Policing is under provincial jurisdiction, as are municipalities, so the only way a federal body like the RCMP can operate as a local police force is by agreeing to a contract with the municipality -- and that's exactly what they do. i.e. Richmond, if they wanted, *could* set up an RPD, but they choose rather just to contract out to the RCMP, which is already trained, staffed, etc.
Some choose to do it, and others not... that's why it's so patchwork.
The only reason I allude to size is that the largest cities (Toronto, Montreal, Vancouver, etc.) will always have their own force (both Ontario and Quebec have provincial police forces which the largest cities don't use either), just because they need a large enough force that it's worth their time to assemble one that has good knowledge of the city.
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