that B.C.'s robust marijuana industry means the province is already well-positioned to begin legal retail sales by the federal government's July 1 target.

"We have, in some parts of the Lower Mainland, more dispensaries than we do Starbucks," the Premier told reporters in Ottawa as he headed into a meeting of first ministers.

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"We are well-advanced in terms of the retail elements of this. The challenges, of course, are on regulation and distribution in a more thoughtful way."

Mr. Horgan's comment comes as provinces and territories scramble to sort out the details of what legalization will look like, as Ottawa has left the contentious issues of regulating wholesale distribution and retail to them.

Some jurisdictions, as well as police forces, have asked for the date to be pushed back.

Ontario became the first province to issue its plan last month, announcing that the province would launch a monopoly of cannabis stores as a subsidiary of the Liquor Control Board of Ontario – 40 next year and 150 by 2020 – in a move that would effectively end private dispensaries.

"Let me be clear: These pot dispensaries are illegal and will be shut down," Ontario Attorney-General Yasir Naqvi told reporters. "If you operate one of these facilities, consider yourself on notice."

Alberta has not yet issued its plan. Calgary city staff have recommended the province set up a private retail system similar to that of liquor stores.

Since the election campaign this spring, Mr. Horgan has been open to the idea of various distribution models, including selling marijuana in government-run liquor stores, private beer and wine stores, pharmacies and existing dispensaries.

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Mike Farnworth, Minister of Public Safety and Solicitor-General, said on Tuesday that the province had not yet decided on a retail model, but that "all options are under discussion."

A consultation process, which launched Sept. 25 and runs until the beginning of November, aims to garner feedback from the public on issues such as distribution and retail models, minimum age and drug-impaired driving.

Should B.C. allow private dispensaries, it would still have to address the issue of supply.

Provinces will likely be required to have a seed-to-sale tracking system – to monitor the movement of cannabis plants, prevent diversion and enable product recalls – but the province has not yet determined what that will look like.

To date, Health Canada has approved 62 licences to commercial producers within the legal, mail-order medical-marijuana system.

Dispensaries currently get their supply from illegal sources, though some of these supplies have operated for decades.

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Dana Larsen, director of the Vancouver Dispensary Society and a long-time marijuana activist, said dispensaries' current suppliers need to be brought into the legal system, whose requirements – such as costly indoor cultivation – can pose significant barriers for smaller producers.

A federal task-force report guiding the government's legalization push noted merits of both a government-run model and a private-enterprise model.

"Either model could achieve the goals of protecting public health and safety, reducing the illicit market and controlling youth access," the report stated. "Ultimately, the task force believes that this decision rests with individual jurisdictions, but regardless of the model chosen, we believe that certain standards should be put in place and followed."

The report encouraged a "diverse, competitive market that also includes small producers," referred to as "craft" or "artisanal" producers, which would prevent the development of monopolies or large conglomerates.

Also on Tuesday, Prime Minister Justin Trudeau proposed an excise tax of $1 a gram on up to $10 of legal marijuana, and 10 per cent on prices over $10 – something the provinces took issue with.

"That's not something we had contemplated before," Mr. Horgan said. "I believe provinces are concerned there are a lot of costs being imposed on us – in terms of distribution, in terms of regulation, in terms of making sure the distribution chain is free from criminal element, and so on – but now we're going to have to share whatever modest revenue there might be?" Mr. Trudeau said the federal government is open to discussions on the matter.

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