The once-struggling town of Smiths Falls, Ont., took a chance on the marijuana industry, and it paid off with the establishment of Canopy Growth Corp. Now the town is betting on luxury canal boat rentals to attract international tourists.

Millions of taxpayer dollars helped sweeten the deal.

Le Boat — a United Kingdom-based yacht company — has a strong track record in Europe with hundreds of boats on waterways in countries including France, Italy and Holland.

Basically it's a condo on water. — Sandy Crothers , Le Boat

"Basically it's a condo on water," said Sandy Crothers, the base manager of Le Boat in Smiths Falls.

The Ontario government is directly investing $2 million and Le Boat is also benefiting from roughly $3.6 million in federal government work that was already going ahead on the Rideau Canal.

Critics are upset public money is being used to help a private enterprise.

"I'm flabbergasted at the amount of money that is involved with this in terms of the amount of jobs it will produce," said landlord and resident Brad Milne. "I just don't see the value in it."

But the mayor of Smiths Falls said it's a way to put the town on the map internationally, and he expects a payoff in tourism dollars and spinoff businesses.

Public funding is helping with a marketing campaign to promote the Rideau Canal to an international market. (Ashley Burke/CBC)

'If you don't build them, they won't come'

Several years ago, all three levels of government started courting Le Boat after officials heard the company was looking to expand to North America. The Rideau Canal, a UNESCO World Heritage site, seemed like a perfect site.

All levels of government then offered Le Boat incentives, including financial help shipping boats overseas, upgrades to the basin where Le Boat will operate, and new docks along the canal in Smiths Falls.

Cyril Cooper, the town's manager of economic development, makes no apologies for this outlay of money. He said governments "worked together to hook" Le Boat and if they didn't offer a "certain level of comfort," the company would have chosen somewhere else.

"If you don't build them, they won't come," said Cooper about the docks the municipality helped pay for. "Let's face it, they're here to support the community and that's important. But at the end of the day, they're here to make money. We have to make sure they are able to survive."

Cyril Cooper, Smiths Falls' economic development manager, said Le Boat launching in Smiths Falls is 'huge. What it means is tourism, and tourists spend dollars.' (Ashley Burke/CBC )

Putting Smiths Falls on the map

Le Boat is investing $16 million itself to launch its operations in Smiths Falls when the Rideau Canal opens for the season in May. The company has already shipped 16 Horizon cruisers worth more than $250,000 each. Depending on the model, the boats can sleep up to 10 people.

Prices range from $1,398 for shorter, four-night hops to Perth or Merrickville. For larger boats, prices can be as much as $13,078 for 10 days to Ottawa or $16,030 for a two-week sojourn to Kingston.

Vacationers rent the boats and are taught how to drive, then spend their trip cruising waterways and exploring communities. Le Boat's vessels are equipped with beds, bathrooms and kitchens.

"We're already 60 per cent sold out for the season," said Lisa McLean, Le Boat's marketing manager for Canada. "Literally, tourists from around the world are booking to see the Rideau Canal."

The bulk of the tourists are from the United States and Europe, but some are travelling from as far away as South Africa and New Zealand.

Sandy Crothers, base manager of Le Boat in Smiths Falls, said the plan is to double the number of boats in the next three to five years. (Ashley Burke/CBC )

Spinoff businesses

The town expects a "significant" return on investment in tourism dollars.

"It's an opportunity for us to hit the global tourism stage in a way we never did before," said Smiths Falls Mayor Shawn Pankow.

Spinoff businesses are starting to pop up, including a canoe and kayak rental company. Shuttles and taxis are needed to transport tourists from Ottawa to Smiths Falls.

Brian Paquette, the owner of Café Whim, is hoping to prepare gourmet meals and floating canteens for tourists.

"I've done all the catering for their events so far," said Paquette. "We have a really good connection … I look forward to a long relationship with them."

The Smiths Falls and District Chamber of Commerce hopes Le Boat's customers will get off their boats and spend money in town.

