On Friday October 9th, the Federal Government introduced new targeted supports to help businesses that may be facing increased uncertainty as we head into the fall months of the COVID-19 pandemic.
New Canada Emergency Rent Subsidy (CERS):
The new rent subsidy provides accessible rent and mortgage support until June 2021 for qualifying organizations affected by COVID-19.
Unlike the previous iteration of this support program, the new rent subsidy will be provided directly to tenants through the Canada Revenue Agency. The CERS will provide a subsidy for eligible fixed property expenses, including rent and interest on commercial mortgage.
The CERS will provide a sliding scale of support that covers a maximum amount of 65 per cent of eligible expenses until December 19th, 2020. The new program is retroactive to September 27th, 2020. If a business is required to close my mandatory public health orders, the business can receive an additional 25 per cent subsidy.
It is our understanding that the subsidy will cover up to $75,000 per location, and that support will be capped at a maximum of $300,000 (across all locations). We understand this number to be cumulative rather than monthly.
Government officials have indicated legislation will be needed in order to bring these changes to fruition. The earliest this could be introduced is the week of October 19th, given the House of Commons is recessed next week.
The Federal Government has indicated that this is a flexible program and will adapt depending on a business’s needs and how the COVID-19 pandemic evolves into the winter months.
Extension of the Canada Emergency Wage Subsidy (CEWS):
The Canada Emergency Wage Subsidy (CEWS) allows employers who are seeing a decline in revenues due to COVID-19 to be eligible for a subsidy based on the overall percentage of decline.
The CEWS program has been extended to June 2021 to encourage employers to keep employees on the payroll and re-hire those who have seen their hours cut due to COVID-19. This is something that OREA was advocating for directly.
Expansion of the Canada Emergency Business Account (CEBA):
The Canada Emergency Business Account (CEBA) provides qualifying businesses with an interest-free loan of up to $60 000 ($40 000 from the original implementation of the CEBA loan, with an additional $20 000 in the new iteration of the program) from their financial institution. The Federal Government will forgive up to $20 000 of the loan if the balance is repaid before December 31st, 2022.
The application deadline for the CEBA is being extended to December 31st, 2020. OREA will continue to update members on the launch date and application process, which will be announced in the coming days. Discussions on certain items are still being negotiated between the government and the banks.
For questions, please contact OREA’s Government Relations team at email@example.com.