Could Mississauga lift its ban on cannabis stores? Councillors to vote on move next week

Ontario's largest municipality without any legal cannabis retail stores is set to reconsider its prohibition Wednesday, with a city report highlighting that its residents are "disproportionately" served by the illegal market.

Mississauga opted out of legal cannabis stores during initial rollout in 2018

Spiritleaf Cannabis store at 1200B Wellington West Ottawa.
The provincially-run Ontario Cannabis Store recently lowered prices in a bid to better compete with the illicit market. (Andrew Lee/CBC)

Councillors in Ontario's largest municipality without any legal cannabis retail stores plan to vote next week on whether to end that ban.

Mississauga was one of dozens of municipalities to bar retail cannabis stores from their communities when legalization came into effect in 2018.

Now, four and a half years later, city councillors are discussing a motion from Coun. Dipika Damerla to reverse that, as illegal stores have proliferated.

She says the choice is no longer between no stores and legal stores, it's between illegal stores or legal stores.

Councillors debated a city staff report on the issue on Wednesday, with about half voicing opposition, and decided to put it to a vote at next week's council meeting.

City disproportionately served by illegal market: report

The report says that according to the Ontario Cannabis Store, Mississauga is disproportionately served by the illegal market.

Police have been unable to stop the illegal operators, but the city is preventing legal operators from setting up shop — a situation Damerla says is untenable.

Mississauga ward 7 Coun. Dipika Damerla is pictured at city hall.
Coun. Dipika Damerla introduced the motion for the city to reconsider its ban on retail cannabis stores. (Sara Jabakhanji/CBC)

A National Research Council of Canada study found "great inconsistency" in the amount of THC in illegal cannabis edibles and "dangerously high levels of pesticides."

The Ontario Cannabis Store, the province's wholesaler for legal retailers, reports that the legal market has been steadily growing since 2018 and eating into illegal business. More than 50 per cent of cannabis sales are now through the legal market, the OCS reports.

"According to the OCS, Mississauga continues to be disproportionately served by the illegal market, compared to communities that have 'opted in,"' the Mississauga staff report says.

In Damerla's ward, police have tried six times to shut down one illegal cannabis store, but the operators just show up the next day, cut the chains off and open as usual, she said.

"So we have a situation where the long arm of the law is unable to stop the illegal guy," she said. "Meanwhile, I am stopping the legal guys — not a tenable situation."

'Gold rush' mentality has passed: advocate 

One of Mississauga's concerns in 2018 was around a desire to avoid "clustering," or having several stores in one block, Damerla said.

But city staff canvassed neighbouring municipalities with legal cannabis and found that wasn't a huge concern there. Even in Toronto, the OCS reports that there were fewer stores permitted to open in March 2023 than in May 2021.

"I think Mississauga was well served by taking the wait-and-see approach because we sort of bypass the whole clustering of stores and then some of them shutting down," Damerla said.

"We bypassed that because now the market's mature, they're sort of aware of the risks of clustering."

George Smitherman, president and CEO of the Cannabis Council of Canada, which represents licensed producers and processors, said the "gold rush" mentality of the early days of legalization has dissipated.

"Part of the stabilization of the sector, in a certain sense, is more of a stark realism about the realities of the business," he said in an interview.

"I think that this, in a certain sense, will temper the enthusiasms of retail store proponents. That's quite different than the environment of four or five years ago."