Small Ontario Town’s Economic Roller Coaster Fueled by Chocolate and Cannabis

SMITHS FALLS, ON — A small town in eastern Ontario, once known as the provincial chocolate capital, is preparing for the sweet return of Hershey’s.

“It’s like an old friend coming home after 15 years away,” said Smiths Falls Mayor Shawn Pankow.

This return is the latest in a series of changes around a facility essential to the city’s identity and economic prosperity.

For 45 years.

Hershey’s once operated a factory in the community of about 9,000 people, located about 75 kilometers southwest of Ottawa.

There was a picture of a chocolate bar on the water tower. School groups taking field trips to the capital to see Parliament often sweetened the deal by stopping at the Hershey Visitor Center.

The factory employed around 400 locals, including Richard Kirkwood, who worked there for 35 years.

“It was a good place to work. It paid my mortgage for 30 years,” he said, referring to the family barbecues, Christmas parties and track days the company hosted.

But everything changed in 2007 when Hershey outsourced the work to Mexico and closed shop.

Kirkwood said he was among the last to be laid off, but the suddenness of the shutdown left many people in a bind. “Now I don’t have a paycheck, I don’t buy a new car, I don’t buy a new house. I just buy what I need.

“The town was suffering,” Kirkwood said.

“We’ve seen a decline in our population, a decline in our tax base, a decline in revenue coming into our city,” said Pankow, who was first elected in 2010. “It’s left a real void ( which) it took us a while to recover from. »

The city is also going through an identity crisis.

“It’s like: Who are we now if we’re not the city of Hershey? » Pankow said at the time.

The legalization of recreational cannabis in 2018 caused a brief economic spike after Canopy Growth Corp. moved to 1 Hershey Drive.

Canopy, best known for its Tweed brand, is one of the largest licensed cannabis producers in Canada. Its opening initially attracted tourists from around the world to experience the so-called cannabis capital of Canada.

Tweed made a splash when it opened by hosting an event on August 25, 2018, featuring one of its most famous partners: Snoop Dogg. Sean Lawrence remembers residents watching from their porches as the rapper smoked a blunt, months before the company began selling the cannabis-infused products it made at the factory.

“There was a tremendous amount of hype in the cannabis industry,” said Lawrence, now board president of the Smiths Falls Chamber of Commerce. “I think people thought it was going to get bigger than it actually did.”

But he said strict government regulations on legal producers have hampered the market.

In February, Canopy laid off 800 employees, or about 35 percent of its workforce, and announced it would sell the factory. Tweed will still employ just over 175 people in Smiths Falls, at another facility.

It announced last month that it would sell the
700,000 square foot facility returned to its original owner for approximately
$53 million.

This sets the stage for a reunion, but the chocolatier returns to a very different town from the one he left.

Growth in small businesses, population and housing has made the city less dependent on a single employer, Lawrence said.

“We’ve had a real economic boom in this city,” he said.

Smiths Falls has long experienced boom and bust cycles, dating back to the 19th century.

It was an important transportation hub in eastern Ontario after the construction of the Rideau Ca**l. The waterway connecting Ottawa and Kingston was completed in 1832.

Smiths Falls also saw the rise and decline of steam rail transportation. It was chosen as the regional headquarters for the Canadian Pacific Railway’s main line in 1885, and the Canadian Northern Railway built a second line through the town in 1912.

But this good fortune ended with the rise of diesel engines and cars, dampening the railway repair, maintenance and services sector.

After decades of decline, the town was stabilized with the opening of a center for the developmentally disabled in 1951, which at its peak housed about 2,500 people and employed more than 800.

The facility was abandoned in 2009 and was later named in a cla*s-action lawsuit against two Ontario psychiatric facilities accused of mistreating former residents. Former residents of the Rideau Regional Center in Smiths Falls and the Huronia Regional Center in Orillia settled the case for $32.7 million.

On a recent sunny Wednesday, the heart of the town, Beckwith Street, was bustling, with people stopping at restaurants, cafes and shops.

Some of them are among the 43 new businesses opened in 2021 and 2022, according to the municipality’s business survey.

Between 2016 and 2021, the city’s population grew by more than five percent and median household income increased by nearly eight percent. Unemployment has also fallen.

Municipal tax revenues have increased by about 50 percent over the past eight years, while the average annual increase in the tax rate was about 1.5 percent. Its annual budget this year amounts to $20.5 million.

Pankow said more than 500 new residential units have been developed since the 2021 census data was collected, thanks in part to the urban exodus triggered by the COVID-19 pandemic, which saw city dwellers in Ottawa and Toronto moving into smaller communities.

Lawrence said the sale of the old chocolate factory solidifies recent growth and he believes Hershey’s is back for the long haul.

Although details on the company’s reopening plans are scarce at the moment, optimism about the city’s future has never been higher.

“Let’s get the city moving again and bring the smell of chocolate back into the air,” Kirkwood said.