Whitehorse Daily Star

Cannabis merchant upset with regulatory delay

A private retailer hoping to secure a cannabis licence is frustrated with what he calls a slow and delayed process – paired with a lack of communication from the licensing board.

By Palak Mangat on June 3, 2019

A private retailer hoping to secure a cannabis licence is frustrated with what he calls a slow and delayed process – paired with a lack of communication from the licensing board.

After submitting his application to open up a site at 204 Main St. more than two months ago, John, with Ninetails Cannabis Inc., spoke to the Star about his concerns in late May.

He preferred not to provide his last name until if and when his venture is approved, but explained he is the face behind the endeavour.

Ninetails submitted its application to the cannabis licensing board set up by the Yukon government earlier this year.

This independent, five-person board has the sole authority to approve licences, determine the conditions and hold hearings related to an application.

Nobody from the board was available to speak with the Star for this story.

John submitted his application to the board via the Yukon Liquor Corp. (YLC) on March 29, and it was deemed as complete on April 5. He received notice it would be going out for the four-week public notice period, which came to an end on May 6.

“I was also notified that I had received no complaints in relation to my application and that the YLC had identified no issues with the application in their analysis,” he wrote.

John added he was told that the following day, on May 7, is when the board had met to review the application.

But now, in early June and nearly four weeks after that May 7 meeting, he still has no licence to show for it. That has left him feeling frustrated.

“This is less timely than I’m used to,” he told the Star last Thursday. “It’s unclear as to why I don’t have a result on the licence yet.”

He believed Ninetails is the only application before the board and past its public notice period, but a YLC webpage shows two others are vying for a licence.

Dawson City Cannabis’ objection period will end June 24.

Meanwhile, 45006 Yukon Inc. (Andrea’s Hotel) will have its objection period run until June 28.

“A certain precedent was set with Triple J’s (Canna Space in Whitehorse); there is a particular timeline – that’s my frame of reference,” John said.

Triple J’s Canna Space was the Yukon’s first private retailer to be granted a licence in mid-April. From the time of submitting its application to the board (Feb. 20) to being granted a licence (April 17), eight weeks passed.

But that process came complete with a public hearing being triggered after one objection came forth during the public notice period.

For John, eight weeks from the submission of his application on March 29 took him to May 24. But he still doesn’t have a clear idea of when he’ll receive an answer.

With the assumption that no objection means no need for a public hearing to address that objection, John has been left wondering why he hadn’t received his licence shortly after the board met May 7.

He’s asked multiple times for an update as to the status of his application.

“In consideration of the fact they received no objections, it didn’t necessitate a hearing – you think that would facilitate a speedy conclusion,” he said.

“It does beg the question if some applicants are getting special treatment relative to others,” John added, noting “it’s no secret Triple J’s was very vocal.”

The first private retailer, Triple J’s had publicly said it hoped to be open before April 20 (also known as 4/20).

While it did achieve that goal, it had said on its Facebook page that it would be ready to serve customers on April 17 – before it had officially secured its licence.

That permit came on April 17, but the Wood Street store wasn’t able to open its doors to customers until the next day.

“Here we are with what appears to be an application with no issues – I can’t even get a little bit of information on where I am in the application process,” John said.

On top of not physically having a licence in his hands, he felt he has been stonewalled by the process in not being given a clear answer on a decision timeline. He believes this will cost him, given that his lease on the site starts this month.

“The business in there (a shoe store) is closing down, it affects their plans – the landlord gets increasingly frustrated, they’re looking for a tenant, whether it’s me or anybody else,” he added.

With the busy summer construction season coming up, he is concerned it could be harder to get a hold of talent or products.

“This has very material costs; it raises the costs of bringing the project in and changes timelines.”

John noted he’s also been able to attract investors from outside the territory and other parts of the country, something he fears could be impacted.

“I’m still hopeful – I don’t think they’re (the board) not going to bring the application to a conclusion,” he said.

“I guess at this point I’m upset and frustrated that it’s at a point that is immediately in front of its inevitable result.

“I have investing partners who pulled together a nice pool of cash,” he added.

They may have thought the territory is “not a destination to make an investment, and I’ve managed to convince them that’s maybe not true,” he added.

That could be at risk if the clock keeps ticking and he remains without a licence.

