A few years after the first film events, the officers were kicked out of the Spurb Police Department after they took Fred Savage on a trip that resulted in his death. Farva (Heffernan) is now a supervisor in construction, and Mac (Lemme) and Rabbit (Stolhanske) are working for him. Thorny (Chandrasekhar) works in forestry, and Foster (Soter) lives with his girlfriend and former colleague, Ursula Hanson (Coughlan). Mac is called by the former boss, Captain O’Hagen (Cox), to join the group and meet at a fishing trip in Canada.

As soon as the group arrives they realize that O’Hagen’s intention was to meet the Vermong Governor Jessman (Carter). This explains that after a study it was discovered that a certain territory in Canada originally belonged to America. Canada has accepted to give up territory, and Guv. Jessman needs to create a police department to take over the duties of Canadian officials in the region.

She invites the group to become police again, promising that if they do that, they will be reinstated. At a reception for police officers, they meet with City Mayor Guy Le Franc (Lowe) and Cultural Attaché Genevieve Aubois (Chriqui). Americans are reluctantly welcomed by locals who want to remain Canadians. The next day, Foster and Mac accompany Mounties to the patrol to meet the locals where they are attacked in the strip club Le Franc.