Pot purgatory: Why 4 ready-to-open Sask. cannabis stores are in a holding pattern

Pot purgatory: Why 4 ready-to-open Sask. cannabis stores are in a holding pattern

At least four Saskatchewan cannabis stores haven't opened yet because the province's liquor and gaming authority (SLGA) hasn't finished screening the would-be owners.

"I am in the unfortunate position of holding three lottery picks but no licence yet," said Jean Paul Lim, a doctor and teacher of internal medicine at the University of British Columbia.

In June 2018, Lim's numbered company — incorporated in B.C. only two months before — won the chance at running cannabis stores in Melfort, Outlook and Rosetown.  

That's all it remains nearly a year later — a chance — because in order to officially obtain the licence to operate the stores legally, Lim must first come out of the other end of what he calls SLGA's "due diligence" screening process.

That process vets potential store operators to ensure, for example, they have a system that will properly account for all the cannabis they'll handle.

"I have no idea when I can open," said Lim via email Wednesday. "Two of my three sites are already completely built out and the third is about 75-per-cent complete and on hold until I rectify the SLGA situation."

Money invested, staff hired

Lim said he's now invested "hundreds of thousands of dollars" into the sites and is afraid of losing them.

"I am not in the driver's seat at this time," he said. 

Under the rules set out by the province, stores must open by October 17 of this year — the one-year anniversary of when recreational cannabis became legal in Canada.

David Morris, an SLGA spokesperson, said via email Wednesday that If a store doesn't open within that timeframe, the opportunity may go to the runner-up that was drawn for that community.

"If the runner-up were not interested then SLGA would need to consider other options. At this point, it's speculative to say what may or may not happen in hypothetical situations," Morris said.

"The proponents that have not yet received their permit continue to move through the process. SLGA continues to work with these businesses to ensure all of the requirements necessary for obtaining a cannabis retail permit are achieved."

Morris said that permit applications are considered private information, meaning SLGA won't provide details about the status of a specific permit application, but that SLGA anticipates several stores will open "in the coming weeks." 

Nipawin store waiting, too 

Licensed shops have opened in 29 of the 51 locations approved to have a cannabis store in the province.

A planned shop in Nipawin has yet to open. As with Lim's locations, the store is ready to open. It has already hired two staff members.

Two partnering companies won the Nipawin slot: majority partner GreenTec Holdings, a B.C.-based cannabis grower and seller, and minority partner Battlefords Agency Tribal Chiefs (BATC) Investments LP.

BATC's members include Ahtahkakoop Cree Nation, Moosomin First Nation, Red Pheasant Cree Nation, Sweetgrass First Nation, Stoney Knoll First Nation, Saulteaux First Nation and Mosquito-Grizzly Bear's Head-Lean Man First Nation.

"We are still waiting for the SLGA to clear us in the security screening process," Shannon Forgues, GTEC Holdings' retail manager, said via email Wednesday. "Our store is built out and staff have been hired."

The companies filed their permit application shortly after the lottery winners were announced in June 2018. 

SLGA good to work with: company

In a subsequent interview, Forgues and GTEC's chief operating officer, David Lynn, stressed that they don't fault SLGA. They said SLGA has been very good to work with compared to other groups and it's got a lot of paperwork to wade through.

Between GTEC and BATC, the SLGA has to do background checks on 16 board members, Lynn said.

"Let's say you were an individual entrepreneur and you were successful in this lottery — the amount of paperwork I think would be significantly less because we had to submit background checks for each board member," Lynn said.

Still, Lynn wondered whether the holdup isn't getting in the way of one of the federal government's stated reasons for legalizing cannabis.

"There is a real interesting irony to all this. The paperwork and the timelines are one of the reasons that the black market is still relatively strong," he said.

"If you don't open up the legal stores, if you don't provide a legal alternative to people, then a lot of them are going to go back to their previous source."