New Details on COVID-19 Federal Response Programs
May 2020 Charity & NFP Law Update
Published on May 28, 2020

By Terrance S. Carter and Luis R. Chacin

New Details on the Canada Emergency Commercial Rent Assistance Program ("CECRA")
On May 20, 2020, Prime Minister Justin Trudeau announced that application documents and updated criteria for the Canada Emergency Commercial Rent Assistance (“CECRA”) for small businesses and charities and not-for-profits are now available. Further to the preliminary details provided on April 24, 2020, as discussed in Charity & NFP Law Bulletin No. 471, new details have been made available on the Canada Mortgage and Housing Corporation (“CMHC”) website.
Of particular note, although it was previously unclear whether property owners would be eligible where their leased property was not subject to a mortgage, the CMHC has now clarified that CECRA is available to property owners regardless of whether their property is subject to a mortgage. Further, the CMHC has also indicated that although CECRA will not apply to any federal-, provincial-, or municipal-owned properties, or where the government is the landlord, relief under CECRA will be available where the property owner is a post-secondary institution, hospital, or pension funds.
Similarly, while the Government of Ontario’s Backgrounder, dated April 24, 2020, had previously indicated that property owners applying to OCECRA must agree to “forego profit for a three-month period”, this requirement was removed from the Backgrounder when it was updated on May 8, 2020 to be more clearly aligned with the requirements outlined by CMHC. 
Property owners may apply for the program from May 25, 2020 until August 31, 2020 if they can prove eligibility during the three-month period of April, May and June 2020. The CMHC website also includes answers to frequently asked questions, such as how to calculate the 70% reduction in revenue requirement, which in the case of registered charities and non-profit organizations the calculation would include most forms of revenue, including revenue from government sources, but excluding revenue from non-arm’s length persons.

New Details on the Canada Emergency Business Account ("CEBA")
On May 19, 2020, Prime Minister Justin Trudeau announced an expansion to the eligibility criteria for the Canada Emergency Business Account (“CEBA”), which provides interest-free loans to help small businesses and certain charities and not-for-profits whose revenues have been impacted by the COVID-19 pandemic to cover their operating costs. CEBA will now be available to applicants with payrolls lower than $20,000 who have an operating account at a participating financial institution, have a CRA business number and have filed a 2018 or 2019 tax return, and have eligible non-deferrable expenses, such as rent, property tax, utilities and insurance, between $40,000 and $1.5 million. As well, CEBA will be available to sole proprietors receiving income directly from their businesses, businesses that rely on contractors, and family-owned corporations that pay employees through dividends rather than payroll. 
CEBA was previously discussed in Charity & NFP Law Bulletin No. 471.

New Details on the Emergency Community Support Fund
Employment and Social Development Canada has released additional details on the $350 million Emergency Community Support Fund, previously discussed in Charity & NFP Law Bulletin No. 471.
The application process was opened on May 19, 2020 for community organizations, including qualified donees and non-profit organizations, serving vulnerable populations affected by the COVID-19 pandemic. The applications can be submitted through the Canadian Red Cross, Community Foundation Canada or United Way Centraide Canada, subject to specific selection criteria as follows: i) the project addresses a pressing social inclusion or well-being need caused by COVID-19 by supplying the necessaries of life and supporting activities of daily living; ii) the project serves one or more vulnerable populations during the COVID-19 crisis; iii) the project can be carried out in a short timeframe with a reasonable budget; and iv) the applicant community organization must attest to not having secured funds to cover the costs of the activities for which they have applied from another intermediary, another federal COVID-19 response program or a different source.

New Details on Emergency Support Fund for Cultural, Heritage and Sport Organizations
On May 8, 2020, the federal Minister of Canadian Heritage announced additional details regarding the COVID-19 Emergency Support Fund for Cultural, Heritage and Sport Organizations, previously discussed in Charity & NFP Law Bulletin No. 471. As such, Canadian Heritage has made funds available to partner organizations, including the Canada Council for the Arts, the Canada Media Fund, FACTOR, Musicaction, and Telefim Canada, to start distributing funds to organizations affected by the COVID-19 pandemic in the cultural, heritage and sport sectors.

Read the May 2020 Charity & NFP Law Update