"Walk into our town, eat at our restaurants, shop at our stores and just really enjoy everything our town has to offer," said Becky Allen, the chamber's executive director.

Lisa McLean, marketing manager with Le Boat, says the company will attract tourists from around the world and boost the local economy in the process. 0:58

Customizing the boats

Some of the public money helping support the project includes almost $2 million from the provincial government.

That includes a $1.5 million investment over five years to customize Le Boat's vessels in Poland and ship them overseas. The boats are reinforced with steel for the canal's rocky bottom and with Canadian power outlets and screened windows to keep out mosquitoes.

The rest of the funding went to the company's startup operations and to help with an international marketing campaign.

Parks Canada is "enthusiastically collaborating" with its government partners and is spending $3.4 million rehabilitating the combined lock in Smiths Falls, which is part of ongoing work on the Rideau Canal that was already planned and includes installing new hydraulic gates and repairing basin walls.

Some residents are happy to see Parks Canada clean up Victoria Basin. Julie Creighton said it's a 'hidden treasure' that has been 'deteriorating, the concrete was breaking away. It was money that needed to be spent, regardless.' (Ashley Burke/CBC )

The federal government has also renovated a federal heritage building with national and cultural significance into office space to lease to Le Boat. The work to the 1841 lockmaster's house has allowed the company to move its North American headquarters from Florida to Smiths Falls.

The company has also been granted the rights to operate on the waterway and use Parks Canada's water lot for its operations.

"Developing new and innovative programs and services allows more Canadians, including youth and newcomers and international visitors, to experience the outdoors and learn about our environment and history," said Valerie de Winter, a spokesperson with Parks Canada, in a statement to CBC News.

The major investment by the Town of Smiths Falls has been building heavy-duty boat docks for Le Boat's use. As well, other upgrades in Victoria Basin including lighting and power for the boating operations. A range of municipalities and community development corporations pitched in to cover those costs, totalling $335,741.

Fifteen docks will likely be designated for Le Boat, and two slated for public use, said Cooper, who hopes to finalize the agreement by May.

Parks Canada spent $28,000 painting, refinishing the floors and upgrading the plumbing at this lockmaster's house for Le Boat to lease as office space. It's in the department's mandate to preserve the heritage value of national historic sites like this. (Ashley Burke/CBC )

'Shake your head. That's so unfair'

While the town is excited, some residents are upset they didn't know Le Boat was coming until it was a done deal. They're also concerned the vast majority of the docks are for Le Boat's private use.

"There is something fishy with this whole Le Boat deal," said resident Garth Dixon in an email to CBC. "This is a national historic site and a UNESCO World Heritage site. Yet this European company is being allowed to install fuel tanks … in its shore."

"How much money will actually end up staying in Canada, how much will go back to the motherland? This is my question," said Hopper Dowler, an entrepreneur in town.

Le Boat has hired seven full-time employees and plans to hire up to seven seasonal workers this summer. Some residents feel that's not enough to justify the government help.

Darlene Kantor, an apartment building superintendent and anti-poverty activist, is upset that government dollars have been used to help Le Boat get established in Smiths Falls. 0:46

"They should be helping the people that are already in Smiths Falls," said Darlene Kantor, a superintendent of low-income apartment buildings in town.

"I fought for basic income for these people that are starving to death or homeless and the [provincial] government can just, wham, come up with $2 million to help a company that's going to profit," said Kantor.

"Come on, shake your head. That's so unfair."

'A very unique opportunity'

The town's mayor is adamant Le Boat is worth the investment.

"Everyone at the table recognized that this is a very unique opportunity," said Pankow. "Never before had we had this type of operation with such a global marketing presence wanting to locate in our community."

Le Boat has teams around the world pitching the Rideau Canal as a destination where tourists can learn to fish, go on a canoe adventure and indulge in food in quaint towns along the way. The staff from Smiths Falls flew to Los Angeles last weekend to spread that message at a trade show.

In fact, the provincial government is expecting to double the $2 million it invested. It's done calculations based on Le Boat's investments in Ontario over the next five years.