AbstractThe rent assistance will be provided through forgivable loans to property owners leasing property to eligible small businesses. In order to qualify for a forgivable loan in relation to the rent paid by an eligible small business, the property owners must have signed an agreement to lower the rent of a tenant small business by at least 75% and to not evict the tenant during the period of reduced rents. The loan will be forgiven if rents are in fact lowered by at least 75%. The loans cover 50% of the gross rent owed by impacted small business tenants during the 3-month period of April, May and June 2020, prior to any rent reductions.
Eligible small businesses are those who:
- pay no more than $50,000 in monthly gross rent per location;
- generate no more than $20 million in annual gross revenues, calculated on a consolidated basis; and
- have temporarily ceased operations (i.e. generating no revenues) or have experienced at least a 70% decline compared to pre-COVID-19 revenues over the period.
Forgivable loans are extendable to include July and/or August rent where landlords choose to grant rent relief for July and/or August to eligible tenants based on their revenue declines in April to June. Loans and loan forgiveness will be available retroactively. Most provinces bear 25% of the cost of the program, up to a cap based on 25% of the initially estimated cost of the program; however, the cost of the program will not be shared in the territories or Prince Edward Island.
PBO estimates federal cost of this measure to be $931 million in 2020-21. The time horizon for this costing is aligned to the PBO’s current Economic and Fiscal Scenario.