CFIB calls on feds to immediately address CECRA shortcomings with 12 per cent of small businesses considering bankruptcy or winding down
ANXIETY FOR MANY small businesses remains high as they head into a third month of severely reduced revenues and no rent relief, warns the Canadian Federation of Independent Business (CFIB). While the Canada Emergency Commercial Rent Assistance (CECRA) program opened last Monday, many businesses continue to report it won’t help them either because their landlord won’t apply or they do not meet the revenue loss criteria of 70 per cent.
Adding to these challenges, CFIB has received hundreds of calls and comments from both tenants and landlords frustrated with the CECRA application process. Comments range from confusion over the amount of financial information required to apply, complex attestation forms and technical difficulties with the application portal. One landlord reported spending four hours on hold with CMHC trying to verify their login information. Others are finding the requirement to attest to 70 per cent revenue losses for April, May and June challenging given that June revenues are still uncertain.
“It’s June 1 and rent relief is a mess that needs a major clean-up,” said Laura Jones, CFIB’s executive vice-president. “Workable rent relief is make-or-break for over half of the small businesses we surveyed and governments need to make this a top priority yesterday.”
CFIB is calling on governments to do three things immediately to address the rent crisis:
- Allow tenants to access their share of CECRA support directly through the program or find another means to get money to those that need it. For example, they could expand the Canada Emergency Business Account (CEBA) loans to at least $60,000 (from $40,000) with an increase to the forgivable portion from 25 per cent to 50 per cent (from $10,000 to $30,000). It should also be a priority to ensure that announced expansions to CEBA are implemented immediately as some business owners have been waiting three months to be included in the program (for example, those with contract workers, personal bank accounts and those that pay by dividends).
- Fix CECRA by simplifying the application process, expanding the number of months it covers, and reducing the 70 per cent revenue loss criteria.
- Put in place a temporary moratorium on commercial evictions for tenants otherwise in good standing with landlords. CFIB has been calling on provinces to do this since March.
“Without resorting to swearing, I can’t emphasize strongly enough how important it is to fix CECRA and put in place a decent safety net for tenants whose landlords won’t use it,” said Jones. “This cannot wait until July 1. We don’t want to see a good chunk of Main Street going down over the ineffective execution of a well-intentioned program.”