Published in the Hill Times, Wednesday, January 16, 2019
Legalizing non-medical cannabis has been a significant challenge for every order of government. Municipalities’ practical experience with legalization also underscores the need to modernize how governments work together to benefit the Canadians we all serve.
This is a big national commitment. And big national commitments often require extensive local implementation. When Ottawa commits to generate growth by investing in infrastructure, municipalities are the ones driving projects forward. To boost Canada’s climate resilience, municipalities are the ones building seawalls, managing complex watersheds, mitigating fire risks and more. With cannabis legalization, it was always going to fall to municipalities to keep people safe and well served.
My organization, the Federation of Canadian Municipalities (FCM), represents local governments serving 90 percent of the population. We’re the governments closest to daily life, so when legalization appeared on the horizon, residents naturally turned to us. What will legalization mean for our neighbourhoods? Will retail facilities be kept away from parks and schools? How will we keep our roads safe?
Ultimately, implementing legalization has reverberated across as many as 17 municipal functions, from land use regulation to business licensing to fire prevention. We’ve been preparing the bulk of Canada’s police forces to promote and enforce new cannabis rules. And municipalities have done tremendous work to be ready, despite having no full seat at the table alongside provincial and federal officials. From early days, many of us were speculatively upgrading by-laws as regulatory frameworks were developed without us—and with no clarity on how municipalities would be able to absorb major new administrative and enforcement costs.
In December 2017, FCM released preliminary estimates projecting municipalities’ new annual costs related to cannabis at $3-4.75 million per 500,000 residents. For communities nationwide, that’s $210-335 million annually to ensure legalization succeeds long-term. To its credit, the federal government responded by retooling the revenue-sharing model for the excise tax on cannabis sales. From a 50/50 federal/provincial split, the provincial share grew to 75 percent, specifically to support municipal costs.
Yet more than a year later, only a handful of provinces have announced plans to flow funds to municipalities. Some provinces have even said that they plan to share nothing at all. Similarly, most municipalities are still seeking clarity on the 2017 federal commitment to flow $81 million over five years through provinces to support police capacity to tackle challenges like drug-impaired driving.
FCM is calling for continued federal leadership to ensure municipalities have the financial tools to fully implement this federal cannabis policy. This is why FCM worked hard to get this issue onto the agenda when Canada’s First Ministers met in Montreal on December 7. And we’ll be looking for solutions when governments sit down to review revenue sharing this spring—something the Prime Minister committed to lead within six months of legalization.
Meanwhile, there are big-picture lessons to take away from the municipal frontlines.
First, for national initiatives of any significant scale, local financial tools should be factored in from Day One. Municipalities have the expertise and drive to deliver on major national objectives. But at least until Canada’s fiscal arrangements change, municipalities forced to rely on the regressive property tax simply don’t have the financial flexibility to absorb major new costs.
Most fundamentally, Canadians expect all of their governments to work together to make their lives better. Their frontline municipal leaders should be at the planning table for nationwide initiatives like cannabis legalization. Our insight into local realities can strengthen any plan that touches Canadians’ lives—and involving municipalities early gives us the knowledge we need to deliver efficiently.
In recent years, we’ve seen unprecedented federal-municipal engagement in shaping a historic infrastructure plan and national housing strategy. It’s time to build on that precedent by modernizing the relationship among orders of government. That’s why modernization is the centrepiece of FCM’s recent recommendations for the upcoming federal budget. As a next step, we’re calling for a new intergovernmental forum to tackle key national challenges together—such as the implementation of major national policies like cannabis legalization.
In short, it’s time to put more of our trust in everyday Canadians by empowering the governments closest to where they live, work and raise their families.
Vicky-May Hamm is Mayor of the City of Magog, QC, and President of the Federation of Canadian Municipalities (FCM). FCM is the national voice of local government, representing 2,000 cities and communities of all sizes serving 90 per cent of all Canadians.