A for lease sign hangs in the window as a cyclist walks past a commercial store, Monday August 31, 2020 in Ottawa. nbsp; THE CANADIAN PRESS/Adrian Wyld

A for lease sign hangs in the window as a cyclist walks past a commercial store, Monday August 31, 2020 in Ottawa. nbsp; THE CANADIAN PRESS/Adrian Wyld

As feds audit landlords over rent aid, businesses fall through cracks of new program

The CMHC said in a statement the reviews are being done as needed to make sure tenants benefited

Documents given to parliamentarians show federal officials audited at least 127 landlords who received aid through a program designed to ease rent costs for small businesses during the COVID-19 pandemic.

That was the figure as of Dec. 10, at which time the Canada Mortgage and Housing Corporation said just over one-quarter of those cases had been “resolved.”

The federal housing agency didn’t say how many more audits have been conducted since.

The CMHC said in a statement the reviews are being done as needed to make sure tenants benefited from the Liberals’ first try at the commercial rent-relief program and that landlords complied with the terms of the program.

The original program provided landlords with forgivable loans that covered half of rent for eligible small businesses, but required property owners to waive a further one-quarter of what they were otherwise owed.

In the end, just over $2 billion in federal aid flowed through the program as many landlords didn’t apply.

Federal figures tabled in the House of Commons show 51,404 distinct property-owners applied to the program, with some submitting requests for multiple properties.

The Liberals revamped the program because of the low take-up, allowing tenants to apply directly and creating a sliding scale of relief, based on revenue declines, of up to 65 per cent of rent or commercial mortgage interest.

The program now includes a lockdown top-up of an added 25 per cent for businesses ordered to close due to COVID-19 restrictions.

Since late September, there have been nearly 112,000 unique applicants for the program, amounting to $986.8 million in aid. Within that, 37,320 applicants received the lockdown top-up, which adds $127 million in spending for a grand total of over $1.1 billion.

A group representing thousands of small businesses across the country said the new version still isn’t living up to expectations because it suffers from a lack of visibility and eligibility issues.

The Canadian Federation of Independent Business said only one-quarter of its members have used the revamped rent subsidy program, compared to two-thirds that have used a popular loan program that can be used for costs like rent.

President Dan Kelly said some small and medium-sized businesses that would be eligible for rent relief are likely avoiding it because of struggles with the first iteration of the program, or other issues they faced in applying for pandemic aid.

“They moved on,” he said.

“A lot of business owners who are eligible for the program have just not yet applied, because they’re unaware that there is substantive support available in a new program. So the visibility of it is, I think, one of the struggles.”

He also said the association has raised concerns to the government that eligibility requirements may be excluding some businesses that own their own properties.

Often, a company like a restaurant or drycleaner will have a holding company that owns a property and to which it pays rent. Under the rent-relief program, that setup makes a business ineligible because the landlord isn’t at arm’s-length from the business owner.

Federal rules say that a holding company may be able to claim some expenses, such as property taxes and insurance.

The previous program had a fix for this potential issue that Kelly said could make either party eligible for relief.

A fix like that would likely need legislative approval.

A bill to enact aid measures from November’s economic statement remains at second reading in the House of Commons. Bill C-14 would allow the government to put money into regional relief packages and create a top-up to child benefit payments.

Earlier Monday, Finance Minister Chrystia Freeland spoke with her U.K. counterpart in advance of a G7 meeting of finance ministers and central bankers.

“We remain committed to supporting people and small businesses so we can make it through this pandemic,” Freeland said in a tweet.

Jordan Press, The Canadian Press

Coronavirus

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

COVID-19. Black Press file photo
No new COVID-19 cases for Nakusp

Our community has not had a case since January; has only had three in total since pandemic started

A nurse performs a test on a patient at a drive-in COVID-19 clinic in Montreal, on Wednesday, October 21, 2020. THE CANADIAN PRESS/Paul Chiasson
36 new cases of COVID-19, one death in Interior Health

The number of active cases in the region is at 366

A health worker holds a vial of AstraZeneca vaccine to be administered to members of the police at a COVID-19 vaccination center in Mainz, Germany, Thursday, Feb. 25, 2021. (Andreas Arnold/dpa via AP)
43 new COVID-19 cases in Interior Health

368 cases in the region remain active

A member of the Avalanche Canada South Rockies field team gathers important snowpack data that is used to produce daily avalanche forecasts for the region. Photo by Jennifer Coulter.
Warming temperatures increase avalanche risk heading into the weekend

Warm temperatures impact conditions, human behaviour

A nurse performs a test on a patient at a drive-in COVID-19 clinic in Montreal, on Wednesday, October 21, 2020. THE CANADIAN PRESS/Paul Chiasson
Interior Health reports 16 new COVID-19 cases

423 cases remain active in the region

B.C. Health Minister Adrian Dix and provincial health officer Dr. Bonnie Henry head for the B.C. legislature press theatre to give a daily update on the COVID-19 pandemic, April 6, 2020. (B.C. government)
B.C. nears 300,000 COVID-19 vaccinations, essential workers next

564 new cases, four deaths, no new outbreaks Thursday

Walter Gretzky father of hockey hall-of-famer Wayne Gretzky waves to fans as the Buffalo Sabres play against the Toronto Maple Leafs during third period NHL hockey action in Toronto on Tuesday, Jan. 17, 2017. THE CANADIAN PRESS/Nathan Denette
Walter Gretzky, father of the Great One, dies at 82

Canada’s hockey dad had battled Parkinson’s disease and other health issues

Kelowna General Hospital (File photo)
Second death reported in Kelowna General Hospital COVID-19 outbreak

A total of seven cases have been identified at the hospital: six patients and one staff

Municipal Affairs Minister Josie Osborne speaks in the B.C. legislature, March 4, 2021. (Hansard TV)
B.C. Liberals, NDP sing in harmony on local election reforms

Bill regulates paid canvassers, allows people in condo buildings

(National Emergency Management Agency)
No tsunami risk to B.C. from powerful New Zealand earthquake: officials

An 8.1 magnitude earthquake shook the north of New Zealand Thursday morning

(AP Photo/Richard Vogel, File)
Pandemic stress, isolation key factors as to why Canadians turned to cannabis, alcohol

Study found that isolation played key role in Canadians’ substance use

Grand Forks’ Gary Smith stands in front of his Church of the Flying Spaghetti Monster float. Photo: Submitted
Grand Forks’ Flying Spaghetti Monster leader still boiling over driver’s licence photo

Gary Smith, head of the Church of the Flying Spaghetti Monster of B.C., said he has since spoken to lawyers

A Cowichan Valley mom is wondering why masks haven’t been mandated for elementary schools. (Metro Creative photo)
B.C. mom frustrated by lack of mask mandate for elementary students

“Do we want to wait until we end up like Fraser Health?”

Most Read