Sky-high licensing fees for Vancouver retail pot shops up for debate

VANCOUVER (NEWS 1130) – Every year, Vancouver’s cannabis retailers cut the city cheques for $34,000. It’s one of the largest municipal business license fees in the nation.

But that may soon change if one councillor’s motion, being tabled Tuesday, makes its way through city hall.

Councilor Rebecca Bligh is aiming to bring pot shop licensing fees more in line with Victoria’s, where they pay $5,000 a year plus a one-time $7,500 rezoning fee.

She said right now, it’s more expensive to license a cannabis store in Vancouver than to license the PNE.

“The fees [in Vancouver] right now are in excess of $34,000. The next-highest fee to that would be the annual business license fee for the entire PNE operation at $18,000. And even the local horsetrack’s annual business license fee sits around $13,000. As you can see, it’s $21,000 higher on an annual recurring basis than businesses that we would suspect ought to be far more complicated in how they function than one individual retail store with a handful of employees,” she said.

“All they’re asking for is a fair shake,” Jaclynn Pehota with the Association of Canadian Cannabis Retailers (ACCRES) said. “They’re not asking for special treatment here. They’re just asking for a reasonable alignment of their business licensing fees.”

ACCRES’ members include major local players like Muse and City Cannabis.

Pehota doesn’t feel the current fee structure is fair.

“It also strikes me as unjustifiable,” she said. “We have been making inquiries to the City of Vancouver, asking for a breakdown of where that [money] is going. Business licensing fees are supposed to be an exercise in cost recovery. They’re not supposed to be an exercise in revenue, from the city’s perspective.”

Bligh’s motion also seeks to eliminate an additional security screening that all pot shop employees have to pay for. She argues it’s an unnecessary burden on people who often make minimum wage.

“We’ll still have a criminal record check, but the extra layer of verification that is unique to the cannabis industry … that does not exist in a liquor retail industry feels more punitive and stigmatizing around the cannabis industry itself,” she said.

Jeremy Jacob with Village Bloomery Cannabis Store said shops like his “are not the license to print money” many think they are, telling us the current license fees are a huge hit.

“As a small business operating under regulation, we’ve seen our wholesale costs increase and then our retail margins decrease. And our consumer buy-in in B.C. is the lowest per capita in Canada,” he claimed. “Many small retailers are facing layoffs and letting staff go, and then the next day or next week or whatever, writing a cheque for $35,000.”

He’s happy Bligh is proposing a new fee structure, which would bring costs more akin to those associated with operating a liquor store.

“We need employment. We’re in a recession, we’re in a pandemic. And the license fees are counter to the goals of developing the sector,” Jacob said.

-With files from Lasia Kretzel