Plans for a government-run store ready to sell cannabis in the territory in time for legalization may be in trouble because the cost of a retail and warhouse location is turning out to be more than projected. (pe3check/123RF)

Yukon’s government-run pot store might not be ready in time for legalization

Only bid for retail space comes in at $3.4M — more than YG’s entire startup budget

Plans for a government-run store ready to sell cannabis in the territory in time for legalization may already be in jeopardy.

Yukon Liquor Corporation officials say the only bid to sell a store location in Whitehorse came in over budget.

Now the government is “evaluating all their options since the price was higher than anticipated,” said spokesperson Patch Groenewegen.

The only bid that came in to become the location of the Yukon government’s new cannabis retail store and warehouse was submitted by Waterstone Products, which has a storefront on Quartz Road. The purchase price came in at $3.4 million, according to the government’s tender management website.

That price tag is more than the entire startup budget for cannabis sales in the 2018-19 territorial budget.

The liquor corporation’s budget only includes $3 million to cover start-up costs associated with the legalization of cannabis. That’s supposed to cover the cost to purchase inventory and train staff as well as potential facility costs, according to the corporation.

Groenewegen couldn’t say what portion of that money was supposed to pay for the building. The government’s original request for proposals was looking for space to either lease or buy.

“It was anticipated that the start-up funding would cover the costs in a lease scenario, or for (a) smaller size facility, which we sought through the RFP process (4,500 square feet),” she clarified in a later email.

The original request for proposals set the minimum square footage for a location at approximately 4,500 square feet or 415 square metres. It did not set a maximum size.

The only bid was for “a much bigger facility,” making costs “higher than anticipated,” she said.

If the government does have to buy a building, it could already be blowing its budget before the document has even been passed by the legislative assembly.

“If the Yukon government proceeds with the purchase of a new cannabis facility, we would need to seek additional funding to be captured in a future supplementary budget,” the email said.

Last year Premier Sandy Silver said Yukon would have a physical location to buy cannabis in time for legalization. That was originally supposed to be by July though Ottawa now says it likely won’t happen before August or September.

Yukon officials have always been working under a tight deadline. The original request for proposals, which closed at the end of February, said the space had to be ready on or before May 29.

For now the government will only say it is “evaluating our options and next steps” and that “details of the operating model will be shared in the coming weeks.”

In an earlier interview Groenewegen agreed it was possible the store wouldn’t be ready in time for legalization.

“We remain confident that Yukon consumers will have legal access to non-medical cannabis once legalized in Yukon and Canada,” she said in her later email.

The Yukon has been planning for online sales along with a physical location.

The option for private retailers is also something that has been promised for the future.

Recent zoning amendments passed by Whitehorse city council mean that the government can only locate its store in the Marwell neighbourhood.

John Streicker, the minister responsible for the liquor corporation has previously said territorial government was fine with the the city’s restrictions.

Groenewegen said the government did a scan of properties in Marwell and were “hopeful” that property owners in the area would bid.

She said the government’s request for proposals met procurement standards.

Contact Ashley Joannou at ashleyj@yukon-news.com

Legalized MarijuanaYukon government

Just Posted

Whether the dust jacket of this historical novel is the Canadian version (left) or the American (right), the readable content within is the same. (Michael Gates)
History Hunter: New novel a gripping account of the gold rush

Stampede: Gold Fever and Disaster in the Klondike is an ‘enjoyable and readable’ account of history

XX
WYATT’S WORLD

Wyatt’s World for May 14, 2021.… Continue reading

Copies of the revised 2021-22 budget documents tabled in the legislature on May 14. (Haley Ritchie/Yukon News)
Liberals introduce new budget with universal dental and safe supply funding

The new items were added to secure the support of the NDP.

Community Services Minister Richard Mostyn speaks to reporters on May 13. (Haley Ritchie/Yukon News)
Cap on rent increases will take effect May 15

The rollout of the policy is creating ‘chaos,’ says opposition

Yukon News file
A 21-year-old man is in custody after a stabbing in Porter Creek on May 14.
One man in hospital, another in custody, after alleged stabbing in Porter Creek

A police dog was used to track the suspect who was later arrested in a wooded area.

Safe at home office in Whitehorse on May 10, 2021. (John Tonin/Yukon News)
Federal government provides $1.6 million for Yukon anti-homelessness work

Projects including five mobile homes for small communities received funding.

Drilling at Northern Tiger’s 3Ace gold project in 2011. Randi Newton argues that mining in the territory can be reshaped. (Yukon government/file)
Editorial: There’s momentum for mining reform

CPAWS’ Randi Newton argues that the territory’s mining legislations need a substantial overhaul

At its May 10 meeting, Whitehorse city council approved the subdivision for the Kwanlin Dün First Nation’s business park planned in Marwell. (Submitted)
KDFN business park subdivision approved

Will mean more commercial industrial land available in Whitehorse

Main Street in Whitehorse on May 4. Whitehorse city council has passed the first two readings of a bylaw to allow pop-up patios in city parking spaces. Third reading will come forward later in May. (Stephanie Waddell/Yukon News)
Whitehorse council pursuing restaurant patio possibilities

Council passes first two readings for new patio bylaw

Neil Hartling, the Tourism Industry Association of the Yukon president, left, said the new self-isolation guidelines for the Yukon are a ‘ray of hope’ for tourism operators. (Ian Stewart/Yukon News file)
Yukon tourism operators prepared for ‘very poor summer’ even with relaxed border rules

Toursim industry responds to new guidelines allowing fully vaccinated individuals to skip mandatory self-isolation.

A lawsuit has been filed detailing the resignation of a former Yukon government mine engineer. (Joel Krahn/Yukon News file)
A year after resigning, former chief mine engineer sues Yukon government

Paul Christman alleges a hostile work environment and circumvention of his authority led him to quit

Former Liberal MLA Pauline Frost speaks to reporters outside the courthouse on April 19. One of the voters accused of casting an invalid vote has been granted intervenor status in the lawsuit Frost filed last month. (Haley Ritchie/Yukon News)
Voters named in Pauline Frost election lawsuit ask to join court proceedings

The judge granted Christopher Schafer intervenor status

Most Read