Long-awaited federal rent subsidy for businesses hurt by COVID-19 starts today


Businesses struggling to pay the bills because of the COVID-19 pandemic will be able to start applying today for a long-awaited new commercial rent relief program offered by the federal government.

The new Canada Emergency Rent Subsidy replaces an earlier rent-support program for businesses introduced in the spring that saw little pickup because it relied on landlords applying for help.

The new program will cover up to 65 per cent of rent or commercial mortgage interest on a sliding scale based on revenue declines, with an extra 25 per cent available to the hardest-hit firms.

The government is only setting the rules until Dec. 19; the Liberals have promised to adapt and target the aid as needed after that date.

Federal cabinet ministers will talk about the program, and two new programs designed to help businesses owned by Black Canadians, during a news conference today.

The Canadian Federation of Independent Business, which represents thousands of small companies across the country, is welcoming the new rent program as something long overdue for firms hit hard by COVID-19.

It is, however, criticizing the government for not opening it to businesses that would have qualified for the previous rent-relief program but could not access federal funds because their landlords chose not to apply.

The assistance will only cover rent, property taxes, insurance and mortgage interest for qualifying companies going back to Sept. 27.

“We have heard heartbreaking stories of beloved, long-standing businesses that have been evicted because they had no rent relief, or those buried under a mountain of debt and still facing an uncertain future and months of reduced sales,” said Laura Jones, the association’s executive vice-president.

CFIB estimates that Canada may lose between 55,000 and 218,000 more small businesses before the end of the pandemic.

Conservatives say Liberals ‘blew it’

The Opposition Conservatives are also criticizing the government for not rolling out the program sooner, and for shortcomings in the related legislation that still need to be fixed.

The revamped program includes a requirement that entrepreneurs pay their rent before applying, putting the subsidy out of reach for many cash-strapped stores.

Finance Minister Chrystia Freeland, who is scheduled to speak around midday in Ottawa, promised that the Canada Revenue Agency wouldn’t enforce the requirement for any companies that apply for the assistance.

She has pledged the government will quickly introduce legislation to formalize the directive.

Businesses will be able to start applying today for the new federal commercial rent-relief program. (Justin Tang/The Canadian Press)

“The government had all summer to come into September with draft legislation that is properly thought out to support small businesses and they blew it,” said Conservative MP Pat Kelly, his party’s small business critic.

“This is the first day that small businesses have been able to apply for the rent subsidy. Most didn’t even qualify for the old subsidy, but even for those that did, that program expired in September, and December’s rent is a little over a week away.”

The Canada Revenue Agency says any rent expenses that haven’t been paid when a company applies will have to be paid within 60 days of the company receiving the rent subsidy. The agency expects its online application and automated verification system will process claims on Nov. 30 and issue payments within three or five business days.

The CRA also is promising “minimal” red tape for applicants — specifically those for whom the agency doesn’t have some information on file already for verifying a claim. In those cases, applicants or third parties like landlords might be contacted to get information on lease agreements and mortgage payments.

Statistics Canada reported last week that commercial rents rose by 0.7 per cent in the third quarter of the year, after a record 1.8 per cent plunge in the second year when the economy took a nose dive due to COVID-19.

Rents for office buildings rose at the fastest pace, followed by industrial and then retail buildings.

The national statistics agency said the rise in commercial rents in the third quarter “reflected the gradual ending of rent relief and abatement that began in the second quarter.”



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