“We’ve had preliminary conversations that if we don’t get a result soon, maybe we’ll take our resources and we’ll shop them to another jurisdiction and focus there – that’s a very real possibility for us.”

The group had also hoped for a summer opening – prime revenue-making time.

That could line up nicely with the busy tourist season. (Figures show visitors creep into the 100,000 range in peak months of July and August, as opposed to roughly 3,000 to 4,000 people in January and February.)

He recalled his application may have referenced a July opening, “but there’s no way we’re going to get there at this point in time.

“If we can pull everything together – early August? Even that may not work,” he said of how soon it could open now.

“If we open in September or October, we’ve missed out on the most profitable season and basically have to start the business in its most vulnerable phase through the low season.”

As for what comes next, John is hopeful – but his patience is running thin.

“Professional services, legal and accounting services, or ordering products – all of that stuff takes a certain amount of time,” he said.

While it’s too early to tell if there could be any legal recourse at this stage, he has wondered if writing to the board “with the support of a lawyer (could be) a bit more effective.

“It’s not something I anticipated to happen; I didn’t think there’d be such a lengthy delay,” he said.

“I’m not naive about the fact that I may not get a licence – I accept that’s a possible outcome, but I would be very surprised,” he added.

So far, John has avoided trying to set a timeline for himself, instead opting to take it one week at a time.

But setting up rules around timeliness, rather than simply hoping the board takes it into account in good faith, could go a long way in easing headaches for future applicants, he added.

“It needs to be established if they’re not going to do it voluntarily,” he said, frustrated that there was also an “exorbitant licensing fee” being charged.”

(The initial application fee is $2,050, officials told media at a briefing earlier this year that detailed possible retail models.)

“You’d think, as an applicant, that entitles you to basic information and a basic level of service – that doesn’t appear to be the case.”

Despite his frustrations with the process, John does commend the YLC for its patience and co-operation in co-ordinating matters between himself and the board.

Comments (8)

Up 3 Down 0

Moe on Jun 8, 2019 at 1:29 pm

@Moe
Thanks for the list Moe.

I notice everyone of these people are liberals. Sloan was in Duncan's government, Farynowski ran for the Liberal banner during that period for Kluane, and the other three are members at large.

So there you have it - no pork bellying here...

Up 23 Down 4

Darrell Drugstore's smartest neighbour on Jun 4, 2019 at 3:46 pm

Has there ever been a worse group of whiners than cannabis merchants ?

And why do they get Soooo much press coverage ?

Up 5 Down 0

Bob on Jun 4, 2019 at 1:52 pm

Here's who is on the Cannabis licensing board http://www.eco.gov.yk.ca/cannabis-licensing-board.html

Up 4 Down 0

moe on Jun 4, 2019 at 12:48 pm

To answer Yukon Max's question, it is no secret who sits on boards in the Yukon. I'm not sure what you are trying to get at. The cannabis licensing board members are:

Sloan, David Member and Chair 01/17/2019

Leonard, Mieke Member and Vice Chair 01/17/2019

Borgford, Shari Member 01/17/2019

Lindsay, James Member 01/17/2019

Farynowski, John Member 01/17/2019

Up 19 Down 4

moe on Jun 4, 2019 at 12:42 pm

'John', who doesn't want to identify himself, says he and his 'out of the territory investors who have put together a nice pool of cash', may very well take their money and go elsewhere if they don't get their approval quickly.

I agree that it is ridiculous that the government is taking more than 8 weeks to process and approve a license that has zero objections and which presumably meets all the bylaw requirements. I would imagine there are federal background checks that also have to be approved for the investors and for John, so that might be what is holding it up.

But aside from that, the secretive nature of this application, the identity of the owner and his investors, and his and their willingness to up and leave for easier pastures, is not at all indicative of someone committed to this territory. I am very curious to see who this person is, and it has left me curious about his 'investors' as well.

Up 16 Down 1

Yukonmax on Jun 4, 2019 at 6:59 am

Gotta check who sits on that board...Why don't you all do the same.

Up 12 Down 4

Woodcutter on Jun 3, 2019 at 6:25 pm

lol - sounds like trying to get a cutting permit.

Up 33 Down 3

Mick on Jun 3, 2019 at 3:40 pm

I liked it better when the dealers were just dealers rather than a bunch of entitled self absorbed whiners.

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