May 20, 2020
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May 20, 2020

Your CFA Daily Update on COVID-19

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Canada Emergency Commercial Rent Assistance Program applications begin on May 25

In his daily press conference, PM Trudeau announced that CECRA applications will be accepted through the Canada Mortgage and Housing Corporation website beginning on May 25. Application documents are available now and funding will flow “quickly” once the program launches. For larger retailers, the government is working on a new support program that will be revealed in the coming days.

When asked by reporters why supports are not being provided directly to tenants, the Prime Minister remarked that any solution must bring “different communities and groups together” and emphasized the importance of having landlords as part of the equation. The government believes this is “the right approach” and Trudeau noted that he “expects landlords and building owners to understand that we are all in this together”. 

Ultimate Parent Clarified

Under the eligibility criteria that were announced in early May a business must

  • pay no more than $50,000 in monthly gross rent per location (as defined by a valid and enforceable lease agreement)
  • generate no more than $20 million in gross annual revenues, calculated on a consolidated basis (at the ultimate parent level)
  • have experienced at least a 70% decline in pre-COVID-19 revenues

Today, CMHC clarified what an ultimate parent/owner is under the program.

  • If the small business tenant or its ultimate owner produces consolidated statements, then the tenant would use revenues reported for the group level of companies.
  • Alternatively, if the small business tenant does not produce consolidated statements, then it is the specific revenue of the tenant that applies for the $20 million test.

Based on this the CFA believes that this clarification almost all the CFA’s members (franchisors and franchisees will be able to use the CECRA in partnership with their landlord. Some large multi-unit franchisees may need to consult their lawyer and accountant to determine how this will affect them specifically.

CMHC Q&A ON CECRA
Astley Gilbert - Promo

Astley Gilbert is offering a 10% discount to all CFA members.

Like all Canadians, we wanted to use our skills to help people in these challenging times and produced a line of products to assist with the current COVID-19 pandemic. 

Click here to review AG COIVD-19 Items for supply

Quebec to allow outdoor gatherings of up to 10 people – more openings on June 1

Quebec is loosening more of its COVID-19 restrictions, despite continuing to have the highest number of new cases in the country. The province's deputy premier, Geneviève Guilbault, announced Wednesday that as of Friday, people will be allowed to hold outdoor gatherings of up to 10 people, composed of up to three households. She said people must maintain physical distancing and must not hold the gathering indoors. 

Quebec private health-care services, such as dentists and physiotherapists, will be allowed to reopen as of June 1. Businesses that provide personal care services, such as hairdressers, will be allowed to open on the same date — but not in the greater Montreal and Joliette areas, where there are still significant COVID-19 outbreaks.

Applications open for government loans to aid big businesses taking financial hit from COVID-19.

Applications opened today for a program that will deliver bridge loans with no upper limit for big Canadian businesses struggling to keep employees on the payroll through the pandemic.

To qualify, businesses must be looking for financing of $60 million or more and have significant operations or large numbers of employees in Canada, and must not be involved in any ongoing insolvency proceedings. There is no upper cap on the loans, which will be based on the cash flow needs of companies for the next 12 months. Each applicant will be assessed on a case-by-case basis.

LARGE EMPLOYER EMERGENCY FINANCING FACILITY
Telus Business

Telus is Helping CFA Members Stay Connected

TELUS Business is working to keep CFA members stay connected through these turbulent times. 
Find out more.

Canada's inflation rate turned negative in April for first time since 2009

Canada's inflation rate fell to an annualized –0.2 per cent in April, as the COVID-19 pandemic pushed down consumer prices for the first time in more than a decade. Statistics Canada's consumer price index plummeted to negative reading as the price of just about everything got much cheaper last month than it was a year ago. April's decline was the first time Canada's year-over-year inflation rate fell into negative territory since September 2009.

Among the major categories seeing huge price declines were:

  • Gasoline, down by almost 40 per cent.
  • Traveler accommodation, down by almost 10 per cent.
  • Electricity prices, down by more than four per cent.
  • Clothing and footwear, down by almost six per cent.

Food prices were among the few products that got more expensive during the month, rising by 3.4 per cent overall due to "higher demand for non-perishable food products, as consumers were encouraged to limit grocery shopping trips as a result of physical distancing measures," the data agency said.

Toronto-Dominion Bank economist James Marple said the data clearly shows that although sectors hit hard by COVID-19, such as hotels and clothing stores, were forced to slash prices to grab whatever customers they could find, on the whole the numbers don't suggest Canada is facing long-term deflation.

"While we would caution against placing too much emphasis on the stability in core measures given the difficulty price collectors had in April (and the need to extrapolate prices for items that they could not measure), the fact remains that outside of the most impacted sectors, price growth remains positive. And the biggest factor dragging down the inflation rate was the huge plunge in gasoline prices, which are already showing signs of heading back up. With activity slowly normalizing through May, the biggest of the price declines are likely in the rear-view mirror," Marple said.

Bank of Montreal economist Doug Porter said the numbers should be taken with a grain of salt, given that Statistics Canada was essentially imputing the price for a lot of products and services that couldn't even have been purchased during the month, like vacation packages and haircuts.

"As much as this is an important release, the reality is that the market for a number of goods and especially services was shut down in April, so many of the prices for that month are nearly meaningless. We suspect that when the economy partially reopens and the dust settles, underlying inflation will be close to zero" Porter said.

Manitoba increases gathering limits starting Friday

The maximum number of people allowed to gather in one place in Manitoba will increase Friday thanks to lowering numbers of active COVID-19 cases, public health officials announced Wednesday.

Up to 25 people can gather in a room together starting Friday, while 50 people can gather outside, provided physical distancing measures are in place, Chief Provincial Public Health Officer Dr. Brent Roussin said.

PiinPoint

PiinPoint Empowering CFA Members

CFA Members can get free access to PiinPoint’s Location Intelligence Platform with data for one Canadian province. 
Find out more.

Webinar Series On Demand

MISSED TODAY'S WEBINAR?

Working With Your Lender – COVID-19 Support Initiatives
 50 CFE PARTICIPATION CREDITS 

SPEAKERS: Paul daSilva, RBC and Joseph Pisani, BMO

In this session, get an overview of some of the initiatives available to you to help you manage the current economic challenges, learn how to understand your cash flow and prepare to work with your financial services partner in a post COVID-19 market.

VIEW IT HERE

FRIDAY'S WEBINAR

MAY 22, 2020
AT 2:00 PM ET

Adapting to the New Normal After COVID-19  
 50 CFE PARTICIPATION  CREDITS  

SPEAKERS: Bill Dietz, Paul Davis Restoration, Greg Tabak, Paul Davis Restoration and Michael Sherrard, Sherrard Kuzz LLP

Join this webinar to gain insight into how to adapt your operating practices to the ‘new normal’ and how to manage your preparedness from a liability perspective as you prepare your return to work plans and procedures.

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Feedback from our Members

"I think the CFA team is doing a great job on communication with respect to Coronavirus. Much appreciated – and admired. Keep up the great work!

 - Stephen Schober, President and Chief Executive Officer, Metal Supermarkets Family of Companies

COVID-19's impact on the world is creating waves across all sectors and industries.

Every member of the CFA community is dealing with an issue that is affecting the world, our industries, our communities, our businesses, and our people.

We would like to hear from you if you have any topics, issues or questions to navigate turbulent times in order to support you further: 

SUBMIT YOUR TOPICS

Are your colleagues and franchisees subscribed to the Daily Update?

If you would like to subscribe all your franchisees to receive our Daily Update, please contact Alex Mann at amann@cfa.ca

SUBSCRIBE HERE
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