The federal government has extended the Canada Emergency Commercial Rent Assistance (CECRA) program by one month. The program was initially intended to support small businesses during the months of April, May, and June.
“We know that many business owners are struggling with cash flow right now, so we’re working on a solution.”
– Justin Trudeau
The CECRA provides unsecured forgivable loans to qualifying commercial property owners to reduce the rent owed by their small business tenants that have been impacted by the COVID-19 pandemic. The program is also intended to help owners meet operating expenses on commercial properties. The CECRA, which is being administered through the Canada Mortgage and Housing Corporation, allows the federal and provincial governments to help cover 50 percent of the rent, with tenants and landlords paying the outstanding amount.
“The federal government intends to extend the Canada Emergency Commercial Rent Assistance by another month, and we’re working with the provinces and territories to do just that,” Prime Minister Justin Trudeau said in a Monday press briefing. “This program is helping thousands of small businesses across the country save on rent. We know that many business owners are struggling with cash flow right now, so we’re working on a solution.”
The CECRA is also being facilitated through Canada’s provinces and territories, and property owners are required to opt into the CERCA in order for businesses to be able to benefit from the program.
One April survey by Save Small Business found that one in five small businesses expected their landlord to sign on to the program. Many provinces have also banned commercial evictions during the pandemic to ensure businesses do not lose their office locations for failing to pay rent.
The news of the extension comes on the same day the Canadian Federation Of Independent Business (CFIB) released the results of a survey that found 30 percent of small businesses cannot afford their July rent without assistance. The CFIB recommended the government extend the CECRA to September in a statement issued Monday.
In addition to requesting an extension, the CFIB also urged the government to create a way for tenants to access the CECRA directly, “which could include an expansion of the forgivable portion of the [Canada Emergency Business Account] loans,” the CFIB noted.
“We need to understand that although half of Canadian businesses are now fully open, things are still very far from normal in terms of revenues for the vast majority of businesses,” said CFIB president Dan Kelly. “Programs that have been extended like the wage subsidy are helping businesses bridge back to normal. We need to do that with other big costs like GST [and] HST, and rent. Canada’s economic recovery depends on it.”
Image source Justin Trudeau via Flickr.